The best dividend stocks blend steady income with long-term growth, offering security and wealth-building potential. While market gains build wealth, dividends provide stability, particularly in volatile times, rewarding patient investors with steady cash flow. With the Federal Reserve cut rates three times already in 2024, the appeal of dividend stocks has only grown. In a low-rate world, they offer stability and returns, making them a smart choice for long-term investors.
ACCO Brands (ACCO) is a global supplier of office and consumer products, from notebooks to computer accessories. ACCO also fortifies investor confidence with steady dividends. Despite tumbling double digits over the past year, the stock has returned 5.3% over six months and could double in the future, according to analysts, signaling durability.
Let’s see why ACCO’s dividend proposition makes it a compelling buy for income-focused investors.
About ACCO Brands Stock
ACCO Brands Corporation (ACCO), founded in 1893 and headquartered in Lake Zurich, Illinois, has spent over a century shaping how the world works, learns, and creates. From school notebooks to high-tech gaming accessories, ACCO’s vast portfolio fuels productivity through brands like Mead, Swingline, and Kensington.
Valued at a market cap of $471.8 million, ACCO stock sits 23% below its 52-week high of $6.62, slipping 2.95% in 2025. But after a strong third-quarter earnings report in October, the stock staged an impressive rebound, fueling its gains of 7.5% over the past six months.
From a valuation standpoint, ACCO stock is priced at 4.42 times forward earnings and 0.28 times sales, which is a bargain as it is trading below not just its peers, but its own historical average.
ACCO’s Steady Dividends with Growth Potential
ACCO Brands has quietly built a reputation as a steady dividend payer. On Dec. 11, investors pocketed a quarterly payout of $0.075 per share, backed by the company’s strong cash flow and resilient balance sheet.
With a forward annualized dividend of $0.30 per share, yielding 5.9%, ACCO easily eclipses the SPDR S&P 500 ETF Trust’s (SPY) 1.18% yield. A conservative 23.26% payout ratio ensures room for both shareholder rewards and future expansion. For income-seeking investors, ACCO offers a rare blend of stability and growth potential.
ACCO Rises After Q3 Earnings Release
On Oct. 31, ACCO Brands delivered a Q3 earnings report that turned heads, sending the stock soaring over 22% in the following five sessions. The office supplies giant posted $420.9 million in net sales, narrowly surpassing Wall Street’s estimates, while its adjusted EPS of $0.23 per share met expectations.
Strong cash management fueled a $26 million year-over-year boost in free cash flow (FCF), reaching $87 million by Sept. 30. Meanwhile, total net debt dropped to $812 million, an $83 million improvement from the prior year, while operating cash flow surged to $95.5 million, up from $70.7 million.
Tech accessories, especially in gaming and computing, remained a bright spot for the second consecutive quarter. Indicating an improving balance sheet, ACCO also reduced its leverage ratio to 3.5x and refinanced credit facilities, pushing maturities from 2026 to 2029 for greater financial flexibility.
With a $20 million cost-cutting initiative in full swing, ACCO’s operational efficiency is sharpening. Strength in key product categories, disciplined cash flow management, and strategic refinancing position the company for stability and long-term growth.
ACCO Brands is gearing up for its fiscal 2024 earnings on Thursday, Feb. 20, after the bell. Management anticipates full-year sales to decline between 8% and 9%, while adjusted EPS is expected to be between $1.04 and $1.09. FCF is projected at $130 million, while leverage ratio is expected to shrink to 3.2x by year-end.
Analysts tracking ACCO are bullish, projecting the company’s EPS to surge 78.3% sequentially to $0.41, while sales are estimated to be $455.1 million. For fiscal 2024, profit is expected to be $1.04 per share, with EPS forecast to rise 8.7% annually to $1.13 in fiscal 2025.
What Do Analysts Expect for ACCO Stock?
Wall Street appears optimistic about ACCO’s prospects. The stock has a unanimous “Strong Buy” rating from the two analysts offering recommendations for the stock.
The average analyst price target of $10.83 implies upside potential of 117% from the current price levels. The Street-high target of $13 suggests the stock could rally as much as 160.5%.
ACCO Brands has faced recent declines, but its financial discipline and cost-cutting efforts are strengthening its foundation. With improving cash flow, reduced debt, and a solid dividend, the company continues to reward shareholders. Trading at a cheap valuation, ACCO offers a blend of stability and potential upside - making it a compelling pick for investors seeking value and income in a challenging market.
