Cemtrex Inc. (NASDAQ:CETX), a technology company specializing in electronic components and accessories, announced today that its Board of Directors has passed a resolution to distribute dividends on Series 1 Preferred Stock in the form of additional shares.
The issuance is set for October 7, 2024, to shareholders on record as of the close of business on September 30, 2024. Series 1 Preferred Stockholders are entitled to an annual dividend rate of 10%, based on the preference amount of $10.00 per share, payable semiannually.
This decision reflects the company's ongoing commitment to deliver value to its shareholders while maintaining a robust capital structure. The preferred stock dividends are a key aspect of Cemtrex's financial strategy, offering a stable return to investors who hold these securities.
Cemtrex, incorporated in Delaware and headquartered in Hauppauge, NY, has been actively expanding its operations and product line, aiming to solidify its position in the highly competitive electronics sector.
The company's choice to pay dividends in the form of additional shares rather than cash could be indicative of a strategy to conserve cash for operational needs and investments.
The information regarding this corporate action is based on a press release statement filed with the Securities and Exchange Commission on September 18, 2024. It is important for investors to note that the value of their investment can go up or down, and past performance is not indicative of future results.
Shareholders of Cemtrex are advised to monitor the company's filings and communications for any further details regarding the dividend issuance and other corporate matters.
In other recent news, Cemtrex, Inc. reported a steady revenue of $14.7 million in the third quarter of 2024, matching the previous year's performance. This stability in revenue comes amidst contrasting fortunes in its business segments, with the Industrial Services segment seeing a 49% increase in revenue, reaching $8.5 million, while the Security segment experienced a 31% decline to $6.2 million due to project delays. This resulted in an operating loss of $3.2 million for the quarter, a significant increase from an operating income of $0.1 million a year ago.
Cemtrex conducted a $10 million upsized underwritten public offering to improve its balance sheet and pay off some debt. Looking forward, the company aims for a full year operating profit, with tight cost controls in place. It also plans to invest in new technologies and marketing to drive future sales in the Security segment.
The firm's Industrial Services segment is poised for a record year of revenue, with potential for over 30% annual growth. The launch of Anavio and other new technologies is expected to contribute to growth in fiscal year 2025.
Despite the contrasting fortunes of its segments, Cemtrex remains focused on strategic initiatives and acquisitions to position itself for future profitability and growth.
InvestingPro Insights
In light of Cemtrex Inc.'s recent announcement on preferred stock dividends, a closer look at the company's financial health and market performance through InvestingPro Insights reveals a mixed picture. Cemtrex operates with a significant debt burden, and analysts anticipate sales growth this year, which could be a positive sign for the company's future revenue streams. However, the company has been quickly burning through cash, as indicated by its negative free cash flow yield, which may explain the decision to issue dividends in the form of additional shares rather than cash.
From a valuation perspective, Cemtrex is trading at a low revenue valuation multiple, with a Price / Book ratio of 13.05 as of the last twelve months leading up to Q3 2024. This could suggest that the stock is undervalued relative to its book value, potentially offering an attractive entry point for value investors. The market cap stands at a modest 2.61M USD, reflecting the company's smaller size in the electronics sector.
Investors should be aware that Cemtrex's stock price has experienced significant volatility, with the price having fallen considerably over various time frames, including the last year and the last three months. These fluctuations underscore the importance of monitoring market trends and the company's financial stability when considering an investment in Cemtrex. For those interested in a deeper dive into the company's metrics, additional InvestingPro Tips are available, providing further insights into Cemtrex's financial standing and market performance.
For a comprehensive analysis and more InvestingPro Tips on Cemtrex, investors can visit https://www.investing.com/pro/CETX, where a total of 15 tips are available to guide investment decisions.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.