- Market value: $447.9 million
- Dividend yield: 3.2%
Rather than creating the hottest new social app or creativity suites, American Software (AMSWA, $13.79) is a lesser-known IT firm that creates supply chain management and enterprise software solutions. It operates via subsidiaries Logility, Demand Solutions, NGC Software and The Proven Method.
2020 has been an up-and-down year for AMSWA shares, which are off 7% year-to-date.
Still, William Blair sees hope in the company’s recently reported fiscal first-quarter earnings, which saw subscription revenues gain 43% year-over-year to $200,000, and adjusted profits hit 9 cents per share to easily beat estimates.
“With regard to the pipeline, management stated that the total dollar value, number of transactions, and average size of transactions are trending positively and that in the last few weeks, sales activity has increased,” note William Blair’s analysts, which rate AMSWA at Outperform (equivalent of Buy). “In addition, there are more seven-figure deals in the pipeline than ever before.”
AMSWA’s dividend has remained level at 11 cents per share for years, but that currently translates into a 3%-plus yield that puts it on this list of cheap dividend stocks.