Universal (NYSE:UVV) Shares Cross Below 200-Day Moving Average - Time to Sell?

Key Points

• Universal shares fell below their 200-day moving average, trading as low as $45.19 versus the average of $52.44. MarketBeat’s analyst consensus is “Hold,” though recent ratings included downgrades to “Sell” and a lower “Hold” grade.
• The company missed quarterly expectations, reporting a loss of $0.18 per share versus the $0.25 estimate and revenue of $523.78 million compared with the $587 million consensus. Analysts expect full-year earnings of approximately $3.18 per share.
• Universal declared a quarterly dividend of $0.83, equating to a 7.3% annualized yield, but its 431.17% payout ratio raises sustainability concerns; two directors also recently reduced their holdings through stock sales.

Universal Corporation (NYSE:UVV - Get Free Report)'s share price crossed below its two hundred day moving average during trading on Monday . The stock has a two hundred day moving average of $52.44 and traded as low as $45.19. Universal shares last traded at $45.6730, with a volume of 274,770 shares.

Analyst Upgrades and Downgrades

A number of research analysts have weighed in on UVV shares. Zacks Research raised Universal from a "strong sell" rating to a "hold" rating in a research note on Monday, August 3rd. Wall Street Zen downgraded Universal from a "hold" rating to a "sell" rating in a report on Saturday, August 15th. Finally, Weiss Ratings downgraded shares of Universal from a "hold (c)" rating to a "hold (c-)" rating in a research report on Wednesday, August 12th. Two research analysts have rated the stock with a Hold rating, Based on data from MarketBeat, the company currently has an average rating of "Hold".

Universal Stock Performance

The company has a quick ratio of 1.00, a current ratio of 2.57 and a debt-to-equity ratio of 0.43. The firm has a market cap of $1.14 billion, a price-to-earnings ratio of 59.32, a PEG ratio of 14.15 and a beta of 0.60. The company has a 50 day moving average of $50.90 and a 200 day moving average of $52.44.

Universal (NYSE:UVV - Get Free Report) last issued its quarterly earnings results on Wednesday, August 5th. The company reported ($0.18) earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $0.25 by ($0.43). The company had revenue of $523.78 million during the quarter, compared to the consensus estimate of $587.00 million. Universal had a return on equity of 3.50% and a net margin of 0.67%. As a group, equities research analysts expect that Universal Corporation will post 3.18 EPS for the current fiscal year.

Universal Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Monday, November 2nd. Stockholders of record on Monday, October 12th will be given a $0.83 dividend. The ex-dividend date is Friday, October 9th. This represents a $3.32 annualized dividend and a dividend yield of 7.3%. Universal's dividend payout ratio (DPR) is presently 431.17%.

Insiders Place Their Bets

In related news, Director Robert C. Sledd sold 2,845 shares of the firm's stock in a transaction that occurred on Wednesday, June 3rd. The stock was sold at an average price of $54.12, for a total value of $153,971.40. Following the sale, the director owned 11,959 shares of the company's stock, valued at approximately $647,221.08. This trade represents a 19.22% decrease in their position. The sale was disclosed in a document filed with the SEC, which is accessible through this hyperlink. Also, Director Lennart R. Freeman sold 1,782 shares of the firm's stock in a transaction on Monday, August 10th. The shares were sold at an average price of $49.82, for a total value of $88,779.24. Following the completion of the sale, the director owned 16,935 shares in the company, valued at $843,701.70. The trade was a 9.52% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. 2.20% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Universal

Several hedge funds and other institutional investors have recently made changes to their positions in UVV. Farther Finance Advisors LLC boosted its position in Universal by 75.2% during the 4th quarter. Farther Finance Advisors LLC now owns 466 shares of the company's stock worth $25,000 after acquiring an additional 200 shares during the period. Baird Financial Group Inc. increased its stake in Universal by 5.1% in the 2nd quarter. Baird Financial Group Inc. now owns 4,152 shares of the company's stock worth $242,000 after purchasing an additional 200 shares in the last quarter. Rexford Capital Inc. raised its holdings in shares of Universal by 2.4% during the fourth quarter. Rexford Capital Inc. now owns 8,671 shares of the company's stock valued at $457,000 after acquiring an additional 200 shares during the period. Bessemer Group Inc. lifted its holdings in shares of Universal by 67.1% in the first quarter. Bessemer Group Inc. now owns 518 shares of the company's stock valued at $27,000 after purchasing an additional 208 shares in the last quarter. Finally, PNC Financial Services Group Inc. boosted its position in Universal by 7.9% during the 4th quarter. PNC Financial Services Group Inc. now owns 3,114 shares of the company's stock worth $164,000 after acquiring an additional 227 shares during the period. 81.00% of the stock is currently owned by institutional investors and hedge funds.

Universal Company Profile

Universal Corporation NYSE: UVV is a global agribusiness company primarily engaged in the procurement, processing and sale of leaf tobacco. Headquartered in Richmond, Virginia, the company sources cured leaf tobacco from key growing regions in North and South America, Africa and Asia. Universal serves major multinational tobacco manufacturers by providing a full range of services including inventory management, quality control and logistics support to ensure a consistent and reliable supply of tobacco leaf.

In addition to its core leaf tobacco operations, Universal offers integrated supply-chain services that encompass warehousing, distribution and ingredient sourcing for smokeless and novel tobacco products.

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