Wednesday, November 12, 2008

Stantec Inc 2

As I said yesterday, I will review for this stock (TSX-STN), the latest quarterly report and update my spreadsheet accordingly. The reason it was recommend is that it is in the infrastructure business. There are many that think this company will profit from government money promised for infrastructure building. I have looked at this stock recently as there are lots of people that think it is a great stock. I bought a small amount in April of this year. It, of course, has lost money for me this year, but I think that I will benefit from it in the long term.

I notice that lots of analysts still have estimated EPS for this stock for 2008 around $1.80. However, since the September quarter there was a loss of $.66, I do not see how this can be. This best that I can see is that it will earn $1.20. However, since the September loss is due to non-cash charges, this lost does not mean too much.

The Current Asset/Current Liability Ratio is no longer a problem and it is the good range of 1.54. Anything over 1.5 is good. The Asset/Liability Ratio is still quite high (and very good) at 1.89. The current P/E is slightly below the 5 year average 19.7. If you go with what others think this stock will earn this year, the current P/E is around 12. However, the price still is not at or lowers than the Graham Price, but this may not happen.

One very good thing is that over the last 90 days there has been lots of insider buying. Stantec has also been buying back their shares and this is also a positive sign. Both their gross and net revenues are up and this is also positive. I think that this is a great company, but you should only buy if you can stand the higher risk that come with buying this stock.

Stantec Inc is a profitable Construction & Engineering company that trades on the TSX. It provides professional services in planning, engineering, architecture, interior design, landscape architecture, surveying and geomatics, environmental sciences project management and project economics for clients, from initial concept and financial feasibility, to project completion and beyond. Its web site is See my spreadsheet at I have reloaded my spreadsheet with the 3rd quarterly report 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 for a list of the stocks for which I have put up spreadsheets on my web site.

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