Marsulex Inc 2

I am continuing my review of the small cap dividend paying stock, Marsulex Inc (TSX-MLX) today for which I have recently done a spreadsheet on. I did a spreadsheet after reading a good investment report. I do not own any of this stock. The report said they liked the strong financial performance of this stock and the strong dividend.

When I look at Insider Buying and Insider Selling, I find that there has been no activity during the past year. From what I can gleam, the President of this company Laurie Tugman, owns some 204,000 shares and at $12, a share is worth about $2.4M. The management seems to have confidence in this company as they have raised their dividend by just over 15% in mid 2009.

The 5 year average low P/E Ratio is high at 38 and the 5 year average high is even higher at 49.7. The main reason being, but not the only one, is that the P/E ratios for 2005 are very high because of the strong dip in earnings for that year. Without 2005, the low P/E is 17 and the high 25. These P/E are still high. The current P/E is much more reasonable at 15. I get a current P/E based on earning estimates.

For this year, I get a Graham Price of $7.82. The current stock price of $12.03 is some 58% above the Graham Price. This stock has a tendency of being above the Graham Price. When I look at the Price/Book Value Ratio, I get a current one of 3.5 and this is some 37% above the 10 year average of 2.55. The current yield of 6.2% is a good one, and the average yield is slightly below at 6.1%. However, the yield, especially in 2008 was better when it had a high yield of 9.9%.

The analysts’ recommendations range from Strong Buy to Buy to Hold. The consensus recommendation would be a Buy. (See my site for information on analyst ratings.) Analysts’ do not seem to expect a great financial year for 2010, but expect much better results in 2011. It is also expected that the company will raise their dividends in 2010. None of the ratios I use shows that the current stock price to be particularly good, but rather reasonable.

As I said yesterday, I not in the market to buy anymore stocks at this time. However, this does look interesting and I will keep an eye on it and follow it.

Marsulex Inc. is a provider of industrial services, primarily environmental compliance solutions for air quality control and industrial hazardous waste streams, and a producer and marketer of sulphur-based industrial and water treatment chemicals. The Company's activities are divided into four reportable segments. The three operating segments are Industrial Services, Western Markets and Marsulex Environmental Technologies. The fourth non-operating segment is Corporate Support, which provides centralized services, such as finance, information systems, human resources and risk management to the operating segments. Its web site is here Marsulex. See my spreadsheet at mlx.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 for stocks followed and investment notes. Follow me on twitter.