Looking over what I have reviewed, I could not believe I have not reviewed one of my favorite stocks, Saputo (TSX-SAP). Considering the fact that I started my purchases in 2006 and 2007 on this stock, and it has earned me a rate of return of 7.2% per year and we are in a bear market, this is nothing short of great. According to my spreadsheet, only just over 2% of the increase is coming from Dividends.
All my following figures are for the year ending at the last annual statement of March 2008. First, what I find good about this stock. The Earnings per Share (EPS) growth for the last 5 and 10 years was 8.3% and 20%. The 5 year rate is not great, but it is acceptable. The 5 and 10 years growth for Dividends was 19% and 35%. The 5 and 10 year figures for Closing Price is 21% and 14%. The 5 and 10 year figures for Book Value is 10% and 15%. The 5 and 10 year figures for Cash Flow is 5.5% and 18.9%. The 5 year figures for Cash Flow are not that good, but again, it is acceptable.
Other things to like are the Liquidity Ratio of 1.55 and the Asset/Liability Ratio of 2.45. The Liquidity Ratio is not as good as the 5 year average of 1.70, but it is higher than 1.50 and this is good. The Return on Equity (ROE) is 16.6% for a 5 year average and was 17.8% for March 2008. These are good figures. The Operation Profit Margin (OPM) is 5.75% and this is good for this type of company.
The only real thing I do not like is the Accrual Ratio, which is very high at 12.86%. Including the Financial Cash Flow in this calculation only increases this Ratio.
So, in review, most of the indicators I follow are favorable on this stock. The main one I really do not like is the Accrual ratio and this may not mean too much but I will keep an eye on it. The liquidity ratio is favorable and this is important in a bear market. Tomorrow, I will review what the analysts are saying about this stock.
This company is a dairy processor and cheese producer in Canada and USA. Its web site is www.saputo.com. See my spreadsheet at www.spbrunner.com/stocks/sap.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 my web site.
I have also reloaded my index to the stock I have reviewed and it is at www.spbrunner.com/stocks/indexport.htm. If you look at my site today at www.spbrunner.com you will see that I have added a section on cooking and cook books I can recommend.
Friday, January 30, 2009
Thursday, January 29, 2009
Canadian National Railway 2
As I said yesterday, I will look to see what the analysts are saying about this stock (TSX-CNR) today. I will update my spreadsheet with the figures from analyst’s reports and current stock prices. I have included estimates for 2009 and 2010. However, do not forget that these are just estimates, and can therefore be very wrong.
The first thing I want to note is that the Globe Investor site gives this stock a 5 star rating. In looking at the ratings for this stock, they range from Strong Buy to Hold, with lots of Hold ratings. However, the mean rating is a Buy. (See my site for information on analyst ratings.) When looking at insider buying and selling there is a lot of selling. However, the selling seems to be all options. This, of course, tells you nothing.
If you look at the charts, this stock has outperformed the TSX and the TSX Industrial Index (of which it is a part) over 1, 3, 5 and 10 year periods. However, it does seem to be trading in a band for the last 3 years. Note that a lot of people feel that the TSX has been trading in a Band for quite some time. By trading in a Band, I mean that this stock has stayed within a price range of $40 to $60. It has not been lower than $40 and it has not been higher than $60 within the last 3 years.
Now I shall look at the spreadsheet to see if this stock is at a good price. This first thing to note that the price is below the last Graham price I had calculated. The last Graham Price was $44.46 and it is trading currently at $43.55. The yield at 2.3% is higher than the 5 year average of 1.6%. The P/E is 11 and this is lower than the 5 year average of 13.8. It is also slightly below the 5 year average low of 11.3. The Price to Book Value (P/BV) is at 2.0 and this is lower than the 5 year average of 2.29.
What is negative about this stock is that the Price/Cash Flow Ratio is 10.5 and this is slightly above the 5 year average of 9.2. The other negative, which I pointed out yesterday, is the Liquidity Ratio is just .93. This means that the company does not have current assets to cover current liabilities. However, any stock you look at will have at least some negative quality. Also, this company is on everybody’s list, including the usual ones of Dividend Achievers, Dividend Aristocrats and Mike’s.
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 www.cn.ca. See my spreadsheet at 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 www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on my web site.
The first thing I want to note is that the Globe Investor site gives this stock a 5 star rating. In looking at the ratings for this stock, they range from Strong Buy to Hold, with lots of Hold ratings. However, the mean rating is a Buy. (See my site for information on analyst ratings.) When looking at insider buying and selling there is a lot of selling. However, the selling seems to be all options. This, of course, tells you nothing.
If you look at the charts, this stock has outperformed the TSX and the TSX Industrial Index (of which it is a part) over 1, 3, 5 and 10 year periods. However, it does seem to be trading in a band for the last 3 years. Note that a lot of people feel that the TSX has been trading in a Band for quite some time. By trading in a Band, I mean that this stock has stayed within a price range of $40 to $60. It has not been lower than $40 and it has not been higher than $60 within the last 3 years.
Now I shall look at the spreadsheet to see if this stock is at a good price. This first thing to note that the price is below the last Graham price I had calculated. The last Graham Price was $44.46 and it is trading currently at $43.55. The yield at 2.3% is higher than the 5 year average of 1.6%. The P/E is 11 and this is lower than the 5 year average of 13.8. It is also slightly below the 5 year average low of 11.3. The Price to Book Value (P/BV) is at 2.0 and this is lower than the 5 year average of 2.29.
What is negative about this stock is that the Price/Cash Flow Ratio is 10.5 and this is slightly above the 5 year average of 9.2. The other negative, which I pointed out yesterday, is the Liquidity Ratio is just .93. This means that the company does not have current assets to cover current liabilities. However, any stock you look at will have at least some negative quality. Also, this company is on everybody’s list, including the usual ones of Dividend Achievers, Dividend Aristocrats and Mike’s.
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 www.cn.ca. See my spreadsheet at 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 www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on my web site.
Wednesday, January 28, 2009
Canadian National Railway
As I said yesterday, I was looking to buy some more Canadian National Railway (TSX-CNR) today. Although the proxy and 2008 Annual Statements have not been distributed, the unaudited 4th quarterly report is available online. So I have updated my spreadsheet for the year ending December 2008
All my following figures are for the year ending at the last annual statement of December 2008. First, what I find good about this stock. The Earnings per Share (EPS) growth for the last 5 and 10 years was 18% and 23%. The 5 and 10 years growth for Dividends was 22% and 18%. The 5 and 10 year figures for Closing Price is 12% and 15%. The 5 and 10 year figures for Book Value is 8% and 10%.
What I do not like is that the Liquidity (Current Asset/Current Liability Ratio) is only .93. This is better than the 5 and 10 year averages of .71 and .68 but I would like it to be higher. The Asset/Liability is much better at 1.66. This is a little lower than the 5 and 10 year averages, but still good. The 5 and 10 growth figures for revenues at 8% and 7% are not bad, but not great either.
I bought this stock in 2005 and during this time, my dividends have increase by just over 100%. I have also made an average annual return of 8.2%. This is not bad considering the fact that we are in a bear market. The dividends have not added a great deal to this stock, as the yield is low at an average of 1.5%. So, it has added to the return by only 1.5% per year. However, CNR has raised their dividend every year, and they have again announced that the dividends will increase for the dividend due at the end of March 2009.
So, in review, most of the indicators I follow are favorable on this stock. The main one I do not like is the liquidity ratio and this is not a great time to have a low liquidity ratio. However, no stock is going to be perfect. Tomorrow, I will review what the analysts are saying about this stock.
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 www.cn.ca. See my spreadsheet at 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 www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on my web site.
All my following figures are for the year ending at the last annual statement of December 2008. First, what I find good about this stock. The Earnings per Share (EPS) growth for the last 5 and 10 years was 18% and 23%. The 5 and 10 years growth for Dividends was 22% and 18%. The 5 and 10 year figures for Closing Price is 12% and 15%. The 5 and 10 year figures for Book Value is 8% and 10%.
What I do not like is that the Liquidity (Current Asset/Current Liability Ratio) is only .93. This is better than the 5 and 10 year averages of .71 and .68 but I would like it to be higher. The Asset/Liability is much better at 1.66. This is a little lower than the 5 and 10 year averages, but still good. The 5 and 10 growth figures for revenues at 8% and 7% are not bad, but not great either.
I bought this stock in 2005 and during this time, my dividends have increase by just over 100%. I have also made an average annual return of 8.2%. This is not bad considering the fact that we are in a bear market. The dividends have not added a great deal to this stock, as the yield is low at an average of 1.5%. So, it has added to the return by only 1.5% per year. However, CNR has raised their dividend every year, and they have again announced that the dividends will increase for the dividend due at the end of March 2009.
So, in review, most of the indicators I follow are favorable on this stock. The main one I do not like is the liquidity ratio and this is not a great time to have a low liquidity ratio. However, no stock is going to be perfect. Tomorrow, I will review what the analysts are saying about this stock.
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 www.cn.ca. See my spreadsheet at 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 www.spbrunner.com/stocks.html for a list of the stocks for which I have put up spreadsheets on my web site.
Tuesday, January 27, 2009
Canadian Utilities 2
Since I stopped working, I have enjoyed taking my morning coffee, almost daily, at Starbucks. I go to the one that in the old Britnell’s Book shop on Yonge, just north of Bloor. This is a lovely place to go. For $2, you can enjoy a great cup of coffee and an atmosphere conducive to reading. I am always reading about how expensive Starbucks is. However, I suppose expensive depends on your point of view. Take the stock market. Some feel that it is still not cheap enough and do not feel that this is the time to start buying. However, it is relatively cheap, so I am slowly buying. Today I was looking into buying Canadian National Railway. I will discuss this stock tomorrow.
Now back to the current stock I want to discuss, Canadian Utilities (TSX-CU). Mostly the insider buying/selling has been on the selling side. However, the selling seems to be in options, so this does not tell us anything. Most analysts have a Hold rating on this stock. However, most also seem to think it is a good quality utility company with solid dividends. It has not done as well as other utilities or the TSX this year, and this seems to be why it is rated as a Hold. Also, most analysts seem to feel that earnings will be fairly flat for 2009.
However, if you look at this stock over the 1, 3, 5 and 10 year periods, it has done better than the TSX and TSX Utility Index. This is a good stock to get solid dividends and solid capital gains. The average 5 year yield is just over 3%, and the dividend increases per year over the last 5 years is quite good at almost 5%. The dividend increase for both 2008 and 2009 has been over 6%.
Good buying indicators are that the current price is quite close to the Graham Price, the current yield of 3.7% is higher than the 5 year average of 2.88% and the P/E of around 12% is lower than the 5 year average of 16%. The negatives are the expected flat earnings and the expected flat cash flow going into 2009. The stock price will probably not pick up until there is some earnings or Cash Flow growth again.
Canadian Utilities Limited operates in four business segments: regulated natural gas operations; regulated electric operations; technologies; and power generation. These operations provide service to industrial, residential and commercial customers. Other businesses consist of: natural gas gathering, processing, storage and natural gas supply management and technical facilities management. ATCO owns this company. Its web site is www.canadian-utilities.com. See my spreadsheet atwww.spbrunner.com/stocks/cu.htm. I have reloaded my spreadsheet to include the latest 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.
Now back to the current stock I want to discuss, Canadian Utilities (TSX-CU). Mostly the insider buying/selling has been on the selling side. However, the selling seems to be in options, so this does not tell us anything. Most analysts have a Hold rating on this stock. However, most also seem to think it is a good quality utility company with solid dividends. It has not done as well as other utilities or the TSX this year, and this seems to be why it is rated as a Hold. Also, most analysts seem to feel that earnings will be fairly flat for 2009.
However, if you look at this stock over the 1, 3, 5 and 10 year periods, it has done better than the TSX and TSX Utility Index. This is a good stock to get solid dividends and solid capital gains. The average 5 year yield is just over 3%, and the dividend increases per year over the last 5 years is quite good at almost 5%. The dividend increase for both 2008 and 2009 has been over 6%.
Good buying indicators are that the current price is quite close to the Graham Price, the current yield of 3.7% is higher than the 5 year average of 2.88% and the P/E of around 12% is lower than the 5 year average of 16%. The negatives are the expected flat earnings and the expected flat cash flow going into 2009. The stock price will probably not pick up until there is some earnings or Cash Flow growth again.
Canadian Utilities Limited operates in four business segments: regulated natural gas operations; regulated electric operations; technologies; and power generation. These operations provide service to industrial, residential and commercial customers. Other businesses consist of: natural gas gathering, processing, storage and natural gas supply management and technical facilities management. ATCO owns this company. Its web site is www.canadian-utilities.com. See my spreadsheet atwww.spbrunner.com/stocks/cu.htm. I have reloaded my spreadsheet to include the latest 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.
Monday, January 26, 2009
Canadian Utilities
This stock (TSX-CU) is on the Dividend Achievers list at www.dividendachievers.com, the Dividend Aristocrats list at www.tmxmoney.com/en/individual.html (see indices) and also on Mike Higgs’ list at www.dividendgrowth.org/Report.htm. Today I will review how this stock has done in the past. Tomorrow I will look at it now and for the future.
All my following figures are for the year ending at the last annual statement of December 2007. The annual report for December 2008 is not yet out.
The dividend growth for the last 5 and 10 years was 4.9% and 4.8%. Although these are not great figures, they are higher than inflation. The 5 and 10 years growth for Closing Price was 16% and 12%. The 5 and 10 year figures for Cash Flow are 16% and 10%. The 5 and 10 years growth for Book Value was 7% and 7%. The Liquidity Ratio is 2.11 and the Asset/Liability Ratio is 1.45. These are all decent figures.
There has been no growth in revenues over the 5 years, and in fact, the revenues have been going down. This is not good. Also, the 5 and 10 year growth for Earnings per Share (EPS) was 5% and 8%. These are rather mediocre. However, as for all dividend paying stock, the cash flow is more important. The Accrual Ratio is 4.4%. This is rather high, but not awful.
Basically, this is a good quality dividend paying stock and I can see why it is on so many lists. The yield is been around 3% and is now at 3.6%. You will not get rich on it, but it has been a solid stock.
Canadian Utilities Limited operates in four business segments: regulated natural gas operations; regulated electric operations; technologies; and power generation. These operations provide service to industrial, residential and commercial customers. Other businesses consist of: natural gas gathering, processing, storage and natural gas supply management and technical facilities management. ATCO owns this company. Its web site is www.canadian-utilities.com. See my spreadsheet at www.spbrunner.com/stocks/cu.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 my web site.
All my following figures are for the year ending at the last annual statement of December 2007. The annual report for December 2008 is not yet out.
The dividend growth for the last 5 and 10 years was 4.9% and 4.8%. Although these are not great figures, they are higher than inflation. The 5 and 10 years growth for Closing Price was 16% and 12%. The 5 and 10 year figures for Cash Flow are 16% and 10%. The 5 and 10 years growth for Book Value was 7% and 7%. The Liquidity Ratio is 2.11 and the Asset/Liability Ratio is 1.45. These are all decent figures.
There has been no growth in revenues over the 5 years, and in fact, the revenues have been going down. This is not good. Also, the 5 and 10 year growth for Earnings per Share (EPS) was 5% and 8%. These are rather mediocre. However, as for all dividend paying stock, the cash flow is more important. The Accrual Ratio is 4.4%. This is rather high, but not awful.
Basically, this is a good quality dividend paying stock and I can see why it is on so many lists. The yield is been around 3% and is now at 3.6%. You will not get rich on it, but it has been a solid stock.
Canadian Utilities Limited operates in four business segments: regulated natural gas operations; regulated electric operations; technologies; and power generation. These operations provide service to industrial, residential and commercial customers. Other businesses consist of: natural gas gathering, processing, storage and natural gas supply management and technical facilities management. ATCO owns this company. Its web site is www.canadian-utilities.com. See my spreadsheet at www.spbrunner.com/stocks/cu.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 my web site.
Friday, January 23, 2009
BCE Inc
I am looking at this stock (TSX-BCE) as I just received the proxy information on it, but there will no 2008 annual report or meeting until probably June 2008. Since the last annual statement was out in December 2007, and the last quarterly statement was September 2008, I will deal with these statements. I will also deal with what analysts are saying about this stock.
First, let us deal with the proxy. As with other high profile Canadian companies, the proxy contain a long list of shareholder proposals. All of the current ones come from a Quebec organization called MEDAC. I do not know the agenda of the organization, but I knew when I read the first proposal of “Increased dividends for long term shareholders” that this organization does not know what it is talking about. It would be illegal for BCE to treat shareholders differently. Even I know that. I did not vote for any of the shareholder proposals. I do not believe in voting for a board of directors and then tying their hands up as to what they can and cannot do.
I looked first at insider buying and selling and there is nothing going on either way. BCE has restored their dividend, but there was no increase. Revenue and earnings are fairly flat of late, although there has been some growth in Cash Flow and Book Value. The Accrual Ratio has remained low. The yield is higher at 5.8% than the 5 year average of 4.4%. The P/E at 11.5% is lower than the 5 year average of 13%. Also, the Graham Price is at $30.17, higher than the current price of $25.17. This all points to a relative good buy at present.
There is a surprising number of Strong Buys out on this stock. There are also a number of Hold ratings. Because of this, the mean rating is a Buy. (See my site for information on analyst ratings.) Some people think that Bell is stronger now that it has the new management put in place by those who wanted to buy it. No one expects the revenues or EPS to make a strong showing for the 2008 statement year end. The main worry seems to be that BCE is facing strong competitive pressure and that it may not do that well. At the moment I plan to continue to hold my shares, but I will be keeping a close eye on this stock and might sell in the future.
BCE Inc. is a communications company. Through Bell Canada, BCE provides local telephone, long distance, wireless communications, Internet access, data, video and other services to residential and business customers. Additional subsidiaries include Bell Globemedia, a media company that includes CTV and the Globe and Mail. Its web site is www.bce.ca. See my spreadsheet at www.spbrunner.com/stocks/bce.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 my web site.
First, let us deal with the proxy. As with other high profile Canadian companies, the proxy contain a long list of shareholder proposals. All of the current ones come from a Quebec organization called MEDAC. I do not know the agenda of the organization, but I knew when I read the first proposal of “Increased dividends for long term shareholders” that this organization does not know what it is talking about. It would be illegal for BCE to treat shareholders differently. Even I know that. I did not vote for any of the shareholder proposals. I do not believe in voting for a board of directors and then tying their hands up as to what they can and cannot do.
I looked first at insider buying and selling and there is nothing going on either way. BCE has restored their dividend, but there was no increase. Revenue and earnings are fairly flat of late, although there has been some growth in Cash Flow and Book Value. The Accrual Ratio has remained low. The yield is higher at 5.8% than the 5 year average of 4.4%. The P/E at 11.5% is lower than the 5 year average of 13%. Also, the Graham Price is at $30.17, higher than the current price of $25.17. This all points to a relative good buy at present.
There is a surprising number of Strong Buys out on this stock. There are also a number of Hold ratings. Because of this, the mean rating is a Buy. (See my site for information on analyst ratings.) Some people think that Bell is stronger now that it has the new management put in place by those who wanted to buy it. No one expects the revenues or EPS to make a strong showing for the 2008 statement year end. The main worry seems to be that BCE is facing strong competitive pressure and that it may not do that well. At the moment I plan to continue to hold my shares, but I will be keeping a close eye on this stock and might sell in the future.
BCE Inc. is a communications company. Through Bell Canada, BCE provides local telephone, long distance, wireless communications, Internet access, data, video and other services to residential and business customers. Additional subsidiaries include Bell Globemedia, a media company that includes CTV and the Globe and Mail. Its web site is www.bce.ca. See my spreadsheet at www.spbrunner.com/stocks/bce.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 my web site.
Thursday, January 22, 2009
Arc Energy Trust 2
Today I want to review Arc Energy Trust stock (TSX-AET.UN) to see what analysts are saying about it. First, I note that there has been lately a lot of insider selling. However, this selling is by a former Director, so this is probably not significant. There has been insider buying by current Directors and Officers of this company. I do not own any of this stock, but I find it an intriguing idea for the TFSA account. However, it is considered to be a high risk stock as it is in the oil business; however, it is not in the oil discovery, but in oil recovery. It would not be considered to be as high risk as oil exploration companies are.
I have today updated my spreadsheet for the latest quarterly report of September 2008. There are lots of Buy ratings on this stock, and a few Strong Buys and some Holds. The mean rating would be a Buy. (See my site for information on analyst ratings.) This stock is considered a good long term investment.
In looking at the charts, this stock, in the 1 year, 3 year, 5 year and 10 year periods has done better than the TSX Energy Trust Index. It also did better than the TSX index, except for the 3 year period. For the year to date (YTD) period, it has done worse than the TSX and the TSX Energy Trust Index.
Looking at the updates to the spreadsheet, I find that the yield at 9% is lower than the 5 year average of 11%. However, this is due to the recent decline in distributions. The Graham Price at $23.29 is higher than the current price of $16.34 by almost 20%. The current P/E at 7% is lower than the 5 year average of almost 11%. Both these indicators are good. The negative thing I find is that the Liquidity Ratio is has gone down a bit since December 2007 to .68. However, the Asset/Liability Ratio is very good at 2.34. The Accrual Ratio has gone down to 2.74% and this is good also. All in all, I can see why a number of analyst are recommending this stock.
Arc Energy Trust acquires and develops long-life low declining oil and gas properties in Western Canada. Its web site is www.arcresources.com. See my spreadsheet at www.spbrunner.com/stocks/aet.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 my web site.
I have today updated my spreadsheet for the latest quarterly report of September 2008. There are lots of Buy ratings on this stock, and a few Strong Buys and some Holds. The mean rating would be a Buy. (See my site for information on analyst ratings.) This stock is considered a good long term investment.
In looking at the charts, this stock, in the 1 year, 3 year, 5 year and 10 year periods has done better than the TSX Energy Trust Index. It also did better than the TSX index, except for the 3 year period. For the year to date (YTD) period, it has done worse than the TSX and the TSX Energy Trust Index.
Looking at the updates to the spreadsheet, I find that the yield at 9% is lower than the 5 year average of 11%. However, this is due to the recent decline in distributions. The Graham Price at $23.29 is higher than the current price of $16.34 by almost 20%. The current P/E at 7% is lower than the 5 year average of almost 11%. Both these indicators are good. The negative thing I find is that the Liquidity Ratio is has gone down a bit since December 2007 to .68. However, the Asset/Liability Ratio is very good at 2.34. The Accrual Ratio has gone down to 2.74% and this is good also. All in all, I can see why a number of analyst are recommending this stock.
Arc Energy Trust acquires and develops long-life low declining oil and gas properties in Western Canada. Its web site is www.arcresources.com. See my spreadsheet at www.spbrunner.com/stocks/aet.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 my web site.
Wednesday, January 21, 2009
Arc Energy Trust
I have recently been reading all I can find on the new Tax Free Saving Accounts (TFSA) and one suggestion I found interesting was the recommendation to put a stock like Arc Energy Trust (TSX-AET.UN) into your TFSA. This makes sense to me as most of the distributions from this trust are Taxable Income and so it is not very tax efficient for holding outside an RRSP or TFSA accounts.
This first thing I should say about this stock is that it is in the Oil business, so its distributions can vary depending on the price of oil. And, if you look at current distributions, they have just come down. However, people have made good money over the years from this trust stock.
All my following figures are for the year ending at the last annual statement of December 2007. The revenue growth for the last 5 and 10 years was 23% and 35%. The 5 and 10 years growth for Earnings per Share (EPS) was 32% and 20%. The 5 and 10 year figures for cash flow are 13% and 11%. The total return for the closing price for the last 5 and 10 years are 20% and 25%. These are all great figures.
The book value for the last 5 and 10 years are 6% and 1%. This are not great, but trust stocks tend to payout their earnings so there is not much room for book value growth. The liquidity of this stock is also low at .72, where the current assets cannot cover the current liabilities. These stocks tend to be like this, but in a bear market caused by a credit crunch, it is not good. However, the Asset/Liability ratio is a much healthier 2.30.
There are no stability ratings for this stock, but this must be considered to be a high risk stock as it is in the oil industry. Tomorrow, I will talk about what the analyst say about this stock.
Arc Energy Trust acquires and develops long-life low declining oil and gas properties in Western Canada. Its web site is www.arcresources.com. See my spreadsheet at www.spbrunner.com/stocks/aet.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 my web site.
This first thing I should say about this stock is that it is in the Oil business, so its distributions can vary depending on the price of oil. And, if you look at current distributions, they have just come down. However, people have made good money over the years from this trust stock.
All my following figures are for the year ending at the last annual statement of December 2007. The revenue growth for the last 5 and 10 years was 23% and 35%. The 5 and 10 years growth for Earnings per Share (EPS) was 32% and 20%. The 5 and 10 year figures for cash flow are 13% and 11%. The total return for the closing price for the last 5 and 10 years are 20% and 25%. These are all great figures.
The book value for the last 5 and 10 years are 6% and 1%. This are not great, but trust stocks tend to payout their earnings so there is not much room for book value growth. The liquidity of this stock is also low at .72, where the current assets cannot cover the current liabilities. These stocks tend to be like this, but in a bear market caused by a credit crunch, it is not good. However, the Asset/Liability ratio is a much healthier 2.30.
There are no stability ratings for this stock, but this must be considered to be a high risk stock as it is in the oil industry. Tomorrow, I will talk about what the analyst say about this stock.
Arc Energy Trust acquires and develops long-life low declining oil and gas properties in Western Canada. Its web site is www.arcresources.com. See my spreadsheet at www.spbrunner.com/stocks/aet.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 my web site.
Tuesday, January 20, 2009
Dividend Increases for 2008
At the financial forum, I talked to few people. They were all shocked when I said that my dividend income had increased in 2008. I looked at my statements for dividends in 2007, compared it to 2008, and found that my dividend income was up 13%.
Today, I am putting up a spreadsheet (see www.spbrunner.com/stocks/dividendincome.htm) showing two things about my dividend income for 2008. The first column called “Div” and the second is called “08”. Under “Div”, I have recorded the dividend increase for that particular stock for 2008 compared to 2007. The second column of “08”, I have recorded if the company actually declared a dividend increase for 2008.
This probably needs some explanation. First, take the Royal Bank (TSX-RY). My dividend from them was 9.9% higher in 2008 then in 2007. However, the Royal Bank did not declare a dividend increase in 2008. They did declare two dividend increases in 2007, one for May 2007 and one for November 2007. So the dividends I received in 2008 were those declared as of November 2008. So while I got more money in dividends from them, they did not actually declare a dividend increase. In 2007, I got dividends from them in February, May, August and November per share of $.40, $.46, $.46, and $.50 for a total of $1.82 per share. In 2008, I again got 4 dividends but of $.50 per share for a total of $2.00 per share. Going from $1.82 per share to $2.00 per share for year gives me an increase in dividends of 9.9%.
The next thing I want to talk about is special dividends. Companies are very reluctant to declare dividend increases unless they feel that they can be permanent. Nothing will destroy share value like a dividend decrease. Take the stock Leon's Furniture (TSX-LNF). They declared a one time special dividend of $.10 a share for May of 2008. According to my figures, the amount of dividends I got from Leon’s increase by over 32% in 2008. In my spreadsheet, I show in the “08” column “SP” for special dividends.
I have two stocks that have dividends paid in foreign currency. Sometimes, the currency exchange rate has more effect on my dividends than what is actually declared by the company. For these two stocks, I put a “U” (for unknown) in the “08” column. Also, for recent purchases, where I do not know if there was a dividend increased declared, I also put “U” (for unknown) in the “08” column.
For stock which I do not receive dividends, I just put “n/a” in the “Div” column. For stock which I purchased in 2007 and early in 2008, where I know if a dividend increase was declared or not, but I do not have enough data to determine the increase, I put “n/a” in the “Div” column and “Y”, or “N” as applicable in the “08” column. Also, I should make a special note on Bombardier (TSX-BBD.B). This stock cut their dividends in 2003 and completely stopped them in 2005. When dividends were resumed 2008, they were higher than those paid in 2005, but not as high as those paid in 2003 were.
My experience is that during bear markets, the rate of dividend increases slow down, but they do not cease all together. It will be interesting to see what the banks do for 2009. Both the Royal Bank and the Bank of Montreal have long histories of giving out more dividends each year. If they do no dividend increases in 2009, then there will be no increases in dividends for both these stocks.
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.
Today, I am putting up a spreadsheet (see www.spbrunner.com/stocks/dividendincome.htm) showing two things about my dividend income for 2008. The first column called “Div” and the second is called “08”. Under “Div”, I have recorded the dividend increase for that particular stock for 2008 compared to 2007. The second column of “08”, I have recorded if the company actually declared a dividend increase for 2008.
This probably needs some explanation. First, take the Royal Bank (TSX-RY). My dividend from them was 9.9% higher in 2008 then in 2007. However, the Royal Bank did not declare a dividend increase in 2008. They did declare two dividend increases in 2007, one for May 2007 and one for November 2007. So the dividends I received in 2008 were those declared as of November 2008. So while I got more money in dividends from them, they did not actually declare a dividend increase. In 2007, I got dividends from them in February, May, August and November per share of $.40, $.46, $.46, and $.50 for a total of $1.82 per share. In 2008, I again got 4 dividends but of $.50 per share for a total of $2.00 per share. Going from $1.82 per share to $2.00 per share for year gives me an increase in dividends of 9.9%.
The next thing I want to talk about is special dividends. Companies are very reluctant to declare dividend increases unless they feel that they can be permanent. Nothing will destroy share value like a dividend decrease. Take the stock Leon's Furniture (TSX-LNF). They declared a one time special dividend of $.10 a share for May of 2008. According to my figures, the amount of dividends I got from Leon’s increase by over 32% in 2008. In my spreadsheet, I show in the “08” column “SP” for special dividends.
I have two stocks that have dividends paid in foreign currency. Sometimes, the currency exchange rate has more effect on my dividends than what is actually declared by the company. For these two stocks, I put a “U” (for unknown) in the “08” column. Also, for recent purchases, where I do not know if there was a dividend increased declared, I also put “U” (for unknown) in the “08” column.
For stock which I do not receive dividends, I just put “n/a” in the “Div” column. For stock which I purchased in 2007 and early in 2008, where I know if a dividend increase was declared or not, but I do not have enough data to determine the increase, I put “n/a” in the “Div” column and “Y”, or “N” as applicable in the “08” column. Also, I should make a special note on Bombardier (TSX-BBD.B). This stock cut their dividends in 2003 and completely stopped them in 2005. When dividends were resumed 2008, they were higher than those paid in 2005, but not as high as those paid in 2003 were.
My experience is that during bear markets, the rate of dividend increases slow down, but they do not cease all together. It will be interesting to see what the banks do for 2009. Both the Royal Bank and the Bank of Montreal have long histories of giving out more dividends each year. If they do no dividend increases in 2009, then there will be no increases in dividends for both these stocks.
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.
Monday, January 19, 2009
Third Day, Toronto Financial Forum
The first speaker I heard on Saturday was Doug Nelson talking about planning your retirement and withdrawals from your RRSPs. He first starts out to ask; what is the answer to having enough money in Retirement is. Perhaps you can delay your retirement date. Maybe you can work part-time in retirement. You could invest more money into your plan. You could take more risk with your retirement funds. You could reduce your expenses. Perhaps you could start a small business to fund some of your retirement requirements. Maybe you could draw less income from your investments.
Doug goes on to give the following steps. Step 1: Do a Retirement Plan. You should define what you want in retirement. You need to define your overall plan. Step 2: You need to define your "after tax" monthly and annual income needs. Step 3: You need to differentiate between your basic income needs and your lifestyle wants. Think about having part of your money in an annuity to cover basic living costs. Step 4: Look at tax efficiency. You will have to deal with clawbacks and tax credits and also with income taxes. Step 5: You need to design a portfolio to meet your income needs in an efficient manner. You need to match annual expenses and annual income. Step 6: You need to compare an investment portfolio with 100% guaranteed solution. Step 7: You need to compare any investment portfolio with your personal risk profile. See we all go to www.myrisktolerance.com and assess our risk level. Step 8: Select investments that meet your income needs, your tax efficiency goals and your risk profile.
Doug recommended we go to www.knowledgebureau.com. I looked at this site and perhaps you might be interested in the free webcasts. He feels we all need a “Master Plan” for retirement. He also feels that a lot of us need to look at annuities to provide some of your retirement income.
The next people I heard from were “The Market Guys” and their talk was on options. They have their own web site at www.themarketguys.com. The next speaker was Jim Ruta on “How to Build an Expert Financial Team”. He basically says that we need to have a number of advisers such as a Financial Planner, an Investment Advisor, a Life Insurance Agent, a Financial Advisor and a Mutual Fund Representative. There is not one person that can cover all our financial needs. However, one of these advisors can plan the role of team leader.
The next speaker I heard was Ken Norquay of Castlemoore Inc. They have a website at www.castlemoore.com. This site has some free newsletters and multimedia stuff. Basically, he said we are in a cyclical bear market. No one knows when it will be over. We have been in cyclical bear markets before. These past cyclical bear markets were in the years of 1906-1916, 1929 to 1942m 1966 to 1982 and currently since 2000. He says how you invest in cyclical bear markets is to buy and sell. Buy at bottoms and sell at tops. When we go into the next cyclical bull market, which occur between cyclical bear markets, how you invest is to buy and hold. If you have read anything about bear and bull markets, you will find that people define the dates of bull and bear markets differently. The above is just the opinion of Ken Norquary.
The last speaker I heard was Kurt Rosentreter, who has a website at www.kurtismycfo.com. He produces a number of newsletters. He says some interesting things. The first thing is that you should divide your expenses into 4 categories. They are core fixed, core variable (ones you can control the costs somewhat), discretionary (like dinner at restaurant), and luxury (like a good expensive car). He thinks that we should avoid condos as retirement homes (as there is big correction in price coming). He thinks that we should not put too much of our wealth into non-income producing property. He says that the stock market will correct every five years, approximately, and we should prepare for that. He finishes with the statement, I am sure you have hear before, that you should never, ever, buy anything you do not understand.
I talked to some people at this forum. When I told people that my dividend income went up this year, they were shocked. Tomorrow I will put up a spreadsheet on this subject.
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.
Doug goes on to give the following steps. Step 1: Do a Retirement Plan. You should define what you want in retirement. You need to define your overall plan. Step 2: You need to define your "after tax" monthly and annual income needs. Step 3: You need to differentiate between your basic income needs and your lifestyle wants. Think about having part of your money in an annuity to cover basic living costs. Step 4: Look at tax efficiency. You will have to deal with clawbacks and tax credits and also with income taxes. Step 5: You need to design a portfolio to meet your income needs in an efficient manner. You need to match annual expenses and annual income. Step 6: You need to compare an investment portfolio with 100% guaranteed solution. Step 7: You need to compare any investment portfolio with your personal risk profile. See we all go to www.myrisktolerance.com and assess our risk level. Step 8: Select investments that meet your income needs, your tax efficiency goals and your risk profile.
Doug recommended we go to www.knowledgebureau.com. I looked at this site and perhaps you might be interested in the free webcasts. He feels we all need a “Master Plan” for retirement. He also feels that a lot of us need to look at annuities to provide some of your retirement income.
The next people I heard from were “The Market Guys” and their talk was on options. They have their own web site at www.themarketguys.com. The next speaker was Jim Ruta on “How to Build an Expert Financial Team”. He basically says that we need to have a number of advisers such as a Financial Planner, an Investment Advisor, a Life Insurance Agent, a Financial Advisor and a Mutual Fund Representative. There is not one person that can cover all our financial needs. However, one of these advisors can plan the role of team leader.
The next speaker I heard was Ken Norquay of Castlemoore Inc. They have a website at www.castlemoore.com. This site has some free newsletters and multimedia stuff. Basically, he said we are in a cyclical bear market. No one knows when it will be over. We have been in cyclical bear markets before. These past cyclical bear markets were in the years of 1906-1916, 1929 to 1942m 1966 to 1982 and currently since 2000. He says how you invest in cyclical bear markets is to buy and sell. Buy at bottoms and sell at tops. When we go into the next cyclical bull market, which occur between cyclical bear markets, how you invest is to buy and hold. If you have read anything about bear and bull markets, you will find that people define the dates of bull and bear markets differently. The above is just the opinion of Ken Norquary.
The last speaker I heard was Kurt Rosentreter, who has a website at www.kurtismycfo.com. He produces a number of newsletters. He says some interesting things. The first thing is that you should divide your expenses into 4 categories. They are core fixed, core variable (ones you can control the costs somewhat), discretionary (like dinner at restaurant), and luxury (like a good expensive car). He thinks that we should avoid condos as retirement homes (as there is big correction in price coming). He thinks that we should not put too much of our wealth into non-income producing property. He says that the stock market will correct every five years, approximately, and we should prepare for that. He finishes with the statement, I am sure you have hear before, that you should never, ever, buy anything you do not understand.
I talked to some people at this forum. When I told people that my dividend income went up this year, they were shocked. Tomorrow I will put up a spreadsheet on this subject.
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.
Friday, January 16, 2009
Second Day, Toronto Financial Forum
Today, the first speaker I heard was John De Goey, who had a talked entitled “You Get What you Don’t Pay For”. This talk was to be about Professionalism in the Financial Advisor field. He said some very interesting things. He wrote a book called “The Professional Financial Advisor II – How the financial services industry hides the ugly truth”. See a review at www.financialpost.com/analysis/columnists. The interesting things he says is that there is greater value in planning than in market timing or stock picking. He also said that the Discount Brokerage firms earn trailing commissions on Active Managed Mutual Funds you buy in your discount account.
However, the main thrust of this talk was that it is better to buy ETFs than Actively Managed Mutual Funds; in that ETFs have less risk and higher returns than the Actively Managed Mutual Funds and that the ETFs have a statistically stronger probability of producing a positive return. He goes on the quote William F. Sharpe’s study on this subject. Sharpe, who has made this argument before, has his own web site at www.stanford.edu/~wfsharpe/. John De Goey thinks that investors would be much better off paying an advisor, than getting “Free” advise from a financial advisor who sells Mutual Funds.
The next speaker I heard was David Baskin. He gave a talk on economics of “What Happened – the Crash of 2008 – and What Next”. This is one of the reasons I go to the Financial Forum, whick is to hear about what the economy is doing and what it will do. Basically, he said we are in a recession, but we are not going to have a depression and we certainly are not going to have a depression like happened in the 30’s. I am sure we all know now that this crisis was caused by the over selling of mortgages in the US. It affects the whole world as US mortgages were sold in bundles to the whole world. The other problem was inter-bank lending. When banks refused to do inter-bank lending, the banking system froze. The good news is the inter-bank lending rate has just come down. (He talked about the TED spread and since this is quite complex, I will refer you to this subject in Wikipedia at en.wikipedia.org/wiki/TED_spread.)
We had a great depression because there was no bank insurance, no unemployment insurance and welfare and the government response was all wrong. One reason we are not going to have a great depression is that unemployment in US is expected to go to 7.3%, when in the great depression it reached 25%. He feels we are closer to the end of this recession than the beginning. In fact, most economists expect that we will start to recover in the summer of 2009. He thinks that we should start to buy stocks, but should focus on good quality blue chip stocks.
The next speaker I listen to was Doug Nelson on “How to Tweak Your Portfolio Like a Pro”. He has three points to make, which are: be pro-active, review your portfolio regularly and take ownership of your money. He advises that we all go to www.myrisktolerance.com and assess our risk level.
The next speaker was Sanjiv Sawh on investments in guaranteed funds. This is just a variable annuity with a Guaranteed Minimum Withdrawal Benefit rider. You pay .3% to .8% fee in order to buy this guarantee. If it helps you sleep at night, this might be a great idea. These are sold by insurance companies, like Manulife, so you will have to go to an insurance agent to buy one. You are basically buying insurance to guarantee your variable annuity will not run out of money if the market crashes.
I also heard how to donate shares to Princess Margaret Hospital Foundation and why I should invest in Preferred Shares. For this last one, it was given by James Hymas and you can get the information from his site at www.himivest.com.
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.
However, the main thrust of this talk was that it is better to buy ETFs than Actively Managed Mutual Funds; in that ETFs have less risk and higher returns than the Actively Managed Mutual Funds and that the ETFs have a statistically stronger probability of producing a positive return. He goes on the quote William F. Sharpe’s study on this subject. Sharpe, who has made this argument before, has his own web site at www.stanford.edu/~wfsharpe/. John De Goey thinks that investors would be much better off paying an advisor, than getting “Free” advise from a financial advisor who sells Mutual Funds.
The next speaker I heard was David Baskin. He gave a talk on economics of “What Happened – the Crash of 2008 – and What Next”. This is one of the reasons I go to the Financial Forum, whick is to hear about what the economy is doing and what it will do. Basically, he said we are in a recession, but we are not going to have a depression and we certainly are not going to have a depression like happened in the 30’s. I am sure we all know now that this crisis was caused by the over selling of mortgages in the US. It affects the whole world as US mortgages were sold in bundles to the whole world. The other problem was inter-bank lending. When banks refused to do inter-bank lending, the banking system froze. The good news is the inter-bank lending rate has just come down. (He talked about the TED spread and since this is quite complex, I will refer you to this subject in Wikipedia at en.wikipedia.org/wiki/TED_spread.)
We had a great depression because there was no bank insurance, no unemployment insurance and welfare and the government response was all wrong. One reason we are not going to have a great depression is that unemployment in US is expected to go to 7.3%, when in the great depression it reached 25%. He feels we are closer to the end of this recession than the beginning. In fact, most economists expect that we will start to recover in the summer of 2009. He thinks that we should start to buy stocks, but should focus on good quality blue chip stocks.
The next speaker I listen to was Doug Nelson on “How to Tweak Your Portfolio Like a Pro”. He has three points to make, which are: be pro-active, review your portfolio regularly and take ownership of your money. He advises that we all go to www.myrisktolerance.com and assess our risk level.
The next speaker was Sanjiv Sawh on investments in guaranteed funds. This is just a variable annuity with a Guaranteed Minimum Withdrawal Benefit rider. You pay .3% to .8% fee in order to buy this guarantee. If it helps you sleep at night, this might be a great idea. These are sold by insurance companies, like Manulife, so you will have to go to an insurance agent to buy one. You are basically buying insurance to guarantee your variable annuity will not run out of money if the market crashes.
I also heard how to donate shares to Princess Margaret Hospital Foundation and why I should invest in Preferred Shares. For this last one, it was given by James Hymas and you can get the information from his site at www.himivest.com.
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.
Thursday, January 15, 2009
First Day, Toronto Financial Forum
As I said yesterday, I was going to spend the next four days at the Toronto Financial Forum at The Toronto Convention Center. The first speaker I heard, Tom Bradley, was the most interesting. He is from a Mutual Fund Company called Steadyhand and it was sponsored by The Money Saver Magazine. The next speaker I heard was Jonathan Chevreau of “Findependence” Day and it was interesting. I next heard a talk on 2009 Equity, Commodity and Currency Market outlook. Next I heard one by Dr. Bart Diliddo of VestorVest Inc. It was boring so I will not talk about it again. Lastly I heard Rich Swope of The Investment Guys site, sponsored by E*Trade and he was interesting.
Tom Bradley first recommended a book called Unconventional Success by David F. Swensen. He said that his Mutual Fund Company concentrated on 4 things. The first thing he said was his company was absolute returns orientated. It did not try to compare their returns with any benchmark. The second thing he stressed was that they concentrated on their best ideas. They do not invest in a lot of stocks, but concentrated a fewer good stocks. They feel unconstrained with their choices and go with value. Their funds also have very low turn over.
Tom Bradley also remarked that we are still in a banking crisis. He feels that debt is still a problem and we have a way to go before we work off the current debt problem. He feels that the economy will be ugly for a while longer and no one knows when the market will go up again. He feels that a lot of capital has been sucked out of the system and this capital is just sitting on the side lines. He ends by quoting Warren Buffet about trying to be fearful when others are greedy and trying to be greedy when others are fearful.
Jonathan Chevreau is probably well known by those who have gone to the Financial Forum before, or who reads the Globe and Mail. He basically talked about his 12 step program to achieve financial independence. This is the day when your sources of income, from such things as investments and business, exceed your income from salaried employment. You can see him at www.financialpost.com/money/wealthyboomer/index.html. Basically, he says we have to learn to spend less than we earn, we must prepare a financial plan for ourselves, pay down our mortgage, get a pension/RRSP plan going, get an emergency fund and use the new Tax Free Savings Account (TFSA). He also feels that the last step is to develop multiple streams of income. These multiple streams could be such income as investment income, Real Estate income, part-time business income, pension income and royalties income.
The talk on 2009 Equity, Commodity and Currency Market outlook I found this interesting. It is not that I invest in commodities and currencies, but Toronto is filled with commodity stocks, so we should be aware of what is happening in this market if we intend to make money in the Toronto Market.
The talk by Rich Swope was also interesting. It was basically, know your market, protect your market and find your opportunities in your market. The protect your market section was having rules, like an 1% rule, where you will try to ensure that you will not lose more than 1% of your portfolio money on one stock. You can find them at www.themarketguys.com/.
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.
Tom Bradley first recommended a book called Unconventional Success by David F. Swensen. He said that his Mutual Fund Company concentrated on 4 things. The first thing he said was his company was absolute returns orientated. It did not try to compare their returns with any benchmark. The second thing he stressed was that they concentrated on their best ideas. They do not invest in a lot of stocks, but concentrated a fewer good stocks. They feel unconstrained with their choices and go with value. Their funds also have very low turn over.
Tom Bradley also remarked that we are still in a banking crisis. He feels that debt is still a problem and we have a way to go before we work off the current debt problem. He feels that the economy will be ugly for a while longer and no one knows when the market will go up again. He feels that a lot of capital has been sucked out of the system and this capital is just sitting on the side lines. He ends by quoting Warren Buffet about trying to be fearful when others are greedy and trying to be greedy when others are fearful.
Jonathan Chevreau is probably well known by those who have gone to the Financial Forum before, or who reads the Globe and Mail. He basically talked about his 12 step program to achieve financial independence. This is the day when your sources of income, from such things as investments and business, exceed your income from salaried employment. You can see him at www.financialpost.com/money/wealthyboomer/index.html. Basically, he says we have to learn to spend less than we earn, we must prepare a financial plan for ourselves, pay down our mortgage, get a pension/RRSP plan going, get an emergency fund and use the new Tax Free Savings Account (TFSA). He also feels that the last step is to develop multiple streams of income. These multiple streams could be such income as investment income, Real Estate income, part-time business income, pension income and royalties income.
The talk on 2009 Equity, Commodity and Currency Market outlook I found this interesting. It is not that I invest in commodities and currencies, but Toronto is filled with commodity stocks, so we should be aware of what is happening in this market if we intend to make money in the Toronto Market.
The talk by Rich Swope was also interesting. It was basically, know your market, protect your market and find your opportunities in your market. The protect your market section was having rules, like an 1% rule, where you will try to ensure that you will not lose more than 1% of your portfolio money on one stock. You can find them at www.themarketguys.com/.
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, January 14, 2009
McCoy Corp and Pulse Data Inc
It seemed best today to continue with what I started yesterday, rather than start something new. As I said yesterday, I went to the Globe and Mail site of www.globeinvestor.com/ and from Globe Investor section I selected the Stock Filter. I asked for companies that were worth between $1 and $5.50 and had a yield between 4% and 20. I narrowed the list to 5. They were Matrikon Inc (TSX-MTK), McCoy (TSX-MCB), Pulse Data (TSX-PSD), Amica Mature Lifestyles (TSX-ACC) and Student Transport of America (TSX-STB).
Amica Mature Lifestyles is luxury housing and services for people retiring. It is into real estate property management. Real Estate is not a great place to be at the moment. For the fiscal year ending in May 2009, it is expected that the earnings will be $.16 down from May 2009 of $.29. It is expected that the May 2010 will be down again, to $.13. However, the dividend on the stock was increased 20% between May 2007 and May 2008 year ends. I think that baby boomers are not going to go to Old Age Homes as our parents did. This may be a good stock to watch.
For Student Transport of America, over the last 3 years their revenues and dividends have gone up. However, they have not earned a profit for the last 3 years. This is a 4 star company, so I will like to take another look at it when the economic climate has improved. There is a Buy rating on this stock. However, I am not about to buy a stock when it has no earnings for 3 years.
The McCoy Corporation has three main operating segments of Energy Products & Services, Trailer Manufacturing and Truck & Trailer Products & Services. Its web site is www.mccoycorporation.ca. I will put up its spreadsheet at www.spbrunner.com/stocks/mcb.htm. Some people have a Buy rating on this stock and some have a Hold rating. I notice there lots of insider buying on this stock. However, there is expectation that the earnings are going nowhere over the next 2 years. I will finish off this spreadsheet in the future and repost it.
Pulse Data Inc. is a provider of 2D and 3D seismic library data and is based in Calgary, Alberta. Pulse owns the second-largest licensable seismic data library in western Canada. Pulse’s 2D and 3D seismic data library extends over the Western Canada Sedimentary Basin, plus selected areas of the U.S. Rocky Mountains region and northern Canada, with a particular focus on active exploration areas. Its web site is www.pulsedatainc.com. See my spreadsheet at www.spbrunner.com/stocks/psd.htm. It has not made any earnings over the last 2 years and its revenue has been going down for the last 3 years. Its dividend performance has not been bad and the Accrual Ratio is very good at -6.5%. There is also some insider buying here as well. I also notice that it has Buy ratings.
Matrikon Inc. is engaged in the sale of software and information technology professional services to industrial facilities. Its web site is www.matrikon.com. See my spreadsheet at www.spbrunner.com/stocks/mtk.htm. The last thing I should say on this stock is that there has been lots of insider buying on this stock, especially under the price of $2.50.
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.
Amica Mature Lifestyles is luxury housing and services for people retiring. It is into real estate property management. Real Estate is not a great place to be at the moment. For the fiscal year ending in May 2009, it is expected that the earnings will be $.16 down from May 2009 of $.29. It is expected that the May 2010 will be down again, to $.13. However, the dividend on the stock was increased 20% between May 2007 and May 2008 year ends. I think that baby boomers are not going to go to Old Age Homes as our parents did. This may be a good stock to watch.
For Student Transport of America, over the last 3 years their revenues and dividends have gone up. However, they have not earned a profit for the last 3 years. This is a 4 star company, so I will like to take another look at it when the economic climate has improved. There is a Buy rating on this stock. However, I am not about to buy a stock when it has no earnings for 3 years.
The McCoy Corporation has three main operating segments of Energy Products & Services, Trailer Manufacturing and Truck & Trailer Products & Services. Its web site is www.mccoycorporation.ca. I will put up its spreadsheet at www.spbrunner.com/stocks/mcb.htm. Some people have a Buy rating on this stock and some have a Hold rating. I notice there lots of insider buying on this stock. However, there is expectation that the earnings are going nowhere over the next 2 years. I will finish off this spreadsheet in the future and repost it.
Pulse Data Inc. is a provider of 2D and 3D seismic library data and is based in Calgary, Alberta. Pulse owns the second-largest licensable seismic data library in western Canada. Pulse’s 2D and 3D seismic data library extends over the Western Canada Sedimentary Basin, plus selected areas of the U.S. Rocky Mountains region and northern Canada, with a particular focus on active exploration areas. Its web site is www.pulsedatainc.com. See my spreadsheet at www.spbrunner.com/stocks/psd.htm. It has not made any earnings over the last 2 years and its revenue has been going down for the last 3 years. Its dividend performance has not been bad and the Accrual Ratio is very good at -6.5%. There is also some insider buying here as well. I also notice that it has Buy ratings.
Matrikon Inc. is engaged in the sale of software and information technology professional services to industrial facilities. Its web site is www.matrikon.com. See my spreadsheet at www.spbrunner.com/stocks/mtk.htm. The last thing I should say on this stock is that there has been lots of insider buying on this stock, especially under the price of $2.50.
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.
Tuesday, January 13, 2009
Matrikon Inc and My TFSA
After buying Shoppers Drug Mart (TSX-SC) for the TFSA, I had some $585 left. Wanting to invest this in something, I looked for a Small Cap dividend paying company. I had invested in Small Caps before, but not very successfully. I had believed the theories that they were different from other companies, that you should not expect the best ones to be making a profit and that the real thing to look at was cash burn. Well, scratch that. I bought 8 Small Caps, of which I have two left. I have not sold them as they are worth so little. They were all losers. So now, I am valuing them as I am valuing any other companies.
I went to the Globe and Mail site of www.globeinvestor.com/ and from Globe Investor section I selected the Stock Filter. I asked for companies that were worth between $1 and $5.50 and had a yield between 4% and 20%. I got back 22 companies. I got quotes on them all and proceeded to look at the estimates on these stocks and at the “company snapshot” pages. The company snapshot page is useful as it gives you parts of the financial statements for the last 3 years and for the last 12 months.
From looking at this stuff, I narrowed the companies down to 5, of which I thought two might be of interest in the future and 3 might be of interest now. The three companies I ended with were Matrikon Inc (TSX-MTK), McCoy (TSX-MCB) and Pulse Data (TSX-PSD). Next, I started spreadsheets on these companies, trying to fill in, at least some of the data, for the last 6 years, to give me 5 years worth of growth data. I also looked them up at TD Waterhouse where I have my Trading Accounts. TD Waterhouse is handy as it has INK Company Insider Reports and for companies that are covered, Financial Post Investor Reports.
For McCoy, it had very good Revenue, Earnings and Dividend Growth and there was good insider buying, especially under $3.00. However, no one expects this stock to match the 2007 earnings in 2008 or 2009. In fact, it is expected that the company earnings will go down in both these years. Also, the Accrual Ratio is extremely high at 21%.
For Pulse Data, there were Strong Buy ratings on this stock and some insider buying. However, they have not made a profit in the last two financial calendar years ending in 2006 and 2007. For the few analysts following this stock, there is a wide divergent in what, if any profit will be made in 2008 and 2009. The Revenues on stock has been declining since 2004. In the financial statements, the company is busy revising them to try only to show what they are doing on continuing businesses. Revenues and cash flows were being revised statement to statement. I do not like this.
The company I bought was Matrikon Inc. They only started paying dividends in 2008. Their annual statement year ends in August of each year, so this makes it hard to see what their dividend policies will be. Their revenues have grown by 10% over the last 5 years; their earnings have grown by 21%; their cash flows have grown by 30% and their book value by 13.5%. When I first went into my broker web site to buy this stock, the bid price was $2.16 and the asking price $2.27. This is a wide variance and the stock is not traded often. I had to wait a few hours, but finally the asking price changed to $2.17 and I bought.
Matrikon Inc. is engaged in the sale of software and information technology professional services to industrial facilities. Its web site is www.matrikon.com. See my spreadsheet at www.spbrunner.com/stocks/mtk.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 my web site.
I went to the Globe and Mail site of www.globeinvestor.com/ and from Globe Investor section I selected the Stock Filter. I asked for companies that were worth between $1 and $5.50 and had a yield between 4% and 20%. I got back 22 companies. I got quotes on them all and proceeded to look at the estimates on these stocks and at the “company snapshot” pages. The company snapshot page is useful as it gives you parts of the financial statements for the last 3 years and for the last 12 months.
From looking at this stuff, I narrowed the companies down to 5, of which I thought two might be of interest in the future and 3 might be of interest now. The three companies I ended with were Matrikon Inc (TSX-MTK), McCoy (TSX-MCB) and Pulse Data (TSX-PSD). Next, I started spreadsheets on these companies, trying to fill in, at least some of the data, for the last 6 years, to give me 5 years worth of growth data. I also looked them up at TD Waterhouse where I have my Trading Accounts. TD Waterhouse is handy as it has INK Company Insider Reports and for companies that are covered, Financial Post Investor Reports.
For McCoy, it had very good Revenue, Earnings and Dividend Growth and there was good insider buying, especially under $3.00. However, no one expects this stock to match the 2007 earnings in 2008 or 2009. In fact, it is expected that the company earnings will go down in both these years. Also, the Accrual Ratio is extremely high at 21%.
For Pulse Data, there were Strong Buy ratings on this stock and some insider buying. However, they have not made a profit in the last two financial calendar years ending in 2006 and 2007. For the few analysts following this stock, there is a wide divergent in what, if any profit will be made in 2008 and 2009. The Revenues on stock has been declining since 2004. In the financial statements, the company is busy revising them to try only to show what they are doing on continuing businesses. Revenues and cash flows were being revised statement to statement. I do not like this.
The company I bought was Matrikon Inc. They only started paying dividends in 2008. Their annual statement year ends in August of each year, so this makes it hard to see what their dividend policies will be. Their revenues have grown by 10% over the last 5 years; their earnings have grown by 21%; their cash flows have grown by 30% and their book value by 13.5%. When I first went into my broker web site to buy this stock, the bid price was $2.16 and the asking price $2.27. This is a wide variance and the stock is not traded often. I had to wait a few hours, but finally the asking price changed to $2.17 and I bought.
Matrikon Inc. is engaged in the sale of software and information technology professional services to industrial facilities. Its web site is www.matrikon.com. See my spreadsheet at www.spbrunner.com/stocks/mtk.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 my web site.
Monday, January 12, 2009
Yield and P/E In Different Directions
As the P/E (Price/Earning Ratio) has gone down, the yields on stocks have gone up. This is typical of market crashes. Companies are very reluctant to reduce dividends, and those on such lists as the Dividend Aristocrats and Dividend Achievers will even raise theirs to stay on these lists.
Also, the Earnings per Share (EPS) is not an indicator for determining if a stock can fund their dividends in a downturn. What you need to look at is cash flow and liquidity. The cash flow to look at is that from operations. Liquidity is the difference between Current Assets and Current Liability. If a company has positive cash flow, greater than the dividend and the liquidity is fine (that is current assets are greater than current liabilities), then your dividend is probably safe.
Generally speaking, dividend yield runs on the TSX at about 2%, but this would have climbed quite a bit higher recently. Dividends are usually maintained in down markets because if a stock cuts its dividend, the stock price will fall like a stone.
Take Saputo (TSX-SAP), a favorite stock of mine. The in 2008 the average yield was 1.7%, but the current yield is 2.8%. Last year, the average P/E was 20%, it is currently at 13%. This also stock raised their dividend 16% in September 2008. Another favorite stock of mine is Pembina Pipelines, which last year had an average yield of 7.8%, but now has a yield of 10.8%. The P/E last year was around 16.5% and is now 11%. This stock also raised their monthly distribution in September by 13%. These stocks are still doing just fine.
Now, let’s look at the banks that did not raise their dividends. Bank of Montreal (TSX-BMO) used to have yields of around 3.5% and P/E around 13%. Now the yield is 8.3% and the P/E is around 8%. Royal Bank used to have yields around 3.25% and P/E around 14%. Now the yield is 5.4% and the P/E is 10.5%. Both these banks had lower EPS in their latest financial years ending October 2008.
So, if you are dependent on dividend income to live on, this is not such a horrible time as may appear. Yes, I have capital loses, on paper at least. However, so far, I have not done badly. The same thing happened in the last bear market of 2000/2001. Although I had, capital loses on paper, my dividends increased. The thing that happened was that my dividends did not increase as quickly as they had prior to the bear market.
Later this week I am going to go the Financial Forum at the Metro Toronto Convention Center. I have gone there every year since it opened. I found it valuable to sit and listen to what their featured speakers have to say about the current investing and economic climate. Last year the theme was that the market could be wrong about a stock for longer than you can remain solvent. Therefore, you should never bet the house (or all your money) on any stock or stock sector. I would let you know if there is any theme this 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 my web site.
Also, the Earnings per Share (EPS) is not an indicator for determining if a stock can fund their dividends in a downturn. What you need to look at is cash flow and liquidity. The cash flow to look at is that from operations. Liquidity is the difference between Current Assets and Current Liability. If a company has positive cash flow, greater than the dividend and the liquidity is fine (that is current assets are greater than current liabilities), then your dividend is probably safe.
Generally speaking, dividend yield runs on the TSX at about 2%, but this would have climbed quite a bit higher recently. Dividends are usually maintained in down markets because if a stock cuts its dividend, the stock price will fall like a stone.
Take Saputo (TSX-SAP), a favorite stock of mine. The in 2008 the average yield was 1.7%, but the current yield is 2.8%. Last year, the average P/E was 20%, it is currently at 13%. This also stock raised their dividend 16% in September 2008. Another favorite stock of mine is Pembina Pipelines, which last year had an average yield of 7.8%, but now has a yield of 10.8%. The P/E last year was around 16.5% and is now 11%. This stock also raised their monthly distribution in September by 13%. These stocks are still doing just fine.
Now, let’s look at the banks that did not raise their dividends. Bank of Montreal (TSX-BMO) used to have yields of around 3.5% and P/E around 13%. Now the yield is 8.3% and the P/E is around 8%. Royal Bank used to have yields around 3.25% and P/E around 14%. Now the yield is 5.4% and the P/E is 10.5%. Both these banks had lower EPS in their latest financial years ending October 2008.
So, if you are dependent on dividend income to live on, this is not such a horrible time as may appear. Yes, I have capital loses, on paper at least. However, so far, I have not done badly. The same thing happened in the last bear market of 2000/2001. Although I had, capital loses on paper, my dividends increased. The thing that happened was that my dividends did not increase as quickly as they had prior to the bear market.
Later this week I am going to go the Financial Forum at the Metro Toronto Convention Center. I have gone there every year since it opened. I found it valuable to sit and listen to what their featured speakers have to say about the current investing and economic climate. Last year the theme was that the market could be wrong about a stock for longer than you can remain solvent. Therefore, you should never bet the house (or all your money) on any stock or stock sector. I would let you know if there is any theme this 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 my web site.
Friday, January 9, 2009
Shoppers Drug Mart 2
Today I want to review Shoppers Drug Mart stock (TSX-SC) to see what analysts are saying about it. First, I want to say that this stock has done great since it has become a public company. However, it is in the Consumer Staple sub-index of the TSX. My experience has been that these companies can do great and then flame out for a while. Examples are Loblaw, which started to have problems in 2005, and Jean Coutu, which started to have problems in 2006. Before 2005/2006, these were great companies to own. This is a reason that I put this stock in my new Tax Free Savings Account. When it gets into problems, I can easily sell it.
A contrast is with stocks in my Canadian Trading account. I try to put stocks in there that I may never have to sell. If I have to sell something from this account, I have to plan carefully tax wise because if you sell stocks from a Trading Account, you are liable for tax on the increase in value of the stock. For example, my ABC (adjusted cost basis) for BCE was $5.42 because I bought it in the 1970’s. If the buy out went through at $42.75, I would have a big tax liability for the capital gains I had earned.
One negative I see on this stock (Shoppers Drug Mart) is there is lots of insider selling. However, there have been some senior management changes and the selling seems to be by the outgoing senior management. As I have said before, insider buying is because the insiders have confidence in their company, but insider selling can occur for lots of reasons.
For this stock, there are lots of Strong Buys ratings, a few Buy ratings and some Hold ratings. The mean rating would be a Buy. (See my site for information on analyst ratings.) No one expects this stock to do badly in 2008 or 2009, as far as financials go. However, it is uncertain when this stock might recover and take off again. This is mainly because it is uncertain when the current financial crisis might be over.
Shoppers’ is a licensor of Shoppers Drug Mart in Canada and Pharmaprix in Quebec. The company owns and operates Shoppers Home Health Care stores. It also owns MediSystem Technologies Inc. Inc. and the new Murale Stores. Its web site is www.shoppersdrugmart.ca. See my spreadsheet at www.spbrunner.com/stocks/sc.htm. I have reloaded my spreadsheet with figures from the 3rd quarterly report of October 4, 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 my web site.
A contrast is with stocks in my Canadian Trading account. I try to put stocks in there that I may never have to sell. If I have to sell something from this account, I have to plan carefully tax wise because if you sell stocks from a Trading Account, you are liable for tax on the increase in value of the stock. For example, my ABC (adjusted cost basis) for BCE was $5.42 because I bought it in the 1970’s. If the buy out went through at $42.75, I would have a big tax liability for the capital gains I had earned.
One negative I see on this stock (Shoppers Drug Mart) is there is lots of insider selling. However, there have been some senior management changes and the selling seems to be by the outgoing senior management. As I have said before, insider buying is because the insiders have confidence in their company, but insider selling can occur for lots of reasons.
For this stock, there are lots of Strong Buys ratings, a few Buy ratings and some Hold ratings. The mean rating would be a Buy. (See my site for information on analyst ratings.) No one expects this stock to do badly in 2008 or 2009, as far as financials go. However, it is uncertain when this stock might recover and take off again. This is mainly because it is uncertain when the current financial crisis might be over.
Shoppers’ is a licensor of Shoppers Drug Mart in Canada and Pharmaprix in Quebec. The company owns and operates Shoppers Home Health Care stores. It also owns MediSystem Technologies Inc. Inc. and the new Murale Stores. Its web site is www.shoppersdrugmart.ca. See my spreadsheet at www.spbrunner.com/stocks/sc.htm. I have reloaded my spreadsheet with figures from the 3rd quarterly report of October 4, 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 my web site.
Thursday, January 8, 2009
Shoppers Drug Mart
Today I want to review Shoppers Drug Mart stock (TSX-SC) as I bought 100 shares for my new Tax Free Trading Account. This stock has received a lot of praise since it started to sell stock in 2000 and 2001. This would be considered to be a dividend paying growth stock. It is currently not on any the dividend achiever’s lists yet because it has only been paying dividends since 2005, just 4 years ago.
If it continues to increase it dividends as it has in the last 4 years, it will be put on these lists. The dividend increases to the last annual statement of December 2007 is 26.5%. It increased its dividend for 2008 by 34%. This is a very good start.
In the 5 years, to the last annual statement of December 2007, this stock has basically done quite well. The Revenues have grown some 16% per year, the Earnings per Share (EPS) has grown some 13.7% per year, the closing price of the stock has grown some 17.4% per year, the Cash Flow has increased some 11.6% per year and the book value has increased some 13.4% per year.
Also, the Return on Equity (ROE) at December 2007 and for the 5 years running to December 2007 is 15.9% and 15.1% respectively and this is good. The Asset/Liability ratio is high at 2.09. The Current Asset/Current Liability ratio is a bit low at 1.01.
I see some negatives on this stock. First, the Accrual Ratio is very high at 9.6%, but at least the Operation Cash Flow is greater than the Net Income. On this stock, the closing price for is almost twice the Graham Price at December 2007, but this is typical for a growth stock. Also, the dividend yield started out in 2005 at less than 1%. With a dividend yield so low, this is more a growth stock than a dividend paying one. Tomorrow I will talk about what the analysts say.
Shoppers’ is a licensor of Shoppers Drug Mart in Canada and Pharmaprix in Quebec. The company owns and operates Shoppers Home Health Care stores. It also owns MediSystem Technologies Inc. Its web site is www.shoppersdrugmart.ca. See my spreadsheet at www.spbrunner.com/stocks/sc.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 my web site.
If it continues to increase it dividends as it has in the last 4 years, it will be put on these lists. The dividend increases to the last annual statement of December 2007 is 26.5%. It increased its dividend for 2008 by 34%. This is a very good start.
In the 5 years, to the last annual statement of December 2007, this stock has basically done quite well. The Revenues have grown some 16% per year, the Earnings per Share (EPS) has grown some 13.7% per year, the closing price of the stock has grown some 17.4% per year, the Cash Flow has increased some 11.6% per year and the book value has increased some 13.4% per year.
Also, the Return on Equity (ROE) at December 2007 and for the 5 years running to December 2007 is 15.9% and 15.1% respectively and this is good. The Asset/Liability ratio is high at 2.09. The Current Asset/Current Liability ratio is a bit low at 1.01.
I see some negatives on this stock. First, the Accrual Ratio is very high at 9.6%, but at least the Operation Cash Flow is greater than the Net Income. On this stock, the closing price for is almost twice the Graham Price at December 2007, but this is typical for a growth stock. Also, the dividend yield started out in 2005 at less than 1%. With a dividend yield so low, this is more a growth stock than a dividend paying one. Tomorrow I will talk about what the analysts say.
Shoppers’ is a licensor of Shoppers Drug Mart in Canada and Pharmaprix in Quebec. The company owns and operates Shoppers Home Health Care stores. It also owns MediSystem Technologies Inc. Its web site is www.shoppersdrugmart.ca. See my spreadsheet at www.spbrunner.com/stocks/sc.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 my web site.
Wednesday, January 7, 2009
Gaz Metro LP 2
One positive to say about this stock (TSX-GZM.UN) today is that there is lots of insider buying going on in December 2008. This tells you that some insiders are confident about the future of this company. Generally speaking, it is not expected to earn in 2009 or 2010 the same EPS as it did in 2008. Cash Flow per share is also expected to go down. Generally speaking, analysts rate this stock as an Underperform or Underweight. (See my site for information on analyst ratings.)
Currently, the Graham Price is above the share price, but the Graham Price is dependent on earnings and book value, so this should go down if earnings go down. It will probably not go below the current price. The current yield on this stock is over 9% and the 5 year average is just over 7%. Also, the P/E is around 10.9% and the 5 year average is 14.6%. These indicators point to the stock being a good buy. The insider buying would indicate that the distribution amount is not likely to change in the near future from $1.24 per share.
One concern I have is the Current Asset/Current Debt ratio is only .87. In times of economic uncertainty, it would be better if they could cover their current debts, which this ratio says they cannot. The Globe gives this stock a 4 star rating, which is good, and as I said yesterday, the stability rating of SR-2 and STA-2M are also good. So it would appear that you can make a good income from this stock, but it will be a while before there is any stock price movement. However, in this market, I am sure that there will be stocks where you can get just as good a yield, but with a better Asset/Debt ratio and a better history of stock gains, as the stock price on this stock seems to have peaked in 2005. So it started its decline prior to the current bear market.
Gaz Metro Limited Partnership is a company whose core business is the distribution of Natural Gas in Quebec. Gas Metro is also, indirectly, the sole shareholder of the Vermont Gas System (VGS), and the Green Mountain Power Corp (GMP), the second largest electricity supplier in Vermont. The company operates in Canada and US. Its web site is www.gazmetro.com. Its web site is www.gazmetro.com. See my spreadsheet at www.spbrunner.com/stocks/gzm.htm. I have reloaded my spreadsheet today.
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.
Currently, the Graham Price is above the share price, but the Graham Price is dependent on earnings and book value, so this should go down if earnings go down. It will probably not go below the current price. The current yield on this stock is over 9% and the 5 year average is just over 7%. Also, the P/E is around 10.9% and the 5 year average is 14.6%. These indicators point to the stock being a good buy. The insider buying would indicate that the distribution amount is not likely to change in the near future from $1.24 per share.
One concern I have is the Current Asset/Current Debt ratio is only .87. In times of economic uncertainty, it would be better if they could cover their current debts, which this ratio says they cannot. The Globe gives this stock a 4 star rating, which is good, and as I said yesterday, the stability rating of SR-2 and STA-2M are also good. So it would appear that you can make a good income from this stock, but it will be a while before there is any stock price movement. However, in this market, I am sure that there will be stocks where you can get just as good a yield, but with a better Asset/Debt ratio and a better history of stock gains, as the stock price on this stock seems to have peaked in 2005. So it started its decline prior to the current bear market.
Gaz Metro Limited Partnership is a company whose core business is the distribution of Natural Gas in Quebec. Gas Metro is also, indirectly, the sole shareholder of the Vermont Gas System (VGS), and the Green Mountain Power Corp (GMP), the second largest electricity supplier in Vermont. The company operates in Canada and US. Its web site is www.gazmetro.com. Its web site is www.gazmetro.com. See my spreadsheet at www.spbrunner.com/stocks/gzm.htm. I have reloaded my spreadsheet today.
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.
Tuesday, January 6, 2009
Gaz Metro LP
In line with what I did at the end of last year, I am again looking at another pipeline stock (TSX-GZM.UN) as a possible investment. It should be noted that this stock is listed as a utility stock, as it has more than just gas pipelines. As I said in December, if there is any money to be made in the current market it is in dividends or distributions. But also heed the warning that with higher yields come higher risks. Today I will review how this stock has done in the past. Tomorrow I will look at it now and for the future.
All my following figures are for the year ending at the last annual statement of September 2008. The revenue growth for the last 5 and 10 years was 4.3% and 5.6%. Although this is not great figures, they are not terrible either. The 5 and 10 years growth for Earnings per Share (EPS) was a negative 1.6% and .3%. These are awful figures, but since this is an income trust, you would be more concerned with the growth in cash flow. The 5 and 10 year figures for cash flow is 3.3% and 3.6% for the last 5 and 10 years. Well, at least this is higher than background inflation.
There has been no growth in dividends over the 5 years and 10 years, in fact the dividends have gone down slightly. If you had held the stock over the last 5 years, you would have made a return of just 1%. Even the Accrual Ratio is rather high at 4.4%. It would seem that I can not find anything positive to say about this stock’s past performance at present. The only bright point is that it has a stability rating of SR-2 and STA-2M. However, I should point out that it used to have a stability rating of STA-1L. This is not a great report, but I do not know what I will find when I start to investigate a stock.
Gaz Metro Limited Partnership is a company whose core business is the distribution of Natural Gas in Quebec. Gas Metro is also, indirectly, the sole shareholder of the Vermont Gas System (VGS), and the Green Mountain Power Corp (GMP), the second largest electricity supplier in Vermont. The company operates in Canada and US. Its web site is www.gazmetro.com. See my spreadsheet at www.spbrunner.com/stocks/gzm.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 my web site.
All my following figures are for the year ending at the last annual statement of September 2008. The revenue growth for the last 5 and 10 years was 4.3% and 5.6%. Although this is not great figures, they are not terrible either. The 5 and 10 years growth for Earnings per Share (EPS) was a negative 1.6% and .3%. These are awful figures, but since this is an income trust, you would be more concerned with the growth in cash flow. The 5 and 10 year figures for cash flow is 3.3% and 3.6% for the last 5 and 10 years. Well, at least this is higher than background inflation.
There has been no growth in dividends over the 5 years and 10 years, in fact the dividends have gone down slightly. If you had held the stock over the last 5 years, you would have made a return of just 1%. Even the Accrual Ratio is rather high at 4.4%. It would seem that I can not find anything positive to say about this stock’s past performance at present. The only bright point is that it has a stability rating of SR-2 and STA-2M. However, I should point out that it used to have a stability rating of STA-1L. This is not a great report, but I do not know what I will find when I start to investigate a stock.
Gaz Metro Limited Partnership is a company whose core business is the distribution of Natural Gas in Quebec. Gas Metro is also, indirectly, the sole shareholder of the Vermont Gas System (VGS), and the Green Mountain Power Corp (GMP), the second largest electricity supplier in Vermont. The company operates in Canada and US. Its web site is www.gazmetro.com. See my spreadsheet at www.spbrunner.com/stocks/gzm.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 my web site.
Monday, January 5, 2009
The Ascent of Money by Niall Ferguson
The full title of this book is The Ascent of Money, a Financial History of the World. If you want to understand the world of financial, this is an excellent book to read. This is a great basic book on finance that is clear and easy to follow. I also enjoy reading books by Niall Ferguson as he always has something interesting to say.
I will point you to some typical book reviews later, but first I want to mention a few things in this book. One of thing he talks about is that while inflation is monetary phenomenon, hyperinflation is always a political phenomenon. Another point he makes is that stock markets are mirrors of the human psyche. He points out the idea of stocks for the long term has only worked in the western world, and this is not true of other places. For instance, stock for the long term would have been a losing proposition in say, South America.
I know that the left hates this man. This is probably because he makes such clear, reasonable augments supporting what he says. This is unlike writers like Christopher Higgins and Richard Dawkins, which the left loves. The reason I do not like readings these lefties is that their basic point seems always to revolve around ‘If you do not think like I do, you are stupid’. I read this beautifully illustrated book on evolution by Dawkins. What I remember about this book was his deep implacable hatred for Bush and the religious right. I thought I would be reading a beautifully illustrated book on evolution, obviously not.
Niall Ferguson has his own web site at www.niallferguson.org/ and there is an entry for him at Wikipedia at en.wikipedia.org/wiki/Niall_Ferguson. As always, you should read anything in Wikipedia with a critical eye. This site will not allow anything to stand that is not politically correct. This article either has a bland description of his work or is critical. Niall Ferguson is not politically correct. Robert Fulford has written a number of articles about Niall Ferguson and they are available at www.robertfulford.com/NiallFerguson1.html. There are also videos with him at google and youtube.
This book review and other books I have reviewed are on my website at www.spbrunner.com/books.html. Also on my website is how to find this book on Amazon if you care to purchase it.
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.
I will point you to some typical book reviews later, but first I want to mention a few things in this book. One of thing he talks about is that while inflation is monetary phenomenon, hyperinflation is always a political phenomenon. Another point he makes is that stock markets are mirrors of the human psyche. He points out the idea of stocks for the long term has only worked in the western world, and this is not true of other places. For instance, stock for the long term would have been a losing proposition in say, South America.
I know that the left hates this man. This is probably because he makes such clear, reasonable augments supporting what he says. This is unlike writers like Christopher Higgins and Richard Dawkins, which the left loves. The reason I do not like readings these lefties is that their basic point seems always to revolve around ‘If you do not think like I do, you are stupid’. I read this beautifully illustrated book on evolution by Dawkins. What I remember about this book was his deep implacable hatred for Bush and the religious right. I thought I would be reading a beautifully illustrated book on evolution, obviously not.
Niall Ferguson has his own web site at www.niallferguson.org/ and there is an entry for him at Wikipedia at en.wikipedia.org/wiki/Niall_Ferguson. As always, you should read anything in Wikipedia with a critical eye. This site will not allow anything to stand that is not politically correct. This article either has a bland description of his work or is critical. Niall Ferguson is not politically correct. Robert Fulford has written a number of articles about Niall Ferguson and they are available at www.robertfulford.com/NiallFerguson1.html. There are also videos with him at google and youtube.
This book review and other books I have reviewed are on my website at www.spbrunner.com/books.html. Also on my website is how to find this book on Amazon if you care to purchase it.
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.
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