Tuesday, March 10, 2009

Richelieu Hardware Ltd 2

In looking at insider buying and selling on this stock (TSX-RCH), there is not much activity. There is slightly more selling, but all amounts are insignificant, so this does not tell us anything. I own a small amount of this stock, and I will at some point, buy more. I have updated my spreadsheet with estimates.

There are few Buy ratings on this stock, and lots of Hold ratings. The consensus rating would be a Hold. (See my site for information on analyst ratings.) What people like about this stock is that it has little or no debt. What concerns analysts are that this company’s profit is tied to home renovations. The market for home renovations is expected to be a tough market over the next little while. According to the Globe and Mail site, this is a 5 star company.

Next, I want to look at what the buy/sell indicators on this stock are saying. They are all pointing to a buy. The current price of $16.50 is below the Graham Price of $19.10. The Yield at 1.9% is higher than the 5 year average of 1.2%. The P/E ratio of 10.6 is below the 5 year average of 16, and the P/BV (Price/Book Value) is 1.59 is below the 5 year average of 2.74. As far a value indicators go, there are no negatives.

In looking at the charts, this stock has done better than the TSX for periods except the 5 year period. Over the last 5 years, it has not gone as high as the TSX and it did not fall as far as the TSX in the recent bear market. Over the last 10 years, it has done much better than the TSX.

This company is a distributor, importer and manufacturer of specialty hardware and complementary products. Its products are kitchen and bathroom cabinets, furniture, and window and door. It is also involved with residential and commercial woodworking industry. It has a large customer base of hardware retailers. Its web site is www.richelieu.com. See my spreadsheet on this company at www.spbrunner.com/stocks/rch.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.

No comments:

Post a Comment