Q: Please provide an update on Richard's Packaging.
Thanks,
Doug
Thanks,
Doug
5i Research Answer:
RPI had an OK Q1, with revenue increasing, reversing a recent trend. It does have challenges, though, including tariff uncertainty. The stock is cheap at 11X earnings, and the yield of 4.73% is decent. The payout ratio of 45% allows some protection to the dividend and maybe room for an increase. The balance sheet is OK with debt at 1X cash flow. It has shown consistent earnings, even in a weaker 2021 (covid issues). Free cash flow is good. There are risks here, including its small size and some cyclicality. Only one analyst covers the company. Insiders own 29%. It is not exciting, but we would consider it a decent small cap, but largely for income investors.