Dividend stocks are gaining momentum following major technology companies announcing their first-ever dividends this year. Americans are also starting to prefer dividend equities during the current inflation storm and expectations of a higher-for-longer scenario. In this environment affordable stocks that pay high dividends are in the limelight.
We recently covered some of the best high-yield penny dividend stocks to buy according to hedge funds. Ardagh Metal Packaging SA (NYSE:AMBP), being a notable name in the packaging industry, deserves special attention.
Ardagh Metal Packaging SA (NYSE:AMBP)
Number of Hedge Fund Investors: 27
Luxembourg-based Ardagh Metal Packaging SA (NYSE:AMBP) makes beverage cans. The stock’s dividend yield as of May 13 is over 9%.
A total of 27 hedge funds tracked by Insider Monkey had stakes in Ardagh Metal Packaging SA (NYSE:AMBP) as of the end of 2023.
Ardagh Metal Packaging SA (NYSE:AMBP) last month reported Q1 results. Adjusted EPS in the quarter totaled $0.01, meeting estimates. Revenue in the quarter inched up 0.9% year over year to $1.14 billion. However, unlike Johnson & Johnson (NYSE:JNJ), The Procter & Gamble Company (NYSE:PG), and The Coca-Cola Company (NYSE:KO), AMBP is a small company with low hedge fund sentiment.
Photo by Karolina Grabowska: https://www.pexels.com/photo/hands-holding-us-dollar-bills-4968630/
Last month the company talked about its dividend policy and cash flows during its latest earnings call:
So our dividend policy is exactly as it has been. And of course, we just announced the $0.10 per quarter. The Board will determine the policy going forward every quarter, but no anticipation of any change there from our perspective. So flat guidance. I’m obviously not going to cut on three years out at this stage in proceeding. In terms of CapEx, I think your directional is right. So we’ve said that we will definitely have a reduction in growth CapEx next year. Could it be of the order of half what we’re projecting for this year? Yeah, I think that’s not far from being the right ball park.
And then lastly, in terms of cash flow guidance, I think our cash flow guidance is largely unchanged from the guidance we gave in February. And I think I did a relatively comprehensive cash flow walk at that point in time. So we said working capital would be a modest inflow maybe of the order of $40 million to $50 million maintenance CapEx around about $120 million mark, as I’ve said in my remarks. Operating exceptionals 30 to 40 outflow, lease repayments, 90-ish outflow, cash interest paid $200 million outflow something of that order and then cash tax approximately $35 million. So I think those are the moving parts you think got the BGI around about $100 million and the rest is below the free cash flow line.
Is Ardagh Metal Packaging SA (NYSE:AMBP) Really The Best High-Dividend Penny Stock?
Great Ajax Corp (NYSE:AJX) is not the best high-dividend penny stock right now according to Insider Monkey’s research.
Click to see 10 Best High-Dividend Penny Stocks Better Than Ardagh Metal Packaging.
Disclosure: None.
