A portfolio of stocks I've been building since September 3, 2019, named Volio, will eventually hold 52 dividend dogs. Volio is the fifth portfolio I've built (at a one dividend dog per-week pace) since 2014. Five portfolios = V for Volio!
Today I'm reviewing the second of five industrials sector stocks poised to join my Volio folio this week. One could be my forty-fifth pick for Volio!
That industrials sector includes twenty-three industries all dedicated to designing, fabricating, and servicing stuff we want and use. Those industrials industries range from aerospace and defense to waste management with all the transportation, business services, and equipment required in between.
My subject today is small-cap business equipment and supplies firm named, HNI Corporation. Its trading ticker is HNI. This is my second report on Hillenbrand Inc for this portfolio. I last reported on HNI on January 9th.
HNI Corp is a provider of office furniture and hearth products.
The company generates the bulk of its revenue from its office furniture segment, which consists of products such as panel-based and freestanding furniture systems and complementary products. These products are sold primarily through a national system of dealers, wholesalers, and office product distributors but also directly to end-user customers and federal, state, and local governments.
The hearth segment consists of products including gas-, wood-, and pellet-burning fireplaces, inserts, stoves, facings, and accessories. The company has operations in the United States, Canada, mainland China, Hong Kong, India, and Taiwan.
HNI Corporation was incorporated in 1944 and is headquartered in Muscatine, Iowa.
I use three key data points to gauge dividend equities or funds like HNI Corp:
(1) Price
(2) Dividends
(3) Returns
Those three basic keys best tell whether a company has made, is making, and will make money.
HNI Price
HNI's price per share closed at $29.21 yesterday. A year ago their price was $34.99. Price fell $5.78 or about 16.5% last year.
Assuming HNI's stock trades in the range of $12 to $36 this next year, its recent $29.21 price might rise by $1.79 to reach $31.00 by July 7, 2021.
HNI Dividends
HNI's most recent declared quarterly dividend was $0.305, paid June 1st. That $0.305 Q dividend equates to $1.22 annually for a yield of 4.18% at yesterday's $29.21 share price.
HNI Gains?
Adding the $1.22 annual estimated dividend to my $1.79 optimistic estimate of HNI Corporation's price upside shows a $3.01 potential gross gain, per share, to be reduced by any costs to trade the shares.
If we put little under $1,000.00 today in HNI Corporation we would buy 34 shares of HNI stock.
A $10 broker fee paid half at purchase and half at sale could cost us about $0.29 per share.
Subtract that $0.29 brokerage cost from my estimated $3.01 gross gain per share results in a net gain of $2.72 X 34 shares = $92.48 for a 9.25% net gain on a $993.14 investment.
Thus, HNI Corporation shows a possible 9.25% net gain including a 4.18% dividend yield. It could be more, it could be less.
The above speculation is based on past performance and supposition. Only time and money invested will tell if HNI Corporation is worth it.
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