Recurring revenues. It’s the name of the game these days for many technology firms. And those firms that have been able to tap into the subscription model have seen plenty of revenue, profit and cash-flow growth. This includes our leading Best Dividend Stocks List pick in the communications sector.
Our firm has been able to pivot from being just a provider of hardware like radios and walkie-talkies to one that uses a hefty dose of analytics, data and mapping software to boost its bottom line. The best part is its client base. Our pick is the leading provider of this mission-critical equipment and software to emergency, law enforcement and even military personal. Because of this, our firm has been blessed with long contract times as well as continued rising defense/emergency services’ spending over the past few years.
For investors, this has directly translated into steady dividend growth and plenty of capital appreciation since selecting our pick back in the beginning of 2017.
See the original article on our pick here.
The real beauty is our pick isn’t done establishing itself as a major player just yet. Smart M&A choices has added even more data and software capabilities to its umbrella, while a new push into surveillance, cybersecurity and even the industrial internet of things (IIoT) applications are starting to pay big benefits. All of this should provide investors with a long runway for additional revenues and cash flows.
In the end, our pick offers plenty of growth and income opportunities for a portfolio.
To summarize, here are five reasons why you should own this stock:
- Total revenues jumped more than 15% to hit a record revenue of more than $7 billion and more than $1.5 billion in operating cash flow in 2018.
- Conducted more than $1 billion in smart M&A transactions to help boost software/services capabilities further last year.
- Higher-margined services and software revenue continue to grow at an impressive pace. Last year, our pick managed to realize a 20% y-o-y sales increase in these areas. Growth came from all regions of the world/operations.
- Steadily increased its dividend since its spinout back in 2011. The latest was another 10% increase at the start of 2019.
- Healthy payout ratio of 35% and yield of 1.56%.
Our Best Dividend Stocks List has 20 of the highest-rated stocks by our proprietary rating system. Go Premium to find out the entire list.