As I said yesterday, if you do not want to do the work, index funds or ETF’s might be for you. Often the MER (the fund charges) are under 1% and many are under .50%
For Index Funds, go to http://globefunddb.theglobeandmail.com/gishome/plsql/gis.fund_filter?pi_type=B, which is the Globe and Mail’s fund site. This is under the Globe Fund section and research tool of Fund Filter. Under the Fund/ Company Group, find the bank or fund company you want. Beside the Index Fund indicator, show Index Funds. When you press Get Results, you will get a list of Index Funds for the bank or fund company you indicated. Once you get results, this new page will have several tabs. To see MER, click the Key Facts tab.
For Index funds, most companies have Canadian, International, European, American and Japanese Index Funds. They will also have Bond Funds, which I do not recommend. You can make more money just buying Canadian Government or Provincial Bonds that getting a bond fund.
To get the ETF’s (Exchange Traded Funds) you have to go to Globe Investor section of this site as these are traded on a stock exhange. Go to http://www.globeinvestor.com/v5/content/filters for the research tool of filters. The Exchange you want is the Toronto Stock Exchange and security you want is ETF. Press Get Results. You do not want the Bull and Bear ETF’s. You want iShares (of Barclay’s Bank) or Claymore Investments.
I know the iShares better than the Claymore Investments ETFs’. Under iShares, you can get ETF’s to cover the most of the TSX indexes, as well as the whole TSX. You can also get information on iShares at http://ca.ishares.com. On the first page, if you are asked, say you are an individual investor. On this site you can get information on all their ETF’s. Under the Document Library, you can get annual and semi-annual reports. These reports will tell you what each ETF was invested in at the time of the report.
ETF’s you might be interested in are the CDN Dividend Index Fund (TSX-XDV) and the CDN Jantzi Social Index fund (TSX-XEN). See my blog on Social Investing in May 2008 for more information on the CDN Jantzi Social Index Fund. The CDN Dividend Index Fund is 30 of the largest dividend paying stocks under the TSX. These tend to be the sort of stocks I invest in.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Friday, August 29, 2008
Thursday, August 28, 2008
Mutual Funds and ETF’s
If you do not want to do the work, index funds or ETF’s might be for you. There are pros and cons to both mutual funds and ETF’s. Most index funds are mutual funds, but some are ETF’s.
Mutual fund managers often have to deal with lots of money to invest when the market is high and requests for unit surrenders when markets are low. This is what forces mutual funds to buy high and sell low. This is the opposite of what they should do. ETF’s do not have this trouble.
The advantage for ETF’s is that you can buy or sell your shares immediately on the open market. This can be helpful if there is a lot of volatility in the market. A disadvantage of ETF’s is that ETF’s may sell at a discount or premium. That is if you ad up the value of all the shares in the ETF and divide it by the number of shares you get a price for the ETF shares. Say this price is $20.90. The fund is selling at a premium if the market price for the ETF is $22. The ETF is selling at a discount if the market price for it is $19. The market price of an ETF does not exactly track the market price of its shares.
A mutual fund’s share price does exactly track the market price of the underlying shares, as the mutual is valued before any shares can be bought or sold. If you ask to buy any units in a Mutual Fund, you put the buy order in today, the fund will be valued at the close of the market that night and your order to buy will be placed at the fund’s unit value determined at the market close. If there is a lot of volatility, this can be a problem, especially if you want to sell and have to wait until the market closes so it can be determined at what price you can sell your units.
In buying mutual funds and ETF’s there is the problem that some of the companies in the Mutual Fund or ETF can be over or under priced. In order to make money on any company it is helpful to buy all your shares at least at a reasonable price. Over or under pricing a company’s shares is just the way the stock market works. It is only just in theories that a company’s share price is a fair price. This does not happen in real life.
I personally like to buy set up my own stock portfolio. I think that this is the best way of investing in stocks. I have this blog to share my experience in investing to those you would like to go this route.
I have updated it with the figures from the June 08 quarterly report.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on my web site.
Mutual fund managers often have to deal with lots of money to invest when the market is high and requests for unit surrenders when markets are low. This is what forces mutual funds to buy high and sell low. This is the opposite of what they should do. ETF’s do not have this trouble.
The advantage for ETF’s is that you can buy or sell your shares immediately on the open market. This can be helpful if there is a lot of volatility in the market. A disadvantage of ETF’s is that ETF’s may sell at a discount or premium. That is if you ad up the value of all the shares in the ETF and divide it by the number of shares you get a price for the ETF shares. Say this price is $20.90. The fund is selling at a premium if the market price for the ETF is $22. The ETF is selling at a discount if the market price for it is $19. The market price of an ETF does not exactly track the market price of its shares.
A mutual fund’s share price does exactly track the market price of the underlying shares, as the mutual is valued before any shares can be bought or sold. If you ask to buy any units in a Mutual Fund, you put the buy order in today, the fund will be valued at the close of the market that night and your order to buy will be placed at the fund’s unit value determined at the market close. If there is a lot of volatility, this can be a problem, especially if you want to sell and have to wait until the market closes so it can be determined at what price you can sell your units.
In buying mutual funds and ETF’s there is the problem that some of the companies in the Mutual Fund or ETF can be over or under priced. In order to make money on any company it is helpful to buy all your shares at least at a reasonable price. Over or under pricing a company’s shares is just the way the stock market works. It is only just in theories that a company’s share price is a fair price. This does not happen in real life.
I personally like to buy set up my own stock portfolio. I think that this is the best way of investing in stocks. I have this blog to share my experience in investing to those you would like to go this route.
I have updated it with the figures from the June 08 quarterly report.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on my web site.
Wednesday, August 27, 2008
IGM Financial 2
As I said yesterday, I invested in the company (TSX-IGM) in October 2006 and I have made 0% return. A very good reason to continue holding this stock is because the dividends have been raised, ever though there is a financial crisis. It shows that management has confidence in the future.
No one expects that this stock will earn for 2008 the same Earnings per Share (EPS) that it earned in 2007. It is not going to be coming down much and it is expected the EPS will rise for 2008. As I said yesterday, the April dividend was raised and the company has announced that the dividends will again be raised, on schedule, for October. This means that the dividends will go up some 15.5% this year. This is a dividend paying stock and dividends will affect the stock price.
There is a number of buy calls out on this stock and some of holds. I think people are afraid of financial stocks, but this could be a great time to buy. For the stock, the dividend yield at 4.9% is higher than the 5 year average of 3.2%. The P/E at 12.9% is lower than the 5 year average of 16.3%.
This stock has a strong balance sheet with the Asset/Liability ratio at 2.17. You would want to ratio to be 1.5 or higher. The Asset/Book Value leverage is good 1.87. The only negative I see is the accrual ratio is high at 5.7%. However, on any stock you look at there will be some negatives. What you need to look at is the whole stock. Is it, by and large, showing mostly good solid positives.
This is a premier mutual fund, managed asset and personal financial services company. The company has three operating units, Investors Group, Mackenzie Financial Corporation and Investment Planning Counsel Inc. This company is part of Power Financial group. Its web site is http://www.igmfinancial.com/english/. See my spreadsheets on this company at www.spbrunner.com/stocks/igm.htm. I have reloaded my spreadsheet with the new figures for the second quarterly report for June 2008.
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. . See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
No one expects that this stock will earn for 2008 the same Earnings per Share (EPS) that it earned in 2007. It is not going to be coming down much and it is expected the EPS will rise for 2008. As I said yesterday, the April dividend was raised and the company has announced that the dividends will again be raised, on schedule, for October. This means that the dividends will go up some 15.5% this year. This is a dividend paying stock and dividends will affect the stock price.
There is a number of buy calls out on this stock and some of holds. I think people are afraid of financial stocks, but this could be a great time to buy. For the stock, the dividend yield at 4.9% is higher than the 5 year average of 3.2%. The P/E at 12.9% is lower than the 5 year average of 16.3%.
This stock has a strong balance sheet with the Asset/Liability ratio at 2.17. You would want to ratio to be 1.5 or higher. The Asset/Book Value leverage is good 1.87. The only negative I see is the accrual ratio is high at 5.7%. However, on any stock you look at there will be some negatives. What you need to look at is the whole stock. Is it, by and large, showing mostly good solid positives.
This is a premier mutual fund, managed asset and personal financial services company. The company has three operating units, Investors Group, Mackenzie Financial Corporation and Investment Planning Counsel Inc. This company is part of Power Financial group. Its web site is http://www.igmfinancial.com/english/. See my spreadsheets on this company at www.spbrunner.com/stocks/igm.htm. I have reloaded my spreadsheet with the new figures for the second quarterly report for June 2008.
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. . See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Tuesday, August 26, 2008
IGM Financial
I invested in the company (TSX-IGM) in October 2006 and I have made 0% return. If it had not been for the dividends, I would have had a loss. Of course, I have not made anything on this stock this year. I expect to make money once this financial crisis is over.
The following values are all for the last 5 years to December 31, 2007, which is the last annual statement date. The Revenues have increased at 8.3% per year, and this is not bad. The increase in Earnings per Share (EPS) has not been bad at 12.5% per year. The increase in dividends has been a very good number at 15.6% per year. The closing price has increased at the rate of 17.9% per year. This is different from my figures above, as my figures in the first paragraph are from Quicken and they are figures from purchase date to the present date.
The Asset/Liability Ratio at 2.13 is very good. The Return on Equity (ROE) is good at 21% for 2007 and this is higher than the 5 year average of 19.6%. The Accrual Ratio is not good at 8.9%. Dividends have raised the 5 year average return by over 4%.
I still expect to do well in this stock and I will not be selling it because of the lack of a current profit. They are still raising their dividends as the last increase was in April this year. This is right on schedule. Their next scheduled dividend increase would be expected in October and this has already been declared. Their total dividend increases for 2008 will be 15.5%, which is close to the 5 year average of 15.6%. I will review this stock to see if it is a good buy tomorrow.
This is a premier mutual fund, managed asset and personal financial services company. The company has three operating units, Investors Group, Mackenzie Financial Corporation and Investment Planning Counsel Inc. This company is part of Power Financial group. Its web site is http://www.igmfinancial.com/english/.
See my spreadsheets on this company at www.spbrunner.com/stocks/igm.htm.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
The following values are all for the last 5 years to December 31, 2007, which is the last annual statement date. The Revenues have increased at 8.3% per year, and this is not bad. The increase in Earnings per Share (EPS) has not been bad at 12.5% per year. The increase in dividends has been a very good number at 15.6% per year. The closing price has increased at the rate of 17.9% per year. This is different from my figures above, as my figures in the first paragraph are from Quicken and they are figures from purchase date to the present date.
The Asset/Liability Ratio at 2.13 is very good. The Return on Equity (ROE) is good at 21% for 2007 and this is higher than the 5 year average of 19.6%. The Accrual Ratio is not good at 8.9%. Dividends have raised the 5 year average return by over 4%.
I still expect to do well in this stock and I will not be selling it because of the lack of a current profit. They are still raising their dividends as the last increase was in April this year. This is right on schedule. Their next scheduled dividend increase would be expected in October and this has already been declared. Their total dividend increases for 2008 will be 15.5%, which is close to the 5 year average of 15.6%. I will review this stock to see if it is a good buy tomorrow.
This is a premier mutual fund, managed asset and personal financial services company. The company has three operating units, Investors Group, Mackenzie Financial Corporation and Investment Planning Counsel Inc. This company is part of Power Financial group. Its web site is http://www.igmfinancial.com/english/.
See my spreadsheets on this company at www.spbrunner.com/stocks/igm.htm.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Monday, August 25, 2008
TD Bank 2
As I said on Friday, I bought this bank (TSX-TD) in 2000 and since that time, I have made an average annual return of 10%. The TD bank was the only bank to raise its dividend in the first quarter of this year, in April. There is no word at the moment on an October raise. If this is the only dividend raise for this year, the annual raise for this year will at 11.85%, be lower than the 5 year average raise of 13.5%. Most people expect that the earnings for 2008 will be slightly ahead of last year. However, this year will not be a great year for any Canadian Bank stock. The third quarterly reports for all banks are expected soon. The second quarter for April 2008 is out and I have updated my spreadsheet with this report.
The number of share outstanding has gone up almost 12% because of the purchase Commerce Bancorp Inc. and this is a very legitimate reason for shares to go up.
This bank has done about the same as the TSX Financial Index over the last year and, of course, worse than the TSX Index. Over the last 5 years, this stock and the TSX Financial Index has done worse than the TSX, but this is basically because of the current banking problems. If you look at the last 10 years, including the recent problems, this stock, as well as the TSX Financial Index has done much better than the TSX. It is the long term that really counts, if you are buying stocks for the long term. The TD Bank has basically tracked the TSX Financial Index.
Over all this has been a good investment for me. I can find nothing negative at this point to say about this bank. I number of analyst have a buy rating and a number have a hold rating. There is no rating that I can see below a hold. TD Bank’s current price is below its Graham price, and this does point to a good time to buy. Also, the P/E rating at 10% is lower than the 5 year average of 16.7% The yield at 4% is higher than the 5 year average of 3%. If you want to buy a bank at a good price, then this bank is at a good price.
However, I do not think the current crisis has past. It is hard to know when this will happen. There may yet be a better price for this bank. Of course there may not be. This is very hard to tell. However, currently this bank is at a good price.
TD bank is a bank with a full range of financial products and services for individuals and corporations in Canada and USA. Its web site is www.td.com. See my spreadsheets on this company at www.spbrunner.com/stocks/td.htm. I have reloaded my spreadsheet to include the last quarterly figures.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
The number of share outstanding has gone up almost 12% because of the purchase Commerce Bancorp Inc. and this is a very legitimate reason for shares to go up.
This bank has done about the same as the TSX Financial Index over the last year and, of course, worse than the TSX Index. Over the last 5 years, this stock and the TSX Financial Index has done worse than the TSX, but this is basically because of the current banking problems. If you look at the last 10 years, including the recent problems, this stock, as well as the TSX Financial Index has done much better than the TSX. It is the long term that really counts, if you are buying stocks for the long term. The TD Bank has basically tracked the TSX Financial Index.
Over all this has been a good investment for me. I can find nothing negative at this point to say about this bank. I number of analyst have a buy rating and a number have a hold rating. There is no rating that I can see below a hold. TD Bank’s current price is below its Graham price, and this does point to a good time to buy. Also, the P/E rating at 10% is lower than the 5 year average of 16.7% The yield at 4% is higher than the 5 year average of 3%. If you want to buy a bank at a good price, then this bank is at a good price.
However, I do not think the current crisis has past. It is hard to know when this will happen. There may yet be a better price for this bank. Of course there may not be. This is very hard to tell. However, currently this bank is at a good price.
TD bank is a bank with a full range of financial products and services for individuals and corporations in Canada and USA. Its web site is www.td.com. See my spreadsheets on this company at www.spbrunner.com/stocks/td.htm. I have reloaded my spreadsheet to include the last quarterly figures.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Friday, August 22, 2008
TD Bank
I bought this bank (TSX-TD) in 2000. Since that time, I have made an average annual return of 10%. Over the last 5 years, I have made a return of 14.7% per year. I have not made any money over the last year, but this is to be expected, considering we have been in a bear market.
The following values are all for the last 5 years to October 31, 2007, which is the last annual statement date. The Revenues have increased at 8.6% per year, and this is not bad. The increase in Earnings per Share (EPS) has been a great 17.8% per year and the increase dividends has been a very good number at 13.5% per year. The closing price has increased at the rate of 22.7% per year. This is different from my figures above, as my figures in the first paragraph are from Quicken and they are figures to date.
The Asset/Liability Ratio is at 1.05 and this is normal for a bank. The Return on Equity (ROE) is good at 18.6% for 2007 and this is higher than the 5 year average of 16.7%. The Accrual Ratio is not bad at 3.3%. Dividends have raised the 5 year average return by over 3%.
Over all this has been a good investment for me. Any investment that can give you a return of 10% over the long term is a very good investment.
TD bank is a bank with a full range of financial products and services for individuals and corporations in Canada and USA. Its web site is www.td.com. See my spreadsheets on this company at www.spbrunner.com/stocks/td.htm.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
The following values are all for the last 5 years to October 31, 2007, which is the last annual statement date. The Revenues have increased at 8.6% per year, and this is not bad. The increase in Earnings per Share (EPS) has been a great 17.8% per year and the increase dividends has been a very good number at 13.5% per year. The closing price has increased at the rate of 22.7% per year. This is different from my figures above, as my figures in the first paragraph are from Quicken and they are figures to date.
The Asset/Liability Ratio is at 1.05 and this is normal for a bank. The Return on Equity (ROE) is good at 18.6% for 2007 and this is higher than the 5 year average of 16.7%. The Accrual Ratio is not bad at 3.3%. Dividends have raised the 5 year average return by over 3%.
Over all this has been a good investment for me. Any investment that can give you a return of 10% over the long term is a very good investment.
TD bank is a bank with a full range of financial products and services for individuals and corporations in Canada and USA. Its web site is www.td.com. See my spreadsheets on this company at www.spbrunner.com/stocks/td.htm.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Thursday, August 21, 2008
Stocks for the Long Run, Jeremy J. Siegel
The 4th edition of this book is at http://www.amazon.com/Stocks-Long-Run-Jeremy-Siegel/dp/007149470, on Amazon. (I had read the 2nd edition.) Jeremy Siegel has his own site at http://www.jeremysiegel.com/. See http://www.mcnallyrobinson.com/product/isbn/9780071494700/bkm/true, for a review of his book. Siegel has articles on the internet at http://www.econlib.org/LIBRARY/Enc/StockPrices.html.
Even though the book is American and it deals with the US, it can also apply to us here in Canada. I, of course, started investing in stocks long before I had read this book. I also invest for the long run and I have done very well. As near as I can figures, I have made, since I started investing in the 70’s an average annual return of 10.3%.
I am basically 100% invested in stocks, 100% of the time. The one main problem with this is that when good investment opportunities come along, I have no available cash for investing. Take the current situation. The fall in the TSX has presented lots of very good buying opportunities and I can take advantage of few.
However, even with the above problem, over the long term, being investing 100% in stocks has been very good for me and I have made good long term returns. The problem with holding back some cash for good investments is that you never know when these opportunities will come. Look at the bear market we had in 2000, 2001. A stock market crash had been predicted for sometime. Alan Greenspan made his “irrational exuberance remark in December 1996. If I had put money aside, it would have earned little money for over 4 years or more.
So in closing, I should say there is not really good answer about whether or not too keep money in reserves for good opportunities. I did not do this so I really have no idea on how it would have affected my returns. In any event, this is an excellent book to read.
See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Even though the book is American and it deals with the US, it can also apply to us here in Canada. I, of course, started investing in stocks long before I had read this book. I also invest for the long run and I have done very well. As near as I can figures, I have made, since I started investing in the 70’s an average annual return of 10.3%.
I am basically 100% invested in stocks, 100% of the time. The one main problem with this is that when good investment opportunities come along, I have no available cash for investing. Take the current situation. The fall in the TSX has presented lots of very good buying opportunities and I can take advantage of few.
However, even with the above problem, over the long term, being investing 100% in stocks has been very good for me and I have made good long term returns. The problem with holding back some cash for good investments is that you never know when these opportunities will come. Look at the bear market we had in 2000, 2001. A stock market crash had been predicted for sometime. Alan Greenspan made his “irrational exuberance remark in December 1996. If I had put money aside, it would have earned little money for over 4 years or more.
So in closing, I should say there is not really good answer about whether or not too keep money in reserves for good opportunities. I did not do this so I really have no idea on how it would have affected my returns. In any event, this is an excellent book to read.
See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Wednesday, August 20, 2008
Royal Bank 2
Yesterday, I talked about the Royal Bank and what a good investment it has been for me. Today, I want to look at this bank as a good investment at the current time. There are diverse analyst ratings on this stock from Buy to Hold. No one thinks that the earnings are going to be going up much, or maybe going down some, for the October 2008 annual reporting date. In any case, they will not be great.
No Canadian bank has done well this year and they are not expected to do well in the short term. Usually, the Royal Bank raises it dividends twice a year. This year they missed an increase for May 2008 and so far, we do not know if there will be a rise in November 2008or not. In any event, the dividend raise this year will be half the usual increase. Dividends were raised 9.9% compared to the average annual raise of 19.8% over the last 5 years. The Return of Equity (ROE) for the quarterly report of April 2008 is 16.7%, and is lower than the 5 year average of 18.4%. These are the negative features shown in my spreadsheet.
I calculate the current Graham Price to be $43.92 compared to the current price of $45.27. These figures are very close. Also, the estimated P/E for 2008 is 10.6%, which is low compared the 5 year average of 14.6%. The estimated dividend yield for 2008 is 4.42, which is higher than the 5 year average of 3.18%. Also, the Price/Book Value ratio at 2.2542 is lower than the 5 year average of 2.65 and close to the 10 year average of 2.2492. All these factors point to this stock being at a good price to buy currently.
A theory is to buy good stocks when they have been beaten down. I agree with this, and Royal Bank has certainly been beaten down recently. There are lots of indicators to show that it is at a good price currently. However, expect some problems in the short term.
Its web site is www.rbc.com. See my spreadsheets on this company at www.spbrunner.com/stocks/ry.htm. I have reloaded my spreadsheet with new figures because of the Quarterly Report for April 2008.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
No Canadian bank has done well this year and they are not expected to do well in the short term. Usually, the Royal Bank raises it dividends twice a year. This year they missed an increase for May 2008 and so far, we do not know if there will be a rise in November 2008or not. In any event, the dividend raise this year will be half the usual increase. Dividends were raised 9.9% compared to the average annual raise of 19.8% over the last 5 years. The Return of Equity (ROE) for the quarterly report of April 2008 is 16.7%, and is lower than the 5 year average of 18.4%. These are the negative features shown in my spreadsheet.
I calculate the current Graham Price to be $43.92 compared to the current price of $45.27. These figures are very close. Also, the estimated P/E for 2008 is 10.6%, which is low compared the 5 year average of 14.6%. The estimated dividend yield for 2008 is 4.42, which is higher than the 5 year average of 3.18%. Also, the Price/Book Value ratio at 2.2542 is lower than the 5 year average of 2.65 and close to the 10 year average of 2.2492. All these factors point to this stock being at a good price to buy currently.
A theory is to buy good stocks when they have been beaten down. I agree with this, and Royal Bank has certainly been beaten down recently. There are lots of indicators to show that it is at a good price currently. However, expect some problems in the short term.
Its web site is www.rbc.com. See my spreadsheets on this company at www.spbrunner.com/stocks/ry.htm. I have reloaded my spreadsheet with new figures because of the Quarterly Report for April 2008.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Tuesday, August 19, 2008
Royal Bank
Since I have stated I will be investing in financial institutions, I decided to put up all my spreadsheets on financial institutions. I bought the Royal Bank in October 1995. Since that date, I have made an average annual return, including dividends, of 20.5%. Over the last 10 years I have made some 11.5% return per year. Over the last 5 years, I have made an average annual return of 13.5%.
Any stock that has returns of 8%, plus 2% dividends, for a total return of 10% per year is a great stock. With the Royal Bank, the dividends have added 3% per year to the return I received over both the last 10 years and the last 5 years. The returns in the first paragraph are to date, so they will vary from my spreadsheet, as the spreadsheet goes only to October of 2007.
The following values are all for the last 5 years to October 31, 2007. For this stock, the growth in Revenue is not great, but not bad either, at 5.4% per year over the last 5 years. The Earnings per Share (EPS) is much better at 16% per year, as is the increase in Closing Price at 19% per year. The increase in dividends at 19% per year is great. The increase in book value at 6.3% is ok.
The Cash Flow from Operations is rather meaningless for banks as it varies back and forth from a positive and negative figure. The Asset/Liability Ratio at 1.04% is normal for a bank. The Return on Equity (ROE) is great at 19.3% for last year and an average of 18.4% per year over the last 5 years. The Accrual Ratio at 4.6% in October 2007 is a little high.
But, as you can see, the returns on this stock are great and it is even better as a long term investment. You can invest and just let the dividend flow in. This is a long term investment. Tomorrow, I will look at this stock to see if it is a good investment today.
This is a bank. It provides personal and commercial banking, wealth management services, insurance, corporate and investment banking and transaction processing services on a global basis. It operates in Canada, USA, Caribbean, and other places around the globe.
Its web site is www.rbc.com. See my spreadsheets on this company at www.spbrunner.com/stocks/ry.htm.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Any stock that has returns of 8%, plus 2% dividends, for a total return of 10% per year is a great stock. With the Royal Bank, the dividends have added 3% per year to the return I received over both the last 10 years and the last 5 years. The returns in the first paragraph are to date, so they will vary from my spreadsheet, as the spreadsheet goes only to October of 2007.
The following values are all for the last 5 years to October 31, 2007. For this stock, the growth in Revenue is not great, but not bad either, at 5.4% per year over the last 5 years. The Earnings per Share (EPS) is much better at 16% per year, as is the increase in Closing Price at 19% per year. The increase in dividends at 19% per year is great. The increase in book value at 6.3% is ok.
The Cash Flow from Operations is rather meaningless for banks as it varies back and forth from a positive and negative figure. The Asset/Liability Ratio at 1.04% is normal for a bank. The Return on Equity (ROE) is great at 19.3% for last year and an average of 18.4% per year over the last 5 years. The Accrual Ratio at 4.6% in October 2007 is a little high.
But, as you can see, the returns on this stock are great and it is even better as a long term investment. You can invest and just let the dividend flow in. This is a long term investment. Tomorrow, I will look at this stock to see if it is a good investment today.
This is a bank. It provides personal and commercial banking, wealth management services, insurance, corporate and investment banking and transaction processing services on a global basis. It operates in Canada, USA, Caribbean, and other places around the globe.
Its web site is www.rbc.com. See my spreadsheets on this company at www.spbrunner.com/stocks/ry.htm.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Monday, August 18, 2008
Commodities and BRIC
How I am going to play this current commodities bull market is by investing in Canadian Financial Institutions, especially banks. This is the same strategy I have used successfully since the 70’s. BRIC by the way means Brazil, Russia, India and China. Our commodities bull market is being pushed especially by India and China.
Canada will do very well because of this as we have much in the way of all sorts of commodities. This commodities bull market should last for some years. Commodities markets have recently been mucking about. The current decline in the price of Oil has been in the news lately. This volatility, of course, is to be expected. This does not mean that there is a problem with our long term commodities bull market.
Both China and India are going to have times of problems, but they have certainly been doing some good capitalistic type moves and have made some good financial decisions lately. We seem to be currently in a time of problems, but this too will pass. It is always hard to say when problems will pass, but they will, they always do. Every market has it own rhythms. There are times when investors in any market act like a mob and times when they act as individuals, so there is a lot of psychology involved. This is why technical analysis, to a great degree, works.
As I have said earlier, I like to invest in banks and other financial stocks to take advantage of other economic activity occurring in Canada. Financial stocks are far less volatile than, say commodities, and this is why I like them. Our large Canadian Banks have been great long term investments, producing not only good returns, compared to the TSX, but also great and increasing dividend income.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Canada will do very well because of this as we have much in the way of all sorts of commodities. This commodities bull market should last for some years. Commodities markets have recently been mucking about. The current decline in the price of Oil has been in the news lately. This volatility, of course, is to be expected. This does not mean that there is a problem with our long term commodities bull market.
Both China and India are going to have times of problems, but they have certainly been doing some good capitalistic type moves and have made some good financial decisions lately. We seem to be currently in a time of problems, but this too will pass. It is always hard to say when problems will pass, but they will, they always do. Every market has it own rhythms. There are times when investors in any market act like a mob and times when they act as individuals, so there is a lot of psychology involved. This is why technical analysis, to a great degree, works.
As I have said earlier, I like to invest in banks and other financial stocks to take advantage of other economic activity occurring in Canada. Financial stocks are far less volatile than, say commodities, and this is why I like them. Our large Canadian Banks have been great long term investments, producing not only good returns, compared to the TSX, but also great and increasing dividend income.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Friday, August 15, 2008
The Age of Turbulence, by Alan Greenspan
The sub-title of this book is “Adventures in a New World”. This is a surprisingly readable book. I highly recommend it. Considering some of the past statements made by Alan Greenspan, I found it rather shocking that he can write an interesting and readable book. You should read this book as you might learn, in an entertaining and enjoyable way, something about economic matters. You will certainly learn a bit more about a man, no matter what you may think about him, that has had a big impact on the US economy and therefore on our Canadian economy.
Reading about Alan and reading reviews on this book, there seems to be too groups of people, those who love him and those who hate him. Those who hate him blame him for the current asset bubble crisis in the US and anything else wrong with the US economy.
So there are huge arguments on what he may or may have done for the US economy. You can take sides, or do as I do and just believe that no one knows what they are talking about when it comes to the economy. What I can see is that, whatever else you might think of Bush, he has certainly been bad for the US economy. The Social Security is still not properly funded. The federal debt is way out of control and it was only made worse by Bush.
We in Canada are in a much better position. We have the CPP under control. Our federal debt is under control. I never like Jean Chretien, however, you have to admit that between him and Paul Martin, our economy was put into great shape. I was so disappointed in Paul Martin as he made an awful Prime Minister. I was looking forward to him being Prime Minister, but it did not turn out as I had imagined. I guess he spent so much time and effort into getting the job, he did not know what to do when he got it.
Wikipedia, of course, has a section on Alan Greenspan. See book review in the NY Times at http://www.nytimes.com/2007/09/18/books/18leonhardt.html?_r=1&oref=slogin. There is some discussion of him at The Nation at http://www.thenation.com/blogs/notion?pid=233482. You can see the book on Amazon at http://www.amazon.com/Age-Turbulence-Adventures-New-World/dp/1594201315. For some of the book being read, go to http://www.audible.com/adbl/site/openplayer.jsp?popUp=false&productID=BK_PENG_000754&title=The+Age+of+Turbulence:+Adventures+in+a+New+World+(Unabridged).
See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Reading about Alan and reading reviews on this book, there seems to be too groups of people, those who love him and those who hate him. Those who hate him blame him for the current asset bubble crisis in the US and anything else wrong with the US economy.
So there are huge arguments on what he may or may have done for the US economy. You can take sides, or do as I do and just believe that no one knows what they are talking about when it comes to the economy. What I can see is that, whatever else you might think of Bush, he has certainly been bad for the US economy. The Social Security is still not properly funded. The federal debt is way out of control and it was only made worse by Bush.
We in Canada are in a much better position. We have the CPP under control. Our federal debt is under control. I never like Jean Chretien, however, you have to admit that between him and Paul Martin, our economy was put into great shape. I was so disappointed in Paul Martin as he made an awful Prime Minister. I was looking forward to him being Prime Minister, but it did not turn out as I had imagined. I guess he spent so much time and effort into getting the job, he did not know what to do when he got it.
Wikipedia, of course, has a section on Alan Greenspan. See book review in the NY Times at http://www.nytimes.com/2007/09/18/books/18leonhardt.html?_r=1&oref=slogin. There is some discussion of him at The Nation at http://www.thenation.com/blogs/notion?pid=233482. You can see the book on Amazon at http://www.amazon.com/Age-Turbulence-Adventures-New-World/dp/1594201315. For some of the book being read, go to http://www.audible.com/adbl/site/openplayer.jsp?popUp=false&productID=BK_PENG_000754&title=The+Age+of+Turbulence:+Adventures+in+a+New+World+(Unabridged).
See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Thursday, August 14, 2008
EnCana Corp 2
As I said yesterday, I have done well by this stock. However, I do not have much of it, and I will keep an eye on it as Oil and Gas stocks can be volatile. Also, my spreadsheet shows the values from Alberta Energy Company prior to 2002. The reality of when stocks amalgamate is that you have to look at how well they are doing from the perspective of where you came from and in this case, I originally had the Alberta Energy stock.
The first thing to remark on this stock today is the increase in Dividends. The dividends have gone up, in 2007 and in 2008 by 100% each year. Because of the price of oil, they are probably making money. This has also put the dividend payout ratio to almost 27%. In my spreadsheet, I have included figures from the last quarterly report of June 2008. These figures have brought the Accrual Ratio down quite a bit to 4.5%, which is good.
This stock has done somewhat better than the TSX over the last year and last 5 years. It has come down quite a bit, as has the TSX, has since June 2008. The TSX Energy Index and the TSX has done about the same over the last 5 years and this stock has done better. The TSX Energy Index and this stock have done better than the TSX over the past year. A number of people have a buy rating on this stock, especially because of the recent decline in price. A split of the stock into two entities is still expected.
The reason I buy any resource stock is because a lot of Canadian companies are in resource field. I find I pay more attention to Canadian resources if I have some stock in this sector. I think that it is necessary to pay attention, as they are so much of our market. However, I never buy enough for them to have any sort of an affect on my portfolio as I keep all my resource stock under 2% of my portfolio. This stock is a good Canadian Oil stock and buying it is a good way of paying attention to the Canadian Oil resources.
This company is involved in the acquisition, exploration and development of natural gas, crude oil and natural gas liquids. It is a merger of Alberta Energy Company Ltd. (AEC) and PanCanadian Energy Corporation (PanCanadian) companies. It is a world-class independent oil and gas company.
Its web site is http://www.encana.com.
See my spreadsheets on this company at www.spbrunner.com/stocks/eca.htm.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
The first thing to remark on this stock today is the increase in Dividends. The dividends have gone up, in 2007 and in 2008 by 100% each year. Because of the price of oil, they are probably making money. This has also put the dividend payout ratio to almost 27%. In my spreadsheet, I have included figures from the last quarterly report of June 2008. These figures have brought the Accrual Ratio down quite a bit to 4.5%, which is good.
This stock has done somewhat better than the TSX over the last year and last 5 years. It has come down quite a bit, as has the TSX, has since June 2008. The TSX Energy Index and the TSX has done about the same over the last 5 years and this stock has done better. The TSX Energy Index and this stock have done better than the TSX over the past year. A number of people have a buy rating on this stock, especially because of the recent decline in price. A split of the stock into two entities is still expected.
The reason I buy any resource stock is because a lot of Canadian companies are in resource field. I find I pay more attention to Canadian resources if I have some stock in this sector. I think that it is necessary to pay attention, as they are so much of our market. However, I never buy enough for them to have any sort of an affect on my portfolio as I keep all my resource stock under 2% of my portfolio. This stock is a good Canadian Oil stock and buying it is a good way of paying attention to the Canadian Oil resources.
This company is involved in the acquisition, exploration and development of natural gas, crude oil and natural gas liquids. It is a merger of Alberta Energy Company Ltd. (AEC) and PanCanadian Energy Corporation (PanCanadian) companies. It is a world-class independent oil and gas company.
Its web site is http://www.encana.com.
See my spreadsheets on this company at www.spbrunner.com/stocks/eca.htm.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Wednesday, August 13, 2008
EnCana Corp
I have had EnCana Corp since February 2006 and to date I have had an average annual return of 21%. In the last 12 months, I have had a return of 15%. This is the second time I have held this stock. I had held it previous as Alberta Energy Company from April 2000 until August 2002 and made some 18% return per annum. As you can see I do not look on oil companies as a long term buy. Although, I must admit, that we are probably in a long term bull market for all resources because India and China. However, I will still keep an eye on this stock; I might sell if I feel that there are no further gains available in the future.
Since this stock is an amalgamation of two stocks, I have charted it from the Alberta Energy Company into EnCana at present. The other problem with charting this stock is that since 2002, the annual statements have been in US Dollars, not Canadian Dollars. What you need to ensure that when comparing figures you are comparing with using only one currency.
As you can see from my spreadsheet, the revenues have been increasing well at some 20.7% a year over the last 5 years. The Earnings per Share (EPS) has not done as well at 5.2% (but has done better in US$ than CDN$). While this EPS is not awful, it is great either. The Dividends have been increasing at 38% per year over the last 5 years. As you can see from the spreadsheet, they were level at $.14 a share between 1996 and 2000. Oil stocks only really do well when the price of oil is high.
At December 2007, the Graham price at $56.04 and the Closing Price of $67.50 are not that far off for an oil company. The Current Asset/Current Liability ratio at .70 is low, but the Asset/Liability ratio of 1.79 is very good. For 2007, the Return on Equity (ROE) at 19.3% is not bad, but not quite up to the 5 year average of 23%. Also, the Accrual Ratio is a bit high at 7.9%.
However, this has been a good stock for me lately and at the moment I will continue to hold it. Tomorrow, I will look more closely at how it is doing currently.
This company is involved in the acquisition, exploration and development of natural gas, crude oil and natural gas liquids. It is a merger of Alberta Energy Company Ltd. (AEC) and PanCanadian Energy Corporation (PanCanadian) companies. It is a world-class independent oil and gas company.
Its web site is www.encana.com.
See my spreadsheets on this company at www.spbrunner.com/stocks/eca.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Since this stock is an amalgamation of two stocks, I have charted it from the Alberta Energy Company into EnCana at present. The other problem with charting this stock is that since 2002, the annual statements have been in US Dollars, not Canadian Dollars. What you need to ensure that when comparing figures you are comparing with using only one currency.
As you can see from my spreadsheet, the revenues have been increasing well at some 20.7% a year over the last 5 years. The Earnings per Share (EPS) has not done as well at 5.2% (but has done better in US$ than CDN$). While this EPS is not awful, it is great either. The Dividends have been increasing at 38% per year over the last 5 years. As you can see from the spreadsheet, they were level at $.14 a share between 1996 and 2000. Oil stocks only really do well when the price of oil is high.
At December 2007, the Graham price at $56.04 and the Closing Price of $67.50 are not that far off for an oil company. The Current Asset/Current Liability ratio at .70 is low, but the Asset/Liability ratio of 1.79 is very good. For 2007, the Return on Equity (ROE) at 19.3% is not bad, but not quite up to the 5 year average of 23%. Also, the Accrual Ratio is a bit high at 7.9%.
However, this has been a good stock for me lately and at the moment I will continue to hold it. Tomorrow, I will look more closely at how it is doing currently.
This company is involved in the acquisition, exploration and development of natural gas, crude oil and natural gas liquids. It is a merger of Alberta Energy Company Ltd. (AEC) and PanCanadian Energy Corporation (PanCanadian) companies. It is a world-class independent oil and gas company.
Its web site is www.encana.com.
See my spreadsheets on this company at www.spbrunner.com/stocks/eca.htm.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Tuesday, August 12, 2008
Canadian Tire Corp 2
As I said yesterday, I bought this stock first in February 2000. There are various calls on this stock, from buy to hold. A lot of analysts feel that the earnings this year will be less than for 2007 and some that it will be slightly higher. There are, of course, fears that Canadian Tire might have problems competing against Wal-Mart. There seems to lots of buying and selling of this stock by insiders, and the buys seem to be greater than the sells, but mostly, there was not much change in insider ownership.
Looking at a chart of Canadian Tire, they tumbled in 2000, before the TSX bear market of 2001. This stock has done as well as the market until December 2007 when it has done much worse. This stock is part of the TSX Consumer’s Discretionary Index. It is done better than this index over the last 5 years, but the pattern of the index and this stock is the same. Over the past year, Canadian Tire has followed the TSX Consumer’s Discretionary Index almost exact, until August. At the time, there was an up tick in the index, but not in this stock. However, in the last week, there has been an uptick in this stock as well.
In June 2008, Canadian Tire increased their dividend by 13.5%. This would seem like a vote of confidence by the company if they raise the dividend. This is higher than the 5 year average of 13%. Also, the 5 year average P/E is 15.5. With the lowest of the estimate EPS, the P/E for 2008 would be 13 and if the EPS is $5.20, the P/E would be 10. This is almost as low as the P/E was in 2000, when it was 9.8.
I also looked at the Accrual Ratio for the quarter ending in June and it is -2.8%, a much better figure that for December 2007 which was 22%. However, I would rather have the accrual negative because the Cash from Operational Activities was higher than the Net Income, rather than have money from Investing Activities making this figure negative. A negative is that the EPS for the first and second quarter is lower than the comparable ones for the year earlier. However, a positive note is that the Revenue for the first and second quarters is higher than the comparables of a year earlier. You first have to grow Revenue, to grow earnings.
I do not have that much of this stock (2% of my holdings), but I am holding on to it. I, unfortunately, do not have money at this time for buying stock, so I will not be increasing my holdings.
Canadian Tire Corporation is engaged in retail sales, financial services and petroleum sales. They own Canadian Tire Store, Gas Outlets, Parts Source Stores and Mark's Work Warehouse. The Canadian Tire stores offer a unique range of automotive, sports and leisure and home products.
Its web site is http://www2.canadiantire.ca/CTenglish/corpidx.html.
See my spreadsheets on this company at www.spbrunner.com/stocks/ctc.htm which I have reloaded with estimates for 2008.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Looking at a chart of Canadian Tire, they tumbled in 2000, before the TSX bear market of 2001. This stock has done as well as the market until December 2007 when it has done much worse. This stock is part of the TSX Consumer’s Discretionary Index. It is done better than this index over the last 5 years, but the pattern of the index and this stock is the same. Over the past year, Canadian Tire has followed the TSX Consumer’s Discretionary Index almost exact, until August. At the time, there was an up tick in the index, but not in this stock. However, in the last week, there has been an uptick in this stock as well.
In June 2008, Canadian Tire increased their dividend by 13.5%. This would seem like a vote of confidence by the company if they raise the dividend. This is higher than the 5 year average of 13%. Also, the 5 year average P/E is 15.5. With the lowest of the estimate EPS, the P/E for 2008 would be 13 and if the EPS is $5.20, the P/E would be 10. This is almost as low as the P/E was in 2000, when it was 9.8.
I also looked at the Accrual Ratio for the quarter ending in June and it is -2.8%, a much better figure that for December 2007 which was 22%. However, I would rather have the accrual negative because the Cash from Operational Activities was higher than the Net Income, rather than have money from Investing Activities making this figure negative. A negative is that the EPS for the first and second quarter is lower than the comparable ones for the year earlier. However, a positive note is that the Revenue for the first and second quarters is higher than the comparables of a year earlier. You first have to grow Revenue, to grow earnings.
I do not have that much of this stock (2% of my holdings), but I am holding on to it. I, unfortunately, do not have money at this time for buying stock, so I will not be increasing my holdings.
Canadian Tire Corporation is engaged in retail sales, financial services and petroleum sales. They own Canadian Tire Store, Gas Outlets, Parts Source Stores and Mark's Work Warehouse. The Canadian Tire stores offer a unique range of automotive, sports and leisure and home products.
Its web site is http://www2.canadiantire.ca/CTenglish/corpidx.html.
See my spreadsheets on this company at www.spbrunner.com/stocks/ctc.htm which I have reloaded with estimates for 2008.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Monday, August 11, 2008
Canadian Tire Corp
I bought this stock first in February 2000. Since that time, including dividends, I have earned to date an average of 12.6% per year. Over the last 5 years, I have earned some 11.6% per year. However, over the last 12 months this stock has lost 33.5% of its value. This stock has been coming down since November 2007 and no one expects it to earn in 2008 what it earned in 2007.
All my following figures are for the 5 years ending in December 2007. Although revenue only advanced by 7.7% per year, the Earnings per Share (EPS) grew by 14.5% per year and the dividend was increasing at the rate of 13% per year. The closing stock price was increasing at a healthy19% per year. This is different from mine figures above as my figures are to date.
You could see problems to come by the end of December 2007 as the Operational Cash Flow decreased by 34% from the end of 2006, giving an negative average at -17% per year over the last 5 years. Also in December 2007, the Operational Profit Margin at 2% was way below the 5 year average of 6.7 %. Their return on equity at December 2007 was 13.5%. This is because the Cash from Operations was lower than the Net Income. You would want the opposite. This higher Net Income also resulted in a high Accrual Ratio of 22%.
Although they are clearly having problems at the moment, I am still holding onto my stock. Tomorrow I will at this stock to see if it is currently a buy or not.
Canadian Tire Corporation is engaged in retail sales, financial services and petroleum sales. They own Canadian Tire Store, Gas Outlets, Parts Source Stores and Mark's Work Warehouse. The Canadian Tire stores offer a unique range of automotive, sports and leisure and home products.
Its web site is http://www2.canadiantire.ca/CTenglish/corpidx.html.
See my spreadsheets on this company at www.spbrunner.com/stocks/ctc.htm.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
All my following figures are for the 5 years ending in December 2007. Although revenue only advanced by 7.7% per year, the Earnings per Share (EPS) grew by 14.5% per year and the dividend was increasing at the rate of 13% per year. The closing stock price was increasing at a healthy19% per year. This is different from mine figures above as my figures are to date.
You could see problems to come by the end of December 2007 as the Operational Cash Flow decreased by 34% from the end of 2006, giving an negative average at -17% per year over the last 5 years. Also in December 2007, the Operational Profit Margin at 2% was way below the 5 year average of 6.7 %. Their return on equity at December 2007 was 13.5%. This is because the Cash from Operations was lower than the Net Income. You would want the opposite. This higher Net Income also resulted in a high Accrual Ratio of 22%.
Although they are clearly having problems at the moment, I am still holding onto my stock. Tomorrow I will at this stock to see if it is currently a buy or not.
Canadian Tire Corporation is engaged in retail sales, financial services and petroleum sales. They own Canadian Tire Store, Gas Outlets, Parts Source Stores and Mark's Work Warehouse. The Canadian Tire stores offer a unique range of automotive, sports and leisure and home products.
Its web site is http://www2.canadiantire.ca/CTenglish/corpidx.html.
See my spreadsheets on this company at www.spbrunner.com/stocks/ctc.htm.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Friday, August 8, 2008
Omnivore’s Dilemma, by Michael Pollan
If you want to know how our food gets to us, and how animals are treated, this is the book to read. It is American, so I do not know how relevant it is for Canadians, but it is interesting none the less. I am sure a lot of what sells in Canada is the same as in the US. Our food is the result of an industrial system. It is interesting how much corn plays a part in the food we get at our grocery stores.
Although, I must admit that I always tended to get only fruits, vegetables, meat and dairy in my weekly shopping. About the only prepackaged stuff I got was some cereal, and this was usually things like a package of oatmeal. I had a kid, so I had to also get some boxed cereal and some pop.
It is interesting how such books as thus one come out just when thinks are changing. This summer, in my local area, we have a farmer’s market opening one day a week. Also, just in the past year, we have a small bakery opened. The bread is wonderful. They list the ingredients for the bread, and it is only 5 items and I understand what all are. Unlike the awful bread, we were subjects to just 10 years ago (and still in the shops) which have a list of ingredients as long as your arm. I had no idea what most of the ingredients were.
When I had a cottage, I got local meat, and the local cattle were grass fed. The steaks were the best I have ever had. I do not know how the pigs and chickens were fed, but the chops and chickens I got were great also. The local place I went for meat was called an abattoir. This is just a French word for slaughterhouse and I do not know why it was called that. It would seem that such small local slaughterhouses are illegal in the US. That is too bad. I heard nothing locally about anyone having any problems with this slaughterhouse. This was a small community, and everyone knows everything that happens. If there had ever been a problem, I would have heard. I guess that sometimes it helps to be behind the US in things as having the privilege of a local slaughterhouse.
Michael Pollan has his own site at http://www.michaelpollan.com/. He also has a blog at http://pollan.blogs.nytimes.com/ and is on the Berkeley web site at http://journalism.berkeley.edu/faculty/pollan/. You can find his books at Amazon.com if you go to http://www.amazon.com/s?ie=UTF8&search-type=ss&index=books&field-author=Michael%20Pollan&page=1. There is also an review of his commandments of eating at http://www.seriouseats.com/required_eating/2008/01/michael-pollans-twelve-commandments-for-serio.html.
Although, I must admit that I always tended to get only fruits, vegetables, meat and dairy in my weekly shopping. About the only prepackaged stuff I got was some cereal, and this was usually things like a package of oatmeal. I had a kid, so I had to also get some boxed cereal and some pop.
It is interesting how such books as thus one come out just when thinks are changing. This summer, in my local area, we have a farmer’s market opening one day a week. Also, just in the past year, we have a small bakery opened. The bread is wonderful. They list the ingredients for the bread, and it is only 5 items and I understand what all are. Unlike the awful bread, we were subjects to just 10 years ago (and still in the shops) which have a list of ingredients as long as your arm. I had no idea what most of the ingredients were.
When I had a cottage, I got local meat, and the local cattle were grass fed. The steaks were the best I have ever had. I do not know how the pigs and chickens were fed, but the chops and chickens I got were great also. The local place I went for meat was called an abattoir. This is just a French word for slaughterhouse and I do not know why it was called that. It would seem that such small local slaughterhouses are illegal in the US. That is too bad. I heard nothing locally about anyone having any problems with this slaughterhouse. This was a small community, and everyone knows everything that happens. If there had ever been a problem, I would have heard. I guess that sometimes it helps to be behind the US in things as having the privilege of a local slaughterhouse.
Michael Pollan has his own site at http://www.michaelpollan.com/. He also has a blog at http://pollan.blogs.nytimes.com/ and is on the Berkeley web site at http://journalism.berkeley.edu/faculty/pollan/. You can find his books at Amazon.com if you go to http://www.amazon.com/s?ie=UTF8&search-type=ss&index=books&field-author=Michael%20Pollan&page=1. There is also an review of his commandments of eating at http://www.seriouseats.com/required_eating/2008/01/michael-pollans-twelve-commandments-for-serio.html.
Thursday, August 7, 2008
Alimentation Couche-Tard Inc 2
Nobody seems to feel that this stock (TSX-ATD.B) will do well for reporting year April 2009, but will recover for April 2010. Unfortunately, many Canadian companies that expand into the US in retail do not do well. The positive side there is insider buying and the company is buying up some of their shares. The other positive is the revenue rise. In terms of earnings, no one seems to feel these will improve until next year and will not show up in the annual statements until April 2010.
Some of the analysts have a Hold rating on this stock and some a Buy rating. I am holding my stock for the present as I think it will again do well in the future, but result might not come until the later part of 2009. The Hold ratings seem to be the disappointing earnings for the year and quarter ending in April 2008.
Over the last 10 years, this stock has done much better than the TSX. However, if you look at this stock in any shorter time period, it is done much worse, although not that badly over the last 5 years. This stock has been dropping since January 2007, but has a slight up tick since mid July 2008, but has gone down over the last two days.
Any purchase of this stock is a risk and the dividend income is not great. Although, if this company’s past history is any guide, this stock might again do very well. It is also close to the Graham price of $12.14.
Alimentation Couche-Tard is Canada’s leading convenience store retailer under brands such as Couche-Tard, Mac’s, Becker’s, Mike’s Mart and has US brand Circle K. The company has alliances with fast-food chains including M & M Meat Shops, Pizza Pizza, Subway and Irving Oil. They just opened up Circle K brand in Vietnam.
Its web site is www.couche-tard.com. See my spreadsheets on this company at www.spbrunner.com/stocks/atd.htm. I have reloaded my spreadsheet with estimate for earnings next year.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Some of the analysts have a Hold rating on this stock and some a Buy rating. I am holding my stock for the present as I think it will again do well in the future, but result might not come until the later part of 2009. The Hold ratings seem to be the disappointing earnings for the year and quarter ending in April 2008.
Over the last 10 years, this stock has done much better than the TSX. However, if you look at this stock in any shorter time period, it is done much worse, although not that badly over the last 5 years. This stock has been dropping since January 2007, but has a slight up tick since mid July 2008, but has gone down over the last two days.
Any purchase of this stock is a risk and the dividend income is not great. Although, if this company’s past history is any guide, this stock might again do very well. It is also close to the Graham price of $12.14.
Alimentation Couche-Tard is Canada’s leading convenience store retailer under brands such as Couche-Tard, Mac’s, Becker’s, Mike’s Mart and has US brand Circle K. The company has alliances with fast-food chains including M & M Meat Shops, Pizza Pizza, Subway and Irving Oil. They just opened up Circle K brand in Vietnam.
Its web site is www.couche-tard.com. See my spreadsheets on this company at www.spbrunner.com/stocks/atd.htm. I have reloaded my spreadsheet with estimate for earnings next year.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Wednesday, August 6, 2008
Alimentation Couche-Tard Inc
I started buying this stock (TSX-ATD.B) in January 2006 and it has basically just gone down in price. Since then this stock has lost 6% for me. Over the last 5 years, the revenue growth at 45% and the Earnings per Share (EPS) growth at 22% look good. However, if you look closer, neither the Revenue nor EPS have grown much over the last 3 years. I got into this stock in 2006 as it had a good past record and had started to pay a dividend. It has not done much since then.
Dividend growth has not been bad, but yield is very low at less than 1%. Also, the payout ratio at an average of 12% is low.
The stock price has increased over the last 5 years at an average of 16.5%, however, the stock has only gone down over the last 3 years. If you look at the cash flow average over the last 5 years, it is good at 17%, but again, has decreased over the last 3 years. The Current Asset/Current Liability is 1.03 and that is a little low, but the Asset/Liability Ratio at 1.61 is a healthy number. The Accrual Ratio has been awful in the past, but is now not bad at .3%. Last year it was very high at 23%.
In looking at this stock, the 5 year and 10 year figures are good, but the last 3 years had been bad.
Alimentation Couche-Tard is Canada’s leading convenience store retailer under brands such as Couche-Tard, Mac’s, Becker’s and Mike’s Mart. Their sales come from fuel, lottery tickets snack food, newspapers and magazines, as well branded products such as Sunshine Joe Coffee. The company has alliances with fast-food chains including M & M Meat Shops, Pizza Pizza and Subway. They are expanding into the U.S., having bought Johnson Oil, a major gas station and convenience store operator.
Its web site is www.couche-tard.com. See my spreadsheets on this company at www.spbrunner.com/stocks/atd.htm. I have loaded my spreadsheet with figures from recent April 2008 Annual Report.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Dividend growth has not been bad, but yield is very low at less than 1%. Also, the payout ratio at an average of 12% is low.
The stock price has increased over the last 5 years at an average of 16.5%, however, the stock has only gone down over the last 3 years. If you look at the cash flow average over the last 5 years, it is good at 17%, but again, has decreased over the last 3 years. The Current Asset/Current Liability is 1.03 and that is a little low, but the Asset/Liability Ratio at 1.61 is a healthy number. The Accrual Ratio has been awful in the past, but is now not bad at .3%. Last year it was very high at 23%.
In looking at this stock, the 5 year and 10 year figures are good, but the last 3 years had been bad.
Alimentation Couche-Tard is Canada’s leading convenience store retailer under brands such as Couche-Tard, Mac’s, Becker’s and Mike’s Mart. Their sales come from fuel, lottery tickets snack food, newspapers and magazines, as well branded products such as Sunshine Joe Coffee. The company has alliances with fast-food chains including M & M Meat Shops, Pizza Pizza and Subway. They are expanding into the U.S., having bought Johnson Oil, a major gas station and convenience store operator.
Its web site is www.couche-tard.com. See my spreadsheets on this company at www.spbrunner.com/stocks/atd.htm. I have loaded my spreadsheet with figures from recent April 2008 Annual Report.
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. See my website at www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Tuesday, August 5, 2008
Canadian National Railway 2
A lot of analysts have a buy rating on this stock because of the June 30, 2008 quarterly report. With the June 30, 2008 quarterly report, we can see revenue is up but earnings are down. The current P/E rating of 13.2 is below the 5 year average of 14.6. The dividend yield is higher at 1.6% than the 5 year average of 1.29. The dividend yield is significant as the yield tends to go towards the average and for this to happen, the stock price must rise.
With this June report, the Current Asset/Current Liability ratio has improved to 1.00 from .66. This means that there are sufficient current assets to cover current liability. The Asset/Liability Ratio is still a healthier 1.71, as any ratio above 1.50 is good.
Even though the economy is weak in US and Canada, this company is doing well. I feel that although this stock is not cheap, it is at a reasonable price and therefore might be a buy. The Revenue growth is a good sign, as revenue has not kept pace with earnings growth. The other negative I see is for June 30, 2008 the accrual ratio is high at 5.77. I am sure that this stock will have a reasonable growth going forward.
CNR have railways lines that cross the North American continent and serve ports on the Atlantic, Pacific and Gulf coasts. They link customers to all three NAFTA nations. Its web site is http://www.cn.ca/about/en_about.shtml. See my spreadsheets on this company at http://www.spbrunner.com/stocks/cnr.htm. I have reloaded my spreadsheet with figures from June 2008 quarterly report and 2008 estimates.
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. See my website at http://www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
With this June report, the Current Asset/Current Liability ratio has improved to 1.00 from .66. This means that there are sufficient current assets to cover current liability. The Asset/Liability Ratio is still a healthier 1.71, as any ratio above 1.50 is good.
Even though the economy is weak in US and Canada, this company is doing well. I feel that although this stock is not cheap, it is at a reasonable price and therefore might be a buy. The Revenue growth is a good sign, as revenue has not kept pace with earnings growth. The other negative I see is for June 30, 2008 the accrual ratio is high at 5.77. I am sure that this stock will have a reasonable growth going forward.
CNR have railways lines that cross the North American continent and serve ports on the Atlantic, Pacific and Gulf coasts. They link customers to all three NAFTA nations. Its web site is http://www.cn.ca/about/en_about.shtml. See my spreadsheets on this company at http://www.spbrunner.com/stocks/cnr.htm. I have reloaded my spreadsheet with figures from June 2008 quarterly report and 2008 estimates.
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. See my website at http://www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
Friday, August 1, 2008
Canadian National Railway
I bought this stock (TSX-CNR) in July 2005, and since that date, I have made, including dividends, a return of 12.3% per annum. This stock is of medium risk and it is on both the Mergent’s Dividend Achievers’ list and the S&P/TSX Canadian Dividend Aristocrats List. I also sometimes look at a web site of Mike Higgs at http://www.dividendgrowth.org/Report.htm. Mike gives a quarterly report showing Canadian Dividend Paying Growth Stocks and if they are cheap based on the dividend yield. This stock is on his list and he shows it cheap in respect to its current dividend yield.
I also have a spreadsheet on this stock. It shows that the Earnings per Share (EPS) have been increasing over the last 5 years at the rate of 24% per annum. Over the last 10 years, the EPS has increased at just 7.8%. As you can see, it has done much better over the last 5 years. This company was also, a crown corporation until 1995.
The dividends have been increasing very well at 24% over the last 5 years per annum and 18.5% over the last 10 years per annum. However, the yield is low as it is averages only 1.3%. You can see this also in the total return on this stock, where for the last 5 years the stock has increased at 17% per annum and the total return (price plus dividends) has increased by 18.9% per annum. The Graham price on this stock at December 31, 2007 is $44.79 and is not far from the closing stock price of $46.65.
The other good things about this stock are that the Operational Cash Flow has been increasing, over the last 5 years at almost 13% per year and the Book Value at a not bad 8%. Also, the Accrual Ratio is not bad at 2.4%.
The negatives are that the Revenues have only increased in the last 5 years by 5% per year and the Current Asset/Current Liability Ratio is only .66. (However, the Asset/Liability Ratio is a much healthier 1.77.) The last negative thing is the Book Value is decreasing in connection with the stock price. However, its value is still higher at 2.22 that the 10 year average of 1.88.
CNR have railways lines that cross the North American continent and serve ports on the Atlantic, Pacific and Gulf coasts. They link customers to all three NAFTA nations. Its web site is http://www.cn.ca/about/en_about.shtml. See my spreadsheet on this company at http://www.spbrunner.com/stocks/cnr.htm.
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. See my website at http://www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
I also have a spreadsheet on this stock. It shows that the Earnings per Share (EPS) have been increasing over the last 5 years at the rate of 24% per annum. Over the last 10 years, the EPS has increased at just 7.8%. As you can see, it has done much better over the last 5 years. This company was also, a crown corporation until 1995.
The dividends have been increasing very well at 24% over the last 5 years per annum and 18.5% over the last 10 years per annum. However, the yield is low as it is averages only 1.3%. You can see this also in the total return on this stock, where for the last 5 years the stock has increased at 17% per annum and the total return (price plus dividends) has increased by 18.9% per annum. The Graham price on this stock at December 31, 2007 is $44.79 and is not far from the closing stock price of $46.65.
The other good things about this stock are that the Operational Cash Flow has been increasing, over the last 5 years at almost 13% per year and the Book Value at a not bad 8%. Also, the Accrual Ratio is not bad at 2.4%.
The negatives are that the Revenues have only increased in the last 5 years by 5% per year and the Current Asset/Current Liability Ratio is only .66. (However, the Asset/Liability Ratio is a much healthier 1.77.) The last negative thing is the Book Value is decreasing in connection with the stock price. However, its value is still higher at 2.22 that the 10 year average of 1.88.
CNR have railways lines that cross the North American continent and serve ports on the Atlantic, Pacific and Gulf coasts. They link customers to all three NAFTA nations. Its web site is http://www.cn.ca/about/en_about.shtml. See my spreadsheet on this company at http://www.spbrunner.com/stocks/cnr.htm.
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. See my website at http://www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on web site.
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