Manitoba Telecom Service

I am reviewing this stock (TSX-MBT) today, as I have not recently done a review on it. Since my last review, I have updated my spreadsheet on it because of the annual report that I received for the end of December 2008. I bought this stock in 2006 and I have made some 2.6% return on it since that time. I have not had it long enough for it to have over come the effects of the recent recession.

However, I do not think having it any longer time period would have over come the effect of this recession. This stock has not done anything for the last 5 years. Of the growth figures I follow, this stock has not done badly in connection with revenues, earnings, cash flow and book value. The dividend problem is the lack of recent increases. The dividend yield has been high over the last few years because the stock price has not gone anywhere. The good part is the growth in revenues, because without growth in revenues, you will get no other growth.

When looking at the assets and liabilities, I find that the Liquidity Ratio is very low at .32. It means that there are not enough current assets to cover current liabilities. Not a great position to be in during a recession. The Asset/Liability ratio is much better at 2.08. The Return on Equity (ROE) is not bad. The 5 year running average is 15.9% and it was 10.4% for the end of December 2008. It was also 10.7% for the March 2009 1st quarter.

When reviewing the Accrual Ratio, I find it has been low in the last few years. However, for the March 2009 quarter, I noticed that it has jumped up to over 7%. This is rather high, where any Accrual Ratio over 5% is high. But, the year is not over yet, so it hard to say where this will go.

At the current time, I will hold on to my stock on this company and see how it fares when this current recession is over. Tomorrow, I will review what the analysts are saying about it.

This company is a full-service communications company. It serves residential and business customers in Manitoba. Their Allstream division serves national business consumers. Its web site is www.mts.ca. See my spreadsheet at www.spbrunner.com/stocks/mbt.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.