Is it a good company at a reasonable price? I do not know why analysts think that this stock will go up over the next 12 months by some 48% because, although Revenue is expected to rise by just under 6%, Earnings are expected to go down with AEPS and EPS down by 32%. The stock price is down by some 63% over the past 4 years. It is no longer a dividend growth stock as dividends have been flat for the last 7 years. It is not a stock I am interested in. However, it is cheap.
I do not own this stock of Richards Packaging Income Fund (TSX-RPI.UN, OTC-RPKIF). A member of one of my investment clubs suggested this stock.
When I was updating my spreadsheet, I noticed that this is a stock that is not well followed. For example, there is no entry for it on WSJ. This is the place I generally get my stock prices from. I notice that although the Revenue went up year to date, but by only around 5%, their administration costs went up over 30%. That is why EPS for the third quarter in 2024 was $2.33, but EPS for the third quarter of 2025 is only $1.25.
If you had invested in this company in December 2014, for $1,010.04 you would have bought 51 shares at $13.29 per share. In December 2024, after 10 years you would have received $1,060.77 in dividends. The stock would be worth $2,219.20. Your total return would have been $3,279.97. This would be a total return of 15.47% per year with 8.19% from capital gain and 7.28% from dividends. There have been some special dividend payments lately.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $13.29 | $1,010.04 | 76 | 10 | $1,060.77 | $2,219.20 | $3,279.97 |
The current dividend yield is moderate with dividend growth suspended. The current dividend yield is moderate (2% to 4% ranges) at 4.70%. The 5 and 10 year median dividend yields are also moderate at 2.60% and 3.59%. The historical median dividend yield is good (5% to 6% ranges) at 5.94%. The company started off as an income fund with quite high dividends. The last dividend increase was in 2017.
The Dividend Payout Ratios (DPR) are fine, but could be lower. The DPR for 2024 for Earnings per Share (EPS) is high at 59% with 5 year coverage good at 36%. The DPR for 2024 for Adjusted Earnings per Share (AEPS) is high at 53% with 5 year coverage good at 48%. The DPR for 2024 for Cash Flow per Share (CFPS) is good at 37% with 5 year coverage at 30%. The DPR for 2024 for Free Cash Flow (FCF) is good at 49% with 5 year coverage at 37%. The FCF for 2024 varies from 24.4m to $50M. I am using $46.6M. Analysts expect the DPR for AEPS to moderate next year to the 40% ranges. I prefer DPRs for earnings to be in the 40% ranges or lower.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 59.48% | 35.94% |
| AEPS | 52.66% | 47.83% |
| CFPS | 37.40% | 29.57% |
| FCF | 49.19% | 36.73% |
Debt Ratios are good. The Long Term Debt/Market Cap Ratio for 2024 is good at 0.00 and currently at 0.17. The Liquidity Ratio for 2024 is good at 1.62 and 1.61 currently. The Debt Ratio for 2024 is good at 2.60 and 1.98 currently. The Leverage and Debt/Equity Ratios for 2024 are good at 1.62 and 0.62 and currently fine at 2.02 and 1.02. Note that there was no long term debt in 2024.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 0.00 | 0.17 |
| Intang/GW | 0.45 | 0.64 |
| Liquidity | 1.62 | 1.61 |
| Liq. + CF | 1.82 | 1.72 |
| Debt Ratio | 2.60 | 1.98 |
| Leverage | 1.62 | 2.02 |
| D/E Ratio | 0.62 | 1.02 |
The Total Return per year is shown below for years of 5 to 20 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 | 0.00% | -4.29% | -8.52% | 4.23% |
| 2014 | 10 | 4.21% | 15.47% | 8.19% | 7.28% |
| 2009 | 15 | 10.63% | 18.52% | 9.83% | 8.69% |
| 2004 | 20 | 3.52% | 11.74% | 5.05% | 6.69% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 9.32, 12.05 and 14.26. The corresponding 10 year ratios are 13.34, 15.84 and 16.86. The corresponding historical ratios are 12.76, 15.36 and 17.85. The current ratio is 13.92 based on a stock price of $28.11 and EPS estimate for 2025 of $2.02. 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 also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 9.84, 12.61, 17.85. The corresponding 10 year ratios are 13.87, 16.47, 19.38. The corresponding historical ratios are 13.34, 15.40 and 17.92. The current ratio is 12.95 based on a stock price of $28.11 and AEPS estimate for 2025 of $2.17. The current ratio is below the low ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.
I get a Graham Price of $30.25. The 10-year low, median, and high median Price/Graham Price Ratios are 1.34, 1.57 and 1.82. The current ratio is 0.93 based on a stock price of $28.11. The current ratio is below the low ratios of the 10 year median ratios. 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 3.35. The current P/B Ratio is 1.50 based on a stock price of $28.11, Book Value per Share of 18.75 and a Book Value of $205.355. The current ratio is 55% 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 10.52. The current ratio is 8.16 based on Cash Flow for the last 12 months of $37.7M, Cash Flow per Share of $3.44 and a stock price of $28.11. The current ratio is 22% 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 5.94%. The current dividend yield is 4.70% based on dividends of $1.32 and a stock price of $28.11. The current dividend yield is 21% below 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 3.59%. The current dividend yield is 4.70% based on dividends of $1.32 and a stock price of $28.11. The current dividend yield is 31% above the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively cheap.
The 10-year median Price/Sales (Revenue) Ratio is 1.12. The current P/S Ratio is 0.71 based on Revenue estimate for 2025 of $431.2M, Revenue per Share of $39.36 and a stock price of $28.11. The current ratio is 36% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.
Results of stock price testing is that the stock price is probably cheap. The 10 year median dividend yield test says this and it is more important than the historical dividend yield test. This assessment is confirmed by the P/S Ratio test that says that the stock price is relatively cheap. A number of other tests say the same thing.
When I look at analysts’ recommendations, I find Strong Buy (1) and Buy (1). The consensus would be a Strong Buy. The 12 month stock price consensus is $41.50 with a high of $42.00 and low of $41.00. The stock price consensus of $41.50 implies a total return of 52.23% with 47.63% from capital gains and 4.70% from dividends based on a current stock price of $28.11.
The last entry on Stock Chase was in 2023. It would seem that analysts have lost interest in this stock. This is never a good sign. Amy Legate-Wolfe on Motley Fool says the company has a manageable payout ratio which suggest dividend stability. Aditya Raghunath on Motley Fool thought this company was a quality dividend stock in 2024. The company put out a press release via Newswire about their annual results for 2024. The company put out a press release via Newswire about their third quarter of 2025.
Simply Wall Street via Yahoo Finance reviews this stock. The review is rather negative. Simply Wall Street has two warnings out on this stock of earnings have declined by 1.9% per year over past 5 years; and profit margins (5.3%) are lower than last year (9.1%).
Richards Packaging Income Fund is involved in packaging distribution businesses. The company principally distributes plastic and glass containers and associated closures. It is used in packaging for cosmetics, healthcare, food, beverage, and other products. Majority of revenue is from healthcare. Geographically, it derives a majority of its revenue from Canada. Its web site is here Richards Packaging Income Fund.
The last stock I wrote about was about was Magna International Inc (TSX-MG, NYSE-MGA) ... learn more. The next stock I will write about will be Chartwell Retirement Residences (TSX-CSH.UN, OTC-CWSRF) ... learn more on December 5, 2025 around 5 pm. Tomorrow on my other blog I will write about Something to Buy December 2025.... learn more on December 4, 2025 around 5 pm.
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