Richelieu Hardware Ltd

I am reviewing this stock today (TSX-RCH) as I own it and I just got its annual report for the financial year ending November 30, 2008. I bought this stock June of 2007 and to date I have made a negative return of 16% per year. I initially bought this stock because it was recommend by the Investment Reporter. It is not on any of the dividend lists, probably because they only started to pay dividends in 2002. This stock would be considered to be a dividend paying growth stock. 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 November 2008. The revenue growth for the last 5 and 10 years was 11% and 12% per year. The 5 and 10 years growth for Earnings per Share (EPS) was 10% and 17% per year. The dividend growth for the last 5 and 6 years was 12% and 19% per year. The Cash Flow growth for the last 5 and 10 years was 18% and 17% per year. The book value growth for the last 5 and 10 years was 16% and 17% per year.

The other good things about this stock is that the Liquidity (Current Asset/Current Liability Ratio) is 4.29 and this is higher than the 5 year average of 3.64 and the Asset/Liability is at 6.05, which is also higher than the five year average of 4.92. These are extremely good values when we are in a credit crunch. This company can very much cover any debt. Also, the Return on Equity (ROE) is good, as it was 15.6% for 2008 and this stock has a 5 year average rate of 16.8%.

There are some not very good figures on this stock. The 5 years growth for the Closing Price was only 1.2%. However, the 10 year growth was 19% per year. The 10 year figure is very good and it shows that you can make money on this stock for the long term. The 5 year return is not surprising as we in a bear market.

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.