I do not own this stock (TSX-RSI). This stock was brought to my attention by Dividend Ninja. This company used to be a Unit Trust (TSX-RSI.UN) but it has converted to corporation.
There is little insider trading, with some insider selling and some insider buying with a small net of insider selling. Belkin Enterprises Ltd. owned by Alton Stuart Belkin owns around 13% of the outstanding shares worth around $70M. Most insiders have some shares or debentures. There are some use of options, but very little.
There are 13 institutions that hold some 28% of the outstanding stock. Over the past 3 months they have very marginally increased their shareholdings. Because the increase is so small it tells us that they are just holding on to their shares.
I get 5 year low, median and high median Price/Earnings Ratios of 8.06, 9.42 and 10.40. The current P/E is 12.12 based on a stock price of $6.18 and a 2012 EPS of $0.51. Although this is not a particularly high P/E Ratio, it is certainly relatively high for this stock. (Using 10 year median P/E Ratios would not help as these are very close to the 5 year P/E Ratios.)
However, companies transitioning from an income trust to a corporation are expected to have stock price increases and dividend decreases or a combination so that the dividend yields go to a 4 to 5% yield. The yield on this stock is above this 4 to 5% range coming currently in at 5.83%, this might suggest that the stock price may not be that high.
I get a Graham Price of $5.86 and 10 year low, median and high median Price/Graham Price Ratios are 0.69, 0.78 and 087. This means that the Graham Price is usually higher than the stock price. The current P/GP Ratio is 1.05. This means that the stock price of $6.18 is relatively high.
I get a 10 year Price/Book Value Ratio of 1.38. The current P/B Ratio is 2.07, a value some 50% higher than the 10 year median. This test shows that the stock price of $6.18 is relatively high. As with all income trusts, this book value growth is non-existent or very low. Most income trusts cannot pass this test.
The dividend yield test would also say that the stock price is relatively high. This is because the 4 year median dividend yield is 10.18% and the current dividend yield is 5.83%, a yield that is some 43% lower. However, this stock went from an income trust to a corporation and it was expected that a combination of dividend decreases and stock increases will lower dividend yields on these companies to a 4 to 5% dividend yield.
Part of the decrease in dividends is due to the fact that dividends were initially reduced by some 26%. The stock price has also gone up and this stock shows a dividend yield above the 4 to 5% range. This is implies that the stock price has not risen or the dividend has not been cut as much as expected or some of both. It may also imply that the stock may not be overpriced. Sometimes these things are not a clear cut as we might like them to be.
When I look at analysts' recommendations, I find only a few analysts following this stock and they all have the same rating which is a Hold. The consensus recommendation would be a Hold. It would seem that the consensus 12 months stock price is around $6.00. This implies that the analysts do not expect much in capital gain over the next 12 months. In fact they expect a capital loss over the next 12 months.
One analyst with a Hold recommendation thinks that the stock price is too high. Another analyst complained that that sugar prices can vary so much over time. A few mentioned that one of their main inputs is natural gas, and natural gas is currently very cheap. (The energy they use is from natural gas.)
Although this blog report is from last year, it is from a blogger than likes this stock and he has some interesting things to say about it. See Divestor Blog.
I must admit this is not a stock that I would buy. It is a mature and low growth stock, but I perceive it as rather risky. If I want a risky stock with dividends, I go for fast growing stock with dividends. I do favor tech companies.
I perceive this company as risky as sugar is a commodity and prices of commodities are generally volatile and I do not invest in commodity is any sort of big way. For example, I have very little in oil and gas investments. I admit that in these sorts of investments you can sometimes make a lot of income, but it is volatile and I do not like my income to be volatile.
Rogers Sugar Inc. was established to hold all of the common shares and notes of Lantic Inc. Lantic Inc. is a refiner, processor, distributor and marketer of sugar products in Canada. Its web site is here Husky. See my spreadsheet at rsi.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.
Friday, August 31, 2012
Thursday, August 30, 2012
Rogers Sugar Inc
I do not own this stock (TSX-RSI). This stock was brought to my attention by Dividend Ninja. This company used to be a Unit Trust (TSX-RSI.UN) but it has converted to corporation.
When this stock converted to a corporation they decreased the dividend some 26%. This was in 2011. In 2012, they increased the dividend by 5.9%. Prior to this they had a mixed record. Dividend yields were high (9 to 13%), but they lowered as well as raised their dividends. Dividends are still quite good at 5.83%, but not as good as before.
It is not bad that a company changes it dividend based on what it can pay, however, if you are living off you dividends, you have to take this into consideration before investing in this company. Companies that vary their dividends tend to decrease them in bad times and raise them in good times. Also, because this company is no longer an income trust, they will not go back to the very high dividends of past years.
The 5 year median Dividend Payout Ratios are 91.34% per year for earnings and 57.55% per year for cash flow. The DPR for earnings are quite high. For the financial year ending September 2011 the DPR for earnings was 82.2%. However, the DPR for earnings is expected to get much better for 2012 and is expected to be around 68.6%.
The total return over the past 5 and 10 years is 12.48% and 11.51%. The interest portion of this return was 9.44% and 9.55% per year, respectively. The capital gain portion was 3.04% and 1.96% per year, respectively. As you can see, most of the return was in dividend income and this came in at 76% and 83% of total returns over the past 5 and 10 years. Dividend returns will be lower going forward.
There was a big increase in shares outstanding in both 2002 and 2003. The increase in shares over the past 10 years is therefore rather high at 7.9% per year. The increase in shares outstanding over the past 5 years is very low at just slightly above 0%. Outstanding share changes can affect the per share values under a company.
The revenues of this company have grown at the rate of 2.8% and 12.7% per year over the past 5 and 10 years. The revenue per share has grown at the rate of 2.8% and 4.4% per year over the past 5 and 10 years. The big difference in the 10 year growth between revenue and revenue per share is due to the big increase in shares over the past 10 years. Revenue growth is important, but as an owner of shares, the growth per share is also quite important.
Earnings per share are a different story with growth at 1.9% and 0% over the past 5 and 10 years. Cash Flow growth is also non-existent as it has declined over the past 5 years by 1.4% and grew over the past 10 years at just 1.4%. However, over the past 10 years, they just had 1 year with negative earnings and no years with negative cash flow.
Book values do not do well under income trust companies, so it is not surprising that over the past 5 years book value per share has only grown at 2.8%. The book value per share has declined over the past 10 years by just over 7% per year.
Return on Equity has in the last 5 years been in the good 10% to 15% range and sometimes even in the very good 15 to 20% range. The 5 year median ROE is 16.6%. The ROE at the end of financial year of 2011 was 15.2%. The ROE based on comprehensive income was also 15.2% in the 2011 financial year. This basically tells you that the quality of earnings is probably good. The 5 year median ROE based on comprehensive income is also 16.6%.
The Liquidity Ratio for the financial year of 2011 was low at 1.32. At the end of the 2nd quarter of 2012 it is better at 1.41, but this is still a bit low. The 5 year median is lower still at just 1.16. However, the debt ratio has varied quite a bit over the years.
The Debt Ratio is currently at a very good 1.91 and this is not far from the one for the financial year ending in September 2011 at 1.90. The 5 year median Debt Ratio is 1.89.
The current Leverage and Debt/Equity Ratios are fine at 2.11 and 1.11 respectively. These are close to the 10 years ratios of 2.17 and 1.15, which are also fine.
Rogers Sugar is a mature and low growth business. There are good dividends to be made, but probably not much in way of capital gains. Let's face it a 5.8% income is quite a good return today. However, dividends have fluctuated in the past.
Rogers Sugar Inc. was established to hold all of the common shares and notes of Lantic Inc. Lantic Inc. is a refiner, processor, distributor and marketer of sugar products in Canada. Its web site is here Husky. See my spreadsheet at rsi.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.
When this stock converted to a corporation they decreased the dividend some 26%. This was in 2011. In 2012, they increased the dividend by 5.9%. Prior to this they had a mixed record. Dividend yields were high (9 to 13%), but they lowered as well as raised their dividends. Dividends are still quite good at 5.83%, but not as good as before.
It is not bad that a company changes it dividend based on what it can pay, however, if you are living off you dividends, you have to take this into consideration before investing in this company. Companies that vary their dividends tend to decrease them in bad times and raise them in good times. Also, because this company is no longer an income trust, they will not go back to the very high dividends of past years.
The 5 year median Dividend Payout Ratios are 91.34% per year for earnings and 57.55% per year for cash flow. The DPR for earnings are quite high. For the financial year ending September 2011 the DPR for earnings was 82.2%. However, the DPR for earnings is expected to get much better for 2012 and is expected to be around 68.6%.
The total return over the past 5 and 10 years is 12.48% and 11.51%. The interest portion of this return was 9.44% and 9.55% per year, respectively. The capital gain portion was 3.04% and 1.96% per year, respectively. As you can see, most of the return was in dividend income and this came in at 76% and 83% of total returns over the past 5 and 10 years. Dividend returns will be lower going forward.
There was a big increase in shares outstanding in both 2002 and 2003. The increase in shares over the past 10 years is therefore rather high at 7.9% per year. The increase in shares outstanding over the past 5 years is very low at just slightly above 0%. Outstanding share changes can affect the per share values under a company.
The revenues of this company have grown at the rate of 2.8% and 12.7% per year over the past 5 and 10 years. The revenue per share has grown at the rate of 2.8% and 4.4% per year over the past 5 and 10 years. The big difference in the 10 year growth between revenue and revenue per share is due to the big increase in shares over the past 10 years. Revenue growth is important, but as an owner of shares, the growth per share is also quite important.
Earnings per share are a different story with growth at 1.9% and 0% over the past 5 and 10 years. Cash Flow growth is also non-existent as it has declined over the past 5 years by 1.4% and grew over the past 10 years at just 1.4%. However, over the past 10 years, they just had 1 year with negative earnings and no years with negative cash flow.
Book values do not do well under income trust companies, so it is not surprising that over the past 5 years book value per share has only grown at 2.8%. The book value per share has declined over the past 10 years by just over 7% per year.
Return on Equity has in the last 5 years been in the good 10% to 15% range and sometimes even in the very good 15 to 20% range. The 5 year median ROE is 16.6%. The ROE at the end of financial year of 2011 was 15.2%. The ROE based on comprehensive income was also 15.2% in the 2011 financial year. This basically tells you that the quality of earnings is probably good. The 5 year median ROE based on comprehensive income is also 16.6%.
The Liquidity Ratio for the financial year of 2011 was low at 1.32. At the end of the 2nd quarter of 2012 it is better at 1.41, but this is still a bit low. The 5 year median is lower still at just 1.16. However, the debt ratio has varied quite a bit over the years.
The Debt Ratio is currently at a very good 1.91 and this is not far from the one for the financial year ending in September 2011 at 1.90. The 5 year median Debt Ratio is 1.89.
The current Leverage and Debt/Equity Ratios are fine at 2.11 and 1.11 respectively. These are close to the 10 years ratios of 2.17 and 1.15, which are also fine.
Rogers Sugar is a mature and low growth business. There are good dividends to be made, but probably not much in way of capital gains. Let's face it a 5.8% income is quite a good return today. However, dividends have fluctuated in the past.
Rogers Sugar Inc. was established to hold all of the common shares and notes of Lantic Inc. Lantic Inc. is a refiner, processor, distributor and marketer of sugar products in Canada. Its web site is here Husky. See my spreadsheet at rsi.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.
Wednesday, August 29, 2012
Canadian Utilities Ltd 2
On my other blog I am today writing about what to read for novice investors. I think that if you want to learn about investing today I would suggest reading some blogs rather than any particular book. One of my favourite investment bloggers is the Loonie Bin Blog continue...
I do not own this stock Canadian Utilities Ltd.(TSX-CU). I started to follow this stock as it was on a number of dividend lists. It was on and still is some dividend lists of Dividend Achievers (see resources) and Dividend Aristocrats (see indices).
Insider trading shows that there was $1.37M of insider buying and $1.35M of insider selling, so there was a very small net of insider buying. Everyone, but directors have lots more options or rights than shares. This includes Subsidiary Executives. There are some directors with shares worth in the millions, and the CEO has shares worth around $6.6M. However, insiders do not own a substantial amount of the outstanding shares. ATCO Ltd (TSX-ACO.X, ACO.Y) owns around 53% of the outstanding shares.
There is not a large investment by institutions into this stock. There are some 5 institutions that own around 5% of the outstanding shares. Over the past 3 months they have marginally decreased their share ownership. This change is small so it tells us nothing.
The 5 year low, median and high median Price/Earnings Ratios are 12.25, 14.02 and 15.79. The current P/E Ratio is 17.11 on a stock price of $69.29 and an EPS value of $4.05 for 2012. The high P/E ratio suggests that the current stock price is relatively high.
I get a Graham Price of $48.04. The 10 year low, median and high median Price/Graham Price Ratios are 0.91, 1.07 and 1.23. The current P/GP Ratio is 1.44 on a stock price of $69.29. This high P/GP Ratios suggests that the stock price is relatively high.
I get a 10 year median Price/Book Value Ratio of 1.99. The current P/B Ratio is 3.64, which is some 37% higher. This high current P/B Ratio suggests a relatively high current stock price.
I get a 5 year median dividend yield of 3.12%. The current dividend yield is 2.55% and is some 18% lower. This lower dividend yield would also suggest a rather high current stock price.
When I look at analysts' recommendations, I find Strong Buy, Buy, and Hold recommendations. The consensus recommendation would be a Buy. (Most of the time this is what you find under analysts' recommendations and it tell you nothing.) My spreadsheet suggests that this stock is overpriced.
One analyst with a Hold recommendation mentioned that the company in Q2 of 2012 missed their EPS estimates. Another analyst says that people continue to use electricity come rain or shine, so investors are happy to accept relatively low, very safe yields. This company fits into this category.
Another analyst said this company's P/E is lower compared to other utility stock. He also liked its potential for raising its dividends. It is expect to raise the dividends at least 9% per year over the coming few years.
The consensus 12 months stock price is $74.10. This implies a 12 month total stock return of 9.5%, with 2.6% from dividends and 6.9% from capital gain.
I think this stock is overpriced, but all utility stock seems to be overpriced currently. It is not wildly overpriced, but a P/E of 17 is rather high for a utility stock. Certainly an ability to give nice dividend raises over the new few years is a positive.
Canadian Utilities Limited operates in four business segments: regulated natural gas operations; regulated electric operations; technologies; and power generation. These operations provide service to industrial, residential and commercial customers. Other businesses consist of natural gas gathering, processing, storage and natural gas supply management and technical facilities management. ATCO (ACO.X) owns just over 50% of this company. CU.X is voting and Class B, CU is non-voting and Class A. Its web site is here Canadian Utilities. See my spreadsheet at cu.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.
I do not own this stock Canadian Utilities Ltd.(TSX-CU). I started to follow this stock as it was on a number of dividend lists. It was on and still is some dividend lists of Dividend Achievers (see resources) and Dividend Aristocrats (see indices).
Insider trading shows that there was $1.37M of insider buying and $1.35M of insider selling, so there was a very small net of insider buying. Everyone, but directors have lots more options or rights than shares. This includes Subsidiary Executives. There are some directors with shares worth in the millions, and the CEO has shares worth around $6.6M. However, insiders do not own a substantial amount of the outstanding shares. ATCO Ltd (TSX-ACO.X, ACO.Y) owns around 53% of the outstanding shares.
There is not a large investment by institutions into this stock. There are some 5 institutions that own around 5% of the outstanding shares. Over the past 3 months they have marginally decreased their share ownership. This change is small so it tells us nothing.
The 5 year low, median and high median Price/Earnings Ratios are 12.25, 14.02 and 15.79. The current P/E Ratio is 17.11 on a stock price of $69.29 and an EPS value of $4.05 for 2012. The high P/E ratio suggests that the current stock price is relatively high.
I get a Graham Price of $48.04. The 10 year low, median and high median Price/Graham Price Ratios are 0.91, 1.07 and 1.23. The current P/GP Ratio is 1.44 on a stock price of $69.29. This high P/GP Ratios suggests that the stock price is relatively high.
I get a 10 year median Price/Book Value Ratio of 1.99. The current P/B Ratio is 3.64, which is some 37% higher. This high current P/B Ratio suggests a relatively high current stock price.
I get a 5 year median dividend yield of 3.12%. The current dividend yield is 2.55% and is some 18% lower. This lower dividend yield would also suggest a rather high current stock price.
When I look at analysts' recommendations, I find Strong Buy, Buy, and Hold recommendations. The consensus recommendation would be a Buy. (Most of the time this is what you find under analysts' recommendations and it tell you nothing.) My spreadsheet suggests that this stock is overpriced.
One analyst with a Hold recommendation mentioned that the company in Q2 of 2012 missed their EPS estimates. Another analyst says that people continue to use electricity come rain or shine, so investors are happy to accept relatively low, very safe yields. This company fits into this category.
Another analyst said this company's P/E is lower compared to other utility stock. He also liked its potential for raising its dividends. It is expect to raise the dividends at least 9% per year over the coming few years.
The consensus 12 months stock price is $74.10. This implies a 12 month total stock return of 9.5%, with 2.6% from dividends and 6.9% from capital gain.
I think this stock is overpriced, but all utility stock seems to be overpriced currently. It is not wildly overpriced, but a P/E of 17 is rather high for a utility stock. Certainly an ability to give nice dividend raises over the new few years is a positive.
Canadian Utilities Limited operates in four business segments: regulated natural gas operations; regulated electric operations; technologies; and power generation. These operations provide service to industrial, residential and commercial customers. Other businesses consist of natural gas gathering, processing, storage and natural gas supply management and technical facilities management. ATCO (ACO.X) owns just over 50% of this company. CU.X is voting and Class B, CU is non-voting and Class A. Its web site is here Canadian Utilities. See my spreadsheet at cu.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.
Tuesday, August 28, 2012
Canadian Utilities Ltd
I do not own this stock (TSX-CU). I started to follow this stock as it was on a number of dividend lists. It was on and still is some dividend lists of Dividend Achievers (see resources) and Dividend Aristocrats (see indices). It is not a bad idea to look at these lists to get ideas on stock to follow or buy. However, please be aware that these lists are constantly being updated. And, companies are not necessarily a good dividend stock just because they are on such lists.
The 5 year median dividend yield is 3.1% and the current yield is 2.55%. The 5 and 10 year growth in dividends is at 7% and 5.5% per year, respectively. The latest dividend increase is very good at 9.9%. Investors in the past have done quite well in that after some 10 years they are getting around 7.5% yield and after 15 years getting around 11.5% yield on their original investment
Total return over the past 5 and 10 years is also quite good. The 5 and 10 year total return is at 7.89% and 12.8% per year. The dividend portion of this return was 2.68% and 3.32% per year over the past 5 and 10 years. The dividends were some 34% and 26% of the total return over these periods. The capital gain portion was at 5.21% and 9.48% per year over these periods.
Revenue has increased at the rate of 4.3% per year over the past 5 years. However, revenue has declined by 1.6% per year over the past 10 years. The Revenue per Share is slightly different with the increase at 4% per year over the past 5 years and a decline of 1.7% per year over the past 10 years. The difference is because outstanding shares have marginally increased each year over the past 5 and 10 years.
Earnings per Share have done better with growth at 7.4% per year and 7% per year over the past 5 and 10 years. The growth in book value is somewhat in line with that of EPS with growth at 5.7% per year and 6.5% per year over the past 5 and 10 years. Growth in cash flow per share is very good with growth at 15.5% and 10% per year over the past 5 and 10 years.
Earnings for the 1st quarter come in within the expected analysts estimate range. However, the earnings for the second quarter come in lower than the expected analysts range. However, the yearly estimates for 2012 and 2013 seem not to have been changed. The EPS for the 3 months ending in June 2012 is $0.74 and the EPS for the 3 months ending in June 2011 is $0.70. So earnings are up some 5.7% between this quarter and last year's quarter.
The Return on Equity is quite good with the ROE at the end of December 2011 at 16.5%. The 5 year median ROE is also quite good at 15.3%. The ROE based on comprehensive income is a bit lower, but still quite good at 13.3% for the end of December 2011. The 5 year median is also good at 14.2%.
The current Liquidity Ratio is quite low at 0.82, but the situation is better than it initially appears as they have spent cash on assets and they have redeemed some preferred shares. The cash flow is still strong. The Liquidity Ratio at the end of December 2011 was 1.47, a better ratio. The current Debt Ratio is a bit lower than normal at 1.52.
The current Leverage and Debt/Equity Ratios are a little high at 3.74 and 2.45. Their 5 year median ratios are 3.02 and 1.74. All the debt ratios are trending the wrong way, buy I do not think that, at this point, there is anything to worry about. They have redeemed some preferred shares and issued new ones at a lower yield. They have bought assets and they still have a good cash flow.
This company has done well for its shareholders over the past 5 and 10 years. The markets have been rather difficult. It is a utility stock and lots of utility stocks have done well. Most of the utility type stocks have done well in our current market as dividends are decent. This stock still has a decent dividend, but the yield is below the both the 5 and 10 years median yields. The management of this company certainly feels good about the future with the recent large dividend increase.
Canadian Utilities Limited operates in four business segments: regulated natural gas operations; regulated electric operations; technologies; and power generation. These operations provide service to industrial, residential and commercial customers. Other businesses consist of natural gas gathering, processing, storage and natural gas supply management and technical facilities management. ATCO (ACO.X) owns just over 50% of this company. CU.X is voting and Class B, CU is non-voting and Class A. Its web site is here Canadian Utilities. See my spreadsheet at cu.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.
The 5 year median dividend yield is 3.1% and the current yield is 2.55%. The 5 and 10 year growth in dividends is at 7% and 5.5% per year, respectively. The latest dividend increase is very good at 9.9%. Investors in the past have done quite well in that after some 10 years they are getting around 7.5% yield and after 15 years getting around 11.5% yield on their original investment
Total return over the past 5 and 10 years is also quite good. The 5 and 10 year total return is at 7.89% and 12.8% per year. The dividend portion of this return was 2.68% and 3.32% per year over the past 5 and 10 years. The dividends were some 34% and 26% of the total return over these periods. The capital gain portion was at 5.21% and 9.48% per year over these periods.
Revenue has increased at the rate of 4.3% per year over the past 5 years. However, revenue has declined by 1.6% per year over the past 10 years. The Revenue per Share is slightly different with the increase at 4% per year over the past 5 years and a decline of 1.7% per year over the past 10 years. The difference is because outstanding shares have marginally increased each year over the past 5 and 10 years.
Earnings per Share have done better with growth at 7.4% per year and 7% per year over the past 5 and 10 years. The growth in book value is somewhat in line with that of EPS with growth at 5.7% per year and 6.5% per year over the past 5 and 10 years. Growth in cash flow per share is very good with growth at 15.5% and 10% per year over the past 5 and 10 years.
Earnings for the 1st quarter come in within the expected analysts estimate range. However, the earnings for the second quarter come in lower than the expected analysts range. However, the yearly estimates for 2012 and 2013 seem not to have been changed. The EPS for the 3 months ending in June 2012 is $0.74 and the EPS for the 3 months ending in June 2011 is $0.70. So earnings are up some 5.7% between this quarter and last year's quarter.
The Return on Equity is quite good with the ROE at the end of December 2011 at 16.5%. The 5 year median ROE is also quite good at 15.3%. The ROE based on comprehensive income is a bit lower, but still quite good at 13.3% for the end of December 2011. The 5 year median is also good at 14.2%.
The current Liquidity Ratio is quite low at 0.82, but the situation is better than it initially appears as they have spent cash on assets and they have redeemed some preferred shares. The cash flow is still strong. The Liquidity Ratio at the end of December 2011 was 1.47, a better ratio. The current Debt Ratio is a bit lower than normal at 1.52.
The current Leverage and Debt/Equity Ratios are a little high at 3.74 and 2.45. Their 5 year median ratios are 3.02 and 1.74. All the debt ratios are trending the wrong way, buy I do not think that, at this point, there is anything to worry about. They have redeemed some preferred shares and issued new ones at a lower yield. They have bought assets and they still have a good cash flow.
This company has done well for its shareholders over the past 5 and 10 years. The markets have been rather difficult. It is a utility stock and lots of utility stocks have done well. Most of the utility type stocks have done well in our current market as dividends are decent. This stock still has a decent dividend, but the yield is below the both the 5 and 10 years median yields. The management of this company certainly feels good about the future with the recent large dividend increase.
Canadian Utilities Limited operates in four business segments: regulated natural gas operations; regulated electric operations; technologies; and power generation. These operations provide service to industrial, residential and commercial customers. Other businesses consist of natural gas gathering, processing, storage and natural gas supply management and technical facilities management. ATCO (ACO.X) owns just over 50% of this company. CU.X is voting and Class B, CU is non-voting and Class A. Its web site is here Canadian Utilities. See my spreadsheet at cu.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.
Monday, August 27, 2012
The North West Company 2
On my other blog I am today writing about what to read for novice investors. I think that if you want to learn about investing today I would suggest reading some blogs rather than any particular book. Some of my favourite investment bloggers are continue....
The stock I am talking about today is the North West Company (TSX-NWC), a company I do not own. At the 2009 Money Show, a number of people where talking about some former, or soon to be former, income trusts being very good investments. This was one company that people were talking about. The dividend yield at that time was 7%.
Lots of insider own shares and some own shares worth into the millions. However, insiders own a very small portion of this company's outstanding shares. Over the past year there has not been much in the way of insider trading. Insider buying is $0.4M and insider selling is $0.6M, leaving a net of insider selling of $0.2M.
There are 39 institutional owners that hold some 28% of the outstanding shares. Over the past 3 months they have sold just over 1% of their shares. This is not enough to be a negative.
The 5 year low, median and high median Price/Earnings Ratios are 11.12, 12.67 and 14.23. The current P/E Ratio of 15.85 on a stock price of $21.40 is rather high and suggests that the current stock price is rather high. Part of the problem is that the financial year ending January 2012 was not that great but the earnings are expected to climb over the next couple of years.
I get a Graham Price of $13.36. The 10 year low, median and high median Price/Graham Price Ratios are 0.93, 1.15 and 1.35. The current P/GP Ratio of 1.60 on a stock price of $21.40 also suggests a relatively high current stock price.
I get a 10 year median Price/Book Value Ratio of 2.92. The current P/B Ratio is 3.64 a value that is some 24% higher. This also suggests a rather high current stock price.
The 5 year median dividend yield is 7.09%. The current yield of 4.86% is some 31% lower. Usually a lower dividend suggests a rather high stock price. However, this company used to be an income trust. It was expected that old income trust companies would end up with dividend yields between 4 and 5%. This yield is closer to the 5% and would suggest that perhaps the stock price really is not that high.
There are number of analysts following this stock and all their recommendations are a Hold recommendation. Therefore, the consensus recommendation would be a Hold. The 12 month consensus stock price is $22.30. This implies a 9.07% total return with 4.86% from dividends and 4.21% from capital gains over the next year.
One analyst with a Hold recommendation worried about the current economic climate. Many people feel we might be heading for another recession. There is also the worry of competition, especially from Target. Here is what Desjardins Securities analyst John Hughes said about this company in June 2012. Here is what CIBC said about this stock in March 2012. This company is also mentioned in a numbers cruncher article entitled "Low-volatility dividend stocks for stormy times" in the G&M.
The stock price is relatively high, but it is not in an unreasonable range. The dividend yield is quite good. The mitigating circumstance is that old income trust were expected to having raising stock prices and/or lowering dividends to get to a 4% to 5% dividend yield range. This company has used decreased dividends (they were lowered some 30%) to get into this dividend yield range. However, stock price has risen a bit, but higher P/E Ratios is also due to lower EPS.
It is a bit pricey and we might be heading into a recession. Also, October is coming and often we get lower markets in the fall. I would think that if you want to buy this stock, you might get a better price in the fall. However, you are also taking a chance as dropping prices in the fall do not always occur for all stocks.
The North West Company is a leading retailer of food and everyday products and services to rural communities and urban neighborhoods in Canada, Alaska, the South Pacific and the Caribbean. North West operates 225 stores under the trading names Northern, NorthMart, Giant Tiger, AC Value Center, and Cost-U-Less. Its web site is here North West Company. See my spreadsheet at nwc.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.
The stock I am talking about today is the North West Company (TSX-NWC), a company I do not own. At the 2009 Money Show, a number of people where talking about some former, or soon to be former, income trusts being very good investments. This was one company that people were talking about. The dividend yield at that time was 7%.
Lots of insider own shares and some own shares worth into the millions. However, insiders own a very small portion of this company's outstanding shares. Over the past year there has not been much in the way of insider trading. Insider buying is $0.4M and insider selling is $0.6M, leaving a net of insider selling of $0.2M.
There are 39 institutional owners that hold some 28% of the outstanding shares. Over the past 3 months they have sold just over 1% of their shares. This is not enough to be a negative.
The 5 year low, median and high median Price/Earnings Ratios are 11.12, 12.67 and 14.23. The current P/E Ratio of 15.85 on a stock price of $21.40 is rather high and suggests that the current stock price is rather high. Part of the problem is that the financial year ending January 2012 was not that great but the earnings are expected to climb over the next couple of years.
I get a Graham Price of $13.36. The 10 year low, median and high median Price/Graham Price Ratios are 0.93, 1.15 and 1.35. The current P/GP Ratio of 1.60 on a stock price of $21.40 also suggests a relatively high current stock price.
I get a 10 year median Price/Book Value Ratio of 2.92. The current P/B Ratio is 3.64 a value that is some 24% higher. This also suggests a rather high current stock price.
The 5 year median dividend yield is 7.09%. The current yield of 4.86% is some 31% lower. Usually a lower dividend suggests a rather high stock price. However, this company used to be an income trust. It was expected that old income trust companies would end up with dividend yields between 4 and 5%. This yield is closer to the 5% and would suggest that perhaps the stock price really is not that high.
There are number of analysts following this stock and all their recommendations are a Hold recommendation. Therefore, the consensus recommendation would be a Hold. The 12 month consensus stock price is $22.30. This implies a 9.07% total return with 4.86% from dividends and 4.21% from capital gains over the next year.
One analyst with a Hold recommendation worried about the current economic climate. Many people feel we might be heading for another recession. There is also the worry of competition, especially from Target. Here is what Desjardins Securities analyst John Hughes said about this company in June 2012. Here is what CIBC said about this stock in March 2012. This company is also mentioned in a numbers cruncher article entitled "Low-volatility dividend stocks for stormy times" in the G&M.
The stock price is relatively high, but it is not in an unreasonable range. The dividend yield is quite good. The mitigating circumstance is that old income trust were expected to having raising stock prices and/or lowering dividends to get to a 4% to 5% dividend yield range. This company has used decreased dividends (they were lowered some 30%) to get into this dividend yield range. However, stock price has risen a bit, but higher P/E Ratios is also due to lower EPS.
It is a bit pricey and we might be heading into a recession. Also, October is coming and often we get lower markets in the fall. I would think that if you want to buy this stock, you might get a better price in the fall. However, you are also taking a chance as dropping prices in the fall do not always occur for all stocks.
The North West Company is a leading retailer of food and everyday products and services to rural communities and urban neighborhoods in Canada, Alaska, the South Pacific and the Caribbean. North West operates 225 stores under the trading names Northern, NorthMart, Giant Tiger, AC Value Center, and Cost-U-Less. Its web site is here North West Company. See my spreadsheet at nwc.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.
Friday, August 24, 2012
The North West Company
I do not own this stock of North West Company (TSX-NWC, OTC-NWTUF). At the 2009 Money Show, a number of people where talking about some former, or soon to be former income trusts being very good investments. This was one company that people were talking about. The dividend yield at that time was 7%.
The dividend yield has come down to a yield of 4.9% yield today. It was expected that a combination of stock increases and dividend adjustments would cause former income trusts to end up with dividends in the 4 to 5% range. With this stock the stock price has more or less held firm, but dividends were, initially at least, reduced by 30%.
The company's Dividend Payout Ratios were not that bad, having peaked at 90% for earnings and 62% for cash flow for the financial year ending in January 2011. They were lower for the financial year ending in January 2012, being 88% for earnings and 44% for cash flow. The DPRs for the financial year ending January 2013 for earnings is expected to be around 77%.
Dividend growth is not bad considering that they were cut 30% in 2012. The 5 and 10 year growth in dividends is 3.7% and 7.1% per year. They have begun to raise the dividends again, and the most recent dividend increase was done for the April 2012 and was for 8.3%.
Total return over the past 5 and 10 years has been quite good, with 5 year returns at 10.63% per year and 10 year returns at 22.13% per year. The dividend portion of these returns is 7.22% and 9.40% per year, respectively. The capital gain portion is at 3.40% and 12.96% per year, respectively. The dividends comprise some 68% and 42% of the 5 and 10 year total returns. However, going forward, the dividends will be down in the 4 to 5% range rather than the past 7 to 9% range.
Growth is generally quite mixed. Revenue and Revenue per Share growth is the same as there has been no growth in shares over the past 5 and 10 years. Revenue growth in the best growth under this company and bodes well for the future. Revenue has grown at the rate of 9.6% and 7.8% per year over the past 5 and 10 years. Cash flow growth is also fine at 8.8% and 7.8% per year over the past 5 and 10 years.
Other growth has not been great. Growth in EPS is just 1.2% and 6.2% per year over the past 5 and 10 years. Growth in book value is the lowest, with its growth at 2.4% and 2.6% per year over the past 5 and 10 years.
Although the ROE based on net income and comprehensive income are both quite good, there is a big difference this year in these ROE calculations. The ROE on net income is 20.4%, with a 5 year median ROE of 25.3%. The ROE on comprehensive is lower at 15.2%, with a 5 year median ROE of 25%. (An ROE from 10% to 15% is considered good. A sustained percentage above 20% is considered above average.)
Debt Ratios on this company are quite good. The current Liquidity Ratio is 2.59, with a 5 year median of 1.66. The current Debt Ratio is 1.83, with a 5 year median of 1.87. The current Leverage and Debt/Equity Ratios are fine, coming in at 2.20 and 1.20, respectively.
Considering the current market situation, this stock is doing quite well. It is a stock I would consider investing in.
The North West Company is a leading retailer of food and everyday products and services to rural communities and urban neighborhoods in Canada, Alaska, the South Pacific and the Caribbean. North West operates 225 stores under the trading names Northern, NorthMart, Giant Tiger, AC Value Center, and Cost-U-Less. Its web site is here North West Company. See my spreadsheet at nwc.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.
The dividend yield has come down to a yield of 4.9% yield today. It was expected that a combination of stock increases and dividend adjustments would cause former income trusts to end up with dividends in the 4 to 5% range. With this stock the stock price has more or less held firm, but dividends were, initially at least, reduced by 30%.
The company's Dividend Payout Ratios were not that bad, having peaked at 90% for earnings and 62% for cash flow for the financial year ending in January 2011. They were lower for the financial year ending in January 2012, being 88% for earnings and 44% for cash flow. The DPRs for the financial year ending January 2013 for earnings is expected to be around 77%.
Dividend growth is not bad considering that they were cut 30% in 2012. The 5 and 10 year growth in dividends is 3.7% and 7.1% per year. They have begun to raise the dividends again, and the most recent dividend increase was done for the April 2012 and was for 8.3%.
Total return over the past 5 and 10 years has been quite good, with 5 year returns at 10.63% per year and 10 year returns at 22.13% per year. The dividend portion of these returns is 7.22% and 9.40% per year, respectively. The capital gain portion is at 3.40% and 12.96% per year, respectively. The dividends comprise some 68% and 42% of the 5 and 10 year total returns. However, going forward, the dividends will be down in the 4 to 5% range rather than the past 7 to 9% range.
Growth is generally quite mixed. Revenue and Revenue per Share growth is the same as there has been no growth in shares over the past 5 and 10 years. Revenue growth in the best growth under this company and bodes well for the future. Revenue has grown at the rate of 9.6% and 7.8% per year over the past 5 and 10 years. Cash flow growth is also fine at 8.8% and 7.8% per year over the past 5 and 10 years.
Other growth has not been great. Growth in EPS is just 1.2% and 6.2% per year over the past 5 and 10 years. Growth in book value is the lowest, with its growth at 2.4% and 2.6% per year over the past 5 and 10 years.
Although the ROE based on net income and comprehensive income are both quite good, there is a big difference this year in these ROE calculations. The ROE on net income is 20.4%, with a 5 year median ROE of 25.3%. The ROE on comprehensive is lower at 15.2%, with a 5 year median ROE of 25%. (An ROE from 10% to 15% is considered good. A sustained percentage above 20% is considered above average.)
Debt Ratios on this company are quite good. The current Liquidity Ratio is 2.59, with a 5 year median of 1.66. The current Debt Ratio is 1.83, with a 5 year median of 1.87. The current Leverage and Debt/Equity Ratios are fine, coming in at 2.20 and 1.20, respectively.
Considering the current market situation, this stock is doing quite well. It is a stock I would consider investing in.
The North West Company is a leading retailer of food and everyday products and services to rural communities and urban neighborhoods in Canada, Alaska, the South Pacific and the Caribbean. North West operates 225 stores under the trading names Northern, NorthMart, Giant Tiger, AC Value Center, and Cost-U-Less. Its web site is here North West Company. See my spreadsheet at nwc.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.
Thursday, August 23, 2012
AGF Management Ltd 2
I do not own this stock of AGF Management Ltd. (TSX-AGF.B), but I used to. I bought this stock in 2001 and sold it off in 2006 and 2008. I made over this period of 7 years some 2.08% per year return. All the return was dividends. I made nothing in capital gains. I sold the stock because I did not think that the stock was going anywhere.
The insider trading report says that there was $0.57M in insider buying and $0.78M in insider selling with net insider selling of $0.2M. There are insiders who have a lot invested in this firm. For example the CEO owns stock worth $148M. However, insiders have not only stock options, but Performance Share Units and Restricted Share Units. (There are lots of firms transitioning away from options to other option like vehicles.) They also have an Employees Share Ownership Plan (ESOP).
There are some 42 institutions that own some 28% of the outstanding shares of this firm. Over the past 3 months they have decreased their outstanding shares by 7.5%. This is a negative.
I get 5 year low, median and high median Price/Earnings Ratios of 10.45, 13.94 and 17.22. The current P/E Ratio is 13.02 which show that the stock price of $11.59 is reasonable. (Note that yesterday, the ROE on the comprehensive income was considerable below the ROE on the net income. This makes you question the quality of the company's earnings.)
I get a Graham Price of $15.78. The 10 year low, median and high median Price/Graham Price Ratios are 0.88, 1.23 and 1.50. The current P/GP Ratio of 0.73 shows a rather low current stock price of $11.59.
I get a 10 year median Price/Book Value Ratio of 1.58. The current P/B Ratio is just 0.93. This current ratio is just 58% of the 10 year median ratio. It is also below 1.00, which means that the stock is selling below the book value. (Generally, when a stock is selling below its book value, it is considered to be cheap.)
The 5 year median dividend yield is 6.19% and the current yield of 9.15% is some 48% higher. This would imply that the current price was a good one. However, one has to be cautious when the dividend yield is so high. This stock started out with low dividends and the 10 year median dividend yield is just 2.97%. It is only since 2008 that the yield has been climbing rather high.
Using my stock price tests it would seem like the current stock price of $11.59 is a good to reasonable price. However, the dividend yield is just too high and I am also worried about the quality of the earnings. What I am suggesting is that we should proceed with caution on this stock.
When I look at analysts' recommendations, I find Strong Buy, Buy, Hold, Underperform and Sell. The consensus recommendation would be a Hold. Most the recommendations are a Hold. The consensus 12 months stock price is $12.70. That implies a 12 months total return of 18.73%, with 9.58% from capital gains and 9.15% from dividend income.
The first quarterly EPS came in within analysts' estimates. However, the second quarterly EPS was way below analysts' estimates. Here is an article on this subject from Reuters. Article said that lower earnings were due to declining financial markets.
A couple of analysts with a Buy recommendation liked the yield and thought it was safe. One noted that this company is one of the last independent mutual fund companies. Analysts that do not like this stock feel that all mutual fund companies in Canada are in problems. One analyst thinks that Canadians are waking up to the fact that they are paying way too much money to have their investments managed.
There is an article about AGF suing an ex-employee Patricia Perez-Coutts who was a fund manager at AGF. Westwood Holdings Group Inc. has hired not only Ms. Perez-Coutts, but also other members of her former team at AGF. See the G&M article. There is also a G&M article on a big outflow of assets that occurred for this company in July 2012. See the G&M article. Also one other blogger Happy Capitalism wrote about this company in May of this year. He thinks that the stock has been oversold for a while and he sees this as a sign of weakness in the stock.
I like strong stable dividend growth type companies. This company is none of those things, really. It is not a company I would buy at this time. They used to be a good company. Maybe they will be again in the future. So, I will continue to follow it, but I am certainly not interested at this point in buying it.
AGF is a Mutual Fund company. It owns AGF Trust Company. The company has a diversified group of products designed to meet a variety of investment objectives including GICs, term deposits, real estate secured loans, investment loans and home equity lines of credits. They sell their products in Canada. Its web site is here AGF. See my spreadsheet at agf.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.
The insider trading report says that there was $0.57M in insider buying and $0.78M in insider selling with net insider selling of $0.2M. There are insiders who have a lot invested in this firm. For example the CEO owns stock worth $148M. However, insiders have not only stock options, but Performance Share Units and Restricted Share Units. (There are lots of firms transitioning away from options to other option like vehicles.) They also have an Employees Share Ownership Plan (ESOP).
There are some 42 institutions that own some 28% of the outstanding shares of this firm. Over the past 3 months they have decreased their outstanding shares by 7.5%. This is a negative.
I get 5 year low, median and high median Price/Earnings Ratios of 10.45, 13.94 and 17.22. The current P/E Ratio is 13.02 which show that the stock price of $11.59 is reasonable. (Note that yesterday, the ROE on the comprehensive income was considerable below the ROE on the net income. This makes you question the quality of the company's earnings.)
I get a Graham Price of $15.78. The 10 year low, median and high median Price/Graham Price Ratios are 0.88, 1.23 and 1.50. The current P/GP Ratio of 0.73 shows a rather low current stock price of $11.59.
I get a 10 year median Price/Book Value Ratio of 1.58. The current P/B Ratio is just 0.93. This current ratio is just 58% of the 10 year median ratio. It is also below 1.00, which means that the stock is selling below the book value. (Generally, when a stock is selling below its book value, it is considered to be cheap.)
The 5 year median dividend yield is 6.19% and the current yield of 9.15% is some 48% higher. This would imply that the current price was a good one. However, one has to be cautious when the dividend yield is so high. This stock started out with low dividends and the 10 year median dividend yield is just 2.97%. It is only since 2008 that the yield has been climbing rather high.
Using my stock price tests it would seem like the current stock price of $11.59 is a good to reasonable price. However, the dividend yield is just too high and I am also worried about the quality of the earnings. What I am suggesting is that we should proceed with caution on this stock.
When I look at analysts' recommendations, I find Strong Buy, Buy, Hold, Underperform and Sell. The consensus recommendation would be a Hold. Most the recommendations are a Hold. The consensus 12 months stock price is $12.70. That implies a 12 months total return of 18.73%, with 9.58% from capital gains and 9.15% from dividend income.
The first quarterly EPS came in within analysts' estimates. However, the second quarterly EPS was way below analysts' estimates. Here is an article on this subject from Reuters. Article said that lower earnings were due to declining financial markets.
A couple of analysts with a Buy recommendation liked the yield and thought it was safe. One noted that this company is one of the last independent mutual fund companies. Analysts that do not like this stock feel that all mutual fund companies in Canada are in problems. One analyst thinks that Canadians are waking up to the fact that they are paying way too much money to have their investments managed.
There is an article about AGF suing an ex-employee Patricia Perez-Coutts who was a fund manager at AGF. Westwood Holdings Group Inc. has hired not only Ms. Perez-Coutts, but also other members of her former team at AGF. See the G&M article. There is also a G&M article on a big outflow of assets that occurred for this company in July 2012. See the G&M article. Also one other blogger Happy Capitalism wrote about this company in May of this year. He thinks that the stock has been oversold for a while and he sees this as a sign of weakness in the stock.
I like strong stable dividend growth type companies. This company is none of those things, really. It is not a company I would buy at this time. They used to be a good company. Maybe they will be again in the future. So, I will continue to follow it, but I am certainly not interested at this point in buying it.
AGF is a Mutual Fund company. It owns AGF Trust Company. The company has a diversified group of products designed to meet a variety of investment objectives including GICs, term deposits, real estate secured loans, investment loans and home equity lines of credits. They sell their products in Canada. Its web site is here AGF. See my spreadsheet at agf.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.
Wednesday, August 22, 2012
AGF Management Ltd
On my other blog are some comments about "Dividend yields on Original Investments". See comments blog.
I do not own this stock of AGF Management Ltd. (TSX-AGF.B), but I used to. I bought this stock in 2001 and sold it off in 2006 and 2008. I made over this period of 7 years some 2.08% per year return. All the return was dividends. I made nothing in capital gains. I sold the stock because I did not think that the stock was going anywhere. From when I sold in 2006 to 2008, the stock did recover a bit.
The other thing I did not like about the stock was that they were continuing to raise the dividends at the expense of Dividend Payout Ratios. The DPRs were quite low when I first bought this stock, but they have been steadily rising. The ones for the financial year ending in November 2011 the DPRs were 90% for earnings and 58% for cash flow. The DPR for earnings for 2012 is expected to be above 100%.
Looking at my spreadsheet, the really only bright spot is the growth in dividends which run at 9% and 17% over the past 5 and 10 years. However, they are been slowing down lately with the last two increases being at 3% and 2.9%. The other growth that is not awful is that for book value per shares and this has grown at 3.9% and 4.5% per year over the past 5 and 10 years.
Total return is not growing and this stock has had the total return go down 4% per year over the past 5 years. Total return is 0% per year over the past 10 years. Dividend income was at 4.6% per year and 3.6% per year over the past 5 and 10 years. Capital gains were a negative 9.3% and 3.7% per year over the past 5 and 10 years.
Although the company has not had any years of negative earnings or cash flow, they also have not been able to growth their earnings or cash flow. They also are not growing their revenue. The revenue has had 0% growth over the past 5 and 10 years. Revenue per share has declined by 2% per year over the past 5 years and has had 0% growth over the past 10 years.
Earnings per Share have declined 1% per year and 4% per year over the past 5 and 10 years. Cash Flow per Shares has declined 1% and 3% per year over the past 5 and 10 years.
The Return on Equity Ratios looks very good on this stock, with the ROE for the financial year ending in November 2011 at 17.8%. However, the ROE based on the Comprehensive is a lot lower at 8.3%. Usually this happens when the quality of the earnings are not as good as they might appear. You expect some variance, but not so much.
The current Liquidity Ratios at 1.12, although not a great ratio, is higher than it has been for a while. Mostly, the Liquidity Ratio is below 1.00 (5 and 10 year median ratios are 0.66 and 0.70). With this ratio under 1.00 it means that the current assets cannot cover the current debts. The other thing to point out that is that if you include cash flow exclusive of dividends, it does not raise the ratio above 1.00.
The current Debt Ratio is rather low also with a current value of 1.32. This ratio also has a tendency to be low and the 5 and 10 year median ratios are at 1.25 and 1.33. This is ok, but what you want is a ratio of 1.50 or above.
The current Leverage and Debt/Equity Ratios are a little high at 4.12 and 3.12. With these ratios lower is much better.
I still do not like this stock as an investment and I am glad that I sold when I did.
AGF is a Mutual Fund company. It owns AGF Trust Company. The company has a diversified group of products designed to meet a variety of investment objectives including GICs, term deposits, real estate secured loans, investment loans and home equity lines of credits. They sell their products in Canada. Its web site is here AGF. See my spreadsheet at agf.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.
I do not own this stock of AGF Management Ltd. (TSX-AGF.B), but I used to. I bought this stock in 2001 and sold it off in 2006 and 2008. I made over this period of 7 years some 2.08% per year return. All the return was dividends. I made nothing in capital gains. I sold the stock because I did not think that the stock was going anywhere. From when I sold in 2006 to 2008, the stock did recover a bit.
The other thing I did not like about the stock was that they were continuing to raise the dividends at the expense of Dividend Payout Ratios. The DPRs were quite low when I first bought this stock, but they have been steadily rising. The ones for the financial year ending in November 2011 the DPRs were 90% for earnings and 58% for cash flow. The DPR for earnings for 2012 is expected to be above 100%.
Looking at my spreadsheet, the really only bright spot is the growth in dividends which run at 9% and 17% over the past 5 and 10 years. However, they are been slowing down lately with the last two increases being at 3% and 2.9%. The other growth that is not awful is that for book value per shares and this has grown at 3.9% and 4.5% per year over the past 5 and 10 years.
Total return is not growing and this stock has had the total return go down 4% per year over the past 5 years. Total return is 0% per year over the past 10 years. Dividend income was at 4.6% per year and 3.6% per year over the past 5 and 10 years. Capital gains were a negative 9.3% and 3.7% per year over the past 5 and 10 years.
Although the company has not had any years of negative earnings or cash flow, they also have not been able to growth their earnings or cash flow. They also are not growing their revenue. The revenue has had 0% growth over the past 5 and 10 years. Revenue per share has declined by 2% per year over the past 5 years and has had 0% growth over the past 10 years.
Earnings per Share have declined 1% per year and 4% per year over the past 5 and 10 years. Cash Flow per Shares has declined 1% and 3% per year over the past 5 and 10 years.
The Return on Equity Ratios looks very good on this stock, with the ROE for the financial year ending in November 2011 at 17.8%. However, the ROE based on the Comprehensive is a lot lower at 8.3%. Usually this happens when the quality of the earnings are not as good as they might appear. You expect some variance, but not so much.
The current Liquidity Ratios at 1.12, although not a great ratio, is higher than it has been for a while. Mostly, the Liquidity Ratio is below 1.00 (5 and 10 year median ratios are 0.66 and 0.70). With this ratio under 1.00 it means that the current assets cannot cover the current debts. The other thing to point out that is that if you include cash flow exclusive of dividends, it does not raise the ratio above 1.00.
The current Debt Ratio is rather low also with a current value of 1.32. This ratio also has a tendency to be low and the 5 and 10 year median ratios are at 1.25 and 1.33. This is ok, but what you want is a ratio of 1.50 or above.
The current Leverage and Debt/Equity Ratios are a little high at 4.12 and 3.12. With these ratios lower is much better.
I still do not like this stock as an investment and I am glad that I sold when I did.
AGF is a Mutual Fund company. It owns AGF Trust Company. The company has a diversified group of products designed to meet a variety of investment objectives including GICs, term deposits, real estate secured loans, investment loans and home equity lines of credits. They sell their products in Canada. Its web site is here AGF. See my spreadsheet at agf.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.
Tuesday, August 21, 2012
Alimentation Couche-Tard Inc. 2
I own this stock of Alimentation Couche-Tard Inc. (TSX-ATD.B). I bought this stock in 2004 and some more in 2006 and 2007. I have made a return of 17.26% per year total return on this stock. Dividends are very low and the portion of this total return attributable to dividends is just 0.51%. The rest, 16.75% is attributable to capital gains.
There is lots of insider selling as is usual with the stock. There is $61.8M of insider selling and net insider selling at $61.7M. Mainly it is insiders cashing in their options. Also, there is some $10M of insider selling by CEO who is gifting some shares. Besides options they have Phantom Stock Units and Deferred Share Unit Plan.
Most insiders have more options or options like things than shares, but there is some heavy insider ownership also, but this in in the Class A multiple voting shares. Also Metro Inc. (TSX-MRU.A) owns almost 28% of the Class A multiple voting shares of this company. The company buys shares on the open market that covers what they give out in options.
Also, in July 2012 the company announced an equity issue on a bought-deal basis of 6.35M Class B shares at price of $47.25 CDN$. I have changed the shares outstanding on my spreadsheet to reflect this. There seems to be very little institutional ownership of this stock (less than 2%). (However, note Metro's shares above.)
I get 5 year low, median and high Price/Earnings Ratios of 9.48, 12.00 and 14.52. I get a current P/E Ratio of 15.15. This P/E ratio shows that the current stock price of $49.07 stock price is a bit high. (Bought deal at $47.25 gives a P/E 14.59. This shows that the bought deal price was also relatively high.)
I get a Graham Price of $29.14. The 10 year low, median and high Price/Graham Price Ratios are 1.12, 1.55 and 1.88. The current P/GP Ratio is 1.68 shows a rather reasonable, if a little high, stock price at $49.07. (Bought deal at $47.25 gives a P/GP ratio of 1.62. Not far off the current P/GP ratio.)
I get a 10 year median Price/Book Value Ratio of 2.88. The current P/B Ratio is 4.21, a value some 46% above the 10 year median P/B Ratio. This shows a relatively high stock price. (The bought deal price of $47.25 has a P/B Ratio of 4.06. This P/B Ratio is 41% above the 10 year median P/B Ratio and therefore a rather high relative price.)
I get a 5 year median dividend yield of 0.81%. The current yield is 0.61%, a yield some 24% lower. This also points to a high price. This yield is even lower than the 10 year median low dividend yield of 0.64%. (The bought deal stock price of $47.25 gives a dividend yield of 0.63%. This yield is some 21% lower than the 5 year median dividend yield. It is also a bit lower than the 10 year median low dividend yield.)
Except for the Graham price test, the current stock price of $49.07 is showing as a relatively high stock price. The recent bought deal stock price of $47.25 is also showing as relatively high price on most tests. (However, just because there is bought deal does not mean that they paid a good price.)
When I look at the analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The vast majority of the recommendations are a Buy and the consensus recommendation is a Buy. The 12 month consensus stock price is $59.00. This implies and 12 month total return of 20.8%, with some 20.2% from capital gains.
I think that the stock price is relatively high for this stock. However, it appears that lots of analysts think otherwise. One analyst thought although the current debt ratios are a bit low, the company did not go the market because of this, but to reload their balance sheet well in advance of their next transaction. The thought is they are going to be going after assets in Europe.
Some analysts with Buy recommendations comment that the management of the company has done a very good job. Another thinks that they have a great model with convenience stores next to gas stations. One analyst with a Don't Buy recommendation says that he does not like the fact that they get a lot of their money selling tobacco products and therefore would not buy the stock.
Personally, I think it is a great company and I will hold on to my shares. I believe that the stock price is high, but not unreasonably high.
This stock is a recent pick of Michael Smedley who is the executive vice-president of Morgan Meighen & Associates. See article. The globe talks about consumer stocks, including this one, as being currently hot. See article. You can learn all about the company and its history at Wikipedia. There is also a long article on this company at CPS Net.
In North America, Couche-Tard is the largest independent convenience store operator (whether integrated with a petroleum company or not) in terms of number of company-operated stores. Its stores offer a broad mix of food products, beverages, other merchandise and services and motor fuel. Grouped under three main brands: Couche-Tard, Mac's and Circle K. Stores are located across 10 Provinces of Canada in three geographic markets (East, Centre and West), and across 43 American states and the District of Columbia in eight major markets (Great Lakes, Midwest, Southeast, Florida, Gulf, Arizona, West Coast and Southwest). In addition, a network of about 3,700 licensees extends in seven other regions worldwide (China, Guam, Hong Kong, Indonesia, Japan, Macau and Mexico). Its web site is here Couche-Tard. See my spreadsheet at atd.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.
There is lots of insider selling as is usual with the stock. There is $61.8M of insider selling and net insider selling at $61.7M. Mainly it is insiders cashing in their options. Also, there is some $10M of insider selling by CEO who is gifting some shares. Besides options they have Phantom Stock Units and Deferred Share Unit Plan.
Most insiders have more options or options like things than shares, but there is some heavy insider ownership also, but this in in the Class A multiple voting shares. Also Metro Inc. (TSX-MRU.A) owns almost 28% of the Class A multiple voting shares of this company. The company buys shares on the open market that covers what they give out in options.
Also, in July 2012 the company announced an equity issue on a bought-deal basis of 6.35M Class B shares at price of $47.25 CDN$. I have changed the shares outstanding on my spreadsheet to reflect this. There seems to be very little institutional ownership of this stock (less than 2%). (However, note Metro's shares above.)
I get 5 year low, median and high Price/Earnings Ratios of 9.48, 12.00 and 14.52. I get a current P/E Ratio of 15.15. This P/E ratio shows that the current stock price of $49.07 stock price is a bit high. (Bought deal at $47.25 gives a P/E 14.59. This shows that the bought deal price was also relatively high.)
I get a Graham Price of $29.14. The 10 year low, median and high Price/Graham Price Ratios are 1.12, 1.55 and 1.88. The current P/GP Ratio is 1.68 shows a rather reasonable, if a little high, stock price at $49.07. (Bought deal at $47.25 gives a P/GP ratio of 1.62. Not far off the current P/GP ratio.)
I get a 10 year median Price/Book Value Ratio of 2.88. The current P/B Ratio is 4.21, a value some 46% above the 10 year median P/B Ratio. This shows a relatively high stock price. (The bought deal price of $47.25 has a P/B Ratio of 4.06. This P/B Ratio is 41% above the 10 year median P/B Ratio and therefore a rather high relative price.)
I get a 5 year median dividend yield of 0.81%. The current yield is 0.61%, a yield some 24% lower. This also points to a high price. This yield is even lower than the 10 year median low dividend yield of 0.64%. (The bought deal stock price of $47.25 gives a dividend yield of 0.63%. This yield is some 21% lower than the 5 year median dividend yield. It is also a bit lower than the 10 year median low dividend yield.)
Except for the Graham price test, the current stock price of $49.07 is showing as a relatively high stock price. The recent bought deal stock price of $47.25 is also showing as relatively high price on most tests. (However, just because there is bought deal does not mean that they paid a good price.)
When I look at the analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The vast majority of the recommendations are a Buy and the consensus recommendation is a Buy. The 12 month consensus stock price is $59.00. This implies and 12 month total return of 20.8%, with some 20.2% from capital gains.
I think that the stock price is relatively high for this stock. However, it appears that lots of analysts think otherwise. One analyst thought although the current debt ratios are a bit low, the company did not go the market because of this, but to reload their balance sheet well in advance of their next transaction. The thought is they are going to be going after assets in Europe.
Some analysts with Buy recommendations comment that the management of the company has done a very good job. Another thinks that they have a great model with convenience stores next to gas stations. One analyst with a Don't Buy recommendation says that he does not like the fact that they get a lot of their money selling tobacco products and therefore would not buy the stock.
Personally, I think it is a great company and I will hold on to my shares. I believe that the stock price is high, but not unreasonably high.
This stock is a recent pick of Michael Smedley who is the executive vice-president of Morgan Meighen & Associates. See article. The globe talks about consumer stocks, including this one, as being currently hot. See article. You can learn all about the company and its history at Wikipedia. There is also a long article on this company at CPS Net.
In North America, Couche-Tard is the largest independent convenience store operator (whether integrated with a petroleum company or not) in terms of number of company-operated stores. Its stores offer a broad mix of food products, beverages, other merchandise and services and motor fuel. Grouped under three main brands: Couche-Tard, Mac's and Circle K. Stores are located across 10 Provinces of Canada in three geographic markets (East, Centre and West), and across 43 American states and the District of Columbia in eight major markets (Great Lakes, Midwest, Southeast, Florida, Gulf, Arizona, West Coast and Southwest). In addition, a network of about 3,700 licensees extends in seven other regions worldwide (China, Guam, Hong Kong, Indonesia, Japan, Macau and Mexico). Its web site is here Couche-Tard. See my spreadsheet at atd.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.
Monday, August 20, 2012
Alimentation Couche-Tard Inc
On my other blog are some comments about "Women on Boards". See comments blog.
I own this stock of Alimentation Couche-Tard Inc. (TSX-ATD.B). I bought this stock in 2004 and some more in 2006 and 2007. I have made a return of 17.26% per year total return on this stock. Dividends are very low and the portion of this total return attributable to dividends is just 0.51%. The rest, 16.75% is attributable to capital gains.
When I bought this company they were not paying dividends. It was not meant to be a long term buy. However, I changed my mind and kept the stock after they started dividends in 2006. Mind you, dividends are quite low as the company has a 5 year median dividend yield of just 0.81%. My experience is lower for the simple fact that I held the stock when it was not paying dividends. The portion of my return in dividends is just under 3%.
This stock has been doing well of late. If you look at the stock over the past 5 and 10 years using their financial years ending in April, you find that the stock has 5 and 10 year total returns of 13.14% and 18.50% per year. The portion of this return attributable to dividends is 0.56% and 0.46%. The rest is all capital gain.
I have just held this stock for 8 years and my dividend yield on my original purchase is just 2%. You would have to hold the stock for 15 years to more to get a really good return on your original purchase. Increases in dividends have been very good with dividend increases over the last 5 and 6 years at 20.1% and 18.4%. It is currently a fast growing stock.
This is considered to be a consumer staple stock. It has down much better than the TSX since our recent problems in 2008. This company does a lot of business in the US so it reports in US$. It has, of course, done better in US$ than in CDN$. However, it has done well in both currencies.
Over the past 5 and 10 years the Revenues have increased by 11% and 21% per year, respectively. The Revenue per Share has grown by 13% and 20% per year. The increase or decrease in shares accounts for the difference between the Revenue growth and the Revenue per Share growth.
The shares outstanding are up 1% over the past 10 years, but are down almost 2% over the past 5 years. The company tends to buy back shares each year that generally more than covers the options they give out.
Earnings per Share have also grown well over the past 5 and 10 years with growth at 18.6% and 22.3% per year, respectively. Cash Flow per Share has also grown well over the past 5 and 10 years with growth at 12.3% and 18.6% per year, respectively. There is the same story with Book Value per Share growth at 13.2% and 17.7% per year growth over the past 5 and 10 years.
The Return on Equity is also great. The ROE for the financial year ending April 2012 is 21%. The 5 year median ROE is 19.1%, an equally great ROE. The ROE based on comprehensive income is very similar with the ROE for April 2012 at 19.6% and the 5 year median at 19.6%. (The ROE on comprehensive income confirms the quality of the ROE on net income.)
As far a debt ratios goes, the Liquidity Ratio for financial year ending April 2012 is quite low at 0.85. This means that the current assets do not cover the current liabilities. However, the cash flow is quite strong and if you add in cash flow after dividends you get a more acceptable value of 1.32. The 5 year median Liquidity ratio is 1.10.
The Debt Ratio is much better at 1.95. This has a 5 year ratio of 1.78. The Leverage and Debt/Equity Ratios are fine at 2.05 and 1.05.
This has been a great stock for me. It is doing great currently even though the overall market is not. This stock would be considered a dividend growth stock. I think that why I have good dividend income growth is because I have a variety of stocks with low, median and high dividends and low, median and high dividend growth rates.
In North America, Couche-Tard is the largest independent convenience store operator (whether integrated with a petroleum company or not) in terms of number of company-operated stores. Its stores offer a broad mix of food products, beverages, other merchandise and services and motor fuel. Grouped under three main brands: Couche-Tard, Mac's and Circle K. Stores are located across 10 Provinces of Canada in three geographic markets (East, Centre and West), and across 43 American states and the District of Columbia in eight major markets (Great Lakes, Midwest, Southeast, Florida, Gulf, Arizona, West Coast and Southwest). In addition, a network of about 3,700 licensees extends in seven other regions worldwide (China, Guam, Hong Kong, Indonesia, Japan, Macau and Mexico). Its web site is here Couche-Tard. See my spreadsheet at atd.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.
I own this stock of Alimentation Couche-Tard Inc. (TSX-ATD.B). I bought this stock in 2004 and some more in 2006 and 2007. I have made a return of 17.26% per year total return on this stock. Dividends are very low and the portion of this total return attributable to dividends is just 0.51%. The rest, 16.75% is attributable to capital gains.
When I bought this company they were not paying dividends. It was not meant to be a long term buy. However, I changed my mind and kept the stock after they started dividends in 2006. Mind you, dividends are quite low as the company has a 5 year median dividend yield of just 0.81%. My experience is lower for the simple fact that I held the stock when it was not paying dividends. The portion of my return in dividends is just under 3%.
This stock has been doing well of late. If you look at the stock over the past 5 and 10 years using their financial years ending in April, you find that the stock has 5 and 10 year total returns of 13.14% and 18.50% per year. The portion of this return attributable to dividends is 0.56% and 0.46%. The rest is all capital gain.
I have just held this stock for 8 years and my dividend yield on my original purchase is just 2%. You would have to hold the stock for 15 years to more to get a really good return on your original purchase. Increases in dividends have been very good with dividend increases over the last 5 and 6 years at 20.1% and 18.4%. It is currently a fast growing stock.
This is considered to be a consumer staple stock. It has down much better than the TSX since our recent problems in 2008. This company does a lot of business in the US so it reports in US$. It has, of course, done better in US$ than in CDN$. However, it has done well in both currencies.
Over the past 5 and 10 years the Revenues have increased by 11% and 21% per year, respectively. The Revenue per Share has grown by 13% and 20% per year. The increase or decrease in shares accounts for the difference between the Revenue growth and the Revenue per Share growth.
The shares outstanding are up 1% over the past 10 years, but are down almost 2% over the past 5 years. The company tends to buy back shares each year that generally more than covers the options they give out.
Earnings per Share have also grown well over the past 5 and 10 years with growth at 18.6% and 22.3% per year, respectively. Cash Flow per Share has also grown well over the past 5 and 10 years with growth at 12.3% and 18.6% per year, respectively. There is the same story with Book Value per Share growth at 13.2% and 17.7% per year growth over the past 5 and 10 years.
The Return on Equity is also great. The ROE for the financial year ending April 2012 is 21%. The 5 year median ROE is 19.1%, an equally great ROE. The ROE based on comprehensive income is very similar with the ROE for April 2012 at 19.6% and the 5 year median at 19.6%. (The ROE on comprehensive income confirms the quality of the ROE on net income.)
As far a debt ratios goes, the Liquidity Ratio for financial year ending April 2012 is quite low at 0.85. This means that the current assets do not cover the current liabilities. However, the cash flow is quite strong and if you add in cash flow after dividends you get a more acceptable value of 1.32. The 5 year median Liquidity ratio is 1.10.
The Debt Ratio is much better at 1.95. This has a 5 year ratio of 1.78. The Leverage and Debt/Equity Ratios are fine at 2.05 and 1.05.
This has been a great stock for me. It is doing great currently even though the overall market is not. This stock would be considered a dividend growth stock. I think that why I have good dividend income growth is because I have a variety of stocks with low, median and high dividends and low, median and high dividend growth rates.
In North America, Couche-Tard is the largest independent convenience store operator (whether integrated with a petroleum company or not) in terms of number of company-operated stores. Its stores offer a broad mix of food products, beverages, other merchandise and services and motor fuel. Grouped under three main brands: Couche-Tard, Mac's and Circle K. Stores are located across 10 Provinces of Canada in three geographic markets (East, Centre and West), and across 43 American states and the District of Columbia in eight major markets (Great Lakes, Midwest, Southeast, Florida, Gulf, Arizona, West Coast and Southwest). In addition, a network of about 3,700 licensees extends in seven other regions worldwide (China, Guam, Hong Kong, Indonesia, Japan, Macau and Mexico). Its web site is here Couche-Tard. See my spreadsheet at atd.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.
Friday, August 17, 2012
Nordion Inc. 2
I do not own this stock (TSX-NDN, NYSE-NDZ), but I used to, but when I owned it, it was MDS Inc. (TSX-MDS). I bought this stock in 1996, 1997 and 1998 and sold it off in 2006. So, I had it some 9 years and I made 4.95% per year. I made capital gains of 4.4% per year and dividends of 0.55% per year. I sold because I thought that the company was going nowhere.
Over the past year there was a very little amount of insider buying and this occurred in the early part of 2012. There is no insider selling. Insiders seem to be retaining their options at the moment and this is a good sign. All insiders seem to have lots more options and options like vehicles than actual common shares.
There are an awful lot options outstanding. There are options, Restricted Share units, Common Shares Deferred Share Units and Common Shares Performance Share Units. For example, the CEO has options and options like things outstanding worth $9.6M and totaling almost 1.6% of the outstanding shares. The CFO has options and options like things outstanding worth $2.5M and 0.4% of the outstanding shares.
According to the information I can find, there are 69 institutions that hold some 74% of the shares of this company. Over the past 3 months they have marginally increased their holdings.
There are too many recent years of no earnings so I cannot get a fix on the 5 year median Price/Earnings ratios. The 10 year low, median and high P/E Ratios are 21.52, 24.98 and 28.44. These are rather high P/E Ratios, but when the company did have earnings, the P/E Ratios tended to be on the high side. The current P/E Ratio of 17.45 on a stock price of $9.78 would suggest that the current stock price is relatively low.
I get a Graham Price of $7.46 and the current stock price of $9.78 gives a Price/Graham Price Ratio of 1.31. I find that the 10 year low, median and high P/GP Ratios are 1.44, 1.73and 2.23. The current P/GP Ratio of 1.31 would suggest a relatively low stock price.
The 10 year Price/Book Value Ratio is 1.76. The current Ratio of 2.22 is some 26% higher. Problem is that the Book Value has been dropping. However, this would suggest that the current stock price is relatively high. Since the company just restarted the dividends, I cannot do any sort of test on dividend yield.
Looking at Price/Cash Flow per share Ratio, I find that the 5 year P/CF Ratio is 11.64 and the P/CF Ratio using the CFPS for the last 12 months, gives a P/CF Ratio of 17.9. This would also suggest a rather high current stock price.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus recommendation would be a Buy. The 12 month consensus stock price is $11.01. This would imply a 12 month total return of 16.7%.
One analysts with a Hold recommendations thought that the poor second quarter of 2012 results from this company was corroborating his long term view of flat to declining revenue performance. He thought that the company would have difficulty reversing its soft performance trends. Paradigm Research has a buy on this company by its analyst Alan Ridgeway. He thinks the shares are undervalued. See article.
An interesting article is about the fact that U.S. anti-proliferation move could harm Nordion's medical isotopes business. See article.
Personally, I do not think that this would be a good stock to have in your portfolio. It is having a hard time now and we could be heading for more economic uncertainty, so I cannot imagine this company would do much for anyone's portfolio for a while.
Nordion Inc. is a global life sciences company that provides products and services for the development of drugs and diagnosis and treatment of disease. The company is a provider of pharmaceutical contract research, medical isotopes for molecular imaging, radiotherapeutics, and analytical instruments. Its web site is here Nordion. See my spreadsheet at ndn.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.
Over the past year there was a very little amount of insider buying and this occurred in the early part of 2012. There is no insider selling. Insiders seem to be retaining their options at the moment and this is a good sign. All insiders seem to have lots more options and options like vehicles than actual common shares.
There are an awful lot options outstanding. There are options, Restricted Share units, Common Shares Deferred Share Units and Common Shares Performance Share Units. For example, the CEO has options and options like things outstanding worth $9.6M and totaling almost 1.6% of the outstanding shares. The CFO has options and options like things outstanding worth $2.5M and 0.4% of the outstanding shares.
According to the information I can find, there are 69 institutions that hold some 74% of the shares of this company. Over the past 3 months they have marginally increased their holdings.
There are too many recent years of no earnings so I cannot get a fix on the 5 year median Price/Earnings ratios. The 10 year low, median and high P/E Ratios are 21.52, 24.98 and 28.44. These are rather high P/E Ratios, but when the company did have earnings, the P/E Ratios tended to be on the high side. The current P/E Ratio of 17.45 on a stock price of $9.78 would suggest that the current stock price is relatively low.
I get a Graham Price of $7.46 and the current stock price of $9.78 gives a Price/Graham Price Ratio of 1.31. I find that the 10 year low, median and high P/GP Ratios are 1.44, 1.73and 2.23. The current P/GP Ratio of 1.31 would suggest a relatively low stock price.
The 10 year Price/Book Value Ratio is 1.76. The current Ratio of 2.22 is some 26% higher. Problem is that the Book Value has been dropping. However, this would suggest that the current stock price is relatively high. Since the company just restarted the dividends, I cannot do any sort of test on dividend yield.
Looking at Price/Cash Flow per share Ratio, I find that the 5 year P/CF Ratio is 11.64 and the P/CF Ratio using the CFPS for the last 12 months, gives a P/CF Ratio of 17.9. This would also suggest a rather high current stock price.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus recommendation would be a Buy. The 12 month consensus stock price is $11.01. This would imply a 12 month total return of 16.7%.
One analysts with a Hold recommendations thought that the poor second quarter of 2012 results from this company was corroborating his long term view of flat to declining revenue performance. He thought that the company would have difficulty reversing its soft performance trends. Paradigm Research has a buy on this company by its analyst Alan Ridgeway. He thinks the shares are undervalued. See article.
An interesting article is about the fact that U.S. anti-proliferation move could harm Nordion's medical isotopes business. See article.
Personally, I do not think that this would be a good stock to have in your portfolio. It is having a hard time now and we could be heading for more economic uncertainty, so I cannot imagine this company would do much for anyone's portfolio for a while.
Nordion Inc. is a global life sciences company that provides products and services for the development of drugs and diagnosis and treatment of disease. The company is a provider of pharmaceutical contract research, medical isotopes for molecular imaging, radiotherapeutics, and analytical instruments. Its web site is here Nordion. See my spreadsheet at ndn.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.
Thursday, August 16, 2012
Nordion Inc.
I do not own this stock (TSX-NDN, NYSE-NDZ), but I used to, but when I owned it, it was MDS Inc. (TSX-MDS). I bought this stock in 1996, 1997 and 1998 and sold it off in 2006. So, I had it some 9 years and I made 4.95% per year. I made capital gains of 4.4% per year and dividends of 0.55% per year. I sold because I thought that the company was going nowhere.
The company started its decline in 2005. By 2007 they had cut their dividends. The stock price really did not take a drive until 2008 when it fell over 60%. The dividends were never very much. They had Dividend Payout Ratios of around 10% for earnings and 6% for cash flow. Dividends were low, with median long term dividends at 0.43% per year.
The company restarted dividends in 2011at a good level of 3.94% median yield. However, the Dividend Payout Ratios were around 150%. The DPR are expected to be significantly lower in 2012 at around 71% for earnings.
This stock reports in US$ and uses US GAAP accounting rules. In 2010 they reorganized and changed their name. No matter what currency you look at, they have not done well. Revenues, Earnings, Cash Flow and Book Value are all lower than in the past and they have had no growth in the last 5 or 10 years.
The debt ratios are quite good and have generally been good. The current Liquidity Ratio is 2.44. The 5 year median Liquidity Ratio is 1.98. The current Debt Ratio is 2.69. The 5 year median Debt Ratio is 2.56. The current Leverage and Debt/Equity Ratios are fine at 1.59 and 0.59.
The Return on Equity is low with the one for the financial year ending at 31 October 2011 at 5.9%. The 5 year median ROE is negative. The ROE based on the comprehensive income is a bit better coming in at 6.2%.
Well, the company is recovering. I think I would have liked it better if it started out with dividend payments at Dividend Payout Ratios that were much more reasonable. Although, I guess you could look at it like the company having some faith in their future. However, I am not comfortable with basing dividends on future earnings and cash flow estimates. Estimates have habits of being unreliable. Lots of stuff can happen in the future that you cannot know about today.
Nordion Inc. is a global life sciences company that provides products and services for the development of drugs and diagnosis and treatment of disease. The company is a provider of pharmaceutical contract research, medical isotopes for molecular imaging, radiotherapeutics, and analytical instruments. Its web site is here Nordion. See my spreadsheet at ndn.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.
The company started its decline in 2005. By 2007 they had cut their dividends. The stock price really did not take a drive until 2008 when it fell over 60%. The dividends were never very much. They had Dividend Payout Ratios of around 10% for earnings and 6% for cash flow. Dividends were low, with median long term dividends at 0.43% per year.
The company restarted dividends in 2011at a good level of 3.94% median yield. However, the Dividend Payout Ratios were around 150%. The DPR are expected to be significantly lower in 2012 at around 71% for earnings.
This stock reports in US$ and uses US GAAP accounting rules. In 2010 they reorganized and changed their name. No matter what currency you look at, they have not done well. Revenues, Earnings, Cash Flow and Book Value are all lower than in the past and they have had no growth in the last 5 or 10 years.
The debt ratios are quite good and have generally been good. The current Liquidity Ratio is 2.44. The 5 year median Liquidity Ratio is 1.98. The current Debt Ratio is 2.69. The 5 year median Debt Ratio is 2.56. The current Leverage and Debt/Equity Ratios are fine at 1.59 and 0.59.
The Return on Equity is low with the one for the financial year ending at 31 October 2011 at 5.9%. The 5 year median ROE is negative. The ROE based on the comprehensive income is a bit better coming in at 6.2%.
Well, the company is recovering. I think I would have liked it better if it started out with dividend payments at Dividend Payout Ratios that were much more reasonable. Although, I guess you could look at it like the company having some faith in their future. However, I am not comfortable with basing dividends on future earnings and cash flow estimates. Estimates have habits of being unreliable. Lots of stuff can happen in the future that you cannot know about today.
Nordion Inc. is a global life sciences company that provides products and services for the development of drugs and diagnosis and treatment of disease. The company is a provider of pharmaceutical contract research, medical isotopes for molecular imaging, radiotherapeutics, and analytical instruments. Its web site is here Nordion. See my spreadsheet at ndn.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.
Wednesday, August 15, 2012
TECSYS Inc 2
On my other blog are some comments on "Inequality". See comments blog.
I own this stock of TECSYS Inc. (TSX-TCS). I came across it last year when I was looking for a dividend paying small cap stock. Since I bought this stock I have made a return of 12.97% per year with 3.42% per year coming from dividends. The capital gain portion is 9.55% per year.
When I look at insider trading, I find a small amount of insider buying and no insider selling. There are options outstanding. The company is buying back shares to cancel. I like strong insider ownership.
There are only 2 institutions that hold some 24% of the outstanding shares. They have decreased their holdings by 3.6% over the past 3 months. This is a negative. Gestion de portefeuille Natcan Inc. a Subsidiary of the National Bank used to hold 1.9M shares ceased to be an insider on 4 April 2012, although National Bank is still one of their bankers.
I get 5 year low, median and high Price/Earnings Ratios of 13.00, 15.21and 17.08. On a stock price of $2.19, I get a P/E ratio of 12.17. This would suggest that the stock price is quite good.
I get a Graham price of $2.33. The 10 year low, median and high Price/Graham Price Ratios are 0.81, 1.03 and 1.30. The current P/GP ratios of 0.94 would suggest a good stock price. On an absolute basis a good stock price is also one at or below the Graham Price.
I get a 10 year median Price/Book Value Ratio of 1.54. The current P/B Ratio of 1.63 is some 6% higher. This higher current P/B Ratio says that the stock price is reasonable (rather than good).
The current dividend yield is 2.74% and the 4 year median dividend yield is 2.76%, one that is a bit higher. The current slightly higher dividend yield also suggests a reasonable stock price.
Since my stock price tests do not come up with the same answer, I would go with the last two and say that the stock price seems reasonable. The first two tests depend partly on estimates and estimates can be high.
I can only find 1 analyst that is following this stock and his recommendation is a Strong Buy. The 12 month consensus stock price is $3.75. This implies a 73.97% total return over the next 12 months with some 71.23% coming from capital gains and 2.74% from dividends. There is only one analyst on this stock and I personally do not count on such increase in this stock.
Here is an article in Material Handling Industry of America on this company. There is also an article by TECSYS at Panorama Consulting Solutions.
I would not give the stock a Strong Buy, but a Buy. This is because I think that the stock price is a reasonable, not a good one. I would only give a Strong Buy to a stock that I liked that had a really good stock price.
TECSYS Inc. is a supply chain management software provider that delivers powerful enterprise distribution, warehouse and transportation logistics software solutions. The company's customers include about 600 mid-size and Fortune 1000 corporations in healthcare, heavy equipment, third-party logistics, and general wholesale high- volume distribution industries. Its web site is here TECSYS. See my spreadsheet at tcs.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.
I own this stock of TECSYS Inc. (TSX-TCS). I came across it last year when I was looking for a dividend paying small cap stock. Since I bought this stock I have made a return of 12.97% per year with 3.42% per year coming from dividends. The capital gain portion is 9.55% per year.
When I look at insider trading, I find a small amount of insider buying and no insider selling. There are options outstanding. The company is buying back shares to cancel. I like strong insider ownership.
There are only 2 institutions that hold some 24% of the outstanding shares. They have decreased their holdings by 3.6% over the past 3 months. This is a negative. Gestion de portefeuille Natcan Inc. a Subsidiary of the National Bank used to hold 1.9M shares ceased to be an insider on 4 April 2012, although National Bank is still one of their bankers.
I get 5 year low, median and high Price/Earnings Ratios of 13.00, 15.21and 17.08. On a stock price of $2.19, I get a P/E ratio of 12.17. This would suggest that the stock price is quite good.
I get a Graham price of $2.33. The 10 year low, median and high Price/Graham Price Ratios are 0.81, 1.03 and 1.30. The current P/GP ratios of 0.94 would suggest a good stock price. On an absolute basis a good stock price is also one at or below the Graham Price.
I get a 10 year median Price/Book Value Ratio of 1.54. The current P/B Ratio of 1.63 is some 6% higher. This higher current P/B Ratio says that the stock price is reasonable (rather than good).
The current dividend yield is 2.74% and the 4 year median dividend yield is 2.76%, one that is a bit higher. The current slightly higher dividend yield also suggests a reasonable stock price.
Since my stock price tests do not come up with the same answer, I would go with the last two and say that the stock price seems reasonable. The first two tests depend partly on estimates and estimates can be high.
I can only find 1 analyst that is following this stock and his recommendation is a Strong Buy. The 12 month consensus stock price is $3.75. This implies a 73.97% total return over the next 12 months with some 71.23% coming from capital gains and 2.74% from dividends. There is only one analyst on this stock and I personally do not count on such increase in this stock.
Here is an article in Material Handling Industry of America on this company. There is also an article by TECSYS at Panorama Consulting Solutions.
I would not give the stock a Strong Buy, but a Buy. This is because I think that the stock price is a reasonable, not a good one. I would only give a Strong Buy to a stock that I liked that had a really good stock price.
TECSYS Inc. is a supply chain management software provider that delivers powerful enterprise distribution, warehouse and transportation logistics software solutions. The company's customers include about 600 mid-size and Fortune 1000 corporations in healthcare, heavy equipment, third-party logistics, and general wholesale high- volume distribution industries. Its web site is here TECSYS. See my spreadsheet at tcs.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.
Tuesday, August 14, 2012
TECSYS Inc
I own this stock (TSX-TCS). I came across it last year when I was looking for a dividend paying small cap stock. Such stocks are, of course, risky.
Since I bought this stock I have made a return of 12.97% per year with 3.42% per year coming from dividends. The capital gain portion is 9.55% per year. This has been held for a short period so per year increases can be misleading. My stock is up 14% since I bought it. This is not bad considering that in the same time period the TSX is down 11.7%.
Dividends have only been paid for 4 years and the growth rate is quite good at 10.7% per year. You should note that this company pays dividend on a semi-annual basis rather than the more common quarterly basis. Dividend yield is moderate at 2.74%. Dividend Payout Ratios are fine with 4 year median DPRs for Earnings at 40% and DPRs for cash flow at 35%. The DPRs have been growing and those for the financial year ending in April 2012 were 67% for earnings and 42% for cash flow.
Revenue growth is ok with growth for the last 5 and 10 years at 4.9% and 6.4%, respectively. The revenue per share growth is better at 8.5% and 9.2% per year, respectively. The difference is because the company has been buying back shares. Shares have decreased by 3.2% and 2.5% per year over the past 5 and 10 years. This means that the per share value growth is probably showing a bit better than actually occurred.
Before 2008, the company showed no profit. Because of this I only have growth statistics for 4 years on this company and last year it made the same amount as it did in 2008 so there is no growth. However, EPS did grow in 2009 and 2010 and then fell. Analysts expect the EPS to grow over the next couple of years.
For cash flow per share, I have a maximum of 8 years of positive data, so the 5 and 8 year growth is at 70% and 13% per year, respectively. The book value per share growth is not great. Book value tends to decline when earnings are negative. The 5 year growth is 5.9% per year. There is no 10 year growth as book value declined at the rate of 3.9% per year over the past 10 years.
The Return on Equity is nothing to write home about. The ROE for the end of April 2012 financial year was 6.8% and the 5 year median ROE is a little higher at 8.6%. Comprehensive income is the same as net income.
The Liquidity Ratio comes in a little low at 1.45. However, a large part of the current liabilities is due to deferred revenue. This is done because it is not certain if all of the deferred revenue will be kept. The result is that Liquidity Ratio is probably showing lower than what it actually is.
The Debt Ratio is very good at 2.24. The reason that this is so good is that the company basically has no debt outside current liabilities. This also reflects what I have found that is common with companies with insider owning large amounts of shares. If you look at insiders with large amount of shares, they collectively hold 37% of the outstanding shares in this company.
I am pleased with the performance of this stock. I have always had a soft spot for tech stocks. At the moment I am going to hold on to this stock.
TECSYS Inc. is a supply chain management software provider that delivers powerful enterprise distribution, warehouse and transportation logistics software solutions. The company's customers include about 600 mid-size and Fortune 1000 corporations in healthcare, heavy equipment, third-party logistics, and general wholesale high- volume distribution industries. Its web site is here TECSYS. See my spreadsheet at tcs.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.
Since I bought this stock I have made a return of 12.97% per year with 3.42% per year coming from dividends. The capital gain portion is 9.55% per year. This has been held for a short period so per year increases can be misleading. My stock is up 14% since I bought it. This is not bad considering that in the same time period the TSX is down 11.7%.
Dividends have only been paid for 4 years and the growth rate is quite good at 10.7% per year. You should note that this company pays dividend on a semi-annual basis rather than the more common quarterly basis. Dividend yield is moderate at 2.74%. Dividend Payout Ratios are fine with 4 year median DPRs for Earnings at 40% and DPRs for cash flow at 35%. The DPRs have been growing and those for the financial year ending in April 2012 were 67% for earnings and 42% for cash flow.
Revenue growth is ok with growth for the last 5 and 10 years at 4.9% and 6.4%, respectively. The revenue per share growth is better at 8.5% and 9.2% per year, respectively. The difference is because the company has been buying back shares. Shares have decreased by 3.2% and 2.5% per year over the past 5 and 10 years. This means that the per share value growth is probably showing a bit better than actually occurred.
Before 2008, the company showed no profit. Because of this I only have growth statistics for 4 years on this company and last year it made the same amount as it did in 2008 so there is no growth. However, EPS did grow in 2009 and 2010 and then fell. Analysts expect the EPS to grow over the next couple of years.
For cash flow per share, I have a maximum of 8 years of positive data, so the 5 and 8 year growth is at 70% and 13% per year, respectively. The book value per share growth is not great. Book value tends to decline when earnings are negative. The 5 year growth is 5.9% per year. There is no 10 year growth as book value declined at the rate of 3.9% per year over the past 10 years.
The Return on Equity is nothing to write home about. The ROE for the end of April 2012 financial year was 6.8% and the 5 year median ROE is a little higher at 8.6%. Comprehensive income is the same as net income.
The Liquidity Ratio comes in a little low at 1.45. However, a large part of the current liabilities is due to deferred revenue. This is done because it is not certain if all of the deferred revenue will be kept. The result is that Liquidity Ratio is probably showing lower than what it actually is.
The Debt Ratio is very good at 2.24. The reason that this is so good is that the company basically has no debt outside current liabilities. This also reflects what I have found that is common with companies with insider owning large amounts of shares. If you look at insiders with large amount of shares, they collectively hold 37% of the outstanding shares in this company.
I am pleased with the performance of this stock. I have always had a soft spot for tech stocks. At the moment I am going to hold on to this stock.
TECSYS Inc. is a supply chain management software provider that delivers powerful enterprise distribution, warehouse and transportation logistics software solutions. The company's customers include about 600 mid-size and Fortune 1000 corporations in healthcare, heavy equipment, third-party logistics, and general wholesale high- volume distribution industries. Its web site is here TECSYS. See my spreadsheet at tcs.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.
Monday, August 13, 2012
Medtronic Inc 2
On my other blog are some comments on "Picking a Dividend Payer in Sideways Market". See comments blog.
I do not own this stock of Medtronic (NYSE-MDT). This is one of a few US stocks that I track. I track it because it is in the Health sector. Except for whether or not as I Canadian I would have made any money on this stock, my spreadsheet is in US$ only.
Now that this stock has been beaten down so much as far as stock prices go, it should be able to provide some return to investors going forward. Analysts are saying that they think EPS will to up both in this year and the next 2 years. It would seem to me that we might be heading for another recession, so this optimism might be misplaced.
I must admit that I do not find the US information on insider trading as helpful as the Canadian information I can get. However, as far as I can see, over the past year, there was some $2.3M US$ of insider selling and some $0.8M US$ of insider buying. There are some 1215 institutions that hold 78% of the outstanding shares in this company. Over the past 3 months they have reduced their exposure by 1%. This is a small amount, so it does not tell us much.
I get 5 year low, median and high Price/Earnings Ratios of 11.89, 19.73 and 27.56. The current P/E ratio is just 10.91 on at $39.81 stock price, so this shows a very good stock price. I get a Graham price of $36.81. The 10 year low, median and high Price/Graham price Ratios were 2.04, 2.46 and 2.83. The current P/GP Ratio is 1.08 on a stock price of $39.81. This also shows a very good relative stock price. This stock price is also getting towards the Graham Price. A stock price at the Graham Price shows good value.
I get a 10 year Price/Book Value Ratio of 2.16. The current P/B Ratio is just 2.41. The current Ratio is some 53% lower than the 5 year P/B Ratios and therefore shows a very good relative price.
The current dividend yield is 2.61% and the 5 year median dividend yield is 2.11%. The current one is some 24% higher than the 5 year median and this also shows a current good stock price.
When I look at analyst' Recommendations, I find Strong Buy, Buy, Hold and one Sell recommendation. The consensus recommendation would be a Buy. The 12 month stock price target is $42.90. This would imply a total return over the next 12 months of 10.4%.
One analysts with a Hold recommendation said that the company has competitive advantages and financial strength. They said that they expect the 12 months stock price to be at $41.00 and this implies a total return over the next 12 months of 5.6%.
An analyst with a Sell recommendation gave much lower EPS estimates for financial years ending in April 2013 and April 2014. He expects this stock to underperform the market due to market share losses and competitive risks. He said that they only reason the company did well in the fourth quarter were lower taxes.
One Buy recommendation came with a comment on the past great history of dividend increases. Over the past 3 years dividend increases have been in the 7 to 9% range, not like the previous growth of 17% over the past 10 years. The most recent increase was at 7.2%. Also, dividends are currently way higher than they have ever been considering that the 10 year median dividend yield is just 0.94%. (Current dividend yield is 2.61%.)
There is a Wikipedia entry for this company, see Medtronic. Eric Cota looks at this company's free cash flow on his blog. This company is also discussed at istockanalyst.
This stock has hit a really low P/E level for this company, but that does not mean it cannot go lower. Management seems to have some faith in the future as they just raised the dividend by 7.2%. However, the dividend increases have been dropping for a while. They have been growing the company as the stock price has been retreating. Price is quite good.
Medtronic is the world's leading medical technology company, pioneering device-based therapies that restore health, extend life and alleviate pain. Primary products include those for bradycardia pacing, tachyarrhythmia management, atrial fibrillation management, among others. Medtronic operates its business in one reportable segment, that of manufacturing and selling device-based medical therapies. The company does business in more than 120 countries. The company's product lines include cardiac rhythm management, neurological and spinal, vascular and cardiac surgery. Its web site is here Medtronic. See my spreadsheet at mdt.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.
I do not own this stock of Medtronic (NYSE-MDT). This is one of a few US stocks that I track. I track it because it is in the Health sector. Except for whether or not as I Canadian I would have made any money on this stock, my spreadsheet is in US$ only.
Now that this stock has been beaten down so much as far as stock prices go, it should be able to provide some return to investors going forward. Analysts are saying that they think EPS will to up both in this year and the next 2 years. It would seem to me that we might be heading for another recession, so this optimism might be misplaced.
I must admit that I do not find the US information on insider trading as helpful as the Canadian information I can get. However, as far as I can see, over the past year, there was some $2.3M US$ of insider selling and some $0.8M US$ of insider buying. There are some 1215 institutions that hold 78% of the outstanding shares in this company. Over the past 3 months they have reduced their exposure by 1%. This is a small amount, so it does not tell us much.
I get 5 year low, median and high Price/Earnings Ratios of 11.89, 19.73 and 27.56. The current P/E ratio is just 10.91 on at $39.81 stock price, so this shows a very good stock price. I get a Graham price of $36.81. The 10 year low, median and high Price/Graham price Ratios were 2.04, 2.46 and 2.83. The current P/GP Ratio is 1.08 on a stock price of $39.81. This also shows a very good relative stock price. This stock price is also getting towards the Graham Price. A stock price at the Graham Price shows good value.
I get a 10 year Price/Book Value Ratio of 2.16. The current P/B Ratio is just 2.41. The current Ratio is some 53% lower than the 5 year P/B Ratios and therefore shows a very good relative price.
The current dividend yield is 2.61% and the 5 year median dividend yield is 2.11%. The current one is some 24% higher than the 5 year median and this also shows a current good stock price.
When I look at analyst' Recommendations, I find Strong Buy, Buy, Hold and one Sell recommendation. The consensus recommendation would be a Buy. The 12 month stock price target is $42.90. This would imply a total return over the next 12 months of 10.4%.
One analysts with a Hold recommendation said that the company has competitive advantages and financial strength. They said that they expect the 12 months stock price to be at $41.00 and this implies a total return over the next 12 months of 5.6%.
An analyst with a Sell recommendation gave much lower EPS estimates for financial years ending in April 2013 and April 2014. He expects this stock to underperform the market due to market share losses and competitive risks. He said that they only reason the company did well in the fourth quarter were lower taxes.
One Buy recommendation came with a comment on the past great history of dividend increases. Over the past 3 years dividend increases have been in the 7 to 9% range, not like the previous growth of 17% over the past 10 years. The most recent increase was at 7.2%. Also, dividends are currently way higher than they have ever been considering that the 10 year median dividend yield is just 0.94%. (Current dividend yield is 2.61%.)
There is a Wikipedia entry for this company, see Medtronic. Eric Cota looks at this company's free cash flow on his blog. This company is also discussed at istockanalyst.
This stock has hit a really low P/E level for this company, but that does not mean it cannot go lower. Management seems to have some faith in the future as they just raised the dividend by 7.2%. However, the dividend increases have been dropping for a while. They have been growing the company as the stock price has been retreating. Price is quite good.
Medtronic is the world's leading medical technology company, pioneering device-based therapies that restore health, extend life and alleviate pain. Primary products include those for bradycardia pacing, tachyarrhythmia management, atrial fibrillation management, among others. Medtronic operates its business in one reportable segment, that of manufacturing and selling device-based medical therapies. The company does business in more than 120 countries. The company's product lines include cardiac rhythm management, neurological and spinal, vascular and cardiac surgery. Its web site is here Medtronic. See my spreadsheet at mdt.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.
Friday, August 10, 2012
Medtronic Inc
I do not own this stock (NYSE-MDT). This is one of a few US stocks that I track. I track it because it is in the Health sector. Except for whether or not as I Canadian I would have made any money on this stock, my spreadsheet is in US$ only.
First I will give you the bad news. If I was invested in this company, as a Canadian, there is not 5 year period since 2004 that I would have made a positive return. And, in 2004 the 5 year total return would only have been 5.7%. I am including dividend payments in these statements.
Both my 5 and 10 year total return as a Canadian would have been negative, with loss at 6.7% per year and 4.68% per year, respectively. Dividends are very low and the portion dividends would have been at 1.67% and 1.23% per year over the past 5 and 10 years.
Americans would have done a bit better with 5 year loss at 4.6% and 10 year loss or gain at 0%. Their dividend income would also be a bit better at 1.72% and 1.36% per year. The main reason for the decline is the change in the Price/Earnings Ratio. 10 years ago P/E Ratio was just under 60.00. Today P/E Ratio is just over 10. It is obvious that investors are only willing to pay a lot less today for each $1 this company earns than they were 10 years ago.
The current dividend yield is rather good at 2.6% per year. This is a rather high yield for this company, which spent many years with the dividend yield under 1%. The 5 year median dividend yield is 2.1% and the 10 year median dividend yield is lower at 0.9%.
However, dividends have grown well at 17% and 15.5% per year. This is quite good growth. The Dividend Payout Ratios are also quite good with the 5 year median DPR at 31.5% for earnings and 22% for cash flow. The DPRs have been increasing lately. The 10 year median DPR for earnings is at 24% and for cash flow is at 18.6%.
Even though shareholders have made no money over the past 5 and 10 years, the company has had moderate to good growth. The revenue has grown over the past 5 and 10 years at 5.6% and 9.7% per year. The 5 and 10 year growth in revenue per share has grown better at 7.7% and 11.5% per year. Per share revenue has grown better because the number of shares outstanding has been coming down marginally each year (at just under 2% per year).
The growth in Earnings per Share has also been quite decent with the 5 and 10 year growth at 7.2% and 15.6% per year. Cash flow per share is not quite as good as its 5 and 10 year growth is at 7.4% and 10.7% per year, respectively. Book Value growth is good with 5 and 10 year growth at 11.4% and 12% per year, respectively.
The Return on Equity has been good for this company with the year ending April 2012 ROE at 21.1%. The 5 year median ROE is also very good and it is also at 21.1%. An ROE from 10% to 15% is considered good. A sustained percentage above 20% is considered above average.
The debt ratios on this company are also quite good, with current Liquidity Ratio at 1.56 and the Debt Ratio at 2.07. What you want with these ratios are ones at or above 1.50. The current Leverage Debt/Equity Ratios are also very good at 1.93 and 0.93. Here the lower the ratio the better.
This company has the characteristic of a company transitioning from a growth company to a mature company. If the company continues to make the same progress on revenues, earnings and cash flow, shareholders could expect to see some profit in the future. However, we might be heading for a recession, so better times for the shareholders may still be a bit further into the future.
Medtronic is the world's leading medical technology company, pioneering device-based therapies that restore health, extend life and alleviate pain. Primary products include those for bradycardia pacing, tachyarrhythmia management, atrial fibrillation management, among others. Medtronic operates its business in one reportable segment, that of manufacturing and selling device-based medical therapies. The company does business in more than 120 countries. The company's product lines include cardiac rhythm management, neurological and spinal, vascular and cardiac surgery. Its web site is here Medtronic. See my spreadsheet at mdt.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.
First I will give you the bad news. If I was invested in this company, as a Canadian, there is not 5 year period since 2004 that I would have made a positive return. And, in 2004 the 5 year total return would only have been 5.7%. I am including dividend payments in these statements.
Both my 5 and 10 year total return as a Canadian would have been negative, with loss at 6.7% per year and 4.68% per year, respectively. Dividends are very low and the portion dividends would have been at 1.67% and 1.23% per year over the past 5 and 10 years.
Americans would have done a bit better with 5 year loss at 4.6% and 10 year loss or gain at 0%. Their dividend income would also be a bit better at 1.72% and 1.36% per year. The main reason for the decline is the change in the Price/Earnings Ratio. 10 years ago P/E Ratio was just under 60.00. Today P/E Ratio is just over 10. It is obvious that investors are only willing to pay a lot less today for each $1 this company earns than they were 10 years ago.
The current dividend yield is rather good at 2.6% per year. This is a rather high yield for this company, which spent many years with the dividend yield under 1%. The 5 year median dividend yield is 2.1% and the 10 year median dividend yield is lower at 0.9%.
However, dividends have grown well at 17% and 15.5% per year. This is quite good growth. The Dividend Payout Ratios are also quite good with the 5 year median DPR at 31.5% for earnings and 22% for cash flow. The DPRs have been increasing lately. The 10 year median DPR for earnings is at 24% and for cash flow is at 18.6%.
Even though shareholders have made no money over the past 5 and 10 years, the company has had moderate to good growth. The revenue has grown over the past 5 and 10 years at 5.6% and 9.7% per year. The 5 and 10 year growth in revenue per share has grown better at 7.7% and 11.5% per year. Per share revenue has grown better because the number of shares outstanding has been coming down marginally each year (at just under 2% per year).
The growth in Earnings per Share has also been quite decent with the 5 and 10 year growth at 7.2% and 15.6% per year. Cash flow per share is not quite as good as its 5 and 10 year growth is at 7.4% and 10.7% per year, respectively. Book Value growth is good with 5 and 10 year growth at 11.4% and 12% per year, respectively.
The Return on Equity has been good for this company with the year ending April 2012 ROE at 21.1%. The 5 year median ROE is also very good and it is also at 21.1%. An ROE from 10% to 15% is considered good. A sustained percentage above 20% is considered above average.
The debt ratios on this company are also quite good, with current Liquidity Ratio at 1.56 and the Debt Ratio at 2.07. What you want with these ratios are ones at or above 1.50. The current Leverage Debt/Equity Ratios are also very good at 1.93 and 0.93. Here the lower the ratio the better.
This company has the characteristic of a company transitioning from a growth company to a mature company. If the company continues to make the same progress on revenues, earnings and cash flow, shareholders could expect to see some profit in the future. However, we might be heading for a recession, so better times for the shareholders may still be a bit further into the future.
Medtronic is the world's leading medical technology company, pioneering device-based therapies that restore health, extend life and alleviate pain. Primary products include those for bradycardia pacing, tachyarrhythmia management, atrial fibrillation management, among others. Medtronic operates its business in one reportable segment, that of manufacturing and selling device-based medical therapies. The company does business in more than 120 countries. The company's product lines include cardiac rhythm management, neurological and spinal, vascular and cardiac surgery. Its web site is here Medtronic. See my spreadsheet at mdt.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.
Thursday, August 9, 2012
Wi-Lan Inc 2
I own not own this stock (TSX-WIN), but I used to when it was considered an up and coming company. However, it crashed with the 2000 bear market and I lost over 99% of my invested money. Good job I only bought a few hundred shares and did not loss that much in actual money terms. Wi-Lan has been trying to recover ever since the 2000 bear market, but the stock price is still only some 94% off the highs of 2000.
The insider trading report shows $0.59M of insider buying and $0.75M of insider selling with $0.16M net of insider selling. Insiders have options and also Restricted Share Units and Deferred Stock Units. Everyone has more options than shares however there are insiders with millions of dollars in shares. Wi-Lan has also been buying stock on the market for cancellation.
There are some 79 institutions holding 38% of the outstanding shares. Over the past 3 months they have increased their shares by just over 2%.
The 5 year low, median and high Price/Earnings Ratios are 6.06, 14.43 and 22.09. This is quite a wide spread. The company has had a number of years of earnings loses so this gets us to some negative P/E Ratios. The current P/E Ratio is 12.18. This is just below the median P/E Ratio for the last 5 years and shows a relatively good price. The ratio of 12.18 is also a reasonable one.
I get a current Graham Price of $4.67. The 6 year low, median and high Price/Graham Price Ratios are 0.52, 1.14 and 1.81. The current P/GP Ratio 1.04. This is a relatively reasonable one. Also a good stock price is near the Graham Price (or a P/GP Ratio of 1.00). (I only have 6 years of Graham Prices as the company did not earning any profits before 2006.)
The 10 year Price/Book Value Ratio is 2.41 and the current P/B Ratio of 2.01 is some 83% of the 10 year ratio and therefore shows that the stock price is reasonable. You would want the current ratio to be 80% of the 10 year ratio to show a good stock price. This is quite close.
It is hard to get much out of the dividend yield statistics as I only have them for 3 years. The 3 year median dividend yield is 1.2% and the current one of 2.87% is quite a bit higher. However, they have recently been ramming up their dividends. On the other hand 2.87% is not a bad dividend rate. They also just raised their dividend by 16.7% for the October payment. The Dividend Payout Ratio for 2011 was 35% and the one for 2012 is expected to be lower at 30%. You would want a rather low Dividend Payout Ratio for this company and it currently seems reasonable.
One note of caution is that you would want a company to have higher cash flow than earnings. This company often seems to have higher earnings than cash flow. (Also see article on Sustainable Dividends Depend on the Payout Ratio investing daily.)
However, one good thing is that currently the company has $1.54 in cash per outstanding share. This is just over 30% of the value of these shares.
When I look at analysts' recommendations I find only Strong Buy and Buy recommendations. The consensus recommendation would be a Strong Buy. Consensus 12 month stock price is $9.11. This implies a total return of 89% over the next 12 months.
One other thing I should point out is that this company has on hand in cash some $1.50 per shares. This is almost 32% of the current stock price. One analyst that thinks this is a buy talks about this. One analyst who said not to buy this company says he does not find their business attractive. He thinks that they are like ambulance chasers.
See a report on the second quarter at with Earnings and Revenue lower. See article at Financial Post.
CanTech has lately been talking about insider buying at Wi-Lan. See recent article at CanTech. They also had another article called "Wi-LAN is becoming a key player in patent monetization, says Byron's Astle". See article.
It is an interesting tech company, but they did not have a great second quarter and analysts' are revising their estimates down a bit. They have done a good job of growing this company since the 2000 bear market, but I do wonder about their future ability to pay dividends. The stock price seems reasonable, but it is not a great price, so I have a hard time believing that the 12 months consensus stock price will be met. It is not a stock I would buy at this time.
Wi-Lan was founded in 1992 to commercialize technology inventions that made low-cost, high-speed wireless networking a reality. Proven through several generations of products manufactured by Wi-Lan and applied in multiple technology standards, Wi-Lan's inventions were, by 2005, commercialized in millions of wireless networking devices worth many billions of dollars. Realizing the value that its intellectual property brought to industry, Wi-Lan chose in 2006 to focus its business on the development, protection and monetization of patented inventions. Its web site is here WiLan. See my spreadsheet at win.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.
The insider trading report shows $0.59M of insider buying and $0.75M of insider selling with $0.16M net of insider selling. Insiders have options and also Restricted Share Units and Deferred Stock Units. Everyone has more options than shares however there are insiders with millions of dollars in shares. Wi-Lan has also been buying stock on the market for cancellation.
There are some 79 institutions holding 38% of the outstanding shares. Over the past 3 months they have increased their shares by just over 2%.
The 5 year low, median and high Price/Earnings Ratios are 6.06, 14.43 and 22.09. This is quite a wide spread. The company has had a number of years of earnings loses so this gets us to some negative P/E Ratios. The current P/E Ratio is 12.18. This is just below the median P/E Ratio for the last 5 years and shows a relatively good price. The ratio of 12.18 is also a reasonable one.
I get a current Graham Price of $4.67. The 6 year low, median and high Price/Graham Price Ratios are 0.52, 1.14 and 1.81. The current P/GP Ratio 1.04. This is a relatively reasonable one. Also a good stock price is near the Graham Price (or a P/GP Ratio of 1.00). (I only have 6 years of Graham Prices as the company did not earning any profits before 2006.)
The 10 year Price/Book Value Ratio is 2.41 and the current P/B Ratio of 2.01 is some 83% of the 10 year ratio and therefore shows that the stock price is reasonable. You would want the current ratio to be 80% of the 10 year ratio to show a good stock price. This is quite close.
It is hard to get much out of the dividend yield statistics as I only have them for 3 years. The 3 year median dividend yield is 1.2% and the current one of 2.87% is quite a bit higher. However, they have recently been ramming up their dividends. On the other hand 2.87% is not a bad dividend rate. They also just raised their dividend by 16.7% for the October payment. The Dividend Payout Ratio for 2011 was 35% and the one for 2012 is expected to be lower at 30%. You would want a rather low Dividend Payout Ratio for this company and it currently seems reasonable.
One note of caution is that you would want a company to have higher cash flow than earnings. This company often seems to have higher earnings than cash flow. (Also see article on Sustainable Dividends Depend on the Payout Ratio investing daily.)
However, one good thing is that currently the company has $1.54 in cash per outstanding share. This is just over 30% of the value of these shares.
When I look at analysts' recommendations I find only Strong Buy and Buy recommendations. The consensus recommendation would be a Strong Buy. Consensus 12 month stock price is $9.11. This implies a total return of 89% over the next 12 months.
One other thing I should point out is that this company has on hand in cash some $1.50 per shares. This is almost 32% of the current stock price. One analyst that thinks this is a buy talks about this. One analyst who said not to buy this company says he does not find their business attractive. He thinks that they are like ambulance chasers.
See a report on the second quarter at with Earnings and Revenue lower. See article at Financial Post.
CanTech has lately been talking about insider buying at Wi-Lan. See recent article at CanTech. They also had another article called "Wi-LAN is becoming a key player in patent monetization, says Byron's Astle". See article.
It is an interesting tech company, but they did not have a great second quarter and analysts' are revising their estimates down a bit. They have done a good job of growing this company since the 2000 bear market, but I do wonder about their future ability to pay dividends. The stock price seems reasonable, but it is not a great price, so I have a hard time believing that the 12 months consensus stock price will be met. It is not a stock I would buy at this time.
Wi-Lan was founded in 1992 to commercialize technology inventions that made low-cost, high-speed wireless networking a reality. Proven through several generations of products manufactured by Wi-Lan and applied in multiple technology standards, Wi-Lan's inventions were, by 2005, commercialized in millions of wireless networking devices worth many billions of dollars. Realizing the value that its intellectual property brought to industry, Wi-Lan chose in 2006 to focus its business on the development, protection and monetization of patented inventions. Its web site is here WiLan. See my spreadsheet at win.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.
Wednesday, August 8, 2012
Wi-Lan Inc
On my other blog are some comments on "Selling SAP, Buying ALA". See comments blog.
I own not own this stock (TSX-WIN), but I used to when it was considered an up and coming company. However, it crashed with the 2000 bear market and I lost over 99% of my invested money. Good job I only bought a few hundred shares and did not loss that much in actual money terms. Wi-Lan has been trying to recover ever since the 2000 bear market, but the stock price is still only some 94% off the highs of 2000.
The company has been recovering from the after bear lows. Looking at the total return on this company over the last 5 and 10 years you have really great figures. The 5 and 10 year total return come to 26.5% and 10.68% per year, respectively. Some of this is dividends as the company started to pay dividends in 2009, but it is a very small portion.
At first when they started to pay dividends, the Dividend Payout Ratios were really awful. However, for 2011 the DPR for earnings was 35% and it is expected to be 28% this year. The DPR for cash flow was 19% in 2011. The most recent dividend increase was in 2012 and it was for 20%, which is a very good increase.
Dividend yield has been going up. The 3 year median dividend yield is just 1.2%, but it is currently at 2.46%.
As part of their recovery, Wi-Lan started to focus its business on the development, protection and monetization of patented inventions. They had a cash flow problem for many years. (That is mostly cash flow was negative.) They also had earnings losses for a number of years. These problems were, for the most part, turned around in 2006.
Over the past 5 and 10 years there has been a big increase in shares with the 5 and 10 year growth both at around 15% per year. This, of course, affects the per share values for this stock. Revenues for the company are up over the past 5 and 10 years at 119% and 16% per year. However, Revenue per Share is up over the past 5 and 10 years at 90% and 0% per year.
EPS is not a great story for this company. EPS are down 3% per year over the past 5 years. I cannot get any sort of fix on a 10 year period as earnings were negative for so many years. Because Cash Flow per share was also negative for many years, I can only get a 4 year growth period on cash flow, but this shows good growth at 29% per year. However, Cash flow was also negative or very low in 2009 and 2010.
It is only the book value per share that I can get really good figures from and the 5 and 10 year growth is at 30% and 17% per year.
Return on Equity has not been great. The ROE for 2011 is ok at 9.6%. However, the ROE based on comprehensive income is only 6.6%. When the ROE for net income and comprehensive income has this sort of difference, it might call into question the quality of the company's stated earnings. Wi-Lan only started to give out comprehensive income in the 2011 statement.
One good thing about this company is that the debt ratios seem to always have been quite good. The current Liquidity Ratio is 9.18. (They just paid off some debentures.) The 5 and 10 year median Liquidity Ratios are at 9.49 and 6.66. The Debt Ratio is also very high at 9.05. The 5 and 10 year median Ratios are 9.08 and 6.73. The company basically has no debt.
The current Leverage and Debt/Equity Ratios are at 1.12 and 0.12. For these ratios, lower is better and they are quite low.
Of course, even with the recovery of this stock, I would still not even come close to what I had paid for it 2000. I paid far too much this stock when I bought it. Prices were inflated in 2000. It was nothing they did particularly to have it valued so highly in 2000. It was not making any money and it had not made any money. The 2000 stock bubble was a tech bubble and this stock took part in the general huge rise in stock prices.
Company is probably still a rather risky investment, but they have done a great job of turning the company around. It is hard to know how secure the dividend is. I would like to see some more years of good Dividend Payout Ratios to feel good about their ability to continue good dividends.
Wi-Lan was founded in 1992 to commercialize technology inventions that made low-cost, high-speed wireless networking a reality. Proven through several generations of products manufactured by Wi-Lan and applied in multiple technology standards, Wi-Lan's inventions were, by 2005, commercialized in millions of wireless networking devices worth many billions of dollars. Realizing the value that its intellectual property brought to industry, Wi-Lan chose in 2006 to focus its business on the development, protection and monetization of patented inventions. Its web site is here WiLan. See my spreadsheet at win.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.
I own not own this stock (TSX-WIN), but I used to when it was considered an up and coming company. However, it crashed with the 2000 bear market and I lost over 99% of my invested money. Good job I only bought a few hundred shares and did not loss that much in actual money terms. Wi-Lan has been trying to recover ever since the 2000 bear market, but the stock price is still only some 94% off the highs of 2000.
The company has been recovering from the after bear lows. Looking at the total return on this company over the last 5 and 10 years you have really great figures. The 5 and 10 year total return come to 26.5% and 10.68% per year, respectively. Some of this is dividends as the company started to pay dividends in 2009, but it is a very small portion.
At first when they started to pay dividends, the Dividend Payout Ratios were really awful. However, for 2011 the DPR for earnings was 35% and it is expected to be 28% this year. The DPR for cash flow was 19% in 2011. The most recent dividend increase was in 2012 and it was for 20%, which is a very good increase.
Dividend yield has been going up. The 3 year median dividend yield is just 1.2%, but it is currently at 2.46%.
As part of their recovery, Wi-Lan started to focus its business on the development, protection and monetization of patented inventions. They had a cash flow problem for many years. (That is mostly cash flow was negative.) They also had earnings losses for a number of years. These problems were, for the most part, turned around in 2006.
Over the past 5 and 10 years there has been a big increase in shares with the 5 and 10 year growth both at around 15% per year. This, of course, affects the per share values for this stock. Revenues for the company are up over the past 5 and 10 years at 119% and 16% per year. However, Revenue per Share is up over the past 5 and 10 years at 90% and 0% per year.
EPS is not a great story for this company. EPS are down 3% per year over the past 5 years. I cannot get any sort of fix on a 10 year period as earnings were negative for so many years. Because Cash Flow per share was also negative for many years, I can only get a 4 year growth period on cash flow, but this shows good growth at 29% per year. However, Cash flow was also negative or very low in 2009 and 2010.
It is only the book value per share that I can get really good figures from and the 5 and 10 year growth is at 30% and 17% per year.
Return on Equity has not been great. The ROE for 2011 is ok at 9.6%. However, the ROE based on comprehensive income is only 6.6%. When the ROE for net income and comprehensive income has this sort of difference, it might call into question the quality of the company's stated earnings. Wi-Lan only started to give out comprehensive income in the 2011 statement.
One good thing about this company is that the debt ratios seem to always have been quite good. The current Liquidity Ratio is 9.18. (They just paid off some debentures.) The 5 and 10 year median Liquidity Ratios are at 9.49 and 6.66. The Debt Ratio is also very high at 9.05. The 5 and 10 year median Ratios are 9.08 and 6.73. The company basically has no debt.
The current Leverage and Debt/Equity Ratios are at 1.12 and 0.12. For these ratios, lower is better and they are quite low.
Of course, even with the recovery of this stock, I would still not even come close to what I had paid for it 2000. I paid far too much this stock when I bought it. Prices were inflated in 2000. It was nothing they did particularly to have it valued so highly in 2000. It was not making any money and it had not made any money. The 2000 stock bubble was a tech bubble and this stock took part in the general huge rise in stock prices.
Company is probably still a rather risky investment, but they have done a great job of turning the company around. It is hard to know how secure the dividend is. I would like to see some more years of good Dividend Payout Ratios to feel good about their ability to continue good dividends.
Wi-Lan was founded in 1992 to commercialize technology inventions that made low-cost, high-speed wireless networking a reality. Proven through several generations of products manufactured by Wi-Lan and applied in multiple technology standards, Wi-Lan's inventions were, by 2005, commercialized in millions of wireless networking devices worth many billions of dollars. Realizing the value that its intellectual property brought to industry, Wi-Lan chose in 2006 to focus its business on the development, protection and monetization of patented inventions. Its web site is here WiLan. See my spreadsheet at win.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.
Tuesday, August 7, 2012
Canyon Services Group 2
For some reason MaAfee is again showing my site as having potentially dangerous or suspicious data and they blocked data which is just the heading infor that google puts in. McAfee does this every once in a while. I do not know why.
On my other blog is some comments on "Dividend Increases". See comments blog.
I own not own this stock of Canyon Services Group (TSX-FRC). I get a newsletter weekly from MPL Communications called Advice Hotline. They wrote up this stock on July 19th and I was impressed with it so I did a spreadsheet. You can sign up for this newsletter at their site.
When I look at the insider trading report, I find $5.5M of insider buying and net insider buying of $4.8M. Buying is by Directors. There is some insider selling. Not only are there options for insiders, but Stock Based Units and Rights Deferred Stock Units (DSU).
I cannot get a low and high median Price/Earnings ratio covering the last 5 years as the company only started to earning positive earnings in 2010. However, the 2 year low, median and high P/E Ratios are 4.05, 7.72 and 11.39. These are rather low P/E Ratios. The current P/E Ratio is between the median and low at 7.10. Please note that the consensus earnings for 2012 have recently been lowered, so this could affect the P/E ratio going forward. This test shows a good stock price.
I get a Graham Price of $13.55 and I get a 0.76 Price/Graham Price Ratio on a stock price of $10.29. The low, median and high P/GP Ratio over the past 7 years are 0.37, 0.91 and 1.31. This test also shows a good stock price.
The 6 year median Price/Book Value Ratio is 1.01. The current P/B Ratio is 1.83, which is 80% higher and shows a relatively high stock price. However, the current P/B ratio is not that high.
I cannot do any sort of test on the dividend yield as dividends just started in 2011. However, the current yield of 5.8% is very good and would suggest a low stock price.
The analysts' recommendations cover Strong Buy, Buy, and Hold. There are a surprising number of analysts following this stock. By far the most recommendation given is a Buy. The consensus recommendation would be a Buy.
The 12 month consensus stock price is $15.10. This suggests a 52.6% total return over the next 12 months, with 5.8% coming from dividends and 46.8 from capital gains. However, if you look at EPS estimates they have been coming down over the past 90 days. The consensus EPS for 2012 is now below the EPS for 2011.
There is a report from Raymond James on Canyon Services. They rate this stock at outperform which is a Buy recommendation. There is also an earlier G&M article on sayings this is a profitable and cheap stock. See article. And, there is a more recent G&M article saying that this stock is a small cap stock to watch. See article.
I still think that this company has great potential. It has a great dividend at 5.83% and the price is quite reasonable on most counts.
Canyon Services Group Inc. is a fast-growing company providing hydraulic fracturing and other well-stimulation services, including coiled tubing, acidizing, cementing, nitrogen and CO2, to oil and natural gas producers developing a variety of play types across Western Canada. Its web site is here Canyon Services. See my spreadsheet at frc.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.
On my other blog is some comments on "Dividend Increases". See comments blog.
I own not own this stock of Canyon Services Group (TSX-FRC). I get a newsletter weekly from MPL Communications called Advice Hotline. They wrote up this stock on July 19th and I was impressed with it so I did a spreadsheet. You can sign up for this newsletter at their site.
When I look at the insider trading report, I find $5.5M of insider buying and net insider buying of $4.8M. Buying is by Directors. There is some insider selling. Not only are there options for insiders, but Stock Based Units and Rights Deferred Stock Units (DSU).
I cannot get a low and high median Price/Earnings ratio covering the last 5 years as the company only started to earning positive earnings in 2010. However, the 2 year low, median and high P/E Ratios are 4.05, 7.72 and 11.39. These are rather low P/E Ratios. The current P/E Ratio is between the median and low at 7.10. Please note that the consensus earnings for 2012 have recently been lowered, so this could affect the P/E ratio going forward. This test shows a good stock price.
I get a Graham Price of $13.55 and I get a 0.76 Price/Graham Price Ratio on a stock price of $10.29. The low, median and high P/GP Ratio over the past 7 years are 0.37, 0.91 and 1.31. This test also shows a good stock price.
The 6 year median Price/Book Value Ratio is 1.01. The current P/B Ratio is 1.83, which is 80% higher and shows a relatively high stock price. However, the current P/B ratio is not that high.
I cannot do any sort of test on the dividend yield as dividends just started in 2011. However, the current yield of 5.8% is very good and would suggest a low stock price.
The analysts' recommendations cover Strong Buy, Buy, and Hold. There are a surprising number of analysts following this stock. By far the most recommendation given is a Buy. The consensus recommendation would be a Buy.
The 12 month consensus stock price is $15.10. This suggests a 52.6% total return over the next 12 months, with 5.8% coming from dividends and 46.8 from capital gains. However, if you look at EPS estimates they have been coming down over the past 90 days. The consensus EPS for 2012 is now below the EPS for 2011.
There is a report from Raymond James on Canyon Services. They rate this stock at outperform which is a Buy recommendation. There is also an earlier G&M article on sayings this is a profitable and cheap stock. See article. And, there is a more recent G&M article saying that this stock is a small cap stock to watch. See article.
I still think that this company has great potential. It has a great dividend at 5.83% and the price is quite reasonable on most counts.
Canyon Services Group Inc. is a fast-growing company providing hydraulic fracturing and other well-stimulation services, including coiled tubing, acidizing, cementing, nitrogen and CO2, to oil and natural gas producers developing a variety of play types across Western Canada. Its web site is here Canyon Services. See my spreadsheet at frc.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.
Friday, August 3, 2012
Canyon Services Group
I own not own this stock (TSX-FRC). I get a newsletter weekly from MPL Communications called Advice Hotline. They wrote up this stock on July 19th and I was impressed with it so I did a spreadsheet. You can sign up for this newsletter at their site.
This stock only went public in 2006. They have had a few years of negative earnings, but lately they have been going great guns. They started to pay dividends in 2011 and then rammed them up in 2012 doing two increases. Current dividend yield is very good at 5.83%.
The Dividend Payout Ratio for earnings is expected to be 33.5% this year and 34% next year. This is a good payout ratio. I do not have any figures for DPR for cash flow, but the company does seem to have a good cash flow.
I only have total returns for the last 5 years and this is at 19.47%, with 19.28% from capital gain and just 0.20% from dividends. They just started to pay dividends, so in the future dividends should be a higher percentage of the total returns.
Since going public they have had a number of public offerings of shares. Shares have increased at the rate of 22% and 23% per year over the past 5 and 7 years. Revenues have increased at 51% and 55% per year over the past 5 and 6 years. Revenue per share has grown at 23% and 25% per year over the past 5 and 6 years.
Earnings per share have grown at 73% and 24% per year over the past 5 and 6 years. Cash flow per share has grown at the rate of 34% and 23% per year over the past 5 and 6 years. The only growth rate that is not great is Book Value and BV per share has grown at 3.4% and 13.5% per year over the past 5 and 6 years.
Return on Equity has only been very good over the past couple of years. They really have only started to earn a profit over the past couple of years. Although the 5 year median ROE is negative, the ROE for 2011 was 30% and for 2010 was 24.4%. ROE based on comprehensive income is the same as that based on net income.
Current Liquidity Ratio is great at 1.81. This ratio has fluctuated a bit in the past, but it has basically been fine. The current Debt Ratio is also great at 4.37 and this has always been great. The current Leverage and Debt/Equity Ratios are also very good 1.30 and 0.30 and these also have always been quite good.
Do not mistake this for a stable dividend paying stock, but it has great potential. It is rather a high risk, but if you can stand the risk, you could probably do very well by it if it keeps growing. I very much like fast growing dividend growth stock and this stock has great potential. Tomorrow I will look at what other analysts say about it and what my spreadsheet says about its current price.
Canyon Services Group Inc. is a fast-growing company providing hydraulic fracturing and other well-stimulation services, including coiled tubing, acidizing, cementing, nitrogen and CO2, to oil and natural gas producers developing a variety of play types across Western Canada. Its web site is here Canyon Services. See my spreadsheet at frc.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.
This stock only went public in 2006. They have had a few years of negative earnings, but lately they have been going great guns. They started to pay dividends in 2011 and then rammed them up in 2012 doing two increases. Current dividend yield is very good at 5.83%.
The Dividend Payout Ratio for earnings is expected to be 33.5% this year and 34% next year. This is a good payout ratio. I do not have any figures for DPR for cash flow, but the company does seem to have a good cash flow.
I only have total returns for the last 5 years and this is at 19.47%, with 19.28% from capital gain and just 0.20% from dividends. They just started to pay dividends, so in the future dividends should be a higher percentage of the total returns.
Since going public they have had a number of public offerings of shares. Shares have increased at the rate of 22% and 23% per year over the past 5 and 7 years. Revenues have increased at 51% and 55% per year over the past 5 and 6 years. Revenue per share has grown at 23% and 25% per year over the past 5 and 6 years.
Earnings per share have grown at 73% and 24% per year over the past 5 and 6 years. Cash flow per share has grown at the rate of 34% and 23% per year over the past 5 and 6 years. The only growth rate that is not great is Book Value and BV per share has grown at 3.4% and 13.5% per year over the past 5 and 6 years.
Return on Equity has only been very good over the past couple of years. They really have only started to earn a profit over the past couple of years. Although the 5 year median ROE is negative, the ROE for 2011 was 30% and for 2010 was 24.4%. ROE based on comprehensive income is the same as that based on net income.
Current Liquidity Ratio is great at 1.81. This ratio has fluctuated a bit in the past, but it has basically been fine. The current Debt Ratio is also great at 4.37 and this has always been great. The current Leverage and Debt/Equity Ratios are also very good 1.30 and 0.30 and these also have always been quite good.
Do not mistake this for a stable dividend paying stock, but it has great potential. It is rather a high risk, but if you can stand the risk, you could probably do very well by it if it keeps growing. I very much like fast growing dividend growth stock and this stock has great potential. Tomorrow I will look at what other analysts say about it and what my spreadsheet says about its current price.
Canyon Services Group Inc. is a fast-growing company providing hydraulic fracturing and other well-stimulation services, including coiled tubing, acidizing, cementing, nitrogen and CO2, to oil and natural gas producers developing a variety of play types across Western Canada. Its web site is here Canyon Services. See my spreadsheet at frc.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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