Is it a good company at a reasonable price? I still like this company and I plan to hold on to what I have. I have not decided whether or not to buy any more. Analysts certainly have mixed views on this stock. It is a positive to see executives buying more shares. It is certainly off the high it reached 2017. The stock is possibly cheap.
I own this stock of Saputo Inc (TSX-SAP, OTC-SAPIF). This was a stock on Mike Higgs' Canadian Dividend Growth Stock list and on the dividend lists that I followed. I bought this stock first in 2006 for my RRSP account. Because I am now taking money from my RRSP accounts, I have been selling this stock because of the low dividend. I still like this stock so I have been buying it in my TFSA.
When I was updating my spreadsheet, I noticed that all the officers I follow have bought more shares over the past year. This company has a financial year ending March 31 each year, so I am looking at the year ending March 31, 2025.
I bought this stock several times between 2006 and 2020. I have made 15.14% per year on this stock with 11.82% from capital gains and 3.06% from dividends. It pays to buy a stock over a number of years. Some of the stock I bought cost more than the current price, and, of course, some cost less. I also sold some stock when I needed to raise cash.
If you had invested in this company in December 2014, for $1,012.68 you would have bought 29 shares at $34.92 per share. In December 2024, after 10 years you would have received $194.16 in dividends. The stock would be worth $724.71. Your total return would have been $918.87. This would be a total loss of 1.12% per year with 3.32% from capital loss and 2.18% from dividends.
Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
---|---|---|---|---|---|---|
$34.92 | $1,012.68 | 29 | 10 | $194.16 | $724.71 | $918.87 |
The current dividend yield is moderate with dividend growth low. The current dividend yield is moderate (2% to 4% ranges) at 2.79%. The 5 year median dividend yield is moderate at 2.35%. The 10 year and historical median dividend yields are low (below 2%) at 1.83% and 1.67%.
The Dividend Payout Ratios (DPR) are fine. The DPR for 2024 for Earnings per Share (EPS) is non-calculable due to an earning loss with 5 year coverage too high at 93%. The DPR for 2024 for Adjusted Earnings per Share (AEPS) is high at 52% with 5 year coverage good at 47%. Analysts expect the DPR for AEPS to be less than 40% in the future. The DPR for 2024 for Cash Flow per Share (CFPS) is good at 20% with 5 year coverage at 21%. The DPR for 2024 for Free Cash Flow (FCF) is good at 42% with 5 year coverage at 35%. There is no agreement on FCF, but figures are not that far off.
Item | Cur | 5 Years |
---|---|---|
EPS | 0.00% | 93.17% |
AEPS | 51.71% | 46.89% |
CFPS | 19.98% | 20.57% |
FCF | 41.56% | 34.74% |
Debt Ratios are good. The Long Term Debt/Market Cap Ratio for 2024 is good at 0.22 and currently at 0.20. The Liquidity Ratio for 2024 is good at 1.52 and 1.52 currently. The Debt Ratio for 2024 is good at 2.01 and 2.01 currently. The Leverage and Debt/Equity Ratios for 2024 are good at 1.99 and 0.99 and currently at 1.99 and 0.99.
Type | Year End | Ratio Curr |
---|---|---|
Lg Term R | 0.22 | 0.20 |
Intang/GW | 0.35 | 0.32 |
Liquidity | 1.52 | 1.52 |
Liq. + CF | 1.76 | 1.89 |
Debt Ratio | 2.01 | 2.01 |
Leverage | 1.99 | 1.99 |
D/E Ratio | 0.99 | 0.99 |
The Total Return per year is shown below for years of 5 to 28 to the end of 2024. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
---|---|---|---|---|---|
2019 | 5 | 2.27% | -6.99% | -9.07% | 2.08% |
2013 | 10 | 4.10% | -1.11% | -3.29% | 2.18% |
2008 | 15 | 6.65% | 6.17% | 3.29% | 2.87% |
2003 | 20 | 8.42% | 8.22% | 5.20% | 3.02% |
1998 | 25 | 13.77% | 10.51% | 7.28% | 3.23% |
1996 | 28 | 12.69% | 9.18% | 6.53% | 2.65% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 19.45, 23.56 and 25.11. The corresponding 10 year ratios are 19.48, 23.37, 25.74. The corresponding historical ratios are 16.74, 20.63 and 21.74. The current P/E Ratio is 15.38 based on a stock price of $27.23 and EPS estimate for 2026 of $1.77. The current ratio is below the low ratio of the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.
I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 16.65, 18.70 and 20.75. The corresponding 10 year ratios are 19.37, 22.56 and 24.74. The corresponding historical ratios are 16.82, 20.85 and 23.57. The current P/AEPS Ratio is 15.30 based on a stock price of $27.23 and AEPS estimate for 2026 of $1.78. The current ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.
I get a Graham Price of $25.84. The 10-year low, median, and high median Price/Graham Price Ratios are 1.41, 1.57 and 1.77. The current ratio is 1.05 based on a stock price of $27.23. The current ratio is below the low ratio of the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.
I get a 10-year median Price/Book Value per Share Ratio of 2.38. The current P/B Ratio is 1.63 based on a Book Value of $6,977M, Book Value per Share of $16.68 and a stock price of $27.23. The current ratio is 31% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.
I get a 10-year median Price/Cash Flow per Share Ratio of 15.48. The current ratio is 7.48 based on a stock price of $27.23, Cash Flow per Share estimate for 2026 of $3.64 and Cash Flow of $1,523M. The current ratio is 41% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.
I get an historical median dividend yield of 1.67%. The current dividend yield is 2.79% based on dividends of $0.76 and a stock price of $27.23. The current dividend yield is 67% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap.
I get a 10 year median dividend yield of 1.82%. The current dividend yield is 2.79% based on dividends of $0.76 and a stock price of $27.23. The current dividend yield is 53% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap.
The 10-year median Price/Sales (Revenue) Ratio is 1.06. The current P/S Ratio is 0.96 based on Revenue estimate for 2026 of $19,631M, Revenue per Share of $46.93 and a stock price of $27.23. The current ratio is 18% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.
Results of stock price testing is that the stock price is probably cheap, but could just be reasonable. The dividend yield tests say that the stock price is relatively cheap. However, the P/S Ratio test just says it is reasonable. I went with cheap because all the rest of the testing is saying the stock price is relatively cheap, but the P/S Ratio test could be right and the stock price could just be reasonable.
When I look at analysts’ recommendations, I find Strong Buy (3), Buy (4), Hold (3), and Underperform (1). The consensus would be a Buy with a wide spread of opinions. The 12 month stock price consensus is $29.82 with a high of $35.00 and low of $26.00. The consensus stock price of $29.82 implies a total return of 12.30% with 9.51% from capital gains and 2.79% from dividends based on a current stock price of $27.23.
This stock is not well followed on Stock Chase. However, in 2025 there is one Buy recommendation. Amy Legate-Wolfe Motley Fool says this stock has potential to reward patient investors who act when prices slide. Chris MacDonald on Motley Fool says that this stock is trading near its lower end of its long term band. The company put out a Press Release about their fourth quarter of 2025.
Simply Wall Street via Yahoo Finance reviews this stock and looks at who owns it. Simply Wall Street has two warnings of has a high level of debt; and dividend of 2.73% is not well covered by earnings.
Saputo is a global dairy processor domiciled in Canada with operations in the United States, Europe, and other international markets like Australia and Argentina. Saputo also competes in foodservice and industrials, which houses its ingredients business. Its web site is here Saputo Inc.
The last stock I wrote about was about was Computer Modelling Group Ltd (TSX-CMG, OTC-CMDXF) ... learn more. The next stock I will write about will be Empire Company Ltd (TSX-EMP.A, OTC-EMLAF) ... learn more on Friday, July 4, 2025 around 5 pm. Tomorrow on my other blog I will write about Relationship Fraud.... learn more on Thursday, July 3, 2025 around 5 pm.
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