Lanny’s Recent Stock Purchase – Armanino Foods of Distinction, Inc. (AMNF)

Wow!  The market has been busy and I have been trying to stay as active as I can, as there are quite a few things going on outside of blogging, working and family.  I typically buy big, blue chip companies who have that 10, 20 or even 30+ years of consecutively increasing their dividend.  This recently dividend stock purchase may be a little different.  One thing the community may not know is, I am Italian.  Needless to say, I love pesto, pasta, meatballs and cheese.  Here is a smaller company that I purchased, that sells these products!  I will go into the details on how I came across them, how much I purchased and why I ended up purchasing them!  On June 8th, I purchased 500 shares of Armanino Foods of Distinction, Inc. (AMNF)!

The Stock Purchase – Armanino Foods (AMNF)

Now, this all started with Jason Fieber and I’m going to link to his holdings, so you see that this in his portfolio.  He purchased them on a few occasions and ever since then, the company was on my radar.  Why were they on my radar?  Well, their original pesto recipe came from Italy.  Since I am Italian, there was a little bias in my following of the company, after Jason purchased them.  Knowing that the original family emigrated to the U.S., just like my family, was also fun to read about.  Landing in Northern California, they grew and marketed herbs and vegetables.

Officially a corporation in 1986, their primary products are Pesto, Pasta and Meatballs.  What’s not to love?  Net Income from 2015 through 2017 has increased from $4M, to $4.2M and to $5.1M.  Quarter 1’s earnings were $1.3M, which would project to be $5.2M.  Therefore, not only does the stomach expand, but the earnings and financial position is expanding as well.  Further, earnings per share increased and are expected to be over $0.16 per share this year, based on the $0.04 per share in quarter 1.  These results are looking very promising.  However, being a dividend investor, we need to run them through the Dividend Diplomat Stock Screener.

Dividend Diplomat Stock Metrics

Here are the quick dividend stock screener metrics:

  1. Price to Earnings: At $2.57 with a forward earning project of $0.1636, this equated out to a p/e ratio of 15.7.  The ratio is easily in the range that I like to see and shows sign of undervaluation.
  2. Dividend Growth: They recently announced this year a dividend increase of 12.5%, which was definitely better than usual.  The primarily reasons for the strong increase is a combination of a lower tax rate and better overall sales.  Further, the 5 year dividend growth rate is 6.72% and with a yield, seen below, that is a very likable growth rate.  See the Impact of the Dividend Growth Rate.
  3. Dividend Yield: With the $2.57 price point, at a dividend of $0.09, their yield was at 3.50%, well above the S&P 500 (on average) and this yield was greater than my portfolio yield, as well.
  4. Payout Ratio: Based on quarter 1, the forward earnings is expected to be $0.1636.  Therefore, with their dividend of $0.09 per year, this equates to a payout ratio of 55%.  This is definitely within the dividend payout ratio range I like to see.  See why the Payout Ratio is an extremely important metric.

Here is proof of my purchase:

In summary, I purchased 500 shares of Armanino Foods (AMNF) at $2.57 with a $6.95 trading fee for a total cost of $1,291.95.  The 500 shares adds $45.00 to my forward dividend income project.  Further, their dividends are received on “off-months” or January, April, July and October.

Armanino Foods (AMNF) Stock Purchase Summary & Conclusion

Talk about funny, right?  I am sure this is the last stock that one would think I was going to buy.  However, I am very happy with this purchase.  It’s a different addition to my portfolio and one would say, one of the smaller one’s to boot.  The food is great, dividend metrics look rock solid and they are starting to show consecutive dividend growth, as well, as they are 4+ years in their run.  I am happy to add the Italian-based company to my portfolio holdings.

What do you think of Armanino Foods?  Do you like them as a stock?  Do you enjoy Pesto, Meatballs and pasta?  Well, sometimes you have to go with your, “gut”, eh?  I am curious on what you think!  Thanks everyone for stopping by and looking forward to the comments.

-Lanny

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35 thoughts on “Lanny’s Recent Stock Purchase – Armanino Foods of Distinction, Inc. (AMNF)

    • Dutch –

      Yep, Jason from Mr.Free@33 brought them up a long time ago. I am biased in the Italian foods market (haha), but honestly – they have sound metrics with the track record of a solid dividend. Looking forward to the first check!

      -Lanny

    • I was reading the title, and the same exact word popped into my head: Interesting. As Tom mentioned, I’ve also not come across the company, or at least that I recall.

      On your question, Lanny, yes – I love many of the things you highlighted here…both the food and the stock criteria. – Mike

  1. Nice pickup. I watched AMNF for sometime and waited until they had their second facility open before I purchased a position and bought two lots; one at 2.17 and one at 2.20 back in Aug of 2017. Being a micro stock that trades OTC their price is less volatile due to low volumes but it could be a downside when it comes time to sell so I limited my investment to 4K shares.

      • Don’t be too impressed I have 20-25 years on you so I should have some more $$. Its all in my IRA which I rolled over a 401K a couple years back so I had a big lump sum of money to invest from 2016 to 2017.

          • Exactly as you described. It was pretty awesome to convert a lump sum into cash flow. I will say you are light years ahead of where I was at your age and I am very impressed with your energy and focus.

  2. Hi Lanny,

    I also first heard about AMNF from Jason’s site a few years ago. I never wound up pulling the trigger but they do seem like a nice small operator with a quality operation.
    Are you planning to add more shares any time soon?

    Take care,
    Ryan

    • GRB –

      Thanks for the comment. Around July/August, I’ll see my capital position and check their price, to see if a $500 add is what I’ll do. Looking to stay below $2.60 for the time being if I can, on my cost basis!

      -Lanny

  3. Lanny, I don’t know much about this company but damn do I love some Italian food. The metrics sound pretty strong with a nice yield and coverage. Time will tell, but I think you made a good choice on this one.

    • MH –

      Hope you are hungry for some AMNF stock, then! It’s not an entirely HUGE investment, but as I eye them up over the next 4-8 weeks, I’ll see if they warrant additional investment. Should be nice to read their upcoming quarterly earnings.

      -Lanny

  4. Nice purchase – I love buying stock with great fundamentals, but also when I have a good personal connection with them.

    DAL, SBUX and DEO come to mind. These are not just great dividend growth stocks, but I am a regular and mostly enthusiastic customer.

    All the best Lanny!

    • Tall –

      Thank you very much. I agree, and I read quite a bit about them, as well as many financial reports.

      I do love those 3 stocks and own 2 of them, with my fiance owning the other (SBUX)! Keep buying great companies, that you see customers flocking in/out of their stores or drinking/consuming their brands!

      -Lanny

  5. I remember when Jason first mentioned AMNF. Quite honestly, my focus has always been on the bigger well known “name brand” stocks we are all familiar with and this company never even hit my radar screen. I never felt comfortable investing in such small market cap companies but that doesn’t mean there can’t be good value found there. That yield looks nice and seems safe and you make a good case for picking up some shares. I need to look at this more in depth. Thanks for sharing.

    • DH –

      Pumped that you remember! I agree, my main focus has typically been in that area, as well. The yield is solid, their financial metrics appear very intriguing still and I am looking forward to being an owner : ) Also, pumped to see what next earnings release has in store. Thanks again for the comment DH, talk soon!!

      -Lanny

  6. They seem like a solid company, possibly a buyout candidate at some point? I’d look into them more but consumer staples stocks are overweighting my portfolio already. There are so many on sale right now.

  7. Lanny,
    I have to echo what DivHut said up there, I feel much the same way although I look at AMNF and think that they would fit into my portfolio. Nice to see you get a solid dividend bang for your buck, and they do indeed look like they are a promising group.
    – Gremlin

    • Gremlin –

      Thank you for the comment. I would say, that there more likely than not, is a spot in our dividend portfolios for a small company because of how heavy we are in massive dividend aristocrats. Pumped for that first reinvestment.

      -Lanny

    • PiV –

      Appreciate the pump up! The metrics looked damn solid. I just commented below this one, but they are already up 4% since purchase, almost. Agh!! I would like some more… haha

      -Lanny

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