Want A Font? Monotype Has It

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

That technology sector has nineteen industries ranging from communication equipment, computers, consumer electronics, and contract manufacturing, to health and information technology and services to internet, scientific instruments, software, solar and all such technological marvels. 

Today I'm reviewing a small-cap software application company, named Monotype Imaging Holdings Inc. Its trading ticker symbol is TYPE

Monotype Imaging Holdings Inc is a provider of type, technology and expertise for creative applications and consumer electronics, or CE, devices. The business is organized on thee segments, Creative, Professional, and Original Equipment Manufacturers (OEM).

The company develops, markets, and licenses technologies and fonts in the United States, the United Kingdom, Germany, Japan, and the rest of Asia. The company offers font products, including its own fonts from the Monotype Libraries, as well as fonts from third parties through its e-commerce Websites, including myfonts.com, fonts.com, fontshop.com, and linotype.com. It also provides font scaling engine and font compression technologies that are compatible with virtual font formats and industry standards, including the PostScript and PCL printing languages.

Further, it provides expert consultation and custom type design services; and technical support and professional services. The company provides approximately 14,000 typeface designs and supports approximately 250 Latin and non-Latin languages. Its solutions are used in various devices, including laser printers, consumer appliances, and the Internet of things devices, as well as in various software applications and operating systems.

The company serves content creators, marketers, consumer device manufacturers, and independent software vendors and developers. 

Monotype Imaging Holdings Inc. is headquartered in Woburn, Massachusetts.

I use three key data points to gauge the value of any dividend equity or fund like Monotype Imaging Holdings Inc. (TYPE): 

(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. 

TYPE Price

Monotype'sprice per share was $18.53 at yesterday's market close. A year ago its price was $24.00 for a price drop of $5.47 per share for the year, that's a 23.8% drop. 

Assuming Monotype's price will trade in the range of $16 to $26 next year, Monotype's recent $18.53 price could improve by $4.00 and grow to $22.53 by early-November, 2019. 

TYPE Dividends

Monotype's most recent quarterly dividend was $0.116 declared November 2nd and payable January 22nd. 

At this most recent $0.116 quarterly rate, Monotype's annual dividend equals $0.464 yielding 2.5% at yesterday's closing $18.53 price.

Gains For PKE?

Adding the $0.46 estimated annual dividend to my estimated $4.00 annual price upside for Monotype Imaging Holdings Inc. (TYPE) makes a $4.46 potential gross annual per share gain, which will be reduced by costs to trade the shares.  

 A little over $1,000.00 invested today at the $18.53 recent price buys 54 Monotype Imaging Holdings Inc. (TYPE) shares. 

A $10 broker fee paid half at purchase and half at sale costs $0.19 per share, subtracting that $0.19 brokerage cost from the estimated $4.46 gross annual gain leaves a net gain of $4.27 X 54 shares = $230.58 for a 23% net gain on a $1,000.62 investment.

Therefore, Monotype Imaging Holdings Inc. whose trading ticker symbol is TYPE, now shows a possible 23% net gain including a 2.5% dividend yield. 

Four brokers cover this stock:

Two say "buy" TYPE.

One thinks TYPE will "outperform" its peers.

One says "hold" tight to TYPE.

Their consensus number is 1.75 or "outperform".

The median of those four broker's price targets is nearly $3 higher than the $22.53 upside I suggested as possible.

Therefore, you may look at these speculative numbers this way, Monotype Imaging Holdings Inc. whose trading ticker symbol is TYPE, has made money, is making money, and could net a 20% to 40% net annual gain including a 2.5% 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 Monotype Imaging Holdings Inc. (TYPE) 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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