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.

1 comment:

  1. Again great in depth analysis! Your blog is the first place I turn to when researching a particular stock

    Do you take requests by any chance? Just kidding.

    Also just so you know I linked to one of your spreadsheets in my (new blog). Mentioned this because I haven't quite figured out how to do proper backlinks in blogger yet.