that fell manGranted, Stock (NASDAQ:SBN) is a pretty attractive dividend stock. If I just look at the 3.9% yield that ultimately comes from glasses, I now find the valuation very, very cheap. With a share price of less than 39 euros, the overall valuation is not too expensive either. I see it as moderate.
However, there are still a few things I miss about the Fielmann stock. Today we will address three questions. Not everyone is a game changer for an investment thesis. But it shows that more would be possible.
Fielmann share: Fixed dividend
For me, the Fielmann share is part of my income portfolio. Of course, I know that not all stocks can always pay a solid payout. Still, I would prefer a more consistent yield. In the Corona crash, management announced very, very quickly that distribution would be suspended.
But what does that mean concretely? To put it very positively: that the management of the founder-driven company is willing to sacrifice short-term profit for long-term success. Honestly, this is actually a quality feature that many investors would like to see. The primary concern here is stability and ensuring that payouts and balances remain sustainable.
Nevertheless, the less consistent yield of Fielmann stock also means it’s not a perfect stock for retirement. In the individual years, it will be possible that we will also experience a zero round in the future. A solid compromise for me. Still, there are more stable dividend stocks out there.
A slightly stronger business model
There is no doubt: the Fielmann share’s business model has many qualities. I will be the first to say that vision aids are an ideal compromise between consumables and pharmaceuticals. After all, it is about replacing our vision.
Despite this, glasses are not such a strong product now that it is a lifestyle product for most consumers. We see that with a view to the profit warning. Many consumers tend to either postpone their purchases or to buy at lower prices. Sunglasses have been in demand lately. But its margins are not strong enough to confirm its 2022 earnings target with solid growth.
In this respect, the Fielmann share is a company with a qualitative business model. Especially since this name is big in the optician sector in Europe. But there is not the last. This is also an aspect that I want to criticize.
The Fielmann share: A slightly lower price-earnings
I also like the overall valuation of Fielmann stock. Or: I use them to buy later. A dividend yield of 3.9% and a P/C ratio of around 10 are favorable. But the price-to-earnings ratio is still relatively high at around 20. Although a return to old strength is possible, he would be only slightly below.
Cash flow is perhaps more telling. Especially since it’s still about growth. But I would prefer a clearer buy signal with a P/E ratio of say 12. But the same applies here: You have to take it as it comes.
The article Not the 3.9% Dividend Yield, But: Fielmann Stock has 3 Things I Miss appeared first on The Motley Fool Germany.
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Vincent owns shares in Fielmann. The Motley Fool does not own any of the stocks listed.
Motley Fool Germany 2022