Should you invest in Acme United Corp?

*This is not financial advice. All content should be considered opinionated. We are not responsible for any of your gains and losses. I am neither a licensed nor a registered financial expert. Please see a financial advisor before making investment decisions.

Acme United Corp (NYSE: ACU) is a supplier of safety products. These safety products are sold at schools, homes, offices, hardware, and industrial markets. The business might look boring on the outside but once you get to know more about the business, you'll soon see the potential.

There are two divisions of Acme United Corp: a first-aid division and a cutting solutions division. In other words, their cutting division is the division where they make specialty knives that are used in an industrial setting. 

For years, Acme United has experienced sales growth for years. 

While the growth might be slower than those in tech or cleaning products, Acme United has continued to grow in two mature industries. With new product offerings and market share gains, Acme United continues to provide its investors with steady growth. 

And for those that are dividend investors, know that the company has a 2.11% dividend (at the time of writing). As for dividend growth, you might want to check this out:

For years, Acme United has been increasing its dividend on a yearly basis. Recently, the company raised its dividend by 9%, which is higher than the inflation rate of ~2%. I know, the dividend increases might look great but without knowing the business model, how could anyone be comfortable with investing in a relatively small and obscure company that continues to increase their dividends? How great is this business? What are their growth catalysts for the future? Are they prone to getting disrupted?

Regarding growth catalysts and disruption, Acme United created an app called SafetyHubb. This app, connected with IoT technology, reminds users to check their cabinets, perform physical inventory, and establish annual budgets. Also, it provides businesses with an OSHA and helps ensure compliance with regulators. Acme United is committed to using technology to make workplaces a whole lot safer.

Furthermore, there are more growth drivers to talk about. For their first-aid business, as more clients use first-aid products, the constant refilling of first-aid supplies is one growth driver for the division. Additionally, the expanded use of their relatively new product, Spill Magic, will boost revenue for their first-aid business. Sales teams are looking to cross-sell their first-aid products among their customer base. And for those looking for a growth via acquisition catalyst, in January of this year, the company acquired First Aid Central, making the first-aid business bigger. 

As for the cutting business, the only growth catalysts it has are the growth of antimicrobial plastics for schools and offices and the release of their unique knives onto the market. 

On a similar note, Acme United is looking to invest more into their eCommerce business. As their online presence grows and investment into their online business ramps up, there's potential for even more sales for the company. 

Overall, Acme United is an intriguing stock that dividend investors and possibly growth investors will learn to love. The first-aid business, while it might be sexy, has a form of being a consumer staple business and a business with recurring revenue as clients look to refill their first-aid kits. Their knives business, while they're unique and high-quality, they do face a lot of intense competition from peers. Plus, there isn't a form of recurring revenue. As the company continues to post-sales growth and increase dividends, this company looks to be a business that many investors might consider into their portfolios. 

In the meantime, do your own research and invest wisely!