Daily Stock Pick: Matson

This week, I'm looking for the fourth industrial representative of eight for my Ivy portfolio.

That sector includes twenty-three industries all related to designing, fabricating and servicing stuff we want and use. The industrials industries range from aerospace and defense to waste management with all the transportation, business services, and equipment required in between.

Today I'm reviewing a small-cap shipping and ports entity named Matson Inc. Its trading ticker symbol is MATX. I last reported on this company on October 23, 2018.

Matson Inc provides ocean transportation and logistics services. The business segments of the company are ocean transportation that supplies ocean freight transportation services to the domestic non-contiguous economies of Hawaii, Alaska, California, Okinawa, and different islands in the South Pacific. The other segment is logistics that offers long haul and regional highway trucking services, warehousing and distribution services, supply chain management, and freight forwarding services. The firm generates majority revenue from ocean transportation.

The company was formerly known as Alexander & Baldwin Holdings, Inc. and changed its name to Matson, Inc. in June 2012. Matson, Inc. was founded in 1882 and is headquartered in Honolulu, Hawaii.

I use three key data points to gauge the value of any dividend equity-like Matson 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.

MATX Price

Matson's price per share closed at $39.30 last Thursday. A year ago its price was $29.12. Price increased $10.18 or 35% in the past year.

Assuming Matson's stock trades in the range of $32 to $44 this year, Matson's recent $39.30 price could rise by $1.70 and go to $41.00 by late-April, 2020.

MATX Dividends

Matson's most recent Quarterly dividend was $0.21 declared January 24th and paid, March 7th.

That $0.21 Q dividend equates to an annual payout of $0.85 for a yield of 2.16% at Thursday's $39.30 closing price.

Gains For MATX?

Adding the $0.85 annual estimated dividend to my $1.70 estimate of Matson's price upside shows a $2.55 potential gross annual gain, per share, which will be reduced by costs to trade those shares.

If we put a little under $1,000.00 today at the $39.30 recent stock price would buy us 25 Matson Inc shares.

A $10 broker fee paid half at purchase and half at sale costs $0.40 per share.

Subtract that $.40 brokerage cost from the estimated $2.55 gross annual gain leaves a net gain of $2.15 X 25 shares

= $53.75 or a 5.5% net gain on a $982.50 investment.

Therefore, Matson Inc, whose trading ticker symbol is MATX, now shows a possible net gain of  5.5% including a 2.16% dividend yield.

Five brokers cover this stock:

Three say 'buy" MATX.

Two say "hold" MATX.

Their consensus score is 1.8 or "outperform."

Therefore, you can look at  Matson Inc and see it has made money, is making money, and could net 5.5% gains including a 2.16% 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 Matson Inc is worth your time and money.