Crown Crafts, Inc.: Bullish 4.1%-Yielder Announces Special Dividend
CRWS Stock Rewards Investors With Another Special Dividend
If you’re like many Americans, you could probably use an extra source of income, whether you’re just starting out, getting close to retirement, or already retired. And who wouldn’t like some extra cash, what with the so-called temporary inflation at its highest level since 1990 and interest rates hovering near record lows?
With interest rates being so low for so long, income-seeking investors have had a difficult time in recent years. Interest rates on even the best two-year CDs are around a measly 0.9%. As of this writing, the average dividend yield on S&P 500 stocks is only 1.2%.
One of the best ways to supplement one’s income is with reliable, high-dividend stocks. An even better way to supercharge a retirement portfolio is with high-dividend stocks that provide special dividends.
Special dividends are essentially one-time payments to shareholders. These payments are separate from a company’s regular dividends, and they can be very lucrative. Keep in mind that you can’t predict or time special dividends, but you can take advantage of them when they arrive.
Case in point, Crown Crafts, Inc. (NASDAQ:CRWS) is a great high-dividend stock that pays reliable regular dividends and occasional special dividends.
Crown Crafts is one of America’s leading providers of infant, toddler, and juvenile consumer products. Thanks to its strong presence in a traditionally stable segment of the retail industry, the company has been able to generate reliable cash flow and ongoing profitability. (Source: “Southwest IDEAS Investor Conference,” Crown Crafts, Inc., November 20, 2019.)
In the second quarter of its fiscal 2022 (ended September 26, 2021), the company’s net income was $2.4 million, or $0.24 per share, compared to $2.5 million, or $0.24 per share, in the same prior-year period. (Source: “Crown Crafts Reports Fiscal 2022 Second Quarter Results,” Crown Crafts, Inc., November 10, 2021.)
Its second-quarter net sales were $20.2 million, versus $21.7 million in the second quarter of fiscal 2021. Crown Crafts’ gross profit in the 2022 second quarter was 30.0% of its net sales, down from 32.8% in its 2021 second quarter.
Excluding sales from the company’s “Carousel Designs” division, which was shuttered in May, the company’s gross margin would have been 30.2%, while its net income would have been $2.4 million, or $0.24 per share.
“Despite labor shortages, shipment delays and rising costs, along with the inconvenience of having to close our main office for several weeks because of damage from Hurricane Ida, management has done an outstanding job working through these challenges to produce solid results,” said E. Randall Chestnut, CEO.
This has allowed the company’s board to announce a regular quarterly dividend of $0.08 per quarter, for a yield of 4.1%. The company also announced a $0.35-per-share special dividend. Both dividends will be paid on December 31 to Crown Crafts stockholders of record at the close of business on December 10.
Once those quarterly and special dividends are paid, Crown Crafts, Inc. will have distributed more than $52.9 million in total dividends since 2010.
As you can see in the following chart (the red line), CRWS stock has paid four special dividends in the past decade:
- 2013: $0.78 per share
- 2017: $0.97 per share
- 2020: $0.57 per share
- 2021: $0.35 per share
Chart courtesy of StockCharts.com
In addition to providing investors with reliable regular dividends and occasional special dividends, Crown Crafts stock has rewarded buy-and-hold investors with share-price appreciation.
As of this writing, CRWS stock is up by:
- Five percent over the last three months
- 10% year-to-date
- 103% since bottoming in March 2020
Over the last 12 years, with dividends reinvested, Crown Crafts stock has provided returns of 472%.
The Lowdown on Crown Crafts, Inc.
A global provider of infant, toddler, and juvenile consumer products, Crown Crafts, Inc. has a dominant position in a stable, niche segment of the retail industry. It seems that people have children regardless of how the economy is doing.
With a significant global presence and strong licensing and retail relationships, CRWS stock has been able to reward investors with a growing share price, reliable regular dividends, and occasional special dividends.