On February 15, 2018, Rocky Mountain Chocolate Factory announced that its Board of Directors has declared a fourth quarter cash dividend of $0.12 per common share outstanding. The cash dividend will be payable March 16, 2018, to shareholders of record at the close of business March 06, 2018.
Rocky Mountain Chocolate Factory’s indicated dividend represents a yield of 3.93%, which is more than double compared to the average dividend yield of 1.78% for the Consumer Goods sector. The recent dividend announcement is the Company’s 59th consecutive dividend.
Rocky Mountain Chocolate Factory has a dividend payout ratio of 70.6%, which indicates that the Company spends approximately $0.71 for dividend distribution out of every $1.00 earned. The dividend payout ratio reflects how much amount a company is returning to shareholders versus how much money it is keeping on hand to reinvest in growth, to pay off debt, and/or to add to its cash reserves.
According to analysts’ estimates, Rocky Mountain Chocolate Factory had a trailing twelve months EPS of $0.54 per share, which is comfortably above the Company’s annualized dividend of $0.48 per share.
As of November 30, 2017, Rocky Mountain Chocolate Factory’s cash and cash equivalents totaled $4.07 million compared to $5.78 million as on February 28, 2017. For the nine months ended November 30, 2017, the Company’s net cash provided by operating activities totaled $1.65 million compared to $3.00 million for the year ago same period. The Company’s strong financial position indicates its ability to absorb any fluctuations in earnings and cash flow and to sustain the dividend distribution for a long period.