Acme United Price Dropped. Time To Buy The Dip?

This week I'm seeking a prestigious and long-term dividend-paying stock from the consumer defensive sector. 

Today I'm reviewing a nano-cap tools and accessories company, named Acme United Corporation. Its trading ticker symbol is ACU

Acme United Corp is a supplier of cutting, measuring, first aid and sharpening products to the school, office, hardware, sporting goods and industrial markets in the United States, Canada, Europe, and Asia.

The company offers a vast array of products through a dozen brand names :

It has sharpeners, trimmers, lettering, and math tools under the Westcott brand; cutting tools for hardware and industrial, lawn and garden, and food processing, clothing, and housewares channels under the Clauss brand; knives, tactical tools and trench multi-tool products under the Camillus brand name; pocket sharpeners under the Glide brand; fishing tools and knives under the Cuda brand; cut and puncture resistant gloves under Kevlar brand; and sharpening tools for all edges under the DMT brand; 

In addition, it offers first aid kits, refills, and safety products under the First Aid Only brand; refills, and emergency medical travel and recreational kits under the Pac-Kit brand; head protection, and ergonomic supports and  over-the-counter medications, under the PhysiciansCare brand; and absorbents and clean up kits under the Spill Magic brand. 

The company sells its products directly and through its independent manufacturer representatives to wholesale, contract, and retail distributors; office superstores; wholesale florists; mass market; e-commerce retailers; and hardware chains. 

The company was formerly known as Acme Shear Company and changed its name to Acme United Corporation in 1971. 

The company was founded in 1867 and is headquartered in Fairfield, Connecticut. 

I use three key data points to gauge the value of any dividend equity or fund like Acme United Corporation (ACU): 

(1) Price

(2) Dividends

(3) Returns

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

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

ACU Price

Acme's price per share was $17.14 at yesterday's market close. A year ago its price was $22.35 for a price roll-back of $5.21 per share for the year.  

Assuming Acme's price will trade in the range of $15 to $30 next year, Acme's recent $17.14 price could improve by $5.00 to $22.14 by late-October, 2019. 

ACU Dividends

Acme's most recent quarterly dividend was $0.11 declared September 18th and paid October 23rd. 

At this most recent $0.11 quarterly rate, Acme's annual dividend equals $0.44 yielding 2.6% at yesterday's closing $17.14 price.

Gains For ACU?

Adding the $0.44 estimated annual dividend to my estimated $5.00 annual price upside for Acme United Corporation (ACU) makes a $5.44 potential gross annual per share gain, which will be reduced by any costs to trade the shares.  

 A little under $1,000.00 invested today at the $17.14 recent price buys 58 Acme United Corporation (ACU) shares. 

A $10 broker fee paid half at purchase and half at sale costs $0.17 per share, subtracting that $0.17 brokerage cost from the estimated $5.44 gross annual gain leaves a net gain of $5.27 X 58 shares = $305.66 or a 30.6% net gain on a $994.12 investment.

Therefore, Acme United Corporation whose trading ticker symbol is ACU, now shows a possible 30.6% net gain including a 2.6% dividend yield. 

One broker covers this stock:

She says "buy" ACU.

That one opinion, the general recommendation number comes up as 1.0 or "buy".

This one wizard of wall street also reckons a price target $2.00 higher than my estimated $22.00 scenario.

So, you could look at these speculative numbers this way, Acme United Corporation whose trading ticker symbol is ACU,  has made money, is making money, and could net a 30% to 40% net annual gain including a 2.6% 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 Acme United Corporation (ACU) is worth your time and money.

Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, ...

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