Why Dividend King Dover Fell by Almost 4% Today

One of the most regal of the stock market's few Dividend Kings was looking a bit tarnished on Thursday. Shares of Dover (NYSE: DOV) took a nearly 4% hit during the trading session following the release of the company's latest set of quarterly results. This occurred on a day when the S&P 500 index closed in positive territory, with the indicator rising by 0.2%.

A mixed third quarter

That morning before market open, Dover unveiled third-quarter figures that showed it earned $1.98 billion in revenue, which was 1% higher on a year-over-year basis. Non-GAAP (adjusted) net income rose more sharply, advancing by 4% to $314 million ($2.27 per share).

According to consensus analyst estimates compiled by Zack's, prognosticators tracking the stock were expecting slightly higher revenue of around $1.99 billion. Yet they anticipated that Dover would only book $2.16 in adjusted, per-share net income.

Although top-line growth wasn't very robust, management waxed enthusiastic about the company's performance. CEO Richard Tobin was quoted as saying that this "was broad-based across the majority of the portfolio, more than offsetting near-term headwinds in polymer processing, beverage can-making, and heat exchangers for European heat pumps."

Guidance cut, but still a powerful company

Investors were likely more influenced by Dover's revised full-year guidance than by trailing performance. The company cut its projections for both revenue and profitability. It now believes revenue will rise by 1% to 3% over 2023's tally. Previously, it was guiding for improvement of 3% and 4%.

The new GAAP net income forecast for the year is $10.11 to $10.21 per share, shaking out into adjusted profitability of $8.08 to $8.18 per share. The prior estimate for the former was $10.80 to $10.95.

These adjustments are somewhat discouraging, but Dover remains a strong presence in many of its varied industrial product segments. It's also nearly at the top of the Dividend Kings list, having declared dividend raises for a hard-to-believe 68 years in a row.

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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.