Universal Forest (UFPI) Hikes Semi-Annual Dividend By 7%
Zacks Investment Research | Oct 20, 2016 06:42AM ET
Forest products company Universal Forest Products Inc. (NASDAQ:UFPI) , a day after reporting record results for third-quarter 2016, announced a 7% increase in its semi-annual dividend rate.
As revealed, Universal Forest Products’ board of directors approved a semi-annual dividend of 45 cents per share, higher than the prior rate of 42 cents. On an annualized basis, the dividend has increased to 90 cents from 84 cents per share.
Universal Forest Products will pay the revised dividend on Dec 15, to its shareholders of record as on Dec 1.
Universal Forest Products follows a consistent policy of rewarding its shareholders handsomely, having paid approximately $8.52 million as dividend in the first nine months of 2016. We believe such disbursements reflect the company’s strong cash position. Exiting the third quarter, the company’s cash and cash equivalents were $36.7 million, while cash generated from operating activities in the nine months ended Sep 2016 increased 12.4% year over year to $136.4 million.
Universal Forest Products engineers, manufactures, treats, distributes and installs lumber, composite wood, plastic and other building products. The company continues to make relentless efforts, both organic and inorganic, toward expanding and improving its products as well as services. Also, the company seems well positioned to benefit from the strengthening demand in the U.S. construction market.
However, in the near term, Universal Forest Products remains exposed to risks arising from customer concentration, rising costs and dependence on housing markets. Also, the company faces competition from other players in the industry.
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