Daily Stock Pick: Flexsteel Industries

This week, I'm looking for the fourth consumer cyclical sector representative of five for my Ivy portfolio.

That cyclicals sector includes twenty-eight industries ranging from Advertising Agencies to Apparel, Autos, Broadcasting, Department Stores, Gambling, Leisure, Lodging, Packaging, Personal Services, Shoes, Restaurants, Rubber, Plastics, Textiles, and all such consumer aimed enterprises.

Today I'm reviewing a small-cap home furnishings and fixtures firm, named Flexsteel Industries Inc. Its trading ticker symbol is FLXS.

Flexsteel Industries Inc is a United States-based company that manufactures, imports and markets residential and commercial upholstered wooden furniture products. The products offering include sofas, loveseats, chairs, rockers, desks, tables, convertible bedding units, and bedroom furniture.

The company’s products are intended for use in home, office, hotel, healthcare, and other contract applications. A featured component in the company’s upholstered furniture is the durable Blue Steel Spring. It operates in the business segment of Furniture products. The company’s furniture products business involves the distribution of manufactured and imported products for residential and contract markets, of which key revenue is derived from the residential market.

The company distributes its products through its sales force and independent representatives.

Flexsteel Industries, Inc. was founded in 1929 and is headquartered in Dubuque, Iowa.

I use three key data points to gauge the value of any dividend equity-like Flexsteel Industries Inc:

(1) Price

(2) Dividends

(3) Returns

Besides those three, several other keys will finally unlock an equity or fund in which to invest.

Those first three primary keys, however, best tell whether a company has made, is making, and will make money.

FLXS Price

Flexsteel's price per share closed at $23.67 yesterday. A year ago its price was $37.32. The price fell $13.65 or 36.6% in the past year.

Assuming Flexsteel's stock trades in the range of $20 to $35 this year, Flexsteel's recent $23.67 price could rise by $1.33 and go to $25.00 by late-March, 2020.

FLXS Dividends

Flexsteel's most recent Quarterly dividend was $0.22 declared March 5th and payable today, March 29th.

That $0.22 Q dividend equates to an annual payout of $0.88 for a yield of 3.72% at yesterday's $23.67 closing price.

Gains For FLXS?

Adding the $0.88 annual estimated dividend to my $1.33 estimate of Flexsteel's price upside shows a $2.21 potential gross annual gain, per share, which will be reduced by costs to trade those shares.

Say we put a little under $1,000.00 today at the $23.67 recent stock price would buy us 42 Flexsteel Industries Inc shares.

A $10 broker fee paid half at purchase and half at sale costs $0.24 per share.

Subtract that $0.24 brokerage cost from the estimated $2.21 gross annual gain leaves a net gain of $1.97 X 42 shares

= $82.74 or a 8.3% net gain on a $994.14 investment.

Therefore, Flexsteel Industries Inc whose trading ticker symbol is FLXS now shows a possible net gain of 8.3% including a 3.72% dividend yield.

One broker covers this stock:

She says "buy" FLXS shares.

Therefore, you can look at  Flexsteel Industries Inc and see it has made money, is making money, and could throw a net gain of 8.3% including a 3.72% dividend yield. It could be more, it could be less.

The above speculation is based on past year performance. The actual results remain to be seen to determine if Flexsteel Industries Inc is worth your time and money.