Karat Packaging Raises Quarterly Dividend 4.44% to $0.47

Karat Packaging Inc. (NASDAQ: KRT) increased its quarterly dividend to $0.47 per share from $0.45, a 4.44% rise. The dividend has an ex-dividend date of Aug. 21, 2026.

The new rate equates to an annual dividend of $1.88 per share. Based on a share price of $49.87, the forward annual yield is 3.77%. The increase extends Karat Packaging’s record of annual dividend growth to two consecutive years.

Business context

The dividend announcement accompanied Karat Packaging’s second-quarter results. The company reported record quarterly net sales of $136.3 million, up 9.9% from the prior-year period, as higher volume and product mix more than offset lower shipping and logistics revenue. Management attributed the growth to customer demand and faster expansion of the company’s online business, which grew 23.6% year over year. Karat also added four chain accounts during the quarter. Karat Packaging’s second-quarter earnings release

Reported profitability benefited substantially from refunds of tariffs imposed under the International Emergency Economic Powers Act. The company said those refunds reduced cost of goods sold by $25.8 million, making the quarter’s unusually strong reported earnings an imperfect guide to recurring profitability. Excluding that benefit, Karat continued to face higher product, freight and import costs. Karat Packaging’s second-quarter earnings release

Karat Packaging manufactures and distributes disposable foodservice products, including containers, cups, bags, cutlery and specialty beverage supplies. Its operating model combines third-party distribution with selected U.S. manufacturing, while its sourcing strategy emphasizes supplier diversification and flexibility between imported and domestically produced goods. The company reported no borrowings outstanding under its revolving line of credit at the end of the second quarter. Karat Packaging’s second-quarter Form 10-Q

What it means for income investors

The higher payment raises KRT’s indicated annual dividend income to $1.88 per share while preserving a quarterly schedule. The 3.77% forward yield reflects the stated $49.87 share price and will fluctuate as the stock price changes.

Karat carries a dividend safety score of 67 out of 100, corresponding to a B grade. That assessment indicates a generally sound payout profile, while the short two-year growth streak and the quarter’s material tariff-refund benefit remain relevant context when evaluating the durability of future increases.