Does CuriosityStream Stock's 12% Dividend Make It a Buy?
This dividend is simply too big to ignore.
Overview
There are few things more exciting for stock market investors than passive income. And CuriosityStream (NASDAQ: CURI) stands out because it combines a significantly above-average yield of 12.2% with immense growth potential as it seeks to scale up its business model. Let's dig deeper into the pros and cons of this tiny video streamer to decide if the sky-high dividend payout makes the stock a buy.
Hindsight is 20/20. And looking back over the last few years, it is clear that many stocks that went public through special purpose acquisition companies (SPACs) have sharply underperformed the market because of challenges like lack of business maturity and equity dilution. Curiosity Stream is an excellent example of this phenomenon, with shares down by roughly 72% from its original SPAC unit price of roughly $10.
Details
The company was hit hard by the dramatic drop in investor interest in stay-at-home stocks after the easing of lockdowns and movement restrictions after the COVID-19 pandemic. Since then, management has been trying to engineer a turnaround and convince investors it's worth taking another look. Second-quarter earnings give valuable insights. Revenue grew 22% year over year to $23.2 million, driven mostly by licensing revenue, which jumped 48% to $14.1 million. This segment refers to the money Curiosity Stream gets from allowing other media companies to use its vast library of educational content.
Source
Originally published at www.fool.com.