Quad/Graphics Shares Popped: What You Need to Know

Before you go, we thought you'd like these...
Before you go close icon

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 print-services company Quad/Graphics (NAS: QUAD) were printing up gains for shareholders today as they rose as much as 27% in intraday trading after the company reported fourth-quarter results and raised its dividend.

So what: It's been a pretty miserable year for Quad/Graphics shareholders as they've watched the stock fall from the mid-40s this time last year to the midteens today. While today's jump doesn't nearly heal that wound, it's at least a move in the right direction.

Sales for the quarter fell from the prior year -- from $1.39 billion to $1.31 billion -- but topped the $1.28 billion that Wall Street was expecting. The adjusted EBITDA number that management watches -- which is a cash-flow-type measure -- came in at $197 million, again down from last year, but ahead of what analysts were looking for.

Now what: In an increasingly digital world, it's a tough place for a company focused on print. However, Quad/Graphics told investors that though it's "cautious" about 2012, the business will continue to at least tread water. Excluding sales from its Canadian division, management sees 2012 revenue of $4 billion, which should be somewhere in the same neighborhood as 2011 sales on a similar basis. Meanwhile, the adjusted EBITDA margin at best is expected to hold steady, though it doesn't sound like management expects it to drop drastically if it does fall.

While all of that may seem discouraging, the company feels confident enough about the future that it raised its dividend 25% to $0.25 per share. That will take the stock's dividend yield -- based on the stock price at the time of this writing -- to roughly 6.5%.

Want to keep up to date on Quad/Graphics?Add it to your watchlist.

At the time this article was published Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.Fool contributor Matt Koppenheffer does not have a financial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter @KoppTheFool or Facebook. The Fool's disclosure policy prefers dividends over a sharp stick in the eye.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners