I do not own this stock of Pulse Seismic Inc. (TSX-PSD, OTC-PLSDF). I wanted to invest some extra money in a dividend paying small cap. I went to the Globe and Mail site of G&M and from Globe Investor section I selected the Stock Filter. I asked for companies that were priced between $1 and $5.50 and had a yield between 4% and 20%. Pulse Seismic Inc. was one of the companies that were returned. This is not a stock I chose to invest in but I found it of interest so I am following it.
When I was updating my spreadsheet, I noticed a lot of red for Revenue, Earnings and Cash Flow. They also discontinued their quarterly dividend in 2017. The Market seems to expect a recovery because the stock price rose in 2016 and 2017. However, it went down again in 2018, but then the TSX has not done a lot this year.
They did cut their regular dividends in 2017. However, in 2017 they gave a special dividend of $0.20 a share. The company talks about giving a special dividend in 2017 on Globe News Wire due to their strong cash position.
They could not afford their dividends as they were not being covered by earnings. This is probably why they were cut.
The company has no long term debt. They Liquidity Ratio for 2017 was 3.09 with a 5 year median of 3.71. The Debt Ratio for 2017 is 3.72 with5 year median of 4.42. The Leverage and Debt/Equity Ratios for 2017 was 1.37 and 0.37 respectively with 5 year median of 1.52 and 0.52 respectively. They have very good debt ratios.
The Total Return per year is show below for years of 5 to 19. 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 charts below.
They have not done well recently for their shareholders. Since they have cut dividends the only return now is capital gain and that has not been very high in the last 5 and 10 years.
| Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|
| 5 | 0.00% | 6.08% | 3.24% | 2.84% |
| 10 | 0.00% | 4.13% | 1.68% | 2.45% |
| 15 | 0.00% | 11.60% | 6.85% | 4.74% |
| 19 | 16.30% | 11.19% | 5.11% |
The 5 year low, median, and high median Price/Earnings per Share Ratios are -8.42, -12.03 and -15.65. The corresponding 10 year ratios are -2.33, -3.49 and -4.64. The historical ratios are 3.59, 5.06 and 6.36. The current P/E Ratio is 19.77 based on a stock price of $2.57 and 2018 EPS estimate of $0.13. It is obvious that we can do not testing again past ratios as there is too many years with negative earnings. On an absolute basis, a P/E Ratio is 19.77 does not point to a cheap price. A Ratio of 19.77 might point to a reasonable price.
I get a Graham Price of $1.38. The 10 year low, median, and high median Price/Graham Price Ratios are 1.97, 2.50 and 2.94. The current P/GP Ratio is 1.86 based on a stock price of $2.57. This stock price testing suggests that the stock price is relatively cheap. There is that same problem with too many EPS losses.
I get a 10 year median Price/Book Value per Share Ratio of $2.51. The current P/B Ratio is 3.92 based on a Book Value of $33.3M, Book Value per Share of $0.66 and a stock price of $2.57. The current ratio is some 565 higher than the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.
I get an historical median dividend yield of 2.26%. There is no current yield as the company cancelled the dividends. Therefore, we cannot do any stock price testing based on dividend yield.
The 10 year median Price/Sales (Revenue) Ratio is 3.22. The current P/S Ratio is 6.92 based on 2018 Revenue estimate of $20M, Revenue per Share of $0.37 and a stock price of $2.57. The current P/S ratio is some 115% higher than the 10 year ratio. This stock price testing suggests that the stock price is relatively expensive.
When I look at analysts’ recommendations I find one Buy recommendation. This is a small stock so it is not well covered. The 12 months stock price given is $3.30. This implies a total return of 28.40% all from capital gains based on a currently stock price of $2.57.
The company put out a new release for their second quarter of 2018 on Globe News Wire. Ambrose O'Callaghan on Motley Fool expects this stock to do well in the future. See what analysts are saying about this stock on Stock Chase. This is not a well-covered stock and the trading volumes are small.
Pulse Seismic Inc acts as a provider of seismic data to the energy sector in western Canada. It is engaged in the acquisition, marketing, and licensing of 2D and 3D seismic data to the energy sector. Its web site is here Pulse Seismic Inc.
The last stock I wrote about was about was Dorel Industries Inc. (TSX-DII.B, OTC-DIIBF) ... learn more. The next stock I will write about will be TECSYS Inc. (TSX-TCS, OTC-TCYSF) ... learn more on Monday, July 30, 2018 around 5 pm.
This blog is meant for educational purposes only and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
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