IESI-BFC Ltd

I am reviewing this stock (TSX-BIN) today as I have not reviewed it since I received the annual report for the end of December 2008. Please note that the last time I reviewed this stock, its name was BFI Canada and the stock symbol was TSX- BFC.UN. This change was effected May 27, 2009. I made a small try out investment in this stock in November 2007 and so far I have had a -28% return.

If you look at the growth figures for this stock, they are mostly very good. The only really low one is for 5 year growth in stock price. The 5 year growth in stock price was just 3%. We are in a recession and at least the growth is positive. An example of good growth is the 5 and 10 years growth in earnings, which are 10% and 16%. They also have solid growth in cash flow. However, the growth in book value is a little low at 8% and 5% for the 5 and 10 year periods.

There are a couple of things that I do not like about this stock. The first thing I do not like is the liquidity ratio, which is only 0.82. This means that current assets to not cover completely the current liabilities. However, the Asset/Liability Ratio is good at 1.70. I like to see both these ratios at, at least, 1.50. The next thing that I do not like is that the Return on Equity (ROE) for 2008 was only 6.5%. The 5 running average ROE to December 2008 was also low at 4.7%. The ROE on this stock has never been particularly high.

I have updated my spreadsheet with the June 2009 quarterly report. In this report, the Liquidity Ratio is higher at 0.91 and this is good. The ROE however, is still low at 4.9%. On Monday, I talk about what the analysts say about this stock. I am holding on to my stock at the current time.

They are a full-service waste management company providing non-hazardous solid waste collection and landfill disposal services for municipal, commercial, industrial and residential customers in five provinces and ten US states. Two-thirds of their business is in US. The fund operates through its subsidiaries. Its web site is www.bficanada.com . See my spreadsheet at www.spbrunner.com/stocks/bfc.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.