It’s easy to match the overall market return by buying an index fund. While individual stocks can be big winners, plenty more fail to generate satisfactory returns. That downside risk was realized by Edgewell Personal Care Company (NYSE:EPC) shareholders over the last year, as the share price declined 17%. That falls noticeably short of the market return of around 17%. Longer term shareholders haven’t suffered as badly, since the stock is down a comparatively less painful 12% in three years. Shareholders have had an even rougher run lately, with the share price down 17% in the last 90 days. This could be related to the recent financial results – you can catch up on the most recent data by reading our company report.
Now let’s have a look at the company’s fundamentals, and see if the long term shareholder return has matched the performance of the underlying business.
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.
Unfortunately Edgewell Personal Care reported an EPS drop of 12% for the last year. This reduction in EPS is not as bad as the 17% share price fall. Unsurprisingly, given the lack of EPS growth, the market seems to be more cautious about the stock.
You can see below how EPS has changed over time (discover the exact values by clicking on the image).
NYSE:EPC Earnings Per Share Growth March 2nd 2025
This free interactive report on Edgewell Personal Care’s earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.
A Different Perspective
While the broader market gained around 17% in the last year, Edgewell Personal Care shareholders lost 16% (even including dividends). Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Regrettably, last year’s performance caps off a bad run, with the shareholders facing a total loss of 0.5% per year over five years. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Case in point: We’ve spotted 3 warning signs for Edgewell Personal Care you should be aware of, and 1 of them is significant.
The board of U.S. Physical Therapy, Inc. (NYSE:USPH) has announced that it will be paying its dividend of $0.45 on the 11th of April, an increased payment from last year’s comparable dividend. This will take the dividend yield to an attractive 2.2%, providing a nice boost to shareholder returns.
U.S. Physical Therapy’s Payment Could Potentially Have Solid Earnings Coverage
We like to see robust dividend yields, but that doesn’t matter if the payment isn’t sustainable. Based on the last payment, U.S. Physical Therapy’s profits didn’t cover the dividend, but the company was generating enough cash instead. Given that the dividend is a cash outflow, we think that cash is more important than accounting measures of profit when assessing the dividend, so this is a mitigating factor.
Over the next year, EPS is forecast to expand by 68.4%. If the dividend continues along recent trends, we estimate the payout ratio will be 64%, which would make us comfortable with the sustainability of the dividend, despite the levels currently being quite high.
NYSE:USPH Historic Dividend March 2nd 2025
Dividend Volatility
The company has a long dividend track record, but it doesn’t look great with cuts in the past. The dividend has gone from an annual total of $0.48 in 2015 to the most recent total annual payment of $1.80. This works out to be a compound annual growth rate (CAGR) of approximately 14% a year over that time. It is great to see strong growth in the dividend payments, but cuts are concerning as it may indicate the payout policy is too ambitious.
Dividend Growth May Be Hard To Come By
Given that the dividend has been cut in the past, we need to check if earnings are growing and if that might lead to stronger dividends in the future. U.S. Physical Therapy has seen earnings per share falling at 5.6% per year over the last five years. A modest decline in earnings isn’t great, and it makes it quite unlikely that the dividend will grow in the future unless that trend can be reversed. Earnings are forecast to grow over the next 12 months and if that happens we could still be a little bit cautious until it becomes a pattern.
U.S. Physical Therapy’s Dividend Doesn’t Look Sustainable
Overall, we always like to see the dividend being raised, but we don’t think U.S. Physical Therapy will make a great income stock. The payments haven’t been particularly stable and we don’t see huge growth potential, but with the dividend well covered by cash flows it could prove to be reliable over the short term. We don’t think U.S. Physical Therapy is a great stock to add to your portfolio if income is your focus.
Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. For example, we’ve picked out 1 warning sign for U.S. Physical Therapy that investors should know about before committing capital to this stock. Looking for more high-yielding dividend ideas? Try our colle
SYDNEY, March 3 (Reuters) – Asian share markets made guarded gains on Monday as investors waited anxiously to see if imminent tariffs would go ahead, while bitcoin surged on news it would be included in a new U.S. strategic reserve of cryptocurrencies.
U.S. President Donald Trump on social media announced five digital assets he expected to include in a new reserve, including bitcoin , ether , XRP , solana and cardano .
Bitcoin, the world’s largest cryptocurrency by market value, shot up 10% on Sunday before paring some gains on Monday to $93,230, while ether, the second-largest cryptocurrency, pulled back to $2,448 after climbing 13% a day earlier.
MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS), opens new tab was flat, while Japan’s Nikkei (.N225), opens new tab rose 1.7%. Chinese blue chips (.CSI300), opens new tab added 0.1%, with a rise in the Caixin/S&P manufacturing PMI to 50.8 in February from 50.1 lending support.
S&P 500 futures and Nasdaq futures were both up 0.2%. They staged a late rally on Friday after a week of heavy losses.
EUROSTOXX 50 futures firmed 0.7%, while DAX futures rose 0.8%. FTSE futures , meanwhile, gained 0.6%.
Investors seemed encouraged that European leaders agreed to draw up a Ukraine peace plan to take to the United States, following President Volodymyr Zelenskiy’s clash with Trump in the Oval Office.
Worries about the health of the U.S. economy resurfaced after a string of soft data that had seen the closely watched Atlanta Fed GDPNow tracker swing to an annualised -1.5%, from +2.3%, sparking talk of a possible recession.
Those fears were fanned on Sunday when U.S. Commerce Secretary Howard Lutnick said tariffs on Canada and Mexico will go into effect on Tuesday, but that Trump would determine whether to stick with the planned 25% level.
An extra 10% levy on Chinese imports is also due to come into effect this week, just as the country’s National People’s Congress opens its third annual session on Wednesday where stimulus measures and possible reprisals against the U.S. could be announced.
“As with other Trump tariff announcements so far, it’s hard to know if this is a bluff or a genuine turn in policy,” said JPMorgan economist Michael Feroli.
“However, if it were to be realised it would create a significant new headwind to economic activity, as well as an upside support to consumer prices.”
PAYROLLS LOOM
All of this raises the stakes for the January U.S. payrolls report due on Friday, where a weak outcome would fuel market bets the Federal Reserve might have to cut interest rates three times this year.
Fed fund futures now imply 69 basis points of easing by December, compared with 46 basis points a week ago. Yields on 10-year
Treasuries extended their rally with a drop to 4.2290%, leaving them down 35 basis points in February, the largest monthly decline since late 2023.
Fed Chair Jerome Powell is due to speak on the economic outlook on Friday, just a few hours after the jobs report, and at least seven other officials will appear this week.
Across the Atlantic, the European Central Bank is widely expected to cut its rates by 25 basis points to 2.50% on Thursday following a run of weak data, and a move under 2% is expected by year-end.
In currency markets, the euro edged up 0.4% to $1.0414 on hopes for progress in a Russian-Ukrainian peace deal, after having dropped as low as $1.0360 on Friday.
The dollar eased back to 1.4443 Canadian dollars , after rising 1.7% last week, and dipped to 20.4586 Mexican pesos .
It eased a touch on the Japanese yen to 150.38 yen , while the dollar index was down slightly at 107.24.
Gold prices firmed 0.2% to $2,864 an ounce , having dropped around 3% last week.
Oil bounced a little, having slid last week amid speculation the U.S. could ease sanctions on Russian output, while the risk of a global trade war could hit demand for energy.
Brent futures rose 0.4% to $73.07 a barrel, while U.S. crude futures also added 0.4% to $70.04 per barrel.
Since they began just over a month ago, the twists and turns of the federal employee firings have been hard to keep straight.
Guided by billionaire Elon Musk and his Department Of Government Efficiency aides, President Donald Trump has spent his first five weeks focused on dismantling the federal government, including shutting down the United States Agency for International Development and taking steps to do the same to the Consumer Financial Protection Bureau. Trump has also discussed trying to eliminate the Department of Education.
After a buyout offer was accepted by fewer federal employees than expected, tens of thousands of federal workers on probation have already been laid off. These probationary workers include employees in their first year or two on the job, people who have recently moved between federal agencies and people who were recently promoted.
The firings have affected all 50 states and include employees at agencies that Americans frequently interact with including the National Park Service, U.S. Department of Agriculture, Veterans Affairs, Internal Revenue Service, National Institutes of Health and many others. And they have continued as the weeks pass.
The White House has not responded to repeated requests from USA TODAY for a precise number of fired employees. The firings are expected to shift next month to include workers not in a probationary period.
Jan. 20: Trump signs executive order changing job classifications
Among his first actions as president, Trump signed an executive order that revives a policy from the final days of his first administration known as Schedule F. The directive creates a new employment classification for tens of thousands of nonpartisan career civil servants, effectively stripping them of job protections by reclassifying them as at-will positions, meaning they can be dismissed for nearly any reason.
A separate executive order froze hiring of federal civilian employees in the executive branch. It states that any federal civilian position vacant when Trump took office may not be filled, and no new position may be created with rare exceptions.
Jan. 28: Buyout offer made to federal employees
Trump’s administration offered buyouts to nearly all 2.3 million federal employees. The offer came in a surprise email that hit inboxes at 6:04 p.m. on Jan. 28 with the subject line: “The Fork in the Road.”
In the email the U.S. Office of Personnel Management offered all federal employees eight months of pay and benefits through September if they resigned by Feb. 6. Unions warned workers considering Trump’s offer that there is no guarantee the president can or will stick to it because Congress hasn’t approved funding for federal agencies past March 14.
Jan. 29: Union sues over reclassifying federal employees
Unions representing federal employees sued the Trump administration to block the schedule F executive order, alleging that it aimed to politicize the federal government by stripping federal workers of job protections.
Feb. 4: USAID employees placed on administrative leave
About 10,000 employees of the United States Agency for International Development ‒ two-thirds of whom work overseas across 60 countries ‒ were notified that they will be placed on administrative leave at the end of the week as part of Trump’s move to dismantle the foreign aid agency.
Feb. 5: Government warns of furloughs
The Trump administration warned federal employees that they could be furloughed if they did not accept the buyout offer, according to an email obtained by USA TODAY.
The email warned employees that many will be stripped of civil-service protections and suggested there may be loyalty tests for those who remain.
Feb. 6: Boston judge temporarily halts deadline to accept buyout offer
U.S. District Judge George O’Toole issued a temporary restraining order pausing the Trump administration’s deadline to accept the buyout in order to allow time for labor unions to challenge the plan’s legality. The American Federation of Government Employees and two other unions filed the lawsuit arguing that the administration lacks any statutory basis for the “unprecedented offer.”
The Trump administration’s lawyers had argued that extending the deadline on the very last day would “markedly disrupt the expectations of the federal workforce, inject tremendous uncertainty into a program that scores of federal employees have already availed themselves of, and hinder the administration’s efforts to reform the federal workforce.”
Also on Feb. 6, the administration ordered all federal department and agency heads to produce lists of their lowest-performing employees.
The order from OPM Acting Director Charles Ezell also asked departments and agencies to identify potential barriers to ensuring “the ability to swiftly terminate poor performing employees who cannot or will not improve.”
Feb. 7: Trump fires head of the federal agency dedicated to guarding the federal workforce from illegal personnel actions
An aide to Trump fired Hampton Dellinger, who leads the Office of the Special Counsel, on the night of Feb. 7 in a one-sentence email. Dellinger sued, arguing that 1978 federal law creating his position states he can only be removed from his job because of inefficiency, neglect of duty, or malfeasance.
Probationary employees largely rely on the Special Counsel to back them when challenging a dismissal through the proper government channels rather than suing.
Feb. 10: Trump fires leaders of two internal boards employees use to protest firings
Within a matter of minutes Trump fired the leaders of two other boards that federal workers can turn to as an avenue to contest their firing. Union challenges to the firings have been rejected because they have not first gone through these boards.
Trump fired Merit Systems Protection Board chair Cathy Harris, just before 11 p.m., leaving the board with two members – Raymond Limon, a Democrat whose term expires Saturday, and Henry Kerner, a Republican. A court temporarily reinstated Harris, whose term doesn’t expire until 2028, after she sued. The Merit Systems Protection Board is tasked with protecting federal workers against partisan politics and illegal employment practices. It cannot operate without a quorum.
Trump also fired the Federal Labor Relations Authority board chair, Susan Grundmann, three and a half minutes before he fired Cathy Harris. The authority handles certain complaints with federal workers’ labor unions.
She’s suing to be reinstated, but for the time being, Trump named Colleen Kiko, a Republican member, as chair, presiding over only one other member, Democrat Anne Wagner.
Also on Feb. 10, a court temporarily reinstated Dellinger, who promptly asked the Merit Systems Protection Board to pause the terminations of six probationary employees at six agencies, and reinstate them while he investigated their cases. The Supreme Court has declined to take up the administration’s case while Dellinger’s challenge goes forward.
Feb. 11: Trump signs executive order to make major cuts to federal work force
Trump signed an executive order Feb. 11 that seeks to significantly reduce the size of the government by instructing heads of federal departments and agencies to undertake plans for “large-scale reductions in force.”
A White House summary of the order said agency heads were ordered to “coordinate and consult with DOGE to shrink the size of the federal workforce and limit hiring to essential positions.”
Under the order, federal agencies aren’t allowed to hire more than one employee for every four employees who depart. It also instructed the U.S. Office of Personnel Management to create new rules to ensure future federal hires are subject to additional conduct standards, such as U.S. citizenship and filing federal tax returns on time.
Feb. 12: Judge allows buyouts to move forward
O’Toole, the Boston-based federal judge, restored Trump’s buyout project, deciding federal employees unions that sued to stop the program lacked standing to bring their challenge and that his court does not have jurisdiction to hear their complaint.
In total, about 75,000 federal employees accepted President Donald Trump’s buyout offer. That equaled about 3.3% of the federal government’s 2.3 million workers, coming in below the White House’s projections that 5% to 10% of the workforce would accept. Congress has not yet approved spending for the next year or said spending for buyouts would be included.
Feb. 13: Thousands of probationary employees are fired across the government
Thousands of recently hired federal workers received notice that they had been fired.
Probationary workers are easier to fire because they lack the bargaining rights that career employees have to appeal their terminations. Firings were government-wide: from the Department of Education and Small Business Administration to the U.S. Environmental Protection Agency, U.S. Forest Service, the Department of Veterans Affairs and the agency that oversees the nation’s fleet of nuclear weapons.
The firings have continued in the weeks since, including more than 880 probationary employees of the National Oceanic and Atmospheric Administration – which forecasts the nation’s weather and protects ocean species – on Thursday.
Feb. 20: Unions sue over firing probationary employees
A coalition of federal employee unions sued the administration, alleging that officials misused the probationary period to eliminate staff and that the Office of Personnel Management directed federal agencies to use a standardized termination notice falsely claiming performance issues in firing tens of thousands of employees.
“OPM, the federal agency charged with implementing this nation’s employment laws, in one fell swoop has perpetrated one of the most massive employment frauds in the history of this country, telling tens of thousands of workers that they are being fired for performance reasons, when they most certainly were not,” the unions argued in court documents.
Feb. 24: Office of Special Counsel says firing of probationary employees was illegal
Dellinger, who leads the Office of the Special Counsel, said firing probationary employees was illegal because it used boilerplate language blaming their performance rather than specific concerns and asked the Merit Systems Protection Board to decide whether to reinstate six employees while he investigates further.
Federal law generally requires 60 days’ notice for a reduction in force (what the federal government calls layoffs) and prohibits probationary employees from being fired for reasons unrelated to performance or conduct.
Feb. 25: Merit Systems Protection Board reinstates some probationary employees
The Merit Systems Protection Board orders six fired federal employees to be rehired at least through April 10, while Dellinger’s office investigates.
“I find that there are reasonable grounds to believe that each of the six agencies engaged in a prohibited personnel practice,” stated the order. The Office of Special Counsel has said it is considering ways to seek relief for a broader group of federal employees similarly fired in recent weeks.
Feb. 27: California judge blocks firing of probationary employees
Judge William Alsup of the U.S. District Court for the Northern California District temporarily blocked the Trump administration from its mass firing of probationary federal employees.
Alsup said the mass firings were likely unlawful and ordered the Office of Personnel Management to halt the action, saying the agency acted out of bounds by telling other agencies – including the Education Department, the Small Business Administration and the Energy Department – to fire employees.
“OPM does not have any authority whatsoever, under any statute in the history of the universe, to hire or fire any employees, but its own,” Alsup said. The judge did not order the rehiring of anyone who had been terminated.
What is ahead?
The Trump administration has ordered heads of federal departments and agencies to prepare to initiate “large-scale reductions in force” by March 13 as Trump shifts to a more aggressive phase of cutting the federal workforce beyond recently hired or promoted employees.
A memo sent by the Personnel Management and Management and Budget offices has also instructed federal departments to eliminate and consolidate duplicative positions, reduce their property footprints and produce reorganization plans for their agencies.
Cryptocurrencies rallied on Sunday after President Donald Trump announced the creation of a strategic crypto reserve for the United States that will include bitcoin and ether, as well as XRP, Solana’s SOL token and Cardano’s ADA.
“A U.S. Crypto Reserve will elevate this critical industry after years of corrupt attacks by the Biden Administration, which is why my Executive Order on Digital Assets directed the Presidential Working Group to move forward on a Crypto Strategic Reserve that includes XRP, SOL, and ADA,” he said in a post on Truth Social. “I will make sure the U.S. is the Crypto Capital of the World.”
“And, obviously, BTC and ETH, as other valuable Cryptocurrencies, will be at the heart of the Reserve,” he said in a follow-up post. “I also love Bitcoin and Ethereum!”
XRP surged 33% after the announcement while the token tied to Solana jumped 25%. Cardano’s coin soared more than 60%.
Bitcoin rose 10% to $94,343.82, after dipping to a three-month low under $80,000 on Friday. Ether, which has suffered some of the biggest losses in crypto year-to-date, gained 13%.
Trump is hosting the first White House Crypto Summit on Friday, and investors will be watching closely for more clues about the direction of the reserve plans.
This is the first time Trump has specified his support for a crypto “reserve” versus a “stockpile.” While the former assumes actively buying crypto in regular installments, a stockpile would simply not sell any of the crypto currently held by the U.S. government.
China’s factory activity expanded at its fastest pace in three months to 50.8 in February, a private-sector survey showed on Monday, as millions of migrant workers returned to work after an extended Lunar New Year holiday.
The seasonally adjusted Caixin/S&P Global manufacturing purchasing managers’ index beat Reuters poll forecast of 50.3, also accelerating from 50.1 in January and 50.5 last December.
The private-sector manufacturing PMI has stayed above the 50 threshold that separates expansion from contraction since last October.
This private survey reading on Monday followed the official manufacturing PMI released on Saturday, which also showed that China’s February factory activity expanded at its fastest pace since November.
The official PMI rose to 50.2 in February from 49.1 in January, according to the National Bureau of Statistics. The non-manufacturing PMI, which includes services and construction, also climbed to 50.4 from 50.2 in January.
The figures came as economists flagged that fresh U.S. tariffs could pressure the country’s manufacturing activity — which accounted for a quarter of China’s GDP last year — and dent the role of exports as a key driver of growth this year.
In February, new export orders grew at the fastest rate since last April, according to the Monday survey, as “demand strengthened from foreign clients.”
The stronger external demand for Chinese manufactured goods could be due to U.S. importers continuing to front-run tariffs in anticipation of even higher levies, Zichun, Huang, China economist at Capital Economics, said in a note.
U.S. President Donald Trump last week announced to impose additional 10% tariffs on Chinese goods — on top of the 10% he levied on China on Feb. 4. Trump had threated 60% tariffs on China on his campaign trail.
The additional tariffs are scheduled to take effect on March 4, coinciding with a high-profile annual gathering in Beijing where Chinese authorities are expected to unveil economic targets for 2025 and fresh policy support.
While attention is now on potential countermeasures from Beijing, investors also await more government details on a broad stimulus plan to prop up the slowing economy, including ramped-up fiscal spending to boost domestic demand and fend off persistent disinflationary pressures.
Patchy recovery
At the upcoming parliamentary meetings, China’s leadership is expected to acknowledge a significant softening in domestic demand while revealing highly anticipated details on fiscal stimulus aimed at shoring up growth in the face of heightened U.S. trade tensions.
While a combination of fiscal support and “tariff front-running” helped China’s economy regain some momentum in February, the overall growth in this quarter is likely to slow, Capital Economics’ Huang said.
“Unless the leadership unveil greater-than-expected stimulus at the National People’s Congress, it is hard to see how a slowdown can be avoided this year,” Huang said.
Plagued by lackluster domestic consumption, output prices at factories have remained under pressure, particularly consumer and investment goods that experienced sharper price declines, according to the Monday survey.
Squeezing that profit margin further, costs for copper and certain chemical products have edged higher, the survey showed.
Employment in the manufacturing sector also slumped to a near five-year low, as manufacturers continued to prioritize cost reductions, particularly among consumer goods producers.
The Atlanta Fed’s GDP tracker now indicates that the economy is headed for a 1.5% contraction in the first quarter, after showing 2.3% growth just days earlier. That also marks a sharp reversal from the fourth quarter, when GDP expanded by 2.3%. Several economic indicators have been raising alarms as consumers and businesses brace for Trump tariffs and federal job cuts.
The US economy appeared to be on solid footing just a week and a half ago, but that has changed as several indicators are now raising red flags.
The latest and perhaps the most stunning one came on Friday, when the Atlanta Fed’s GDPNow tracker showed the first quarter is on track for a 1.5% contraction. Only nine days earlier on Feb. 19, it was pointing to growth of 2.3%.
That also marks a sharp reversal from the fourth quarter, when the US economy expanded by 2.3%. Such growth had previously reinforced views of so-called American exceptionalism, as the US appeared to stand out among other major global economies like China and Europe that were mired in slowdowns.
The Atlanta Fed attributed the sudden change to fresh data on the US trade deficit, which drags on growth, and weaker consumer spending.
On Friday, the trade balance in goods showed a record $153.3 billion deficit in January as imports soared by $34.6 billion versus a $3.3 billion uptick in exports.
While most of President Donald Trump’s tariffs have not gone into effect yet, consumers and businesses have been loading up on imported goods since the election to get ahead of higher prices. The latest report on durable goods orders, which saw an increase, may also reflect a rush to buy imports early.
Despite the shopping spree on imports, overall demand is weaker. Separate data on Friday showed Americans slashed their spending in January at the fastest pace in four years. Unseasonably cold weather was likely a factor, but Trump’s policies—including plans to drastically cut federal spending and downsize the workforce—also had their fingerprints on it.
“Increased uncertainty surrounding trade, fiscal and regulatory policy is casting a shadow over the outlook,” Lydia Boussour, a senior economist at accounting and consulting firm EY, told the Associated Press.
Other data have also sounded alarms on the economy. Jobless claims were up last week as cuts by DOGE rippled through the labor market, pending home sales hit a record low, and consumer confidence indicators sank on rising fears of tariff-fueled inflation.
In addition, surveys from regional Fed banks found deterioration in the economic outlook as well as plans for capital spending.
To be sure, one quarter of contraction would not constitute a recession. The unofficial rule of thumb is two consecutive quarters, while the National Bureau of Economic Research makes the official ruling on a recession—ofter after the fact.
Economists at JPMorgan lowered their first-quarter growth outlook to 1.5% from 2.25%, adding that weak January activity should be followed by a rebound in February and March.
“For now we are not inclined to hit the panic button,” they said Friday, noting that labor market data aren’t tracking with a shrinking economy.
Apollo Management Chief Economist Torsten Slok said in a note Saturday that the US economy will suffer a “modest stagflationary shock” but won’t slip into a recession.
“In other words, DOGE and tariffs combined are a mild temporary shock to the economy that will put modest upward pressure on inflation and modest downward pressure on GDP,” he wrote.
China’s manufacturing activity expanded at the fastest pace in three months in February as new orders and higher purchase volumes led to a solid rise in production, an official factory survey showed on Saturday.
The reading should reassure officials that fresh stimulus measures launched late last year are helping shore up a patchy recovery in the world’s second-largest economy, ahead of China holding its annual parliamentary meeting starting on March 5.
Whether the upturn can be sustained remains to be seen amid a trade war that was kicked off by U.S. President Donald Trump’s first salvo of punitive tariffs.
The official purchasing managers’ index (PMI) rose to 50.2 in February from 49.1 a month prior, the highest since November and beating analysts’ forecasts in a Reuters poll of 49.9.
The non-manufacturing PMI, which includes services and construction, rose to 50.4 from 50.2 in January.
Chinese policymakers are expected to announce economic targets and fresh policy support next week at the high-profile gathering in Beijing, which investors will also watch for signs of further support for the struggling property sector and indebted local developers.
China’s $18 trillion economy hit the government’s growth target of “around 5%” in 2024, though in an uneven manner, with exports and industrial output far outpacing retail sales while unemployment remained stubbornly high.
Beijing is expected to maintain the same growth target this year, but analysts are uncertain over how quickly policymakers can revive sluggish demand, especially given the intensifying trade tensions with the U.S.
“Since the PMI data is measured on a month-on-month basis, it may be affected by seasonal factors related to the Spring Festival in January and February,” said Zhang Zhiwei, chief economist at Pinpoint Asset Management.
“The manufacturing data is relatively stable,” he added, with the caveat that a more accurate assessment would only be possible after the release of further data. China will release trade data for January-February on March 7.
New export orders, factory gate prices, employment all remained in negative territory last month, the National Bureau of Statistics data showed, but contracted more slowly.
Employment still hit a 22-month high.
TACKLING EXTERNAL SHOCKS
To sustain growth and counter rising external pressures, policymakers have pledged higher fiscal spending, increased debt issuance and further monetary easing.
Top Chinese Communist Party officials met on Friday and vowed to take steps to prevent and resolve any external shocks to China’s economy, state media reported.
The Politburo meeting came a day after Trump said he would slap an extra 10% duty on Chinese goods on March 4, on top of the 10% tariff that he levied on February 4 over the fentanyl opioid crisis, to push Beijing to do more to stop the trafficking of the deadly drug.
That would result in a cumulative 20% tariff, which is still lower than the 60% he threatened on the campaign trail.
China’s commerce ministry said on Friday it hoped to return to negotiations with the United States as soon as possible, warning that failure to do so could trigger retaliation.
Analysts polled by Reuters estimated the private sector Caixin PMI rose 50.3, from 50.1 in January. The data will be released on March 3.
It looks like Armstrong World Industries, Inc. (NYSE:AWI) is about to go ex-dividend in the next 3 days. The ex-dividend date is usually set to be one business day before the record date, which is the cut-off date on which you must be present on the company’s books as a shareholder in order to receive the dividend. The ex-dividend date is important as the process of settlement involves a full business day. So if you miss that date, you would not show up on the company’s books on the record date. In other words, investors can purchase Armstrong World Industries’ shares before the 6th of March in order to be eligible for the dividend, which will be paid on the 20th of March.
The company’s next dividend payment will be US$0.308 per share, on the back of last year when the company paid a total of US$1.23 to shareholders. Based on the last year’s worth of payments, Armstrong World Industries stock has a trailing yield of around 0.8% on the current share price of US$153.66. If you buy this business for its dividend, you should have an idea of whether Armstrong World Industries’s dividend is reliable and sustainable. As a result, readers should always check whether Armstrong World Industries has been able to grow its dividends, or if the dividend might be cut.
Dividends are typically paid out of company income, so if a company pays out more than it earned, its dividend is usually at a higher risk of being cut. Armstrong World Industries is paying out just 19% of its profit after tax, which is comfortably low and leaves plenty of breathing room in the case of adverse events. Yet cash flows are even more important than profits for assessing a dividend, so we need to see if the company generated enough cash to pay its distribution. It distributed 28% of its free cash flow as dividends, a comfortable payout level for most companies.
It’s encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don’t drop precipitously.
Have Earnings And Dividends Been Growing?
Stocks in companies that generate sustainable earnings growth often make the best dividend prospects, as it is easier to lift the dividend when earnings are rising. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. This is why it’s a relief to see Armstrong World Industries earnings per share are up 4.2% per annum over the last five years. Recent growth has not been impressive. Yet there are several ways to grow the dividend, and one of them is simply that the company may choose to pay out more of its earnings as dividends.
Another key way to measure a company’s dividend prospects is by measuring its historical rate of dividend growth. In the past six years, Armstrong World Industries has increased its dividend at approximately 9.9% a year on average. It’s encouraging to see the company lifting dividends while earnings are growing, suggesting at least some corporate interest in rewarding shareholders.
To Sum It Up
From a dividend perspective, should investors buy or avoid Armstrong World Industries? Earnings per share have been growing moderately, and Armstrong World Industries is paying out less than half its earnings and cash flow as dividends, which is an attractive combination as it suggests the company is investing in growth. It might be nice to see earnings growing faster, but Armstrong World Industries is being conservative with its dividend payouts and could still perform reasonably over the long run. Overall we think this is an attractive combination and worthy of further research.
The board of Packaging Corporation of America (NYSE:PKG) has announced that it will pay a dividend of $1.25 per share on the 15th of April. This payment means that the dividend yield will be 2.3%, which is around the industry average.
Packaging Corporation of America’s Payment Could Potentially Have Solid Earnings Coverage
We like a dividend to be consistent over the long term, so checking whether it is sustainable is important. Packaging Corporation of America was earning enough to cover the previous dividend, but it was paying out quite a large proportion of its free cash flows. The company is clearly earning enough to pay this type of dividend, but it is definitely focused on returning cash to shareholders, rather than growing the business.
The next year is set to see EPS grow by 39.5%. If the dividend continues along recent trends, we estimate the payout ratio will be 44%, which is in the range that makes us comfortable with the sustainability of the dividend.
NYSE:PKG Historic Dividend March 2nd 2025
Packaging Corporation of America Has A Solid Track Record
The company has a sustained record of paying dividends with very little fluctuation. The dividend has gone from an annual total of $1.60 in 2015 to the most recent total annual payment of $5.00. This works out to be a compound annual growth rate (CAGR) of approximately 12% a year over that time. We can see that payments have shown some very nice upward momentum without faltering, which provides some reassurance that future payments will also be reliable.
Packaging Corporation of America May Find It Hard To Grow The Dividend
Investors could be attracted to the stock based on the quality of its payment history. However, Packaging Corporation of America has only grown its earnings per share at 4.0% per annum over the past five years. Growth of 4.0% per annum is not particularly high, which might explain why the company is paying out a higher proportion of earnings. This could mean the dividend doesn’t have the growth potential we look for going into the future.
In Summary
Overall, we don’t think this company makes a great dividend stock, even though the dividend wasn’t cut this year. While Packaging Corporation of America is earning enough to cover the dividend, we are generally unimpressed with its future prospects. Overall, we don’t think this company has the makings of a good income stock.
It’s important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. However, there are other things to consider for investors when analysing stock performance. As an example, we’ve identified 1 warning sign for Packaging Corporation of America that you should be aware of before investing. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.
