BOSTON - OneSpan Inc. (NASDAQ: NASDAQ:OSPN), a global provider of digital security and e-signature solutions, today announced the initiation of a quarterly cash dividend program, signaling its commitment to enhancing shareholder value. The company, which has seen its stock surge over 68% year-to-date and currently maintains a market capitalization of $686 million, declared an initial quarterly cash dividend of $0.12 per share, payable on February 14, 2025, to shareholders on record as of January 31, 2025.According to InvestingPro data, this marks OneSpan's first-ever dividend program, coming at a time when the company shows strong financial health with more cash than debt on its balance sheet.
Al Nietzel, Chair of the Board at OneSpan, expressed the company's confidence in its growth trajectory and future cash generation capabilities. Nietzel highlighted that the initiation of this dividend program is part of a broader capital allocation strategy, which may include share repurchases, special dividends, organic investments, and targeted mergers and acquisitions. This confidence appears well-founded, as InvestingPro analysis indicates net income is expected to grow this year, with the company maintaining a healthy current ratio of 1.76. However, Nietzel noted that the declaration and payment of future dividends would remain at the discretion of the Board of Directors.
OneSpan is recognized for its security and identity solutions, which include e-signature and digital workflow products designed to secure and facilitate digital transactions. The company boasts a clientele that includes over 60% of the world's top 100 banks and operates in more than 100 countries, processing millions of digital agreements and billions of transactions annually. The company's strong market position is reflected in its impressive gross profit margin of 71% and return on equity of 15%.
The forward-looking statements in the press release, which include expectations about future dividends and capital allocation, are subject to risks and uncertainties. Factors that could affect the company's financial results and capital decisions include market conditions, customer demand, technological changes, competition, and operational challenges, among others. For a deeper understanding of OneSpan's financial health and growth prospects, investors can access comprehensive analysis and additional insights through InvestingPro, which currently shows the stock trading slightly below its Fair Value.
The information presented in this article is based on a press release statement from OneSpan Inc.
In other recent news, OneSpan Inc. has been making significant strides in its financial performance and strategic direction. Rosenblatt recently maintained a Buy rating on OneSpan, raising its price target to $22.00 from the previous figure. The firm attributes this to OneSpan's strong execution and its successful shift towards a subscription-based model, which has been well-received as evidenced by the growing demand for digital agreements.
OneSpan's fiscal year 2024 revenue prediction has been revised, now showing an increase of 2.5%, up from the earlier estimate of 2.3%. Subscription services are expected to contribute 58% to the total revenue, a slight increase from the previous forecast of 57%.
In the third quarter of 2024, OneSpan demonstrated notable growth in its Annual Recurring Revenue (ARR) and subscription revenues, despite a decrease in total revenue primarily due to expected declines in hardware sales. The company's adjusted EBITDA reached $17 million, representing 30% of revenue, and a 9% increase in ARR to $164 million. OneSpan also reported a significant turnaround with a GAAP net income per share of $0.21, compared to a loss in the previous year.
These recent developments indicate OneSpan's successful transition to a subscription-based model and its robust financial performance. The company's focus on growing its partner ecosystem and the anticipated growth in security subscription revenue positions OneSpan for efficient and profitable revenue growth in the future.
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