A High-Yielding Dividend Stock With Earnings on Deck

SpartanNash stock could be just what dividend investors are looking for

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SpartanNash Company (NASDAQ:SPTN) is an American food distributor and grocery store retailer. SPTN's core businesses include distributing food to independent grocers, military commissaries, and chain retail stores in all 50 states, Europe, Latin America, and the Middle East. SpartanNash currently operates 148 supermarkets, primarily under the banners of Family Fare, Martin's Super Markets, D&W Fresh Market, VG's Grocery and Dan's Supermarket. Through its MDV military division, SPTN is also a distributor of grocery products to U.S. military commissaries.

SpartanNash stock currently trades at about the same price it did last year, but the equity is up 30% since bottoming at an annual low of $15.75 last September. Additionally, shares of SPTN have grown 18% year-to-date. However, SpartanNash stock is trading down 8% since reaching an annual high of $22.25 in March.

sptn chart aug 17

SPTN will issue its second quarter of 2021 financial results after the stock market closes on Wednesday, August 18. Over the past four quarterly earnings reports released by SpartanNash, the supermarket giant has outperformed earnings expectations twice. 

For Q2 of 2020, SpartanNash beat analyst estimates by a margin of $0.10, reporting an EPS of $0.73. For Q3 of 2020, SPTN's EPS decreased to $0.70, but the grocery company managed to beat expectations by a margin of $0.08. For Q4 of 2020, SpartanNash announced another decrease in earnings, dropping to $0.43 per share and missing estimates by a margin of $0.02. For Q1 of 2021, SpartanNash reported an EPS of $0.56, meeting expectations on the dot.

As a major point of interest for dividend investors, SpartanNash offers a forward dividend of $0.80, which is equivalent to a dividend yield of 3.98%. SpartanNash stock also has a very attractive price-earnings ratio of 9.21. However, the biggest issue for SPTN is its lack of consistent growth. This is represented in SpartanNash stock’s forward price-earnings ratio of 10.42. Although this figure is still a great value, the forward price-earnings ratio reflects an expected decrease in earnings for the company.

SpartanNash experienced a decline in annual revenues in fiscal 2018 and a significant decrease in net income in fiscal 2019. Nonetheless, SPTN's revenues are up 13% and the company's net income has increased by $132.8 million since fiscal 2017. As a takeaway, it is difficult to imagine SPTN stock depreciating in the coming years, making it a strong option for dividend investors looking to expand their portfolios.

 

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