Matson Inc. (NYSE:MATX) shares soar significantly by 21% in Monday’s trade. The stock soared on higher volumes, as there was no report to support the today’s rally. MATX stock share volume increased to 828,995 shares, compared to the industry average of 230,096 shares. Matson stock is currently trading around $38 a share, just shy of the 52-week high of $40 a share. Matson shares have the 52-week trading range of $21.63-$40.32.
Its stock bounced back sharply since the second half of 2017. After hitting the 52-week low of $21.63 per share, the stock moved higher in the last five months.
Matson is a holding company, consisting of two segments, ocean transportation, and logistics. The company also provides container stevedoring, container equipment maintenance and other terminal services for MatNav and other ocean carriers.
Matson stock also offers a decent quarterly dividend of $0.20 per share, yielding around 2.50%. Higher dividends always show the company’s potential to generate enough cash flows to pay for dividend payments after fulfilling the capital requirements.
The company’s financial numbers appear strong enough to support the dividends and share price. In the latest quarter, its revenue increased 8.7% to $543 million, compared to the past year quarter. Its EBITDA increased to $96.2 million, higher from $81.3 million in the 3rd Quarter of 2016.
Matt Cox, Matson’s Chairman and Chief Executive Officer, commented, “Matson achieved better-than-expected third quarter results due to stronger demand for our expedited China service, stronger southbound volume in Alaska, the timing of fuel surcharge collections, and higher lift volumes at SSAT.”
In the latest quarter, the company generated operating cash flows of $147 million, while its cash on hand increased by $10.8 million to $24.7 million. The company’s operating cash flows are enough to cover the dividend payments of only $25 million. Thus, Matson’s dividend looks completely safe. Moreover, the stock is trading at attractive valuations considering the lower than industry valuations. Overall, the results for the final quarter of fiscal 2017 will set the tone for future movements.
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