Friday, June 22, 2018

Computer Modelling Group Ltd

Sound bite for Twitter and StockTwits is: Dividend Paying Tech. Probably the best stock price test for this company is the P/S Ratio which says the price is reasonable and around the median. All the ratios on this stock are quite high but then it is a Tech stock. Debt Ratios are good to see it through tough times. I think that the dividends are too high for their current earnings and cash flow. See my spreadsheet on Computer Modelling Group Ltd.

I own this stock of Computer Modelling Group Ltd. (TSX-CMG, OTC-CMDXF). I bought this company in 2008 because it is a dividend paying growth stock that would also be considered to be a small cap with a capitalization of around $115 million. It has great growth and it is information technology a favourite sector of mine. Because the stock grew rapidly and because it is a tech stock, I sold some shares in 2011 to lock in profit.

This used to be a great company. It provides services to the oil and gas industry and it has really stalled since 2015. It may be a tech company, but they work in the oil and gas industry so this can explain the slow down. This company has a financial reporting date of March 31.

Dividend yields have been moderate. The Current dividend yield is 3.97%, with 5 year, 10 year and historical dividend yields at 3.66%, 3.65 and 3.59%. Until recently dividend growth has been good. The 10 and 13 year dividend growth was at 17% and 26% per year. However, they have not raised dividends since 2015.

Their dividends have been flat since 2015 because they are paying out more than they are earning. The Dividend Payout Ratio for financial year ending in March 2018 is 153% with 5 year coverage at 121%. Analysts do not expect the DPR to be lower than 100% over the next couple of years. They are also paying out a high portion of their cash flow. DPR for CFPS for 2018 was 96% with 5 year coverage at 77%. I prefer this ratio to be 40% or less.

Debt ratios are very good. This is wise when you are in servicing the oil and gas industry. There is no long term debt. The Liquidity Ratio is 2.03 with 5 year median of 2.34. The Debt Ratio is 2.31 with 5 year median at 2.41. Leverage and Debt/Equity Ratios are 1.76 and 0.76 respectively with 5 year median ratios at 1.66 and 0.66.

The Total Return per year is show below for years of 5 to 21. 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.

As you can see from the chart below, this company grew quick rapidly until recently.

Years Div. Gth Tot Ret Cap Gain Div.
5 4.56% 1.82% -2.07% 3.89%
10 17.28% 27.29% 18.45% 8.83%
13-15 25.92% 42.70% 28.82% 13.88%
20 28.99% 22.91% 6.07%
21 20.67% 16.70% 3.97%


The 5 year low, median and high median Price/Earnings per Share Ratios are 20.70, 31.79, and 37.95. The 10 year corresponding ratios are 21.01, 28.93 and 33.96. The corresponding historical ratios are 10.22, 13.48 and 17.22. The current P/E Ratios are 34.72 based on a stock price of $10.07 and 2019 EPS $0.29. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $2.13. The 10 year low, median and high median Price/Graham Price Ratios are 3.02, 4.04 and 4.51. The current P/GP Ratio is 4.74. This stock price testing suggests that the stock price is relatively expensive. These are rather high P/GP Ratios

I get a 10 year median Price/Book Value per Share of 12.53. The current P/B Ratio is 14.54 based on Book Value of $55,564M, Book Value per Share of $14.54 and a stock price of $10.07. The current ratio is some 16% higher than the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median. When a P/B Ratio of 1.50 is a good one, the P/B Ratios on this stock is very high.

I get an historical median dividend yield of 3.59%. The current dividend yield is 3.97% based on dividends of $0.40 and a stock price of $10.07. The current dividend is some 11% above the historical dividend yield. This stock price testing suggests that the stock price is relatively reasonable and above the median.

The 10 year median Price/Sales (Revenue) Ratio is 10.39. The current P/S Ratio is 10.32 based on 2019 Revenue estimate of $78.3M, Revenue per Share of $0.98 and a stock price $10.07. The current ratio is some 0.7% lower than the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and around the median.

When I look at analysts’ recommendations I find Buy (3), Hold (3) and Underperform (2). The consensus would be a Hold. The 12 month consensus stock price is $9.97. This implies a total return of 2.98% with a capital loss of 0.99% and dividends of 3.97% based on a current stock price of $10.07.

The company has announced on Globe News Wire that the current CEO is stepping down this year and being replaced by Ryan Schneider. Gerald Huddleston on Simply Wall Street talks about their high DPR, but the company has never in the past cut their dividends. Lisa Matthews on Registrar Journal says this stock has been downgraded by Industrial Alliance Securities. See what analysts are saying on Stock Chase. It is a company not well covered by analysts. Veronika Hirsch thinks that it is would be a takeout target for Baker-Hughes (NYSE-BHGE).

Computer Modelling Group Ltd functions in the Canadian software industry. It specializes in integrated analysis and optimization, black oil and unconventional simulation, reservoir and production system modelling. Its web site is here Computer Modelling Group Ltd.

The last stock I wrote about was about was CI Financial Corp (TSX-CIX, OTC- CIFAF)... learn more. The next stock I will write about will be Parkland Fuel Corp (TSX-PKI, OTC-PKIUF)... learn more on Monday, June 25, 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.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Wednesday, June 20, 2018

CI Financial Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Financial. My stock testing is showing this stock as cheap. Mutual Fund companies seem to be having a hard time currently. See my spreadsheet on CI Financial Corp.

I do not own this stock of CI Financial Corp (TSX-CIX, OTC-CIFAF). I started to follow this stock originally because it was a Mutual Fund company. People talked about it being easier to make money from buying a Mutual Fund company than buying Mutual Funds. In June 2014, MPL communications called this stock a Buy and advised that they were adding it to their list of Key Stock for the Investment reporter.

The stock hit a high 10 years ago, so you see that the total return for 10 years is low. This is the reason that you should not over pay for a stock, even a good stock. It greatly affects your long term total return.

When they became a Unit Trust in 2006, dividends were significantly increased, but these dividends proved to be unsustainable. They changed back to a corporation in 2009 and dividends were decreased in 2010. Since that time, they have been increasing their dividends since 2011. It is not surprising that the dividends under the income trust are higher as a company can pay out more than their earnings. However, corporations cannot.

Currently the dividends are moderate to good with low to moderate dividend growth. The current dividend yield is good at 5.69% with 5 year median yield moderate at 3.96, 10 year median yield good at 4.14% and the historical median yield moderate at 3.48%.

Some years they do more than one dividend increase but that did not happen last year where the increase was only one and that one was for 2.2%. There has been no increase so far this year. The dividend grow over the past 5 to 22 years is shown below. For the past 5 and 10 years the dividend growth is 8.03% and 1.98% per year. The 10 year growth is very low.

Currently they can afford their dividends. The Dividend Payout Ratios for 2017 for EPS was 74% with 5 year coverage at 69%. The DPR for CFPS for 2017 was high at 63% with 5 year coverage at 54%. I prefer the CFPS coverage to be at 40% or lower.

The Long Term Debt/Market Cap Ratio is very low and therefore good at 0.11. The Liquidity Ratio is low at 0.87. In this case it means that current assets cannot cover current liabilities. If you add in cash flow after dividends it is still very low at 1.10. However, the current portion of long term debt is $222.00 and if you take that out and add in cash flow after dividends the ratio is 1.40. I prefer to see it at 1.50 or higher.

The liquidity Ratio has always been low with 5 year median of 0.90. If you add in cash flow after dividends the 5 year median is better at 1.62. The Debt Ratio is 1.83. A Debt Ratio of 1.50 or higher is good. The Leverage and Debt/Equity Ratio are ok if a little high at 2.21 and 1.21. I would prefer to see these lower.

The Total Return per year is show below for years of 5 to 23. 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.

As you can see in the chart below, Total Return has mostly been good except for the 10 year period.

Years Div. Gth Tot Ret Cap Gain Div.
5 8.03% 8.27% 3.61% 4.65%
10 1.98% 5.49% 0.59% 4.90%
15 23.35% 12.85% 6.33% 6.52%
20 23.66% 21.31% 13.51% 7.81%
23 25.17% 20.81% 14.04% 6.76%


The 5 year low, median and high median Price/Earnings per Share Ratios are 14.80, 16.53 and 18.27. The 10 year corresponding ratios are 14.66, 16.51 and 19.08. The historical corresponding ratios are 15.84, 18.08 and 20.08. The current P/E Ratio is 10.32 based on a stock price of $24.77 and 2018 EPS estimate of $2.40. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $19.21. The 10 year low, median and high median Price/Graham Price Ratios are 1.48, 1.67 and 1.95. The current P/GP Ratio is 1.29. This stock price testing suggests that the stock price is relatively cheap.

I get a 10 year median Price/Book Value per Share of 3.80. The current P/B Ratio is 3.62 based on Book Value of $1,819M, Book Value per Share of $6.84 and a stock price of $14.77. The current ratio is some 4.6% lower than 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 3.48%. The current dividend yield is 5.69% based on dividends of $1.41 and a stock price of $24.77. The current dividend yield is some 64% higher than the historical median. This stock price testing suggests that the stock price is relatively cheap.

The 10 year median Price/Sales (Revenue) Ratio is 4.13. The current P/S Ratio is 2.89 based on 2018 estimates of $2,286M, Revenue per Share of $8.58 and a stock price of $24.77. The current ratio is some 30% lower than the 10 year ratio. This stock price testing suggests that the stock price is relatively cheap.

When I look at analysts’ recommendations I find Strong Buy (1), Buy (3), Hold (4) and Underperform (1). The consensus would be a Hold. The 12 month stock price is $28.67. This implies a total return of 21.44% with 15.74% from capital gains and 5.69% from dividends based on a current stock price of $24.77.

Fisher Staff Writer on Fisher Business News says this company has a Value Composite score of 26. This suggests that stock is neither under or overvalued. A Danvers Record writer on Danvers Record says that the company has a Montier C-score of 4 where 0 says there is no evidence of cooking the books to 6 which indicates a high likelihood of book cooking. Joey Frenette on Motley Fool writes an interesting article in which he says that a ban on trailer fees will really harm this company. See what analysts are saying about this stock on Stock Chase. Some think the company is in a tough business. Most think it will do ok.

CI Financial Corp is a wealth management company that provides financial products and services including mutual funds, exchange traded funds, segregated funds, financial planning, insurance, investment advice, and succession planning. Its web site is here CI Financial Corp.

The last stock I wrote about was about was Algonquin Power & Utilities Corp (TSX-AQN, NTSE-AQN)... learn more. The next stock I will write about will be Computer Modelling Group Ltd. (TSX-CMG, OTC-CMDXF)... learn more on Friday, June 22, 2018 around 5 pm. With getting my new computer, I doubt that I will have time to write on my other blog on Thursday, June 21, 2018.

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.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Monday, June 18, 2018

Algonquin Power & Utilities Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Utility. It would seem from my stock price testing that the stock price is reasonable and at or below the median. I would worry about inconsistent performance. Their Dividend Payout Ratio for EPS is still too high. See my spreadsheet on Algonquin Power & Utilities Corp.

I do not own this stock of Algonquin Power & Utilities Corp (TSX-AQN, NTSE-AQN). This is a dividend paying utility stocks. I got it off a list of dividend paying utility stocks. Also, I own Emera Inc. and this company owns shares in Algonquin Power.

The most notable thing is that they have changed their reporting currency in 2018 to US$. They started to pay dividends in US$ in 2014 but did not report in US$ until this year. This is a utility company. What you generally want in a utility company is consistency. Unfortunately, this company is not consistent at all. See the chart below.

They have not got a good record of dividend growth. Part of this is because the company used to be an income trust and decreased the dividends by some 78% when the company changed to a corporation. The thing is that income trust can pay more than earnings in dividends but corporations cannot. They however also decreased the dividends 2002 after going public in 1997 as an income trust. They started to increase dividends again 2011 and have increased them since. Also in 2014 they started to pay dividends in US$.

Currently dividends are good with moderate dividend growth. The current dividend is 4.81% and the last dividend increase was in 2018 and it was for 10%. The 5, 10 and historical median dividends yield are 4.58%, 4.60% and 7.81%. This long term yield is high because company used to be an income trust.

As far as I can see they cannot afford their dividends. The Dividend Payout Ratio has never been below 100%. A lot of income trust companies had tax pools extending into the future after they became corporations. However, these companies do need to get their DPR down. Analysts expect that the DPR for this company will be less than 100% in 2019. This is just their estimates and analysts have been expecting before than the company will get their DPR below 100%.

The Long Term Debt/Market Cap Ratio for 2017 is 0.64 which is fine. However, last year’s was 1.25 and currently the ratio is 0.92. You do not want this near 1.00 as it is not good for long term debt to be higher than the Market Cap.

The Liquidity Ratio for 2017 is 0.88. This means than current assets cannot cover current liabilities. Unfortunately, lots of utilities have low Liquidity Ratios. If you add in cash flow after dividends, the Liquidity Ratio is still low at 1.21 but it is acceptable. The Debt Ratio is better at 1.65.

Leverage and Debt/Equity Ratios for 2017 are 3.30 and 1.99 respectively. They are high but unfortunately utilities tend to have their ratios rather high.

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.

As you can see long term total returns were mostly dividends and very low capital gains. On the other hand income trusts tend to have high distributions and slow growth. But the stock price in 1997 was higher than the stock prices from 2006 to 2014 inclusive.

Years Div. Gth Tot Ret Cap Gain Div.
5 10.03% 20.45% 15.50% 4.95%
10 -6.68% 9.32% 5.27% 4.05%
15 -0.27% 8.87% 2.81% 6.06%
19 -0.83% 7.88% 1.49% 6.38%


The 5 year low, median and high median Price/Earnings per Share Ratios are 23.61, 27.16 and 30.53. The corresponding 10 year values are 23.16, 26.55 and 29.39. The historical values are 23.77, 27.39 and 30.87. The current P/E Ratio is 24.23 based on a currently stock price of $12.60 and 2018 EPS of $0.52. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a Graham Price of $9.46. The 10 year low, median and high median Price/Graham Price Ratios are 1.19, 1.40 and 1.58. The current P/GP Ratio is 1.33 based on a stock price of $12.60. 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 of 1.49. The current P/B Ratio is 1.65 based on Book Value of $3,301M, Book Value per Share of $7.65 and a stock price of $12.60. The current P/B Ratio is some 10.5% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get 5 and 10 median dividend yields of 4.75% and 4.70% respectively. The current dividend yield is 5.36% based on dividends of $0.52 and a stock price of $9.57. The current dividend yield is higher than the 5 and 10 year median dividends yields by 13% and 14% respectively. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$ as dividends are paid in US$.

The 10 year median Price/Sales (Revenue) Ratio is 2.38. The current P/S Ratio is 2.37 based on a stock price of $12.60, 2018 Revenue estimate of $2,287M and Revenue per Share of $5.30. The current ratio is below the 10 year median by 0.19%. This stock price testing suggests that the stock price is relatively reasonable and below the median.

When I look at analysts’ recommendations I find Strong Buy (3), Buy (7) and Hold (2). The consensus would be a Buy. The 12 month stock price consensus is $14.48. This implies a total return of 20.28% with 14.92% from capital gain and 5.36% from dividends.

Haris Anwar on Motley Fool compared this stock to Fortis. I think that Fortis has been much more stable over the long term than Algonquin Power. See my report on Fortis Inc. (TSX-FTS, OTC-FRTSF)... here. James Anderson on Registrar Journal talks about recent analyst recommendations for this stock. The consensus is a Buy. See what analysts are saying about this stock on Stock Chase. Analysts like this stock and others compare it to Fortis.

Algonquin Power & Utilities Corp is a renewable energy and regulated utility company. It is engages in hydroelectric, wind, thermal and solar power facilities, and sustainable utility distribution businesses. Its web site is here Algonquin Power & Utilities Corp.

The last stock I wrote about was about was Alcanna Inc. (TSX-CLIQ, OTC-LQSIF)... learn more. The next stock I will write about will be CI Financial Corp (TSX-CIX, OTC- CIFAF)... learn more on Wednesday, June 20, 2018 around 5 pm. Tomorrow on my other blog I will write about New Computer.... learn more on Tuesday, June 19, 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.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Friday, June 15, 2018

Alcanna Inc.

Sound bite for Twitter and StockTwits is: Dividend Paying Consumer. Considering how badly the company is doing, I do not think the stock is cheap but more to a reasonable price. See my spreadsheet on Alcanna Inc.

I do not own this stock of Alcanna Inc. (TSX-CLIQ, OTC-LQSIF) which used to be Liquor Stores N. A. Ltd. (TSX-LIQ, OTC-LQSIF). The idea of following this stock came from a reader of my blog.

In May of 2018 the company changed name from Liquor Stores N.A. (TSX-LIQ, OTC LQSIF) to Alcanna Inc. (TSX-CLIQ, OTC LQSIF). The name change was because the company is expanding into cannabis. So far they are not doing well. You can see from the chart below on long term returns. Only the people that bought this stock at the beginning have made money and it was all in dividends.

The Net Insider Buying is rather high at 0.67% of market value. However, the buying is via stock options. It would be a more positive note if insiders were buying stock with cash.

Dividends have mostly gone down. This stock started off as an income trust and therefore had quite high Payout Ratios because income trust can pay out more. It decreased its dividend about 33% when the company became a corporation. In 2018 they changed the dividend payout from monthly to quarterly.

The dividend yield was high in the past because the company started as an income trust. The yield has been travelling south because of dividend cuts. The current dividend yield is moderate at 3.97%.

They decreased their dividends around 67% in 2016 because of the high Payout Ratios. It is expected that the Dividend Payout Ratio would be 176% in 2018. Analysts do not expect the Dividend Payout Ratio for EPS to be below 100% over the next couple of years. They cannot afford their dividends.

The Total Return per year is show below for years of 5 to 13. 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.

It would seem that only the people getting this stock at the very beginning have made any sort of total return and that return is all dividends.

Years Div. Gth Tot Ret Cap Gain Div.
5 -22.60% -1.30% -10.46% 5.33%
10 -14.77% -5.13% -7.78% 6.48%
13 -9.87% 6.88% -2.35% 9.23%


The 5 year low, median and high median Price/Earnings per Share Ratios are 18.91, 22.96 and 27.02. The 10 year corresponding ratios are 13.44, 16.22 and 20.71. The corresponding historical ratios are 14.38, 16.42 and 21.21. The current P/E Ratio is 44.41 based on a stock price of $9.06 and 2018 EPS estimate of $0.20. This stock price testing suggests that the stock price is relatively expensive. However, EPS are very low and this would not be a good test.

I get a Graham Price of $6.15. The 10 year low, median and high median Price/Graham Price Ratios are 0.82, 1.04 and 1.26. The current P/GP Ratio is 1.47 based on a stock price of $9.06. This stock price testing suggests that the stock price is relatively expensive. However, EPS are very low and this would not be a good test. EPS are part of the Graham Price formula.

I get a 10 year median Price/Book Value per Share of 1.13. The current P/B Ratio is 1.10 based on Book Value of $286M, Book Value per Share of $8.24. The current ratio is some 2.5% lower than the 10 year ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

The P/B Ratio test is not a good one either because of the fact that book value has declined by 13% and 8% per year over the past 5 and 10 years. On the other hand the P/B Ratio of 1.10 is very low. Any ratio 1.50 or below is low. This does points to a low stock price.

I get an historical median dividend yield of 7.04%. It is high because the company used to be an income trust. The current dividend yield is 3.97% based on dividends $0.36 and a stock price of $9.06. The current dividend is some 44% above the historical median. This stock price testing suggests that the stock price is relatively expensive. This is not a good test because of declining dividends.

An adjusted historical median yield is 3.03%. The current yield is some 31% lower. This stock price testing suggests that the stock price is relatively cheap.

The 10 year median Price/Sales (Revenue) Ratio is 0.52. The current P/S Ratio is 0.50 based on 2018 Revenue of $629M, Revenue per Share of $18.12 and a stock price of $9.06. The current P/S Ratio is some 4% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median. This is probably the best test available.

When I look at analysts’ recommendations I find Strong Buy (2), Buy (5) and Hold (2). The consensus would be a Buy. The 12 month stock price consensus is $11.60. This implies a total return of 31.01% with 28.045 from capital gain and 3.97% from dividends based on a current stock price of $9.06.

Andy Nguyen on Simply Wall Street says that company’s problem is that the operating expenses are growing faster than revenue. Mark Bunting talks to the CEO of this company on Small Cap Power. This company is covered in the first part of the video. Jason Phillips on Motley Fool talks about Aurora Cannabis Inc.’s 25% investment in Alcanna Inc.

Alcanna Inc. formerly Liquor Stores N.A. Ltd is a retailer of adult beverages offering beer, wine and spirits items under the brand names Wine and Beyond, Liquor Depot and Brown Jug. Its web site is here Alcanna Inc .

The last stock I wrote about was about was Intertape Polymer Group Inc. (TSX-ITP, OTC-ITPOF)... learn more. The next stock I will write about will be Algonquin Power & Utilities Corp (TSX-AQN, NTSE-AQN)... learn more on Monday, June 10, 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.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Thursday, June 14, 2018

Intertape Polymer Group Inc.

Sound bite for Twitter and StockTwits is: Dividend Growth Industrial. Price is reasonable but above the median to expensive. Strong Revenue growth is needed for continued strong growth in earnings and cash flow. See my spreadsheet on Intertape Polymer Group Inc.

I do not own this stock of Intertape Polymer Group Inc. (TSX-ITP, OTC-ITPOF). I got this stock suggestion from Peter Keyser who I met in an Investment Club.

I noticed that EPS and Cash Flow are growing strongly, but Revenue has not except for 2017 where it grew by 11% and is expected to grow by 10.6% this year. EPS has grown by some 23% and 22% per year over the past 5 and 10 years and cash flow has grown by 11% and 14% per year. However, Revenue has grown by 2.7% and 1.6% per year over the past 5 and 10 years. For strong earnings and cash flow growth in the future, Revenue will need to grow strongly also.

Dividends have grown well over the past 4 year. In US$ they are up by 15% per year and in CDN$ they are up by 20% per year. However, analysts do not expect further growth in dividends over the next couple of years including 2018. The dividend yield is moderate with a current dividend yield at 3.80% and the 4 year median at 3.28%. Dividends are paid in US$.

The Dividend Payout Ratio for 2017 is 52% with 5 year coverage also at 52%. The DPR for CFPS is 29% for 2018 was 5 year coverage at 24%. So it appears that they can afford their dividends. With a young growing company you probably want low dividends as the company will need money to grow. These figures are in US$.

The Long Term Debt/Market Cap ratio is good at 54%. The Liquidity and Debt Ratios are good with the ones for 2017 at 1.94 and 1.55 respectively. The 5 year median ratios are 2.32 and 1.80 respectively. The Leverage and Debt/Equity Ratios are rather typical at 2.89 and 1.86.

The Total Return per year is show below for years of 5 to 24 in CDN$ and 5 to 23 in US$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See charts below. The first is in CDN$ and the second in US$.

Long term returns have been very low in both CDN$ and US$. Recent total returns have been good.

In CDN$

Years Div. Gth Tot Ret Cap Gain Div.
5 19.86% 26.62% 21.85% 4.77%
10 23.74% 21.48% 2.25%
15 9.38% 8.31% 1.07%
20 -1.16% -1.78% 0.62%
24 4.41% 3.81% 0.59%


In US$

Years Div. Gth Tot Ret Cap Gain Div.
5 15.02% 20.48% 16.28% 4.20%
10 20.88% 18.74% 2.14%
15 11.79% 9.93% 1.86%
20 -0.51% -1.24% 0.73%
23 4.17% 3.38% 0.79%


The 5 year low, median and high median Price/Earnings per Share Ratios are 12.92, 15.79 and 18.66. The corresponding 10 year ratios are 7.78, 13.71 and 17.14. The historical ratios are 9.29, 15.48 and 21.48. The current P/E Ratio is 14.96 based on a current price of $19.20 and 2018 EPS estimate of $1.28 ($0.99 US$). This stock price testing suggests that the stock price is relatively reasonable and around the median. This testing is in CDN$.

I get a Graham Price of $12.83. The 10 year low, median and high median Price/Graham Price Ratios are 0.74, 1.23 and 1.58. The current P/GP Ratio is 1.50 based on a stock price of $19.20. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in CDN$.

I get a 10 year median Price/Book Value per Share of 2.76. The current P/B Ratio is 3.44 based on Book Value of $252M, Book Value per Share of $4.29 and a stock price of $14.74. The current ratio is some 24% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$. You will get a similar result in CDN$.

I get an historical median dividend yield of 3.28%. This is based on dividends of $0.56 and a stock price of $14.74. This current yield is some 16% above the median. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$. You will get a similar result in CDN$. This is not a good test because there is only 4 years of data.

The 10 year median Price/Sales (Revenue) Ratio is 0.70. The current P/S Ratio is 0.87 based on 2018 Revenue estimate of $993M, Revenue per Share of $16.89 and a stock price of $14.74. The current P/S ratio is some 25% above the 10 year median. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$. You will get a similar result in CDN$.

When I look at analysts’ recommendations I find Buy (5) and Hold (1) recommendations. The consensus recommendation is a Buy. The 12 month stock price is $25.50 CDN$ ($19.67 US$). This implies a total return of 36.57% with 32.79% from capital gains and 3.78% from dividends.

The company announced on Global News Wire that they have a new $600 Million Credit Facility. Craig Ardmore on Colby Post says that the company has a Value Composite score of 26 which means it is not under or overvalued. Vernon Smith on Simply Wall Street says it is too early to tell if this stock will be a good dividend paying stock. Brad Macintosh on Motley Fool says that the stock’s outlook is bumpy growth but stable income. See what analysts are saying about this stock on Stock Chase. They think is it’s a long term buy although current price may be high.

Intertape Polymer Group Inc. is a part of the packaging industry. It manufactures and sells paper and film based pressure sensitive and water activated tapes and other packaging systems for industrial and retail use. Its web site is here Intertape Polymer Group Inc.

The last stock I wrote about was about was Waste Connections Inc. (TSX-WCN, NYSE-WCN)... learn more. The next stock I will write about will be Alcanna Inc. (TSX-CLIQ, OTC-LQSIF)... learn more on Friday, June 15, 2018 around 5 pm. Tomorrow on my other blog I will write about Canadian Banks.... learn more on Thursday, June 14, 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.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Wednesday, June 13, 2018

No power, no computer, no blog today

No power, no computer, no blogg today.

Monday, June 11, 2018

Waste Connections Inc.

Sound bite for Twitter and StockTwits is: Dividend Growth Industrial. It is not surprising that this stock is testing as relatively expensive. Share prices are been on a tear lately. I am following this stock from Progressive Waste Solutions Ltd (TSX-BIN). Waste Connections Inc. is an American company that took over Progressive Waste. See my spreadsheet on Waste Connections Inc.

I do not own this stock of Waste Connections Inc. (TSX-WCN, NYSE-WCN), but I used to. I first bought this stock in 2007 because TD Securities had a very favorable report on this stock and had it on it action buy lists. At that time it was BFI Canada Income Fund. In 2010, I needed to buy something for Pension Account. I have this already and it is on TD Action Buy List. I sold when it because the target of a reverse takeover by an American company.

Revenue, Net Income and Cash Flow has gone up spectacularly for this company over the past 5 and 10 years. Revenue is up 17% to 19% per year, Net Income is up by 44% and 34% per year and Cash Flow up 29% and 18% per year over these periods. However, what really counts is per share increases and they are a lot lower due to increases in the number of shares. Revenue per Share is down by 12.5% and 6% per year, EPS is up by 7% and 6% per year and Cash Flow is down by by 6% and 6% per year over the same periods.

The lack of good recent earnings per share is showing up in the low increase in Book Value per Share which is up less than 1% over the past 5 and 10 years.

For Canadians, the dividend story is complex. Progressive Waste Solutions started off as an income fund. When it changed to a corporation it decreased its dividends by some 72%. Dividends were increased again after that, but the takeover by Waste Connection Inc. had initially a lower dividend. If you look at the chart below, it has been a mixed bag for investors. Dividends are up over the past 5 years and down over the past 10 and almost level over the past 15 years with increases just below 1% per year.

Dividend yields are low to moderate. The current dividend yield is just 0.73%. The 5, 10 and historical median dividend yields are 0.97%, 1.15% and 2.10%. The last dividend increase was in 2017 and it was for 16.7%.

Dividends are now paid in US$. They can afford them as the Dividend Payout Ratio for 2017 was 23% with 5 year coverage at 21%. The DPR for CFPS for 2017 was 10% with 5 year coverage at 7%.

The Long Term Debt/Market Cap Ratio is 0.21. This is a health ratio. The Liquidity Ratio for 2017 was 1.47 which is a bit low as I like it to be at 1.50 or above. The 5 year median is 1.00 which is making current liabilities level with current assets. The Debt Ratio is better at 2.09 with a 5 year median at 1.61. Leverage and Debt/Equity Ratios are good at 1.91 and 0.91 respectively.

The Total Return per year is show below for years of 5 to 16. 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.

As you can see from the chart below, shareholders have done well over the past 16 years of this company. The future may be hard to tell because of the amalgamation of Progressive Waste Solutions with Waste Connections Inc.

Years Div. Gth Tot Ret Cap Gain Div.
5 10.94% 25.64% 24.56% 1.08%
10 -6.37% 10.29% 9.21% 1.08%
15 0.92% 14.64% 11.95% 2.69%
16 15.24% 12.35% 2.89%


The 5 year low, median and high median Price/Earnings per Share Ratios are 14.12, 17.09 and 20.06. The corresponding 10 year ratios are 13.95, 17.73 and 21.30. The corresponding historical ratios are 15.60, 19.32 and 24.67. The current P/E Ratio is 34.76 based on 2018 EPS estimate of $2.87 ($2.21 US$) and a stock price of $99.66. This stock price testing suggests that the stock is relatively expensive. This was done in CDN$.

I get a Graham Price of $44.65. The 10 year low, median and high median Price/Graham Price Ratios are 0.90, 1.05 and 1.22. The Current P/GP Ratio is 2.23 based on a stock price of $99.66. This stock price testing suggests that the stock is relatively expensive. This was done in CDN$.

I get a 10 year median Price/Book Value per Share of 1.37. The current P/B Ratio is 3.22 based on BV of $6,275M, Book Value per Share of $23.83 and a stock price of $76.73. The current P/B Ratio is some 135% above the 10 year median ratio. This stock price testing suggests that the stock is relatively expensive. This was done in US$. You would get a similar answer in CDN$.

I get an historical median dividend yield of 2.10%. The current dividend yield is 0.73% based on dividends of $0.73 CDN$ ($0.56 US$) and a stock price of $99.66. The current dividend yield is some 65% below the historical one. This stock price testing suggests that the stock is relatively expensive. This was done in CDN$.

The 10 year median Price/Sales (Revenue) Ratio is 0.73. The current P/S Ratio is 4.12 based on 2018 Revenue estimate of $4,904, Revenue per Share of $18.62 and a stock price of $76.73. The current ratio is some 325% higher than the 10 year ratio. This stock price testing suggests that the stock is relatively expensive. This was done in US$.

When I look at analysts’ recommendations I find Strong Buy (1), Buy (1) and Hold (1). The consensus would be a Buy. The 12 month stock price consensus would be $83.89 US$ or $108.82 CDN$. The total return would be 10.33% with 9.19% from capital gains and 0.94% from dividends based on a current price of $99.66 CDN$.

Kurt Siggers Frisco Fastball talks about recent analysts’ recommendations on this stock. Fisher Staff Writer says on Fisher Business News that ADX for Waste Connections Inc. is 33.60 which suggests a strong trend. Ambrose O'Callaghan on Motley Fool thinks that it would be best to wait for a better entry point for this stock. See what analysts are saying about this stock on Stock Chase. Analysts think it is growing well by acquisitions.

Waste Connections Inc. is a solid waste services company in North America. The company provides waste collection, transfer, disposal and recycling services in mostly exclusive and secondary markets in the United States, and Canada. Its web site is here Waste Connections Inc.

The last stock I wrote about was about was Power Corp of Canada (TSX-POW, OTC-PWCDF)... learn more. The next stock I will write about will be Intertape Polymer Group Inc. (TSX-ITP, OTC-ITPOF)... learn more on Wednesday, June 13, 2018 around 5 pm. Tomorrow on my other blog I will write about Next Recession.... learn more on Tuesday, June 12, 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.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Friday, June 8, 2018

Power Corp of Canada

Sound bite for Twitter and StockTwits is: Dividend Growth Financial. It is coming up cheap on my tests. It should do better with rising interest rates. If this is a stock you want to buy, now is the time. See my spreadsheet on Power Corp of Canada .

I do not own this stock of Power Corp of Canada (TSX-POW, OTC-PWCDF). I started following this stock because it was on the Dividend Achievers, the Dividend Aristocrats lists and also on Mike Higgs’ list. It is a stock that I notice has been recommended lately as good value (October 2008). I would not buy it because I have shares in Power Financial, which this company controls.

There was no dividend increases from 2009 to 2014 inclusive. This is because of problems coming out of the last recession. They have increased their dividend some 21 times over the past 29 years. Dividend yields had been low (below 2%) to moderate (around 2%) until 2008. Since then they have been high (in 3%, 4% and 5% range).

Dividends yields have been moderate to good with dividend growth low to moderate. The historical, 5 and 10 year median dividend yields are 2.31%, 4.00% and 4.35%. The dividend growth for the past 5 and 10 year periods is below 5% per year. The dividend growth for the 15 to 29 year periods is above 8%. See the chart below.

The Dividend Payout Ratio for 2017 is 51% with 5 year coverage at 46%. The DPR for CFPS for 2017 is 9% with 5 year coverage also at 9%. So it looks like the company can afford their dividends.

There are some economists that think that the next bear market will be very hard on companies with lots of debt. So I thought I would speak to this subject in my review. The Leverage and Debt/Equity Ratio are fine at 12.10 and 11.10 for its sector. For financial, the Liquidity Ratio is not important although. It is fine at 1.64. The Debt Ratio is fine at 1.09 for a financial stock.

The Long Term Debt/Market Cap Ratio may look high at 11.26 because generally you want it less than 1.00. However, since this is a financial what is important is that the investments cover the long term debt. Long Term Debt is some 92% of investments, so this is fine.

The Total Return per year is show below for years of 5 to 30. 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.

This company has a lot of subsidiaries that are in Life Insurance. Life Insurance companies have had a difficult time with the very low interest rates from the last recession. That is the reason for the very low return over the past 10 years. Life Insurance companies will do better in a rising interest rate environment.

Years Div. Gth Tot Ret Cap Gain Div.
5 3.99% 9.46% 4.99% 4.47%
10 4.35% 1.15% -2.13% 3.28%
15 8.82% 8.12% 3.99% 4.13%
20 10.12% 8.41% 4.75% 3.66%
25 11.76% 13.60% 8.86% 4.74%
30 10.65% 11.28% 7.64% 3.64%


The 5 year low, median and high median Price/Earnings per Share Ratios are 10.38, 11.22 and 12.05. The corresponding 10 year ratios are 10.82, 13.12 and 14.33. The historical ratios are 11.26, 12.95 and 14.81. The current P/E Ratio is 9.07 based on 2017 EPS estimate of $3.36 and a stock price of $30.48. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $47.97. The 10 year low, median and high median Price/Graham Price Ratios are 0.72, 0.90 and 1.01. The current P/GP Ratio 0.64 based on a stock price of $30.48. This stock price testing suggests that the stock price is relatively cheap.

I get a 10 year median Price/Book Value per Share of 1.26. The current P/B Ratio is 1.00 based on Book Value of $14,145M, Book Value per Share of $30.44 and a stock price of $30.48. The current P/B Ratio is some 21% below the 10 year ratio. This stock price testing suggests that the stock price is relatively cheap. On an absolute basis a stock is considered cheap if selling around a ratio of 1.00. In fact a ratio of 1.50 or below is considered good.

I get an historical median dividend yield of 2.31%. The current dividend yield is 5.01% based on dividends of $1.53 and a stock price of $30.48. The current dividend yield is some 117% 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 0.35. The current P/S Ratio is 0.27 based on 2018 Revenue estimate of $51,747M, Revenue per Share of $111.35 and a stock price of $30.48. The current ratio is some 21% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

When I look at analysts’ recommendations I find Buy (1) and Hold (6) recommendations. The consensus recommendation would be a hold. The 12 month stock price is $33.50. This implies a total return of 14.92% with 9.91% from capital gains and 5.01% from dividends. These calculations are based on a current stock price of $30.48.

Will Ashworth of Motley Fool thinks you should not pass up investing in the stock. (Note: that sometimes you need to use your browsers arrows to back out and back into a Motley Fool article to get the full article.) Ross Marowits of the Canadian Press writing in the Financial Post says that this company is prepared to invest $10B in the US over the next 5 years. An article by the Canadian Press in The Reminder talks about Power Financial Corp’s, a subsidiary of Power Corp, investment in Wealth Simply a FinTech. See what analysts are saying about this company on Stock Chase . They do not find this company very exciting.

Power Corporation of Canada is a holding company with interests in financial services, communications, and other business sectors. It operates through its subsidiaries and has a business presence worldwide. Its web site is here Power Corp of Canada .

The last stock I wrote about was about was Lassonde Industries (TSX-LAS.A, OTC-LSDAF)... learn more. The next stock I will write about will be Waste Connections Inc. (TSX-WCN, NYSE-WCN)... learn more on Monday, June 11, 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.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Wednesday, June 6, 2018

Lassonde Industries Inc.

Sound bite for Twitter and StockTwits is: Dividend Growth Consumer. This company looks good except that the stock price is very high. All my testing shows the stock price as expensive. See my spreadsheet on Lassonde Industries Inc.

I do not own this stock of Lassonde Industries (TSX-LAS.A, OTC-LSDAF). Although this stock is not on the Investment Reporter list, MPL communications does write about this stock. It has been covered several times in their Advice Hotline emails. Reports have been favorable and they suggest buying it for dividends and long term capital gains.

The Ink Research on Insider ownership always seems to be old. So either Ink is not picking it up or they are late in filing this information.

Dividends yields are moderate as is the dividend growth. The current dividend is 1.11% with 5, 10 and historical median at 1.11%, 1.67% and 1.76%. Dividend growth has been between 10 and 13% per year except for the past 10 year period where it is just 4.4% per year. See the chart below.

They can well afford their dividends as the Dividend Payout Ratios are low. The Dividend Payout Ratio for 2017 is 18% with 5 year coverage at 21%. The DPR for CFPS for 2017 was 9.5% with 5 year coverage at 9%.

The Total Return per year is show below for years of 5 to 27. 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.

Most of the total return is from capital gains. The shareholders have done well with this stock.

Years Div. Gth Tot Ret Cap Gain Div.
5 13.73% 29.22% 27.75% 1.48%
10 4.40% 21.77% 20.25% 1.53%
15 13.29% 21.86% 20.13% 1.73%
20 11.20% 15.11% 7.18% 7.93%
25 10.57% 15.13% 13.85% 1.28%
26-27 10.87% 17.35% 15.58% 1.76%


The 5 year low, median and high median Price/Earnings per Share Ratios are 15.79, 18.10 and 20.37. The 10 year corresponding ratios are 11.46, 13.59 and 15.72. The historical corresponding ratios are 11.23, 13.13 and 15.14. It looks like the run up in stock price has a large component in increasing P/E Ratios. The current P/E Ratio is 21.60 based on 2017 EPS estimate of 13.47 and a current stock price of $291.01. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of %161.81. The 10 year low, median and high median Price/Graham Price Ratios are 0.88, 1.05 and 1.21. The current P/GP Ratio is 1.80 based on a stock price of $291.01. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median Price/Book Value per Share of 1.82. The current P/B Ratio is 3.37 based on Book Value of $651M, Book Value per share of $86.39 and a stock price of $291.01. The current P/B Ratio is some 85% 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 1.76%. The current dividend yield is 1.11% based on dividends of $3.24 and a stock price of $291.01. The current dividend yield is some 37% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive.

The 10 year median Price/Sales (Revenue) Ratio is 0.64. The current P/S Ratio is 1.26 based on 2017 Revenue estimate of $1,613M, Revenue per Share of $230.83 and a stock price of $291.01. The current ratio is some 97% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

When I look at analysts’ recommendations I find Buy (1) and Hold (1) recommendations. There seems to be few analysts following this stock. The consensus recommendations would be a Buy. The 12 month stock price is $282.50. This implies a total loss of 1.81% with a capital loss of 2.92% and dividends of 1.11% based on a current stock price of $191.01. The stock price is moving up quickly.

This news release on Cision talks about the company’s takeover of Old Orchard Brands in the US. Ricardo Landis on Simply Wall Street talks about debt levels of this company. The company has good debt levels. Staff Contributor om Darby News Journal says this company’s C-Score is 1 where score can be 0 (not fraudulent book cooking to 6 (high likelihood of fraudulent activity). Will Ashworth on Motley Fool talks about 3 Quebec stocks to buy, including this one. See what analysts are saying about this stock on Stock Chase. There is nothing recent, but nothing bad either.

Lassonde Industries Inc. develops, produces and markets fruit and vegetable juices and drinks. It is a producer of store brand ready-to-drink fruit juices and drinks in the United States and also a producer of cranberry sauces. Its web site is here Lassonde Industries Inc.

The last stock I wrote about was about was Goeasy Ltd (TSX-GSY, OTC-EHMEF)... learn more. The next stock I will write about will be Power Corp of Canada (TSX-POW, OTC-PWCDF)... learn more on Friday, June 8, 2018 around 5 pm. Tomorrow on my other blog I will write about Something to Buy June 2018.... learn more on Thursday, June 7, 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.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Monday, June 4, 2018

Goeasy Ltd

Sound bite for Twitter and StockTwits is: Dividend Growth Consumer. Price testing is uneven but it is expensive on both P/B Ratio and P/S Ratio tests. On both these measures, the ratios have climbed, but not as quickly as the stock price. The stock fails the Graham Price test also. It passes the P/E Ratio test, but this is not always a good test. It also passes the dividend yield test which is a fairly good test. There seems to be fewer complaints against the company than in other years. It is giving out a lot of stock options. See my spreadsheet on Goeasy Ltd.

I do not own this stock of Goeasy Ltd (TSX-GSY, OTC-EHMEF). In April of 2016 Investment Reporter said to seek stocks with growing dividends from The Investment Reporter Key stock buys. This is one stock that was named. However, I would still rather invest in companies that are not in the business of charging very high interest rates.

To me they are giving out a high proportion of options. This is not a tech company, it is a consumer company. The increase in outstanding shares due to options is at a median of 1.58% over the past 4 years. The median increase in outstanding shares due to stock options for all the stocks I follow is 0.17% and 70% are at 0.37% or lower.

The company started to pay dividends in 2004. The dividends yields are moderate as is the dividend growth. The current dividend yield is 2.20% with 5, 10 and historical median dividend yields at 2.17%, 2.56% and 2.25%. Dividend increases have been very uneven. They have been high when given, but there were no increases between 2010 and 2014 inclusive. The last increase was for 25% and it occurred this year. See chart below for increases per year over past 5, 10 and 12 year periods.

The Dividend Payout Ratio for 2017 was 26% with 5 yea coverage at 25%. So the company can afford their dividends. The DPR for CFPS is very low at 5% for 2017 and 5 year coverage also at 5%.

The Total Return per year is show below for years of 5 to 22. 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.

The company seems to be doing well lately, but long term investors have made little. Total returns and dividend growth is very uneven.

Years Div. Gth Tot Ret Cap Gain Div.
5 13.06% 35.56% 32.72% 2.83%
10 9.43% 8.04% 6.52% 1.52%
12-15 11.51% 17.74% 15.34% 2.39%
20 5.30% 4.30% 1.00%
22 3.59% 2.93% 0.66%


The 5 year low, median and high median Price/Earnings per Share Ratios are 8.85, 11.56 and 14.51. The corresponding 10 year P/E Ratios are 9.14, 11.77 and 14.78. The corresponding historical P/E Ratios are 9.64, 14.46 and 18.27. The current P/E Ratio is 11.57 based on a current stock price of $40.95 and 2018 EPS estimate of $3.54. This stock price testing suggests that the stock price is relatively reasonable and around the median.

I get a Graham Price of $35.91. The 10 year low, median and high median Price/Graham Price Ratios are 0.64, 0.85 and 1.07. The current P/GP Ratio is 1.14 based on a stock price of $40.95. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median Price/Book Value per Share of 1.37. The current P/B Ratio is 2.53 based on a Book Value of $220M, Book Value per Share of $16.19 and a stock price of $40.95. The current P/B Ratio is some 85% above the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive.

The stock failed this test is for a couple of reasons. First the book value per share is not growing as fast as the stock price. Also, outstanding shares have been increasing by 2.5% and 2.7% per year over the past 5 and 10 years. This results in the P/B Ratio going up a lot over the past 10 years. Book value is import as it reflects the Shareholders’ Equity in a business. You can find a discussion on this subject on Investopedia.

I get an historical median dividend yield of 2.25%. The current dividend yield is 2.20% based on dividends of $0.90 and a stock price of $40.95. The current yield is some 2% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable and around the median.

The 10 year median Price/Sales (Revenue) Ratio is 0.81. The current P/S Ratio is 1.15 based on 2018 Revenue estimate of $483M, Revenue per Share of $35.53 and a stock price of $40.95. The current ratio is some 42% above the 10 year ratio. This stock price testing suggests that the stock price is relatively expensive.

When I look at analysts’ recommendations I find Strong Buy (1), Buy (4) and Hold (1). The consensus recommendation would be a Buy. The 12 month stock price consensus is $46.83. This implies a total return of 14.36% with 2.20% from dividends and 16.36% from capital gains.

Because of past complaints about this company, I looked to see if there was any improvement. There actually seem to be fewer complaints online than in past years. BBB registered complaints are shown here. There are good and bad reviews of working for this company on Indeed. There is a web site Easy Financial, Pissed Consumer devoted to consumer complaints.

Ambrose O'Callaghan on Bay Street talks about the great first quarter for this company. Ambrose O'Callaghan on Motley Fool talks about this stock as a growth stock. Ivanka Thompson on Bangalore Weekly talks about recent analyst’s recommendations and changes. See what analysts are saying about this stock on Stock Chase. Analysts mostly like this company.

Goeasy Ltd is a provider of goods and alternative financial services which are engaged in merchandise leasing of household furnishings and home electronic products to consumers and offering unsecured installment loans to consumers. Its web site is here Goeasy Ltd.

The last stock I wrote about was about was Husky Energy Inc. (TSX-HSE, OTC-HUSKF)... learn more. The next stock I will write about will be Lassonde Industries (TSX-LAS.A, OTC-LSDAF)... learn more on Wednesday, June 6, 2018 around 5 pm. Tomorrow on my other blog I will write about Dividend Stocks June 2018.... learn more on Tuesday, June 5, 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.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.