Yahoo Finance Upbound (UPBD) Cheers Investors With 9% Dividend Hike
Upbound Group, Inc. UPBD announced a dividend hike, showcasing its commitment to delivering value to its shareholders. The company’s board of directors has approved a dividend hike by roughly 9% to a quarterly cash dividend of 37 cents per share. This first-quarter 2024 dividend will be paid out on Jan 9, 2024, to shareholders of record as of Dec 19, 2023. This brings the new annualized dividend to $1.48 per share, resulting in a dividend yield of 4.8%.
The dividend increase not only provides tangible benefits to existing shareholders but also positions Upbound as an attractive investment opportunity for those seeking stable and consistent returns. Dividend payouts are the biggest enticements for investors and the company is committed to boosting shareholders’ wealth.
Upbound ended third-quarter 2023 with cash and cash equivalents of $105.7 million, reflecting an increase of 21.8% sequentially. The company provided cash from operating activities of $219.9 million and free cash flow totaled $183.8 million during the nine months of 2023. For capital allocation, the company’s key priorities for 2023 will be reinvestment in the business, dividend payment and debt reduction. It ended the third quarter with $1.2 billion of outstanding debt and 2.5x leverage.
Speaking of its shareholder-friendly moves, the company returned $88 million to shareholders via dividends and share buybacks through the end of the reported quarter. It repurchased 0.9 million shares in the third quarter and 1.7 million shares through October 31. The company expects free cash flow to be in the band of $215-$235 million for 2023.
What Else?
Upbound is focused on creating a better shopping experience for customers as well as advancing e-commerce growth via improvement in the online checkout process, increased product offerings, and higher personalization in sales and marketing strategies. In third-quarter 2023, e-commerce accounted for 25% of the quarterly revenues, up from 23% in the year-earlier quarter. This is due to increased Rent-A-Center web traffic.
Web traffic and web orders improved 40% and 15%, respectively, year over year. The company’s key objective is to advance its digital business. Extended aisle generated sturdy growth with deliveries up 129% year over year during the reported quarter.
Further, the company has been making steady investments in enhancing the omnichannel platform so that customers can experience a seamless approach across channels, markets, products and brands. It has been increasing e-commerce offerings and mobile applications for a while and leveraging a cloud-based point-of-sale platform to manage orders more efficiently, lower losses and cut operating costs.
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All said, Upbound’s impressive fundamentals, strong footing in the industry and solid portfolio make it a promising stock. UPBD draws further investor attention through its regular dividend payouts and commitment to enhancing shareholder returns. The company carries a Zacks Rank #2 (Buy) at present. Its shares have risen 37.3% in the year-to-date period compared with the industry’s 16.7% growth.
Other Stocks to Consider
Some other top-ranked stocks in the industry are Royal Caribbean RCL, lululemon athletica LULU and Ralph Lauren RL.
Royal Caribbean sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
RCL has a trailing four-quarter earnings surprise of 28.3%, on average. The Zacks Consensus Estimate for RCL’s 2023 sales and earnings per share (EPS) indicates growth of 57.7% and 187.9%, respectively, from the previous year's reported number.
lululemon athletica is a yoga-inspired athletic apparel company. LULU carries a Zacks Rank #2 at present.
The Zacks Consensus Estimate for lululemon athletica’s current financial-year sales and EPS implies growth of 18.1% and 20.5%, respectively, from the previous year's reported figure. LULU has a trailing four-quarter earnings surprise of 6.8%, on average.
Ralph Lauren, a footwear and accessories dealer, has a Zacks Rank of 2 at present. RL has a trailing four-quarter earnings surprise of 18%, on average.
The Zacks Consensus Estimate for Ralph Lauren’s current fiscal year sales and EPS suggests growth of 1.4% and 13.1%, respectively, from the previous year's reported actual.
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Royal Caribbean Cruises Ltd. (RCL) : Free Stock Analysis Report
Ralph Lauren Corporation (RL) : Free Stock Analysis Report
lululemon athletica inc. (LULU) : Free Stock Analysis Report
Upbound Group, Inc. (UPBD) : Free Stock Analysis Report
