Wednesday, February 10, 2010

Lassonde Industries

I am today reviewing Lassonde Industries (TSX-LAS.A), because I read a favorable report on this company. My spreadsheet covers the financial year ending in 2008 and the 3rd quarter of 2009. I have not invested in this stock, but it is a Canadian Dividend Paying stock. It is not on the dividend lists that I follow, as the company is small, but it does consistently increase their dividends, especially of late.

When you look at the growth figures, they are consistently great. The lowest is Total Return, but this is still very good as it is some 9.4% per year for the last 5 years and 8% per year for the last 10 years. We should take into account the fact that we are just coming through a recession. The best growth figures are for the earnings and they are 16.6% per year for the last 5 years and 17.5% per year for the last 10 years.

One of the most important growth figures is dividend growth. The 5 and 10 year figures are 16% per year and 10.5% per year. The Dividend Yield is low for this stock, but it is usually close to 1.5%. The thing is you can not have everything. This stock has been producing solid results and has been giving shareholders consistent dividends.

The other good thing about this stock is the Liquidity Ratio and the Asset/Liabilities Ratio. Both these are very good. This company has a solid balance sheet. The Liquidity Ratio for September 2009 was 2.16 and the 5 year average is 2.05. The Asset/Liabilities Ratio for September 2009 was 2.12 and the 5 year average is 2.18. What you want is these ratios to be at least 1.50, so this stock has very good ratios.

The next thing to talk about is the Return on Equity. This stock has a 5 year average ROE of 14.4% and the ROE at the end of September 2009 was 15.5%. The only fault I find is that the Accrual Ratio is rather high at the end of 2008 at 7.6%. But, I want to point out two things. First, the Cash Flow from Operations is higher than the Net Income and the Accrual Ratio for the end of September 2009 is down to .95%.

So, really, I can find little fault in this stock. This is another stock that as two classes of shareholders and one family, the Lassonde family, controls this company. I know that some people do not like companies that do this, but sometimes they are well managed and they give shareholder a good return. I note that the Globe Investor site gives this stock a 5 star rating.

Lassonde Industries Inc. is a leading manufacturer of pure fruit juices and fruit drinks in Canada, and the largest manufacturer and distributor of apple juice in Eastern Canada. Through its subsidiaries, Lassonde is active in the processing, packaging and marketing of food products such as pure fruit juices, fruit and citrus drinks, the canning of corn on the cob for foreign markets as well as dipping sauces, fondue bouillon, meat marinades, barbecue sauces and baked beans. The Company also markets its know-how in Canada and abroad. 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. Also, look at other investing notes on my website at Follow me on twitter.

No comments:

Post a Comment