Canada Bread

I am reviewing this stock (TSX-CBY) as I read a favorable review of this stock as a good dividend paying stock to invest in. This stock has come up a number of times in favorable reviews. It is a stock on the Investment Reporter list. It is not on the other three lists that I follow. I do not own this stock. I held it once in the past from 1999 to 2000, but sold as I thought it was going nowhere. One thing that has occurred since I owned this stock is that it merged with Maple Leaf’s baking division and now Maple Leaf owns 89.8% of Canada Bread.

In looking at the growth figures I am interested in, the thing that struck me was that the dividend does not increase. I tracked it back to 1994 and it was still $.24 a share, which is the same it is today. Other growth figures that have been good are that in Earnings, Stock Price, Book Value and Cash Flow. The growth in Revenue is also not bad, but the 5 year figure is not great.

If you look at the Liquidity ratio, it is low at .64. This means that the current assets cannot cover the current Liabilities. However, the Asset/Liability Ratio is very good at 3.47. The Return on Equity (ROE) is also quite good for this stock with 2008 being 9.2% and the 5 year average at 11.6%. The accrual ratio is not bad at 2.9%.

All in all this looks like a nice stock, however, I would not personally be interested in it, as the dividends do not increase. Tomorrow, I will look at how the analysts view this stock.

Canada Bread is a leading manufacturer and marketer of value-added flour based products, including fresh bread, rolls, bagels and sweet goods, frozen partially baked or par-baked breads and bagels, and specialty pasta and sauces. The Company markets products under a number of leading brand names, including Dempster’s, Olafson’s, POM, Ben’s and Olivieri. Canada Bread has operations in Canada, the United States and the United Kingdom. Its web site is www.canadabread.ca. See my spreadsheet at www.spbrunner.com/stocks/cby.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.