Why Intertape Polymer Shares Popped

Is this meaningful? Or just another movement?

| More on:

Although we don’t believe in timing the market or panicking over market movements, we do like to keep an eye on big changes — just in case they’re material to our investing thesis.

What: Shares of packaging products company Intertape Polymer Group (TSX: ITP) surged 11% today after its quarterly results and outlook topped Bay Street expectations.

So what: The stock has skyrocketed over the past year on strong bottom line growth, and today’s Q2 results — EPS doubled year over year to $0.30 — coupled with upbeat guidance only reinforce that trend. While revenue slipped 2% over the year-ago period, gross margins increased 350 basis points to 21.8%, suggesting that its product mix, cost structure, and competitive position are all improving despite the slowdown.

Now what: For the current quarter, Intertape expects revenue to be slightly up sequentially and gross margins to keep improving, prompting management to take some shareholder-friendly actions. “The Board’s recent dividend declaration, which is double the previous annualized amount, and its decision to redeem the remaining Notes are supported by the Company’s continued financial improvements and positive outlook,” said President and CEO Greg Yull. Of course, with the stock now up about 130% from its 52-week lows, much of that optimism might already be baked into the valuation. 

Assembling an air-tight portfolio can be a tall order. But every seasoned investor knows this little secret: You can build your portfolio and protect it with high-yielding dividend stocks! Now, which dividend plays are the best, you ask? We found 13 of them …

To help take the guesswork out of dividend investing, The Motley Fool assembled a Special FREE Report, “13 High-Yielding Stocks to Buy Today.” Just click here now to receive a copy at no charge!

The Motley Fool’s purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool Canada’s free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead.

Follow us on Twitter and Facebook for the latest in Foolish investing.

Fool contributor Brian Pacampara does not own shares in any of the companies mentioned at this time.  The Motley Fool does not own shares in any of the companies mentioned at this time.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

More on Investing