ST. PETERSBURG, Fla. – Superior Group of Companies, Inc. (NASDAQ: SGC), a diversified business providing healthcare apparel, branded products, and contact center services, has launched a new stock repurchase initiative. The company’s Board of Directors has authorized the buyback of up to $10 million of its common stock over the next year.
This new repurchase plan supersedes the previous one, dated May 2, 2019, which allowed for the repurchase of up to 750,000 shares. Under that plan, the company repurchased 92,549 shares. The current plan permits the company to acquire shares through various methods, including open market transactions, privately negotiated deals, block purchases, or under Rule 10b5-1 trading plans. These purchases are subject to market conditions and other considerations, such as stock price and availability.
The timing and volume of repurchases will be contingent on several factors, including market dynamics. The shares bought back under this plan may be reissued for purposes such as employee benefit plans or other corporate uses.
Superior Group of Companies, established in 1920, operates through three segments, each addressing a distinct market. The company prides itself on its commitment to quality, service, and technology, aiming to provide exceptional brand engagement experiences for customers and employees alike. The firm has a strategy focused on enhancing shareholder value through organic growth and strategic acquisitions.
The announcement is based on a press release statement and reflects the company’s ongoing efforts to manage its capital and enhance value for its shareholders.
In other recent news, Superior Group of Companies (SGC) announced its Q2 2024 financial results, showing a 2% revenue increase to $132 million, falling short of expectations due to market and supply chain disruptions.
Despite these challenges, the company’s full-year outlook remains unchanged, projecting revenues between $563 million and $570 million, and earnings per diluted share from $0.73 to $0.79. While the healthcare apparel segment saw a 5% decrease in revenue, the branded products and contact centers segments saw increases of 2% and 9%, respectively.
SGC also reported an improved net leverage ratio to 1.7 times trailing 12-month covenant EBITDA, down from 3.7 times the previous year. The company expects gross margins to remain stable in the high 30s percentage range and is optimistic about a stronger performance in the second half of the year due to seasonality and new customer onboarding in the contact center segment.
These recent developments indicate that despite facing softer market conditions and supply chain delays, SGC remains committed to strategic investments for expanding its market share. The company anticipates a strong third and fourth quarter, driven by seasonality and supply chain recovery. Despite the challenges, SGC shows confidence in its ability to maintain consistent gross margins and achieve strong execution for growth.
InvestingPro Insights
In light of Superior Group of Companies, Inc.’s (NASDAQ: SGC) recent announcement of a new stock repurchase program, a closer look at some key financial metrics and InvestingPro Tips can provide investors with a deeper understanding of the company’s current market position. With a market capitalization of approximately $212.19 million, SGC is navigating the market with a Price/Earnings (P/E) ratio of 17.93, reflecting investor sentiment about its earnings potential.
InvestingPro Tips indicate that SGC has a history of rewarding its shareholders, having raised its dividend for three consecutive years and maintained dividend payments for 48 consecutive years. This consistent return to shareholders is complemented by a strong dividend yield of 4.43% as of the last recorded date. Additionally, two analysts have recently revised their earnings estimates upwards for the upcoming period, suggesting potential optimism about the company’s financial prospects.
From a valuation standpoint, SGC’s P/E Ratio (Adjusted) for the last twelve months as of Q2 2024 stands at 18.97, with a PEG Ratio of just 0.08, indicating that the stock may be undervalued relative to its earnings growth. The company’s solid gross profit margin of 38.8% further underscores its ability to generate earnings efficiently.
Despite recent price volatility, with the stock taking a significant hit over the last week, month, and quarter, the InvestingPro platform offers additional insights that may be of interest to investors. There are currently 11 more InvestingPro Tips available, including analysis on the stock’s liquidity and profitability, which can be accessed to gain a comprehensive view of SGC’s financial health and market performance.
For investors interested in exploring these additional tips and data points, they can visit InvestingPro for a more detailed analysis: https://www.investing.com/pro/SGC.
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