Dividend stock of the week: MSC Industrial Direct
MSC Industrial Direct company is an industrial parts and equipment distributor headquartered in the USA. This company has an interesting combination of dividend yield and payout ratio. Its current yield is around 4.20 % which is supported by a very healthy payout ratio of 52 % which indicates a lot of free capital to potential investments in the company or steer dividend increases.
It currently operates in the USA, Canada, and the UK and we can call it Amazon of metalwork and maintenance tools. It operates within a very specific niche and has superior execution of orders which creates a good retailer - customer relationship. It currently operates 12 fulfillment centers which are capable of 99% same day deliveries which is something very uncommon in this market. The company currently undergoing large cost-cutting initiatives which should boost profitability in upcoming years.
In summary, MSC Industrial Direct is an undervalued company right now. It also has a healthy payout ratio, high dividend yield, and a bright future... At least if you believe in current management and their current efforts. See the MSM dividends now.