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Crown Crafts: Improvements Happening, But Caution Required (NASDAQ:CRWS)

Crown Craft (CRWS) came through a screen we ran where the objective was to find dividend-paying companies trading at low valuations. Crown Craft at present is trading with a P/E of 8.7 and is paying a forward dividend of $0.32, which currently equates to a yield of 5.61%. Being well above average, the dividend is a great place to start when researching the company. The reason being that the sustainability of dividend encompasses the income statement, cash flow statement as well as the balance sheet.

Suffice it to say, the holy grail of value investing is to buy companies that are undervalued and which also return plenty of the company’s cash flow to shareholders. We state this because dividends have accounted for almost half of the gains of the S&P 500 over the past century.

In saying this, Crown Craft’s dividend of $0.32 per share has been at this level

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