Hey there,
I've looked into this one a few times and each time I come away less than enthused. This is what i wrote about it last time (a coupel of months ago)
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It holds a series of trademarks in which it earns royalties on. They consist of Mr. Lube, Air Miles, Sutton, Mr. Mikes, Oxford and Nurse Next Door. The recent acquisition of Oxford and last year's purchase of Nurse Next Door has offset weakness in other names.
WOrth noting that the Nurse Next Door has also seen issues of its own as several Master Licenses and franchise licenses have been terminated due disputes.
It isn't a bad company and generates decent cash flow but the company's dividend coverage ratio is high at 104%. While one might think this was pandemic related, last year it was 108%. This is not a number I'd be comfortable with in terms of deeming the dividend safe.
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It has reported one quarter since that response and in that quarter, it did post a pretty strong rebound quarter in which revenue and distributable cash flow increased by 38.7% and 38.3% respectively. As a result of the strong cash flows it actually increased the dividend by 5%. It is seeing some positive trends now in most of its categories which is a good thing. Most importantly, the payout ratio dropped to 89.8% last quarter, the lowest it has been for a long time. If this is the expectation moving froward, then it is in much better position than it has been in recent years. It is likely what spurred the dividend raise.
Keep in mind however, that this lower payout ratio has more to do with the fact it paid out lower dividends as it cut the dividend from $0.02 to 0.017 last year. The 5% raise brings it to $0.175 so below pre-pandemic levels. Overall, I am now cautiously optimistic on the safety of that dividend given the strong performance upon re-opening. But this is still not a company I'm totally interested in as it still has a spotty history of execution and its charts leaves me with little to be desired.
Mat