Is it a good company at a reasonable price? This does seem to be a good company. They had problems in 2021 when they purchased Handicare Group. See link. Earnings dropped then. Analysts still like this company and feel it has a great future. It will be a very positive sign when the company starts to raise the dividends again. Results of price testing is saying the stock price is reasonable.
I do not own this stock of Savaria Corporation (TSX-SIS, OTC-SISXF). I got this stock off the Dividend Blogger site that no longer exists. I am always interested in dividend growth small cap stock. The first few years of accounting were rather confusing, but I think I figured them out in the end.
When I was updating my spreadsheet, I noticed this stock has been growing quite well, but it is slowing down. In the chart below, I am showing 5 and 10 year total growth and per year growth in columns 3 and 4. Column 5 shows growth expected over 12 months to the first quarter in 2024 and expected growth over the next year.
| Yr | Item | Tot. Gwth | Per Year | Gwth | Coverage |
|---|---|---|---|---|---|
| 5 | Revenue Growth | 192.61% | 23.95% | -0.26% | <-12 mths |
| 5 | AEPS Growth | 47.73% | 8.12% | 9.23% | <-12 mths |
| 5 | Net Income Growth | 114.30% | 16.47% | 13.23% | <-12 mths |
| 5 | Cash Flow Growth | 218.06% | 26.04% | 3.65% | <-12 mths |
| 5 | Dividend Growth | 38.56% | 6.74% | 0.00% | <-12 mths |
| 5 | Stock Price Growth | 16.16% | 3.04% | 24.19% | <-12 mths |
| 10 | Revenue Growth | 1005.05% | 27.16% | 4.52% | <-this year |
| 10 | AEPS Growth | 182.61% | 10.95% | 29.23% | <-this year |
| 10 | Net Income Growth | 614.12% | 21.72% | 16.01% | <-this year |
| 10 | Cash Flow Growth | 1028.11% | 27.42% | 30.84% | <-this year |
| 10 | Dividend Growth | 549.50% | 20.58% | 0.08% | <-this year |
| 10 | Stock Price Growth | 414.24% | 17.79% | 24.19% | <-this year |
If you had invested in this company in December 2013, for $1,000.05 you would have bought 339 shares at $2.95 per share. In December 2023, after 10 years you would have received $1,250.74 in dividends. The stock would be worth $5,142.63. Your total return would have been $6,393.37. This would be a total return of 25.58% per year with 17.79% from capital gain and 5.79% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $2.95 | $1,000.05 | 339 | 10 | $1,250.74 | $5,142.63 | $6,393.37 |
The current dividend yield is moderate with dividend growth low and currently pausing. The current dividend yield is moderate (2% to 4% ranges) at 2.72%. The 5, 10 and historical median dividend yields are also moderate at 3.32%, 3.26% and 3.50%. The dividend growth over the past 5 years is low (below 8% per year) at 6.7% per year. The last dividend increase was in 2022 and it was for 3.8%. Dividends are paid monthly
The Dividend Payout Ratios (DPR) could improve. The DPR for 2023 for Earnings per Share (EPS) is too high at 91% with 5 year coverage at 102%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is find at 80% with 5 year coverage too high at 91%. The DPR for 2023 for Cash Flow per Share (CFPS) is good at 30% with 5 year coverage at 35%. The DPR for 2023 for Free Cash Flow (FCF) is too high at 58% with 5 year coverage at 59%.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 91.16% | 101.89% |
| AEPS | 79.94% | 91.00% |
| CFPS | 29.77% | 34.58% |
| FCF | 57.50% | 59.12% |
Debt Ratios are good. The Long Term Debt/Market Cap Ratio for 2023 is good at 0.26 and currently at 0.20. The Liquidity Ratio for 2023 is good at 1.98 and 1.92 currently. The Debt Ratio for 2023 is good at 1.99 and 1.99 currently. The Leverage and Debt/Equity Ratios for 2023 are fine at 2.01 and 1.01 and currently at 2.01 and 1.01.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 0.26 | 0.20 |
| Intang/GW | 0.58 | 0.46 |
| Liquidity | 1.98 | 1.92 |
| Liq. + CF | 2.23 | 2.31 |
| Debt Ratio | 1.99 | 1.99 |
| Leverage | 2.01 | 2.01 |
| D/E Ratio | 1.01 | 1.01 |
The Total Return per year is shown below for years of 5 to 22 to the end of 2023. 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.
| Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|
| 5 | 6.74% | 6.50% | 3.04% | 3.46% |
| 10 | 20.58% | 23.58% | 17.79% | 5.79% |
| 15 | 15.10% | 35.13% | 25.38% | 9.75% |
| 20 | 14.45% | 14.05% | 11.18% | 2.86% |
| 22 | 11.23% | 16.80% | 13.70% | 3.10% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 21.49, 26.08 and 31.04. The corresponding 10 year ratios are 20.84, 25.74 and 32.82. The corresponding historical ratios are 14.44, 19.43 and 23.57. The current P/E Ratio is 26.46 based on a stock price of $18.79 and EPS estimate for 2024 of $0.71. This ratio is between the median and high ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median.
I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Earnings per Share Ratios are 19.45, 23.56 and 28.82. The corresponding 10 year ratios are 19.15, 24.48 and 30.01. The current P/AEPS Ratio is 22.37 based on a stock price of $18.79 and AEPS estimate for 2024 of $0.84. The current ratio is between the low and median ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get a Graham Price of $12.11. The 10-year low, median, and high median Price/Graham Price Ratios are 1.28, 1.63 and 1.98. The current ratio is 1.55 based on a stock price of $18.79. The current ratio is between the low and median ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get a 10-year median Price/Book Value per Share Ratio of 2.86. The current P/B Ratio is 2.42 based on a stock price of $18.79, Book Value of $550.5M, and Book Value per Share of $7.76. The current ratio is 15% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get a 10-year median Price/Cash Flow per Share Ratio of 15.36. The current P/CF Ratio is 12.96 based on a stock price of $18.79, Cash Flow per Share estimate for 2024 of $1.45 and Cash Flow of $102.9M. The current ratio is 16% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get an historical median dividend yield of 3.50%. The current dividend yield is 2.77% based on dividends of $0.5196 and a stock price of $18.79. The current dividend yield is 21% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive.
I get a 10 year median dividend yield of 3.26%. The current dividend yield is 2.77% based on dividends of $0.5196 and a stock price of $18.79. The current dividend yield is 15% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.
The 10-year median Price/Sales (Revenue) Ratio is 1.76. The current P/S Ratio is 1.52 based on a stock price of $18.79, Revenue estimate for 2024 of $875M and Revenue per Share of $12.33. The current ratio is 13% 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 reasonable. The 10 year dividend yield test says the stock price is reasonable, but above the median. This is because the company has not increased their dividends since 2022. This is this also the point. They are not doing well currently if they cannot afford to increase their dividends. Analysts do not expect a dividend raise in the near future. The P/S Ratio test says the stock price is reasonable. Most of the rest of the testing is saying the stock price is reasonable and above and below the median.
When I look at analysts’ recommendations, I find Strong Buy (1), and Buy (5). The consensus would be a Buy. The 12 month stock price consensus is $22.75 with a high of $24.00 and a low of $21.00. The consensus price of $22.75 implies a total return of 23.84% with 21.08% from capital gains and 2.27% from dividend based on a current stock price of $18.79.
There are two entries on Stock Chase for 2024, and they are both buys. Stock Chase gives this stock 4 stars out of 5. Rajiv Nanjapla on Motley Fool thinks this will be a top performing stock over the next 20 years. Kay Ng on Motley Fool believe this stock will benefit from an aging population. The company put out a Press Release about their fourth quarter of 2023. The company put out a Press Release on their first quarter of 2024.
Simply Wall Street via Yahoo Finance talks about this stock and its dividends. They have two warnings out on this stock of significant insider selling over the past 3 months; and shareholders have been diluted in the past year. I noticed over the past year for officers and directors I follow that the CEO and Chairman has bought stock over the past year, but two directors have sold some stock. Other have not changed the number of shares owned. Simply Wall Street gives this stock 4 stars out of 5.
Savaria Corp designs, engineers, and manufactures products for personal mobility. Its products include home elevators, wheelchair lifts, commercial elevators, ceiling lifts, stairlifts, and van conversions. Its web site is here Savaria Corporation.
The last stock I wrote about was about was TECSYS Inc (TSX-TCS, OTC-TCYSF) ... learn more. The next stock I will write about will be Ballard Power Systems Inc (TSX-BLDP, NASDAQ-BLDP) ... learn more on Friday, July 26, 2024 around 5 pm. Tomorrow on my other blog I will write about Smart Investing 2.... learn more on Thursday, July 25, 2024 around 5 pm.
This blog is meant for educational purposes only and is not to provide investment advice. I am not a licensed professional investment advisor. 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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Also, on my book blog I have put a review of the book Persians by Lloyd Llewellyn-Jones learn more...
1922 be 2022: "This is because the company has not increased their dividends since 1922."
ReplyDeleteYou are right and I will fix the notes.
ReplyDelete