Our analysis is based on comparing Interface, Inc. with the following peers – Mohawk Industries, Inc., Armstrong World Industries, Inc., Herman Miller, Inc., HNI Corporation, Unifi, Inc., Steelcase Inc. Class A, Dixie Group, Inc., Accor SA Sponsored ADR, Knoll, Inc. and Albany International Corp. Class A (MHK-US, AWI-US, MLHR-US, HNI-US, UFI-US, SCS-US, DXYN-US, ACCYY-US, KNL-US and AIN-US).
Interface, Inc.’s dividend yield is 1.08 percent and its dividend payout is 28.82 percent. This compares to a peer average dividend yield of 2.10 percent and a payout level of 42.86 percent. This relatively lagging dividend performance could spur some dividend action going forward – as long as the company’s relatively strong dividend quality score of 83 out of a possible score of 100 looks sustainable.
Dividend Quality Overview
- Over the last twelve months (prior to September 30, 2017), TILE-US paid a high quality dividend, which represents a yield of 1.06% at the current price.
- Dividend quality trend has not been consistent over the last five years. Dividends were paid during each of these years — of these 3 were high quality and 2 were low quality.
- The ending cash balance, with a dividend coverage of 5.06x, provides a substantial cushion in case of a significant reduction of cash flows in the future.
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Over the last twelve months (prior to September 30, 2017), TILE-US paid a high quality dividend.
The source of the company’s cash to support the dividend paid over the last twelve months is operating cash flow (coverage of 5.63x), investing cash flow (coverage of -1.94x), issuance cash flow (coverage of -5.16x) and twelve-month prior cash (coverage of 7.37x), for a total dividend coverage of 6.06x.
TILE-US’s issuance cash flow includes outflows from net share buybacks (coverage of -5.78x). Thus, the total coverage including share buybacks is 11.84x, which reflects our assumption that the cash paid for share buybacks is discretionary and could instead be used to pay dividends.
These coverage ratio factors imply that the firm’s dividends are wholly paid from operating and investing cash flows net of any debt repayments, which suggests a high dividend quality.
|Dividend Yield (%)||0.57||0.51||0.85||0.95||1.2||1.08|
|Dividend Payout (%)||100||15.07||37.84||16.36||26.51||28.82|
A complete list of metrics and analysis is available on the company page.
Interface, Inc. designs, manufactures and sells modular carpet, manufactured for the commercial and institutional markets under the Interface brand, and for consumer markets as FLOR modular carpets. It also offers Intersept, a proprietary antimicrobial used in a number of interior finishes. The company was founded by Ray C. Anderson in 1973 and is headquartered in Atlanta, GA.
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