Surprising dividend suspension by Hurco
Surprising dividend suspension by Hurco
No dividend after 10 straight years of increases
In a rather surprising move Industrial technology company Hurco (HURC) has announced that it will stop its dividend payments. In a press release dated June 14, 2024 Hurco explains the dividend supension.
Hurco Companies, Inc. has announced the temporary suspension of its regular quarterly cash dividend on common stock. This strategic move aims to bolster financial flexibility, manage market volatility, and strengthen the company's balance sheet.
Greg Volovic, Hurco’s President and CEO, commented, "While this was a difficult decision, temporarily suspending the dividend will benefit our cash flow management and allow us to better allocate capital towards strengthening our balance sheet and investing in core business areas. We are committed to enhancing shareholder value and will consider resuming dividends during profitable periods and when share repurchase opportunities are advantageous."
Earlier in the fiscal year ending October 31, 2024, Hurco paid two quarterly dividends of $0.16 per share. The Board will continue to monitor market conditions and the company's financial health to evaluate the potential for future dividends.
HURCO DIVIDEND STATS (before the cut)
Year increased: 10
5 yr CAGR: +7.8%
Yield: 3.7% (now 0.0%)
YTD stock price: -27%
For now, Hurco remains focused on its core business and research and development initiatives to navigate the current market landscape and deliver long-term shareholder value.
Hurco's dividend action comes after 10 consecutive years of dividend increases. Last year, the dividend rose by 6.7% to a new record of $0.16 per quarter. However, the stock price has been declining for five consecutive years, which was a sign of potential issues. Now, with the dividend proving unsustainable, the stock has dropped an additional 10%.
Disclaimer: The information provided here is for informational purposes only and should not be considered financial advice. Investors should conduct their own research or consult with a financial advisor before making any investment decisions.