MOV Stock: Underrated Luxury Stock with a Robust Dividend
June 2, 2025
Why MOV Stock Is Built to Last
Put simply, loads of debt can be a silent killer for companies. When times are good—with low interest rates and a growing economy—debt is harmless. But when the economy turns or growth slows down, interest payments pile up and flexibility disappears.
No or low debt isn’t just a nice-to-have; it could even be a competitive advantage. For income investors with a long-term focus, a debt-free balance sheet is a sign of discipline, resilience, and smart management.
With this in mind, take a look at Movado Group Inc (NYSE:MOV)—a company that runs one of the tightest ships in the luxury space. Its management is laser-focused, manages its cash conservatively, and quietly rewards those who own MOV stock.
It sounds bold at a moment when MOV stock is trending downward and it seems like markets have a pessimistic view, but this company is built to last. This decline in the MOV stock price could be a blessing in disguise.
What Does Movado Group Do?
Headquartered in Paramus, New Jersey, Movado Group designs, sources, markets, and distributes watches in the U.S. and internationally. It operates in two segments: Watch and Accessory Brands, and Company Stores.
The company offers its watches under the “Movado,” “Concord,” “Ebel,” “Olivia Burton,” and “MVMT” brands. It also has licensed brands such as “Coach,” “Tommy Hilfiger,” “HUGO BOSS,” “Lacoste,” and “Calvin Klein.”
Furthermore, Movado Group designs, sources, markets, and distributes jewelry and other accessories and provides after-sales and shipping services.
Movado’s customers include jewelry store chains, department stores, independent regional jewelers, a network of independent distributors, online marketplaces, licensors’ retail stores, and third-party e-commerce retailers. The company also sells directly to consumers through its e-commerce platforms. (Source: “Profile,” Yahoo! Finance, last accessed May 23, 2025.)
Solid Financials Despite Headwinds
On April 16, the company reported its financial results for the fourth quarter and fiscal year 2025. To say the least, Movado’s recent financial performance continues to tell a story of resilience.
It is not a secret that the luxury retail sector has faced pressure from slowing consumer spending in recent quarters, but this company’s profit margins remain healthy, plus its inventory is well managed and its expenses are under control.
Movado’s net sales for fiscal year 2025 amounted to $653.4 million and its diluted earnings per share were $0.81.
Moreover, this company doesn’t have any debt. That’s a big thing these days given how interest rates haven’t budged much and the fact that, based on the yields on long-term bonds at the moment, it seems like rates will remain high for a longer period. Remember: a massive debt load would eat into a company’s profits or amplify its losses.
Movado ended the fiscal year with a rock-solid balance sheet and current assets of about $490.0 million, of which over $208.0 million consisted of cash and cash equivalents. Its current liabilities were just about $113.0 million. This gives the company working capital of over $377.0 million. (Source: “Movado Group, Inc. Announces Fourth Quarter and Fiscal Year 2025 Results,” Movado Group Inc, April 16, 2025.)
With all of this in mind, I can’t help but think that the fact that MOV stock has fallen 38% over the past one year is just an overreaction.
Chart Courtesy of StockCharts.com
Investors Get Consistent Payouts with MOV Stock
MOV stock currently offers a very attractive dividend yield, especially when compared to other luxury or retail names. But the most important thing to discuss here is the dividend consistency and management’s commitment to keeping shareholders happy.
Movado doesn’t overpromise. It pays what it can afford and maintains that payout through various market conditions.
On April 11, Movado’s board of directors approved a dividend payment of $0.35 per share for May 6. But, this wasn’t just a one-off payment. The company has been dishing out $0.35/share per quarter since early 2022. This translates to $1.40 per share on an annual basis, which is a dividend yield on MOV stock of 8.43%.
Are dividends safe here, especially considering the fact that Movado belongs to a cyclical sector?
I believe they are, given how tight of a ship company management has run. However, I also think investors shouldn’t be expecting a massive increase in payouts, as the luxury sector is going through a rough patch. Once the dust clears, dividends could increase though.
The Lowdown on MOV Stock
MOV stock offers something that’s getting harder to find these days: a business with no debt, a management team focused on the long term, and a dividend shareholders can count on.
For income investors who are looking for stocks that don’t give them nightmares, MOV stock seems to check all the boxes. It can’t be stressed enough: Movado has no leverage and boasts good products and a business that generates robust cash and makes sure investors are happy.
It’s a stock that’s loved by institutional investors as well. As per the most recent data, over 93% of all outstanding Movado’s shares were held by 200 institutional investors. Royce & Associates LP, BlackRock, Inc., and Dimensional Fund Advisors LP are the top three holders of MOV stock. (Source: “Holders,” Yahoo! Finance, last accessed May 23, 2025.)
