Thursday, July 23, 2009

Stantec Inc

I am reviewing this stock (TSX-STN) today as I have not reviewed it since I received the annual report for the end of December 2008. As this is a non dividend paying stock, I only bought a small amount of it in August of 2008. To date I have lost about 2.5% per year on it. However, I am not giving up on this stock and I will maintain my position it.

As in the case of yesterday’s stock, if you look at the growth figures for this stock, most are good. The only one that is not is the earnings for the last 5 years. This is because of the drop in earnings for 2008. However, one bad earnings year means nothing.

Moving on to look at is the Asset/Liability Ratios; I find these quite good. I have updated my spreadsheet for the first quarter of 2009 and these good ratios are maintained. I like to see both ratios at 1.50 or above and for this company both the Liquidity Ratio and the Asset/Liability Ratio have achieve this.

The Return on Equity (ROE) for 2008 was low at only 5.4%. However, the 5 running average ROE to December 2008 was 11.7%. The ROE for the first quarter of 2009 was again higher at 14.6%. The bad thing about this first quarter is the negative Cash Flow from Operations. When this is negative, you can not really calculate an Accrual Ratio. However, the Accrual Ratio for 2008 was negative and was just below zero.

This company is in construction and Engineering and it should do well once the economy has recovered. The company has a good history of making money. I have read a number of articles on this company and it is generally very well thought of. Tomorrow, I will look into what the analyst say about buying this stock.

Stantec Inc is a profitable Construction & Engineering company that trades on the TSX. It provides professional services in planning, engineering, architecture, interior design, landscape architecture, surveying and geomatics, environmental sciences project management and project economics for clients, from initial concept and financial feasibility, to project completion and beyond. They work in North America, the Caribbean, United Kingdom, Australia, and New Zealand. Its web site is See my spreadsheet at

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 for a list of the stocks for which I have put up spreadsheets.

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