company background image
UG

United-Guardian NasdaqGM:UG Stock Report

Last Price

US$12.32

Market Cap

US$56.6m

7D

-0.6%

1Y

-13.5%

Updated

28 Sep, 2022

Data

Company Financials
UG fundamental analysis
Snowflake Score
Valuation1/6
Future Growth0/6
Past Performance3/6
Financial Health6/6
Dividends3/6

UG Stock Overview

United-Guardian, Inc. manufactures and markets cosmetic ingredients, pharmaceuticals, medical lubricants, and proprietary specialty industrial products in the United States and internationally.

United-Guardian Competitors

Price History & Performance

Summary of all time highs, changes and price drops for United-Guardian
Historical stock prices
Current Share PriceUS$12.32
52 Week HighUS$26.09
52 Week LowUS$11.91
Beta0.30
1 Month Change-18.68%
3 Month Change-17.81%
1 Year Change-13.54%
3 Year Change-33.94%
5 Year Change-40.19%
Change since IPO76.00%

Recent News & Updates

Aug 15

Buying Back Into United-Guardian, Inc.

Since I took my chips off the table a few months back, the shares have lost over 1/3 of their value. This has put the company back on my radar. The company is less profitable, to be sure, but the dividend is reasonably well-supported, and the yield is high. This gives investors time to wait for a turnaround. We're told to "buy when others are fearfully selling." This is easier said than done, and I think United-Guardian is an example of this phenomenon. If you've got a vague inkling that the only reason I write on this platform is to brag publicly, get ready for that inkling to be massively reinforced, because today will see some industrial-grade bragging on my part. I'll try (unsuccessfully) to ignore this annoying little voice in my head yammering something about "pride goeth the fall" or whatever, so I can focus on writing about the latest win. As I pointed out in my latest piece about United-Guardian, Inc. (UG). I had outperformed the S&P 500 slightly over the previous four years, but it was time to take chips off the table. I did that this past April, and since then the shares are down about 36%. So, to drive the point home, in 2018 I was bullish on this stock and rode it to a great return. This past April I sold shares, and they've lost over ⅓ of their value since. I want to revisit this name primarily to brag, obviously, but I think there are some other reasons to revisit the name. Specifically, the company has posted financial results since I last looked at the company, and those deserve commentary. Additionally, a stock trading at $15.50 is much less risky an investment than the same stock trading at $24.50, so it may be worth buying back in at this point. I'm self-aware enough to realise that my writing can be tiresome to many. I spell words properly, and that may bother some of my American audience, with their, uh, "singular" approach to the English language. Worse, I can be a tiresome braggart, as I've already demonstrated above. This may offer some clues about the current state of my social life. Anyway, whatever the reason, I fully understand that you may not want to douse yourself in undiluted "Doyle mojo." For that reason, I offer up a "thesis statement" paragraph in each of my articles. This gives you the highlights of my argument without needing to wade through the swamp that is a full-blown article. You're welcome. Here goes. I'll be buying back into this company this morning because the shares are now sufficiently cheap again. I'm doing this in spite of the recent drop in profitability. I think the dividend is reasonably well covered, and I think the high dividend yield will be supportive of price, suggesting very limited downside from here. That said, even if the shares drop in price from the current level, the dividend will compensate for any losses over time in my view. I like investments where time is your friend, and that is certainly the case here. There you have it. If you continue to read from this point, any resulting nausea that my writing produces is on you. Company Background & Risks In case you're unfamiliar with United-Guardian, I'll do my best to enlighten you. The company operates in four distinct product categories: cosmetic ingredients, pharmaceuticals, medical products, and specialty industrial products, and each of these is marketed slightly differently. In all four categories, the company is focused on R&D activities, as evidenced by the fact that it's been granted 30 patents since its founding in 1942. The R&D efforts in the cosmetic ingredients space have been directed toward formulating "natural" products that are used as components of various cosmetic products that are then included in the formulations produced by marketing partners. The company sells its cosmetic ingredients through 5 marketing partners, the largest of which is Ashland Specialty Ingredients. These partnerships are ideal because partners have much deeper market penetration and reach than the company could achieve. The "cosmetic ingredients" category is the company's largest (~49% of sales) and fastest growing, and it is the group of products that I'm most excited about. In particular, I have high hopes for the Lubrajel suite of products. I think the macro background is quite favourable, because the demand for "natural" products is expected to grow somewhere between a healthy 5.3% and an eye-watering 6.6% pace over the next 8 years. There are two risks that I've been able to identify here. The first of these is the currency. Although fully 80% of sales take place in the United States, the stronger U.S. dollar will inevitably impact sales going forward. The next risk involves the company's ability to obtain raw materials. They have consistently been able to acquire what they needed, even during the height of the pandemic, some materials are now more expensive, and there are now longer lead times for some of them. The rising dollar and increased costs may obviously impact the company's gross profit margin on certain products. Financial Snapshot Relative to the first six months of 2021, the financial performance during the most recent period has obviously been mixed. Revenue during the first six months of the year saw sales up by about 6% compared to 2021, but net income has collapsed, down by ~$981 thousand, or 39%. The reason for this relates to increased costs of sales, operating expenses, and R&D expenses, each up by 19%, 20.3%, and 11.74% respectively. Additionally, the company took an $854 thousand dollar loss on marketable securities. The capital structure also deteriorated fairly significantly relative to the same period in 2021, with total liabilities up by ~15%, and cash down by about 21.5%. While I like making comparisons from one period to the next, it's sometimes troubling because one or both periods may not be representative. For instance, you may remember that there was a global pandemic in 2020-2021 that turned off global economic activity, and thus any comparisons to that period may be fraught with bias. For that reason, I also want to draw a comparison between the most recent period and the first six months of 2019, as the latter period is free of the pernicious effects of the pandemic. When compared to 2019, similar themes emerge. Revenue was higher and net income was lower in 2022, and the capital structure in 2022 was also much weaker. Given the above, I think it's reasonable to suggest that a part of the stock price weakness relates to the drop-off in income. One thing that buoys the stock price, though, is the dividend, and so I want to write briefly about it. If the dividend is reasonably secure, and the valuation is low enough, I'd be very happy to buy back in. The company generated $1.164 million in cash from operations during the first six months of 2022, compared to $2.6 million during the same period in 2021. The reason for the drop obviously relates to a drop in net income, but there are two other factors worth noting. First, the company spent $317.4 thousand on new inventories and spent $231.4 thousand in prepaid taxes. I think these will either add to future cash inflows, or at least reduce future outflows. During the same period, the company spent $1,699.392 on dividends, or about $535,000 more than it generated in cash from operations. It's also relevant that the company has $355 thousand in cash and approximately $6.4 million in marketable securities. Finally, although I moaned about "deterioration" above, I think it's worth noting that "cash and marketable securities" is still over 3x greater than "total liabilities." Thus, I'm reasonably confident that the dividend can be maintained here, and for that reason, I'd be happy to buy back in at the right price. United-Guardian Financials (United-Guardian Investor Relations) The Stock If you read my stuff regularly you know what time it is. It's the time where I turn into a bit of a financial "hall monitor", where I remind everyone that a company is distinct from its stock. The company buys inputs and sells them (ideally) at a profit. In the final analysis, that's all any company is. The stock, on the other hand, is a piece of paper that gets traded around in a public market and is influenced by a great many factors, many of which are only peripherally related to the underlying business. For instance, the stock price is certainly impacted by the company's recent financial performance. It's also impacted by the crowd's ever-changing views about the company's future financial performance. It's also potentially impacted by the changing moods of an influential analyst. Finally, the stock is influenced by the crowd's ever-changing perspectives on the relative merits of "stocks" as an asset class. For these reasons, the stock is a much more volatile thing than the underlying business. While this is tiresome, it is potentially profitable. If we can spot the discrepancies between the crowd's take on a given business, and the assumptions embedded in the price, we can earn a profit. Although I'm very, very sorry to circle back on this point, I bought when the market for these shares became excessively pessimistic years ago, and sold when the market became excessively optimistic. That was a lie. I wasn't at all sorry about reminding you of my success with this one. I really, really hope you forgive me. Anyway, I've found that cheaper stocks offer a higher risk-adjusted return, so I like to buy shares when I consider them to be cheap and eschew them when they get expensive. If you're one of my regular reader-victims you know that I measure the cheapness (or not) of a stock in a few ways, ranging from the simple to the more complex. On the simple side, I look at the ratio of price to some measure of economic value like sales, earnings, free cash flow, and the like. Ideally, I want to see a stock trading at a discount to both its own history and the overall market. In my previous missive, I took profits here because the price to free cash reached 22.5 times. The shares are now about 25% cheaper on that basis per the following: UG data by YCharts While the shares are relatively cheaper, investors are (unsurprisingly) being compensated with a much higher dividend yield, per the following: UG data by YCharts

Shareholder Returns

UGUS Personal ProductsUS Market
7D-0.6%-4.7%-2.0%
1Y-13.5%-26.7%-20.3%

Return vs Industry: UG exceeded the US Personal Products industry which returned -28.1% over the past year.

Return vs Market: UG exceeded the US Market which returned -22.1% over the past year.

Price Volatility

Is UG's price volatile compared to industry and market?
UG volatility
UG Average Weekly Movement6.4%
Personal Products Industry Average Movement9.4%
Market Average Movement6.9%
10% most volatile stocks in US Market15.8%
10% least volatile stocks in US Market2.8%

Stable Share Price: UG is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: UG's weekly volatility (6%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
194223Ken Globushttps://www.u-g.com

United-Guardian, Inc. manufactures and markets cosmetic ingredients, pharmaceuticals, medical lubricants, and proprietary specialty industrial products in the United States and internationally. The company offers cosmetic ingredients, including LUBRAJEL line of water-based moisturizing and lubricating gel formulations; LUBRAJEL NATURAL consisting of natural ingredients for cosmetic use; LUBRAJEL MARINE; LUBRASIL II SB, a special formulation of LUBRAJEL in which silicone oil is incorporated into a LUBRAJEL base; LUBRAJEL II XD; B-122, a powdered lubricant that is used in the manufacture of pressed powders, eyeliners, rouges, and industrial products; KLENSOFT, a surfactant, which is used in shampoos, shower gels, makeup removers, and other cosmetic formulations; and ORCHID COMPLEX, an oil-soluble base for skin creams, lotions, cleansers, and other cosmetics. Its medical lubricants comprise LUBRAJEL RR and RC, which are water-based lubricant gels for urinary catheters; LUBRAJEL MG to lubricate urinary catheters, pre-lubricated enema tips, and other medical devices; LUBRAJEL LC and LUBRAJEL FA that are LUBRAJEL formulations for oral care; and LUBRAJEL FLUID to lubricate water-soluble products.

United-Guardian Fundamentals Summary

How do United-Guardian's earnings and revenue compare to its market cap?
UG fundamental statistics
Market CapUS$56.60m
Earnings (TTM)US$3.68m
Revenue (TTM)US$14.36m

15.4x

P/E Ratio

3.9x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
UG income statement (TTM)
RevenueUS$14.36m
Cost of RevenueUS$6.29m
Gross ProfitUS$8.07m
Other ExpensesUS$4.39m
EarningsUS$3.68m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)0.80
Gross Margin56.18%
Net Profit Margin25.61%
Debt/Equity Ratio0.0%

How did UG perform over the long term?

See historical performance and comparison

Dividends

9.2%

Current Dividend Yield

127%

Payout Ratio
We’ve recently updated our valuation analysis.

Valuation

Is UG undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

1/6

Valuation Score 1/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for UG?

Other financial metrics that can be useful for relative valuation.

UG key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue3.5x
Enterprise Value/EBITDA9.1x
PEG Ration/a

Price to Earnings Ratio vs Peers

How does UG's PE Ratio compare to its peers?

UG PE Ratio vs Peers
The above table shows the PE ratio for UG vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average10.2x
NAII Natural Alternatives International
5.3xn/aUS$57.2m
LFVN LifeVantage
14.7xn/aUS$45.8m
MTEX Mannatech
6.9xn/aUS$43.9m
FTLF FitLife Brands
13.8xn/aUS$74.0m
UG United-Guardian
15.4xn/aUS$56.6m

Price-To-Earnings vs Peers: UG is expensive based on its Price-To-Earnings Ratio (15.4x) compared to the peer average (10.2x).


Price to Earnings Ratio vs Industry

How does UG's PE Ratio compare vs other companies in the US Personal Products Industry?

Price-To-Earnings vs Industry: UG is expensive based on its Price-To-Earnings Ratio (15.4x) compared to the US Personal Products industry average (15.4x)


Price to Earnings Ratio vs Fair Ratio

What is UG's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

UG PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio15.4x
Fair PE Ration/a

Price-To-Earnings vs Fair Ratio: Insufficient data to calculate UG's Price-To-Earnings Fair Ratio for valuation analysis.


Share Price vs Fair Value

What is the Fair Price of UG when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: UG ($12.32) is trading below our estimate of fair value ($14.23)

Significantly Below Fair Value: UG is trading below fair value, but not by a significant amount.


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Insufficient data to show price forecast.


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Future Growth

How is United-Guardian forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


14.8%

Forecasted Household industry annual growth in earnings

In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as United-Guardian has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Discover growth companies

  • Examine United-Guardian's financial health to determine how well-positioned it is against times of financial stress by looking at its level of debt over time and how much cash it has left.

Past Performance

How has United-Guardian performed over the past 5 years?

Past Performance Score

3/6

Past Performance Score 3/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


0.2%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: UG has high quality earnings.

Growing Profit Margin: UG's current net profit margins (25.6%) are lower than last year (32.7%).


Past Earnings Growth Analysis

Earnings Trend: UG's earnings have grown by 0.2% per year over the past 5 years.

Accelerating Growth: UG's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: UG had negative earnings growth (-4.6%) over the past year, making it difficult to compare to the Personal Products industry average (-4.8%).


Return on Equity

High ROE: UG's Return on Equity (38%) is considered high.


Discover strong past performing companies

Financial Health

How is United-Guardian's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: UG's short term assets ($11.1M) exceed its short term liabilities ($2.0M).

Long Term Liabilities: UG's short term assets ($11.1M) exceed its long term liabilities ($31.9K).


Debt to Equity History and Analysis

Debt Level: UG is debt free.

Reducing Debt: UG has not had any debt for past 5 years.

Debt Coverage: UG has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: UG has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


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Dividend

What is United-Guardian current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Cash Flow Coverage


9.17%

Current Dividend Yield

Dividend Yield vs Market

United-Guardian Dividend Yield vs Market
How does United-Guardian dividend yield compare to the market?
SegmentDividend Yield
Company (United-Guardian)9.2%
Market Bottom 25% (US)1.6%
Market Top 25% (US)4.6%
Industry Average (Personal Products)1.3%
Analyst forecast in 3 Years (United-Guardian)n/a

Notable Dividend: UG's dividend (9.17%) is higher than the bottom 25% of dividend payers in the US market (1.67%).

High Dividend: UG's dividend (9.17%) is in the top 25% of dividend payers in the US market (4.69%)


Stability and Growth of Payments

Stable Dividend: UG's dividend payments have been volatile in the past 10 years.

Growing Dividend: UG's dividend payments have increased over the past 10 years.


Earnings Payout to Shareholders

Earnings Coverage: With its high payout ratio (127.4%), UG's dividend payments are not well covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (137.7%), UG's dividend payments are not well covered by cash flows.


Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

5.3yrs

Average management tenure


CEO

Ken Globus (70 yo)

40.67yrs

Tenure

US$405,785

Compensation

Mr. Kenneth H. Globus, also known as Ken, has been the Chairman at United-Guardian, Inc. since September 2009 and its Chief Executive Officer since December 2006. Mr. Globus has been President and General...


CEO Compensation Analysis

Ken Globus's Compensation vs United-Guardian Earnings
How has Ken Globus's remuneration changed compared to United-Guardian's earnings?
DateTotal Comp.SalaryCompany Earnings
Jun 30 2022n/an/a

US$4m

Mar 31 2022n/an/a

US$4m

Dec 31 2021US$406kUS$285k

US$5m

Sep 30 2021n/an/a

US$4m

Jun 30 2021n/an/a

US$4m

Mar 31 2021n/an/a

US$4m

Dec 31 2020US$441kUS$280k

US$3m

Sep 30 2020n/an/a

US$4m

Jun 30 2020n/an/a

US$4m

Mar 31 2020n/an/a

US$4m

Dec 31 2019US$439kUS$276k

US$5m

Sep 30 2019n/an/a

US$4m

Jun 30 2019n/an/a

US$4m

Mar 31 2019n/an/a

US$5m

Dec 31 2018US$422kUS$273k

US$4m

Sep 30 2018n/an/a

US$5m

Jun 30 2018n/an/a

US$5m

Mar 31 2018n/an/a

US$4m

Dec 31 2017US$372kUS$268k

US$4m

Sep 30 2017n/an/a

US$4m

Jun 30 2017n/an/a

US$3m

Mar 31 2017n/an/a

US$3m

Dec 31 2016US$388kUS$262k

US$3m

Sep 30 2016n/an/a

US$2m

Jun 30 2016n/an/a

US$3m

Mar 31 2016n/an/a

US$4m

Dec 31 2015US$393kUS$261k

US$5m

Compensation vs Market: Ken's total compensation ($USD405.79K) is below average for companies of similar size in the US market ($USD784.47K).

Compensation vs Earnings: Ken's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: UG's management team is seasoned and experienced (5.3 years average tenure).


Board Members

Experienced Board: UG's board of directors are seasoned and experienced ( 25.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

What is the ownership structure of UG?
Owner TypeNumber of SharesOwnership Percentage
Institutions1,202,00726.2%
Individual Insiders1,688,68136.8%
General Public1,703,63137.1%

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Top 25 shareholders own 62.75% of the company
OwnershipNameSharesCurrent ValueChange %Portfolio %
28.69%
Kenneth Globus
1,318,053$16.2m0%no data
7.71%
Betsee Parker
354,133$4.4m0%no data
4.94%
Renaissance Technologies LLC
226,763$2.8m0.93%no data
4.06%
GAMCO Investors, Inc.
186,300$2.3m0.27%0.01%
2.85%
The Vanguard Group, Inc.
130,932$1.6m0.81%no data
2.33%
Dimensional Fund Advisors LP
106,956$1.3m-0.37%no data
2.08%
Neuberger Berman Investment Advisers LLC
95,345$1.2m2.15%no data
1.96%
Rodgers Brothers Inc., Asset Management Arm
89,850$1.1m-1.1%0.23%
1.53%
Teton Advisors, LLC
70,511$868.7k0%0.17%
1.15%
Parthenon LLC
53,009$653.1k-24.8%0.11%
0.72%
UBS Asset Management
33,291$410.1k88.54%no data
0.65%
BlackRock, Inc.
29,776$366.8k-5.36%no data
0.49%
Geode Capital Management, LLC
22,514$277.4k127.07%no data
0.48%
Ellsworth Advisors, LLC
22,259$274.2k0%0.11%
0.47%
The Northstar Group, Inc.
21,809$268.7k-0.98%0.08%
0.46%
EAM Investors, LLC
20,939$258.0k0%0.06%
0.44%
United Capital Financial Advisers, LLC
20,070$247.3k0%no data
0.37%
First Manhattan Co.
17,062$210.2k0%no data
0.31%
Heritage Investors Management Corp
14,109$173.8k1.51%0.01%
0.29%
Bridgeway Capital Management, LLC
13,466$165.9k0%no data
0.27%
Arthur Dresner
12,175$150.0k0%no data
0.24%
HighTower Advisors, LLC
11,000$135.5k0%no data
0.12%
Rockefeller & Co. LLC
5,401$66.5k0%no data
0.087%
Lawrence Maietta
4,000$49.3k0%no data
0.072%
U.S. Bancorp Asset Management, Inc.
3,319$40.9k-10.76%no data

Company Information

United-Guardian, Inc.'s employee growth, exchange listings and data sources


Key Information

  • Name: United-Guardian, Inc.
  • Ticker: UG
  • Exchange: NasdaqGM
  • Founded: 1942
  • Industry: Personal Products
  • Sector: Household
  • Implied Market Cap: US$56.602m
  • Shares outstanding: 4.59m
  • Website: https://www.u-g.com

Number of Employees


Location

  • United-Guardian, Inc.
  • 230 Marcus Boulevard
  • PO Box 18050
  • Hauppauge
  • New York
  • 11788
  • United States


Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
UGNasdaqGM (Nasdaq Global Market)YesCommon StockUSUSDJan 1980

Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/09/28 00:00
End of Day Share Price2022/09/28 00:00
Earnings2022/06/30
Annual Earnings2021/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.