CCL Industries Inc 2

Canadian Tire Corp (TSX-CTC.A) made news because of good 3rd quarterly results and they raised their dividends some 9.1% for 2012. This is not as good as the raise of 2011 which was a 35% raised, but then they had no dividend rises in 2009 and 2010. I own this stock and have since 2000. I have made a 10% return per year on this stock, but only 1.7% per year can be attributed to dividends.

I do not own CCL Industries Inc. (TSX-CCL.B). This is an Industrial Stock, that is into packaging for consumer products. They have done better than Canam since the recent recession, but they have not completely recovered.

When I look at insider trading I find, again, lots of insider selling, around $7.2M. There is also some very minor insider buying. This is the same as last year, which had some $8M of insider selling. Insiders, except for the directors have more options than shares. Some 39 institutions own 40% of the outstanding shares of this company. There has been some buying and selling over the past 3 months, with institutions marginally increasing their investment in this company over the last 3 months.

The 5 year median low Price/Earnings Ratio is 11.7 and the 5 year median high P/E Ratio is 14.9. The current P/E ratio of 11.7 is therefore on the low side. I get a 10 year Price/Book Value ratio of 1.39 and the current P/B Ratio at 1.19 is some 86% lower. This shows the stock price on the low side.

I get a Graham Price of $37.73. The current stock price of $29.70 is some 21% lower. The stock price on this stock is generally lower than the Graham Price. The median and low median difference between the Graham Price and the stock price is the stock price being at 17% and 26% lower, respectively. So the current price is on the low side.

I get a current dividend yield of 2.36%. The 5 year median is 1.89%, so this also shows a good current stock price. Also, even better is the 10 year median high yield is 2.31 which is also lower. So all my tests show this company’s stock price is relatively low.

When I look at analysts’ recommendations, I find one Strong Buy and one Buy. The consensus would probably be a Buy. One analyst liked this stock as it is unique for a Canadian company to be a multinational, multi-consumer products company. One Buy recommendation came with a $36 12 month stock price. This is the sort of company to buy for rising dividends and long-term gains.

CCL Industries Inc. provides state-of-the-art specialty packaging solutions to some of the world’s largest producers of consumer brands in personal care, cosmetic, healthcare, household and specialty food and beverage products. With headquarters in Toronto, Ontario, Canada, CCL Industries operates production facilities in North America, Europe, Latin America, Asia and Australia. Stuart Lang and Donald Lang own this stock 94%. Its web site is here CCL. See my spreadsheet at ccl.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.