Recent Buy: Owens & Minor Inc.

ID-100426334-300x300 Recent Buy: Owens & Minor Inc.I added more shares to my portfolio with the purchase of Owens & Minor Inc. (OMI)

81 shares @ $15.37 on 2/15/2018.

79 shares @ $16.37 on 3/1/2018.

This increases my forward 12-month dividend income by $166.40 to a total of $5,085.98

I also updated my portfolio page to reflect the change.

 

My Thoughts

So this is my third stock purchase of this company in less than a month time frame. I first bought Ownes & Minor on January 26. I bought 54 shares @ $21.95. If I bought a company and it drops 10-15% right after my buy, I will definitely buy more shares.

Nothing in the fundaments has changed since I bought shares. The only thing that has changed has been the market overreacting. Yes, revenue is lower at $9.32 billion vs the prior year of $9.72 billion. Earning has taken a hit as you see from the below FASTGraph picture.

However, with the new tax reform and the current acquisitions, CFRA expects earnings growth of 4% for the next three years. Currently, OMI has a dividend yield of 6.1% which represent only a 64% payout ratio based on last years earning of $1.61.

So mixing in high dividend yield and higher earnings make this company very attractive.

I am currently a full position and do not plan to add any more shares unless there is a significant price drop.

OMI is undervalued, and I recommend it a BUY at this time. I have a fair price of $20.98 which means that OMI is 22.6% undervalued based on today’s price of $16.08 (3-7-2018).

 

Screen-Shot-2018-03-07-at-7.39.00-PM Recent Buy: Owens & Minor Inc.

 

What do you think of the company? Plan on owning it? or why not?

 

Thanks for reading, and don’t forget to connect with me.

Image by Sira Anamwong at FreeDigitalPhotos.net

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Comments

  1. I never looked at OMI before. Thanks for bringing this name to my attention. You don’t really see it in many long term DGI portfolios though that juicy yield does look tempting and seems to be safe based on current cash flow. The stock has seen a pretty serious drop in price as of late. Just a market overreaction??? Thanks for sharing.

    • Hey DivHut, yea OMI is very undervalued and take a look at it. I am sure you will add it to your portfolio. best of luck to you and thanks for stopping by.

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