Richelieu (TSX:RCH) stock soars as sales grow 20% YoY in Q3. Buy alert?

Highlights

  • Richelieu Hardware Ltd recorded a 20 per cent (C$ 62.1 million) year-over-year (YoY) sales growth which totaled C$ 373.3 million in Q3 2021.
  • After closing at C$ 41.36 on Wednesday, the RCH stock was trading at a value of C$ 43.08 on Thursday morning (11.52 AM EST), up by more than four per cent.
  • The company’s board of directors approved a quarterly dividend payment of C$ 0.07 per share to its shareholders.

The Canadian specialty hardware and complementary products provider Richelieu Hardware Ltd (TSX:RCH) recorded a 20 per cent (C$ 62.1 million) year-over-year (YoY) sales growth which totaled C$ 373.3 million in its latest quarter. Of this increase, internal growth accounted for 14.1 per cent and the remaining 5.9 per cent resulted from acquisitions.

After closing at C$ 41.36 on Wednesday, the RCH stock was trading at a value of C$ 43.08 on Thursday morning (11.52 AM EST), up by more than four per cent.

The Montreal-based company reported a 30 per cent YoY increase to C$ 318.8 million in sales from the manufacturers market in the third quarter of 2021. Sales from hardware retailers and renovation superstores were C$ 54.5 million in Q3 2021, down 18.2 per cent compared to the same quarter of the previous year.

Richelieu Hardware Ltd (TSX:RCH) Q3 FY21 results

The company posted a 21.3 per cent YoY increase to C$ 246.2 million from overall sales operations in Canada in Q3 2021. The sales from the United States also noted a YoY growth of 26.7 per cent to US$ 102.1 million in this quarter.

RCH noted a 35.2 per cent YoY rise in its net earnings attributable to shareholders to C$ 38.7 million, in the latest quarter.

Cash flow from operating activities amounted to C$ 48.6 million in Q3 2021, 27.7 per cent up from the same quarter of the previous year.

Conclusion

On Wednesday, October 6, RCH noted its stocks closing at C$ 41.36 apiece, down by nearly eight per cent from its 52-week high of C$ 46.17 (September 13). Its stock jumped more than 29 per cent on a year-to-date basis and by nearly 27 per cent in the last nine months.

On Thursday, October 7, the company’s board of directors approved a quarterly dividend payment of C$ 0.07 per share to its shareholders who will be on record on October 21, and it will be payable on November 4.

At the time of writing, RCH held a profit-to-earnings ratio of 20.3, a price-to-book ratio of 4.09, a return on equity of 21.64 per cent and a return on assets of 15.74 per cent.

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