Cemtrex announces dividend payment in shares for preferred stockholders

Cemtrex Inc. (NASDAQ:CETX), a company specializing in electronic components and accessories with annual revenues of $63.73 million, has declared that it will be compensating its Series 1 Preferred Stock shareholders with additional shares as a dividend. The decision was made by the Board of Directors on Wednesday, March 19, 2025, and the shares are scheduled for distribution on April 7, 2025. Stockholders on record by the close of business on March 31, 2025, will be eligible for the dividend.

The dividend payout is part of the company’s semiannual obligation to its Series 1 Preferred Stock investors, who are entitled to a 10% annual dividend based on the $10.00 per share Preference Amount. This move to pay dividends in the form of additional shares rather than cash is a strategic decision by the company, which operates out of Hauppauge, NY. According to InvestingPro data, Cemtrex carries a significant debt burden of $24.63 million against a market capitalization of just $2.86 million, which may explain the preference for share-based dividends over cash payments.

Cemtrex’s approach aligns with its fiscal policies and reflects a commitment to its preferred shareholders. The payment in shares will potentially allow shareholders to increase their investment in the company without immediate tax implications that generally accompany cash dividends. While the company maintains a current ratio of 1.17, InvestingPro analysis reveals the company is currently operating at a negative EBITDA of $4.98 million. Despite these challenges, InvestingPro’s Fair Value analysis suggests the stock may be undervalued at current levels. For detailed insights and 11 additional ProTips about Cemtrex, investors can access the comprehensive Pro Research Report available on InvestingPro.

Investors and market watchers typically view such dividend payment strategies as a sign of a company’s financial health and its ability to generate sufficient earnings. Paying dividends in shares can also be a way for companies to conserve cash while still fulfilling their dividend commitments.

The information regarding this dividend payout is based on a press release statement provided by Cemtrex Inc. to the Securities and Exchange Commission (SEC). The company is incorporated in Delaware and has its principal executive offices located in New York. Cemtrex Inc. is listed on the Nasdaq Capital Market under the ticker symbol CETX.

In other recent news, Cemtrex Inc. has successfully regained compliance with Nasdaq’s minimum stockholder equity requirement, resolving a non-compliance issue that began in August 2024. The company’s recent Form 10-K filing showed a stockholder’s equity of $4,710,677, exceeding the $2.5 million minimum requirement, which led to Nasdaq’s confirmation of compliance. Additionally, Cemtrex’s subsidiary, Vicon Industries, secured a $1.2 million order for a Texas border security project, which is expected to be fulfilled in fiscal Q2 2025. This order reflects growing demand for Vicon’s security solutions in high-security environments.

In a leadership update, Cemtrex appointed Paul J. Wyckoff as its new Chief Financial Officer. Wyckoff has been with the company since 2014 and served as Interim CFO since January 2022. Meanwhile, Cemtrex faces a potential Nasdaq delisting due to a shortfall in stockholder’s equity, as reported in its financial disclosure for the quarter ending December 31, 2024. The company has until April 7, 2025, to submit a compliance plan to Nasdaq, with a possible extension until August 20, 2025, to meet the requirements.

These developments are crucial for investors monitoring Cemtrex’s financial and regulatory status.

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