Mueller Industries: A Dividend Powerhouse on the Rise
Parker Hannifin peer with a 5 year dividend CAGR of 35.1% (!!)
Investors seeking robust dividend growth and a solid track record of financial performance should look no further than our new Focus stock (#4): Mueller Industries (MLI). For all free subscribers please note that our 3 previous Focus stocks highlighted earlier (Korn Ferry, Discover Financial and Nexstar Media) returned 10.0% on average so far since we wrote about these companies.
This industrial manufacturing stalwart, Focus stock #4, has been making waves with its impressive dividend hikes, boasting an average annual increase of 35.1% over the past five years.
Last year alone, Mueller Industries, the $8 billion market cap peer to much bigger Dividend Hero Parker Hannifin (PH) raised its dividend by a substantial 33.3%, reflecting the company's commitment to rewarding its shareholders. The momentum has continued into this year, with the stock price soaring by 49%, highlighting the market's confidence in future prospects. Despite this price appreciation, the company still offers a current dividend yield of 1.1%.
Interestly enough the company we are talking about has a relative attractive valuation with an estimated p/e of 14 for 2024. We also love the company’s EBIT margin of 21.6% (FY 2023) and its high and consistant Return on Invested Capital (ROIC) of almost 46% for 2023. We also love: a debt free balance sheet and a balanced capital deployment with capex, share repurchases, dividends and acquisitions throughout the years.
Our new focus stock also generates much stronger total returns versus peers based on Return on Equity and Return on Average Capital Invested (ROIC). is a low cost manufacturer with quality products, a resilient business model and strong customer relations resulting in profitability through all economic cycles, even during recessionary periods or the global (covid) pandemic. No surprise that this stock trades near its all time high. However, the stock price could rise much higher over time given the strong fundamentals. We will explain you why. First, lets learn everything about this beautiful company!