Our analysis is based on comparing Park-Ohio Holdings Corp. with the following peers – Anixter International Inc., Crane Co., Sun Hydraulics Corporation, Omega Flex, Inc., Lincoln Electric Holdings, Inc., Actuant Corporation Class A, Dover Corporation and Parker-Hannifin Corporation (AXE-US, CR-US, SNHY-US, OFLX-US, LECO-US, ATU-US, DOV-US and PH-US).
Park-Ohio Holdings Corp.’s dividend yield is 1.26 percent and its dividend payout is 18.80 percent. This compares to a peer average dividend yield of 1.56 percent and a payout level of 36.54 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 75 out of a possible score of 100 looks sustainable.
Dividend Quality Overview
- Over the last twelve months (prior to June 30, 2017), PKOH-US paid a medium quality dividend, which represents a yield of 1.26% at the current price.
- Dividend quality trend has not been consistent over the last five years. Dividends were paid during 3 of these years — of these 2 were high quality and 1 was medium quality.
- The ending cash balance, with a dividend coverage of 11.73x, 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 June 30, 2017), PKOH-US paid a medium 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 8.77x), investing cash flow (coverage of -9.81x), issuance cash flow (coverage of 4.21x) and twelve-month prior cash (coverage of 9.35x), for a total dividend coverage of 12.73x.
PKOH-US‘s issuance cash flow includes outflows from net share buybacks (coverage of -0.63x). Thus, the total coverage including share buybacks is 13.35x, 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 net cash inflow from issuance was required (in addition to operating and investment cash) to pay the dividend, which suggests a medium dividend quality.
|Dividend Yield (%)||0||0||0.51||1.4||1.17||1.26|
|Dividend Payout (%)||0||0||10.19||12.89||19.38||18.8|
A complete list of metrics and analysis is available on the company page.
Park-Ohio Holdings Corp. engages in the provision of supply chain logistics services and manufactures aluminum products. It operates in three segments: Supply Technologies, Assembly Components, and Engineered Products. The Supply Technologies segment provides customers with total supply management services for a broad range of high volume, specialty production components. The Assembly Components segment manufactures cast aluminum components, automotive and industrial rubber and thermoplastic products, fuel filler and hydraulic assemblies for automotive, agricultural equipment, construction equipment, heavy duty truck and marine equipment industries. It also provides value-added services such as design and engineering, machining and assembly. The Engineered Products segment operates a diverse group of niche manufacturing businesses that design and manufacture a broad range of high quality products engineered for specific customer applications. The company was founded in 1998 and is headquartered in Cleveland, OH.
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