Monday, May 17, 2010

Marsulex Inc

Instead of continuing my review of stock that have published their annual statements, I thought I would review a 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.

I have not got complete 10 year figures on this company as their website has limited financial information. From what I got, the 10 year figures for revenue and earnings are not good. However, the 5 year figures for these items are. The 5 year growth in revenue per share is 17% per year, and the 5 year growth in earnings is 45% per year.

The total return growth for the last 5 and 10 years are the best with growth of 14.7% and 15.8% per year respectively. The last growth figures for Cash Flow and Book Value are mixed. The 10 year growth for cash flow shows no growth, but the 5 year growth is 22.4% per year. The Book Value in basically the reverse and shows a 12% growth per year for the last 10 years, but a growth of only 3% per year for the last 5 years. This is a small cap company, so it is not unusual to have growth that is rather mixed.

The Liquidity Ratio is rather low at 0.86. This means that the current assets cannot cover the current liabilities. However, the cash flow statements have a positive flow for both 2008 and 2009. The Asset/Liability Ratio is much better at 1.46, but I would prefer this to be higher at 1.50. The last thing to mention is the Asset/Book Value Ratio (or leverage). This ratio is a bit high at 3.16, but it has been coming down since a peak in 2006 at 3.91.

The first quarterly results are in and the company has reported an 8.5% decline in Revenues, but a 150% increase in earnings. However, the estimates given by analysts still seem to expect that the final earnings for 2010 and 2011 will be lower than that for 2009. The Book Value for this quarter is down slightly. The last thing to mention is that the Accrual Ratio is at a very good -7.6%. An Accrual Ratio of -5% or less is great.

Currently, I not in the market to buy anymore stocks, but 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 sulfur-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.

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