Does This Dividend Stock Belong in Your Portfolio?

Hardwoods Distribution (TSX:HDI) is a British Columbia-based company that operates a network of distribution centres in Canada and the United States. It is engaged in the wholesale distribution of hardwood lumber and related sheet goods and specialty products.

Shares of Hardwoods Distribution have climbed 8.2% in 2019 as of close on February 14. The stock hit 52-week lows in late December and has since bounced back with the TSX index. Shares are still down 37% year over year.

The company is set to release its fourth-quarter and full-year results for 2018 in the coming weeks. In the third quarter Hardwoods reported that consolidated sales rose 11.9% year-over-year to $290.4 million with 9% sales growth in its U.S. operations.

Hardwoods has been forced to contend with challenging conditions in the hardwood plywood category, but it expects this to improve going forward. Unfortunately, a solid Q3 was not enough to beat back negative momentum that has started to drive the stock down in early autumn.

The board of directors last announced a dividend of $0.08 per share. This represents a 2.5% yield. The company has achieved dividend-growth for eight consecutive years.

Hardwoods offers decent income and the company has projected that Q4 will produce top line growth in comparison to the same quarter in 2017. The stock is not the attractive buy it was in late 2018, but it is still a good price in comparison to many pricey options on the TSX.