Fastenal Company (NASDAQ:FAST) Raises Dividend to $0.26 Per Share

Key Points

• Fastenal raised its quarterly dividend to $0.26 per share from $0.24, an 8.3% increase. The dividend is payable on August 25 to shareholders of record on July 28, with an implied yield of 2.2%.
• The company has increased its dividend for 26 straight years, though its recent three-year dividend growth rate has been flat. Its payout ratio is 86.7%, which is currently covered by earnings but leaves less room if profits weaken.
• Fastenal recently reported Q2 EPS of $0.33, matching expectations, while revenue of $2.39 billion beat estimates and rose 14.7% year over year. Analysts currently rate the stock a Hold on average, with a consensus price target of $48.83.

Fastenal Company (NASDAQ:FAST - Get Free Report) declared a quarterly dividend on Friday, July 10th. Investors of record on Tuesday, July 28th will be given a dividend of 0.26 per share on Tuesday, August 25th. This represents a c) dividend on an annualized basis and a yield of 2.2%. The ex-dividend date of this dividend is Tuesday, July 28th. This is a 8.3% increase from Fastenal's previous quarterly dividend of $0.24.

Fastenal has raised its dividend payment by an average of 0.0%per year over the last three years and has increased its dividend every year for the last 26 years. Fastenal has a payout ratio of 86.7% indicating that its dividend is currently covered by earnings, but may not be in the future if the company's earnings fall. Research analysts expect Fastenal to earn $1.38 per share next year, which means the company should continue to be able to cover its $1.04 annual dividend with an expected future payout ratio of 75.4%.

Fastenal Stock Up 1.9%

Shares of NASDAQ:FAST opened at $47.02 on Friday. The stock has a fifty day simple moving average of $45.92 and a two-hundred day simple moving average of $45.35. The stock has a market capitalization of $53.96 billion, a price-to-earnings ratio of 39.85, a PEG ratio of 2.94 and a beta of 0.72. Fastenal has a 12-month low of $38.97 and a 12-month high of $50.63. The company has a current ratio of 4.18, a quick ratio of 2.21 and a debt-to-equity ratio of 0.01.

Fastenal (NASDAQ:FAST - Get Free Report) last announced its earnings results on Tuesday, July 14th. The company reported $0.33 EPS for the quarter, meeting analysts' consensus estimates of $0.33. The business had revenue of $2.39 billion during the quarter, compared to analysts' expectations of $2.34 billion. Fastenal had a net margin of 15.45% and a return on equity of 34.03%. The firm's revenue was up 14.7% on a year-over-year basis. During the same period in the prior year, the company earned $0.29 earnings per share. On average, research analysts anticipate that Fastenal will post 1.25 earnings per share for the current fiscal year.

Wall Street Analysts Forecast Growth

FAST has been the subject of several analyst reports. Barclays reduced their price objective on Fastenal from $47.00 to $46.00 and set an "equal weight" rating for the company in a research note on Thursday, July 16th. DA Davidson reissued a "neutral" rating and set a $46.00 price target on shares of Fastenal in a report on Wednesday, July 15th. Bank of America upped their price target on Fastenal from $48.00 to $55.00 in a research report on Monday, April 13th. Wolfe Research reaffirmed an "underperform" rating and issued a $47.00 price objective on shares of Fastenal in a research note on Thursday, July 9th. Finally, Jefferies Financial Group reaffirmed a "buy" rating on shares of Fastenal in a research report on Thursday, June 4th. Five equities research analysts have rated the stock with a Buy rating, six have given a Hold rating and two have assigned a Sell rating to the company's stock. According to data from MarketBeat, the company currently has an average rating of "Hold" and a consensus target price of $48.83.

About Fastenal

Fastenal NASDAQ: FAST is a wholesale distributor of industrial and construction supplies, best known for its broad assortment of fasteners such as bolts, nuts, screws and anchors. Founded in Winona, Minnesota, Fastenal has grown from a regional supplier into a national and international distributor serving a wide range of end markets, including manufacturing, construction, maintenance, repair and operations (MRO), and government customers. The company is publicly traded and operates through a network of locally staffed branches combined with national distribution capabilities.

Product offerings extend beyond fasteners to include tools, safety and personal protective equipment, power transmission components, cutting and welding supplies, janitorial and material handling items, and other industrial consumables.

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