On my book blog I have written about Kevin Dutton's book on The Wisdom of Psychopaths. This is an absolutely fascinating book on our fellow man. Even if you do not read the book there are a number of very interesting internet links to Kevin Dutton's site and videos. I think that listen to an author greatly enhances your appreciation of his book...continue...
I do not own this stock of EnCana Corp (TSX-ECA, NYSE-ECA), but used to. I have held this stock twice. I do not look on oil companies as a long term buy. Please note that my spreadsheet following this company starts with Alberta Energy Company and follows this company into the formation of EnCana in 2002. It was in 2002 EnCana was formed with the merger of AEC and PanCanadian Energy Corporation.
When I look at Insider Trading, I find a small amount of insider buying and no insider selling. Insiders seem to be retaining their options recently. This is a positive. However, there are lots of options and options like vehicles outstanding. There are not only options but Deferred Share Units, Restricted Share Units and Rights - Performance Share Unit Plan.
Some examples of insider ownership and insider option hold would be that the CEO owns shares worth $3M and has almost $64M in options; an officer has $0.6M in shares and $6.5M in options; a director has 0.8M in shares and $3M in options; and a Subsidiary Executive has $0.2M in shares and $6.7M in options.
According to NASDAQ, the company, as of 30September 2012, has 431 institutions that own 64.6% of the outstanding shares. Over the three month period to 30 September 2012 institutions have increased their shares by 2.3%.
I get 5 year low, median and high median P/E Ratios 10.18, 12.01 and 13.84. I get a current P/E ratio of 17.38 based on 2012 earnings of earnings of $1.24 and stock price of $21.48. All values are in CDN$. It would seem that the current stock price is rather high, relatively speaking.
I get a Graham Price of $14.59. The 10 year low, median and high median Price/GP Ratios are 0.71, 0.92 and 1.08. The current P/GP Ratio is 1.47. This high P/GP Ratio suggests that the stock price is relatively high.
I get a 10 year Price/Book Value per Share Ratio of 1.71. The current P/B ratio is 2.81, which is some 64% higher. However, I would discard this test as the BV fell some 66% because of recent accounting rule changes.
I get a current dividend yield of 3.8%. The 5 year median dividend yield is 2.8% a value some 35% lower. This current high dividend yield would suggest that the stock price is currently cheap. We should probably moderate this judgment as dividends have been raised significantly over the past 5 years.
When I look at analysts' recommendations, I find Buy, Hold and Underperform recommendations. The consensus recommendation would be a Hold. The vast majority of the analysts give this stock a Hold recommendation. With the Hold recommendation comes with a 12 month stock price of $22.00. This implies a total return of 6.22%, with 3.8% from dividends and 2.42% from capital gains.
One analyst is worried about the persistently weak fundamentals for gas and gives this stock a Hold recommendation. Some analysts seem optimistic about gas over the short term. Technical analysis seems to be also pointing to a Hold at Barchart.
My stock tests give a rather mixed result. However, I have questions on two of the tests. The cleanest results come from the P/E and P/GP Ratios and they are saying that the stock price is relatively high. (This is why I have more than one test checking on stock price.)
EnCana is among the largest natural gas companies in North America. They are focused on natural gas exploration and the development of resource plays. They have a diversified portfolio of assets and hold a highly competitive land and resource position in a number of North America's most promising shale and tight gas resource plays. Its web site is here EnCana. See my spreadsheet at eca.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 or StockTwits.
Friday, November 30, 2012
Thursday, November 29, 2012
EnCana Corp
I do not own this stock of EnCana Corp (TSX-ECA, NYSE-ECA), but used to. I had held this stock previously as Alberta Energy Company from April 2000 until August 2002 and made some 18% total returns per year. I had EnCana Corp from February 2006 to November 2009 and made a 9.54% per year total return. Of this total return I made some 2.26% per year in dividends.
I have held this stock twice. As you can see I do not look on oil companies as a long term buy. I sold this stock in 2009 because I only had 100 shares and the stock was going to split into two companies. I would have ended up with small investment in two companies. Also, please note that my spreadsheet following this company starts with Alberta Energy Company and follows this company into the formation of EnCana in 2002. It was in 2002 EnCana was formed with the merger of AEC and PanCanadian Energy Corporation.
Because this is an oil and gas company and because they pay decent dividends, the dividends will fluctuate and generally fluctuate because of the price of oil and gas. Since 2007 dividend yields have been trending up as has the company's Dividend Payout Ratios. Dividend yield is currently at 3.8% and the 5 year dividend yield is 2.81%. The 5 year median DPRs for earnings is 32% and for CFPS is 13.5%. Both these ratios are expected to be higher this year with DPRs for earnings at 66% and for CFPS at 16.5%. (Note DPR for earnings was very high in 2011 at 470%.)
Even though dividends have been fluctuating lately, the dividends have grown at the rate of 27% per year over the past 5 and at the rate of 22% over the past 10 years. This seems to be because dividend yields in the past were quite low, but in recent years have been good. The DPRs in the past were also very low.
The outstanding shares have decreased by 1% per year over the past 5 years and increased by 3.7% per year over the past 10 years. Except for new shares issued in 2002 (re merger) the outstanding shares have been decreasing. They are increased due to stock options and decreased due to the company buying back shares.
Growth generally is better in US$ terms (the currency used in the current statements) than in CDN$ terms. Being a Canadian, I am, of course, most interested in growth in CDN$ terms. For example, revenues have increased by 0% and 13.9% per year over the past 5 and 10 years in US$. Revenues have decreased by 2.6% over the past 5 years and they increased by 8.9% over the past 10 years in CDN$.
Revenue per share has decreased by 1.5% per year over the past 5 years and increased by 5% per year over the past 10 years. These values are in CDN$. As far as earnings per share growth there has been none over the past 5 and 10 years. EPS has decline by 46.8% per year over the past 5 and by 14.9% per year over the past 10 years. These figures are also in CDN$. EPS has fluctuated, but there have not been any negative earnings years.
Total return is down over the past 5 years by 4.06% per year. The dividend portion of the return was 3.28% per year. The capital losses were 7.34% per year. The total return over the past 10 years is 9.02% per year. The dividend portion was at 3% per year. The capital gain was at 6.01% per year. Dividends made up some 33% of this 10 year return. These figures are in CDN$.
The cash flow per share growth is good at 9.6% per year and 9.8% per year over the past 5 and 10 years. However, CFPS does fluctuate a lot, but there is no year with a negative cash flow. These figures are in CDN$.
One of the biggest changes for this company recently is that they have changed their accounting rules from C GAAP (2010) to IFRS (2011) to US GAAP (2012). It is hard to see some of the effects of these changes to the statements, but a glaring one is from 2011 to 2012 Book Value per Share has dropped some 66%.
With the company going from Canadian GAAP to IFRS accounting, there was gain in book value per share. However, with the sharp drop in book value in 2012, if you look at growth in book value to date, you get no increase in book value over the past 10 years and a drop in book value of 11% per year over the past 5 years.
Things like this can happen when accounting rules are changed. Unfortunately, accounting rules are changing all the time. However, they are generally not as big as the changes in rules from C GAAP to IFRS. There have always been differences in rules between C GAAP and US GAAP, but you generally do not see such dramatic changes. Under current rules, some Canadian companies can use US GAAP rules and this company has decided to do this. There are pros and cons to any set of rules.
Return on Equity was lousy in 2011 because the company did not make much money. The ROE was just 0.8%. The 5 year median ROE is better at11.2%. The ROE based on comprehensive income was also low for 2011 at 0.4%. The 5 year median ROE is also better at 10.4%.
The Liquidity Ratio was lately been good with the one for the end of 2011 at 1.75 and the current one at 2.07. The 5 year median Liquidity Ratio is just 1.37. However, the cash flow has been strong. The Debt Ratio has generally been good. This ratio for 2011 was 1.93. The current ratio is low at 1.41. The 5 year median ratio is 1.95, a good ratio.
The Leverage and Debt/Equity Ratios are fine with the ones for 2011 at 2.08 and 1.08 respectively. Relatively speaking, the current ratios are a bit high at 3.43 and 2.43. The 5 year median ratios are fine at 2.11 and 1.11.
This is an oil and gas company and as such I believe is riskier than average stock. However, if you can take on the risk, you can make good money on such stocks. Also, when such companies give decent dividends, even if they fluctuate you can make a good income. However, the dividends are more than likely to be cut in bad times (i.e. when recessions hit). If this is a problem for you, you might want to consider stocks without this risk.
EnCana is among the largest natural gas companies in North America. They are focused on natural gas exploration and the development of resource plays. They have a diversified portfolio of assets and hold a highly competitive land and resource position in a number of North America's most promising shale and tight gas resource plays. Its web site is here EnCana. See my spreadsheet at eca.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 or StockTwits.
I have held this stock twice. As you can see I do not look on oil companies as a long term buy. I sold this stock in 2009 because I only had 100 shares and the stock was going to split into two companies. I would have ended up with small investment in two companies. Also, please note that my spreadsheet following this company starts with Alberta Energy Company and follows this company into the formation of EnCana in 2002. It was in 2002 EnCana was formed with the merger of AEC and PanCanadian Energy Corporation.
Because this is an oil and gas company and because they pay decent dividends, the dividends will fluctuate and generally fluctuate because of the price of oil and gas. Since 2007 dividend yields have been trending up as has the company's Dividend Payout Ratios. Dividend yield is currently at 3.8% and the 5 year dividend yield is 2.81%. The 5 year median DPRs for earnings is 32% and for CFPS is 13.5%. Both these ratios are expected to be higher this year with DPRs for earnings at 66% and for CFPS at 16.5%. (Note DPR for earnings was very high in 2011 at 470%.)
Even though dividends have been fluctuating lately, the dividends have grown at the rate of 27% per year over the past 5 and at the rate of 22% over the past 10 years. This seems to be because dividend yields in the past were quite low, but in recent years have been good. The DPRs in the past were also very low.
The outstanding shares have decreased by 1% per year over the past 5 years and increased by 3.7% per year over the past 10 years. Except for new shares issued in 2002 (re merger) the outstanding shares have been decreasing. They are increased due to stock options and decreased due to the company buying back shares.
Growth generally is better in US$ terms (the currency used in the current statements) than in CDN$ terms. Being a Canadian, I am, of course, most interested in growth in CDN$ terms. For example, revenues have increased by 0% and 13.9% per year over the past 5 and 10 years in US$. Revenues have decreased by 2.6% over the past 5 years and they increased by 8.9% over the past 10 years in CDN$.
Revenue per share has decreased by 1.5% per year over the past 5 years and increased by 5% per year over the past 10 years. These values are in CDN$. As far as earnings per share growth there has been none over the past 5 and 10 years. EPS has decline by 46.8% per year over the past 5 and by 14.9% per year over the past 10 years. These figures are also in CDN$. EPS has fluctuated, but there have not been any negative earnings years.
Total return is down over the past 5 years by 4.06% per year. The dividend portion of the return was 3.28% per year. The capital losses were 7.34% per year. The total return over the past 10 years is 9.02% per year. The dividend portion was at 3% per year. The capital gain was at 6.01% per year. Dividends made up some 33% of this 10 year return. These figures are in CDN$.
The cash flow per share growth is good at 9.6% per year and 9.8% per year over the past 5 and 10 years. However, CFPS does fluctuate a lot, but there is no year with a negative cash flow. These figures are in CDN$.
One of the biggest changes for this company recently is that they have changed their accounting rules from C GAAP (2010) to IFRS (2011) to US GAAP (2012). It is hard to see some of the effects of these changes to the statements, but a glaring one is from 2011 to 2012 Book Value per Share has dropped some 66%.
With the company going from Canadian GAAP to IFRS accounting, there was gain in book value per share. However, with the sharp drop in book value in 2012, if you look at growth in book value to date, you get no increase in book value over the past 10 years and a drop in book value of 11% per year over the past 5 years.
Things like this can happen when accounting rules are changed. Unfortunately, accounting rules are changing all the time. However, they are generally not as big as the changes in rules from C GAAP to IFRS. There have always been differences in rules between C GAAP and US GAAP, but you generally do not see such dramatic changes. Under current rules, some Canadian companies can use US GAAP rules and this company has decided to do this. There are pros and cons to any set of rules.
Return on Equity was lousy in 2011 because the company did not make much money. The ROE was just 0.8%. The 5 year median ROE is better at11.2%. The ROE based on comprehensive income was also low for 2011 at 0.4%. The 5 year median ROE is also better at 10.4%.
The Liquidity Ratio was lately been good with the one for the end of 2011 at 1.75 and the current one at 2.07. The 5 year median Liquidity Ratio is just 1.37. However, the cash flow has been strong. The Debt Ratio has generally been good. This ratio for 2011 was 1.93. The current ratio is low at 1.41. The 5 year median ratio is 1.95, a good ratio.
The Leverage and Debt/Equity Ratios are fine with the ones for 2011 at 2.08 and 1.08 respectively. Relatively speaking, the current ratios are a bit high at 3.43 and 2.43. The 5 year median ratios are fine at 2.11 and 1.11.
This is an oil and gas company and as such I believe is riskier than average stock. However, if you can take on the risk, you can make good money on such stocks. Also, when such companies give decent dividends, even if they fluctuate you can make a good income. However, the dividends are more than likely to be cut in bad times (i.e. when recessions hit). If this is a problem for you, you might want to consider stocks without this risk.
EnCana is among the largest natural gas companies in North America. They are focused on natural gas exploration and the development of resource plays. They have a diversified portfolio of assets and hold a highly competitive land and resource position in a number of North America's most promising shale and tight gas resource plays. Its web site is here EnCana. See my spreadsheet at eca.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 or StockTwits.
Wednesday, November 28, 2012
CCL Industries Inc 2
On my other blog I am today asking why you are investing...continue...
I do not own this stock of CCL Industries Inc. (TSX-CCL.B, OTC-CCDBF). I had read a favorable report on this stock and they are on the dividend lists that I follow of Dividend Achievers (see resources) and Dividend Aristocrats (see indices). This is why I am following this company.
When I look at the insider trading reporting, I find no insider buying and $1.2M of insider selling. The insider selling seems to be all options selling. Commonly insiders consider options part of their salaries and tend to sell off options when they can do so. Insiders have options and also Rights Restricted Share Units and Rights Deferred Share Units.
There are 45 institutions that own some 40% of the outstanding shares of this company. Over the past 3 months they have increased their share holdings by just over 27%. Interestingly, 7 institutions increased their positions, but 15 reduced theirs.
The 5 year low, median and high median Price/Earnings Ratios are 11.69, 13.22 and 14.76. The current P/E Ratio is 13.29 based on a stock price of $37.88 and 2012 earnings of $2.85. This low ratios shows that the current price is reasonable.
I get a current Graham Price of $40.42. The low, median and high median Price/Graham Price Ratios are 0.76, 0.85 and 0.96. The current P/GP ratio is 0.94. This ratio is towards to high end relatively, but shows that the stock price is perhaps reasonable. A P/GP ratio of 1.00 or below shows a stock price is a good one.
The 10 year Price/Book Value per Share Ratio is 1.39 and the current P/B Ratio is 1.49. The current one is some 7% higher than the 10 year median ratios. It is fairly close to the 10 year median ratio so the stock price is probably reasonable. (This tests shows a good stock price when the current ratio is at 80% of the 10 year median ratio. This is telling us that the stock price is not cheap.)
The current dividend yield is 2.06% and the 5 year median dividend yield is 6% higher at 2.20%. This shows that the stock price is probably reasonable.
As far as I can see there is only 1 analyst that is following this stock. This analyst gives a recommendation of Buy. (The consensus would therefore be a buy.) The 12 month stock price is $43.00. This implies a total return of 15.58% with 2.06% from dividends and 13.52% from capital gain.
The company is solid and the stock price is reasonable.
CCL Industries Inc. provides state-of-the-art specialty packaging solutions to some of the world's largest producers of consumer brands in personal care, cosmetic, healthcare, household and specialty food and beverage products. CCL is the world's largest supplier of innovative and secure labeling solutions to leading global companies in the consumer product and healthcare sectors and supplies aluminum containers and plastic tubes for major consumer brands of personal care, household products and specialty food and beverages. With headquarters in Toronto, Ontario, Canada, CCL Industries operates production facilities in North America, Europe, Latin America, Asia and Australia. Its web site is here CCL. See my spreadsheet at ccl.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
I do not own this stock of CCL Industries Inc. (TSX-CCL.B, OTC-CCDBF). I had read a favorable report on this stock and they are on the dividend lists that I follow of Dividend Achievers (see resources) and Dividend Aristocrats (see indices). This is why I am following this company.
When I look at the insider trading reporting, I find no insider buying and $1.2M of insider selling. The insider selling seems to be all options selling. Commonly insiders consider options part of their salaries and tend to sell off options when they can do so. Insiders have options and also Rights Restricted Share Units and Rights Deferred Share Units.
There are 45 institutions that own some 40% of the outstanding shares of this company. Over the past 3 months they have increased their share holdings by just over 27%. Interestingly, 7 institutions increased their positions, but 15 reduced theirs.
The 5 year low, median and high median Price/Earnings Ratios are 11.69, 13.22 and 14.76. The current P/E Ratio is 13.29 based on a stock price of $37.88 and 2012 earnings of $2.85. This low ratios shows that the current price is reasonable.
I get a current Graham Price of $40.42. The low, median and high median Price/Graham Price Ratios are 0.76, 0.85 and 0.96. The current P/GP ratio is 0.94. This ratio is towards to high end relatively, but shows that the stock price is perhaps reasonable. A P/GP ratio of 1.00 or below shows a stock price is a good one.
The 10 year Price/Book Value per Share Ratio is 1.39 and the current P/B Ratio is 1.49. The current one is some 7% higher than the 10 year median ratios. It is fairly close to the 10 year median ratio so the stock price is probably reasonable. (This tests shows a good stock price when the current ratio is at 80% of the 10 year median ratio. This is telling us that the stock price is not cheap.)
The current dividend yield is 2.06% and the 5 year median dividend yield is 6% higher at 2.20%. This shows that the stock price is probably reasonable.
As far as I can see there is only 1 analyst that is following this stock. This analyst gives a recommendation of Buy. (The consensus would therefore be a buy.) The 12 month stock price is $43.00. This implies a total return of 15.58% with 2.06% from dividends and 13.52% from capital gain.
The company is solid and the stock price is reasonable.
CCL Industries Inc. provides state-of-the-art specialty packaging solutions to some of the world's largest producers of consumer brands in personal care, cosmetic, healthcare, household and specialty food and beverage products. CCL is the world's largest supplier of innovative and secure labeling solutions to leading global companies in the consumer product and healthcare sectors and supplies aluminum containers and plastic tubes for major consumer brands of personal care, household products and specialty food and beverages. With headquarters in Toronto, Ontario, Canada, CCL Industries operates production facilities in North America, Europe, Latin America, Asia and Australia. Its web site is here CCL. See my spreadsheet at ccl.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
Tuesday, November 27, 2012
CCL Industries Inc
I do not own this stock of CCL Industries Inc. (TSX-CCL.B, OTC-CCDBF). I had read a favorable report on this stock and they are on the dividend lists that I follow of Dividend Achievers (see resources) and Dividend Aristocrats (see indices). This is why I am following this company. This is a company with two classes of shares and the original family owns 94% of the votes.
The company pays a decent dividend of around 2% (the 5 year median dividend yield is 2.2%) and they increase their dividend at a decent rate. The dividends have grown at the rate of 10% and 8% over the past 5 and 10 years. The last time they increased their dividend was this year and the increase was for 11.4%.
The Dividend Payout Ratios are good with the 5 year median ratios at 30% for earnings and 13% for cash flow. This year's ratios are expected to be in line with longer term ratios at 27% for earnings and 15% for cash flow.
The outstanding shares have only changed marginally over the past few years with the shares outstanding increasing by 0.7% per year over the past 5 years and decreasing by 0.1% over the past 10 years. The outstanding shares have been going up recently due to stock options being exercised.
The total return for this stock over the last 5 and 10 years has been at 3.68% and 10.08% per year. The dividend portion of this return was at 2.02% and 2.33% per year, respectively. The capital gain over these periods was at 1.66% and 7.75% per year, respectively. The dividend portion of the return was 54.96% and 23.09% per year over the past 5 and 10 years.
There has not been much growth in revenues lately with revenues up just 0.9% per year over the past 5 years. Revenues are down by 2.3% per year over the past 10 years. Revenue per share is similar with revenue per share up 0.3% per year over the past 5 years and down 2.2% per year over the past 10 years.
The earnings per share have a tendency to fluctuate, but they always have positive earnings. EPS is up some 1.4% per year over the past 5 years and is up 13.6% per year over the past 10 years. This is an industrial company and so it having fluctuating EPS is not a surprise. The good part of this is that the EPS are positive.
The cash flow per share has the same problem as the EPS in that they fluctuate, but they are positive. The CFPS is up 3.5% and 4.7% per year over the past 5 and 10 years. The book value per share has increased by 3.9% per year over the past 5 and 10 years.
The return on equity was good at 10.3% (for the financial year ending in 2011). This has varied over the years and the 5 year median ROE is lower at 9%. Unfortunately, the ROE on comprehensive income is lower with the ROE for 2011 at just 7.2% and the 5 year median ROE also at 7.2%. The ROE on comprehensive income tends to be lower than the ROE on net income and this can call into question the quality of the earnings. (That is that the EPS may not be quite as good as they first appear to be.)
The Liquidity Ratios tend to be quite good with the ratio for 2011 at 1.66 and the current one being at 1.93. They also have strong cash flows, and the Liquidity Ratio with cash flow after dividend is at 2.24 for 2011and has a 5 year median of 2.19. The Debt Ratio is also good with the ratio for 2011 being at 2.03 and the current one at 2.12.
The current Leverage and Debt/Equity Ratios are 1.90 and 0.90. These ratios have been higher in the past as the 5 year median ratios are 2.36 and 1.36, respectively. Generally speaking, when a stock is mostly owned by insiders or a family, you tend to get good debt ratios and this stock is no different.
The reason people buy dividend growth stocks, which this stock is one of, is that because the dividends paid on your original investment grows over time. For this stock, after 10 years, you could have twice the yield on your stock purchase money today or after 20 years your dividend on your stock purchase money today could be close to 10%.
This stock has been a solid investment for dividend investing shareholders.
CCL Industries Inc. provides state-of-the-art specialty packaging solutions to some of the world's largest producers of consumer brands in personal care, cosmetic, healthcare, household and specialty food and beverage products. CCL is the world's largest supplier of innovative and secure labeling solutions to leading global companies in the consumer product and healthcare sectors and supplies aluminum containers and plastic tubes for major consumer brands of personal care, household products and specialty food and beverages. With headquarters in Toronto, Ontario, Canada, CCL Industries operates production facilities in North America, Europe, Latin America, Asia and Australia. Its web site is here CCL. See my spreadsheet at ccl.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
The company pays a decent dividend of around 2% (the 5 year median dividend yield is 2.2%) and they increase their dividend at a decent rate. The dividends have grown at the rate of 10% and 8% over the past 5 and 10 years. The last time they increased their dividend was this year and the increase was for 11.4%.
The Dividend Payout Ratios are good with the 5 year median ratios at 30% for earnings and 13% for cash flow. This year's ratios are expected to be in line with longer term ratios at 27% for earnings and 15% for cash flow.
The outstanding shares have only changed marginally over the past few years with the shares outstanding increasing by 0.7% per year over the past 5 years and decreasing by 0.1% over the past 10 years. The outstanding shares have been going up recently due to stock options being exercised.
The total return for this stock over the last 5 and 10 years has been at 3.68% and 10.08% per year. The dividend portion of this return was at 2.02% and 2.33% per year, respectively. The capital gain over these periods was at 1.66% and 7.75% per year, respectively. The dividend portion of the return was 54.96% and 23.09% per year over the past 5 and 10 years.
There has not been much growth in revenues lately with revenues up just 0.9% per year over the past 5 years. Revenues are down by 2.3% per year over the past 10 years. Revenue per share is similar with revenue per share up 0.3% per year over the past 5 years and down 2.2% per year over the past 10 years.
The earnings per share have a tendency to fluctuate, but they always have positive earnings. EPS is up some 1.4% per year over the past 5 years and is up 13.6% per year over the past 10 years. This is an industrial company and so it having fluctuating EPS is not a surprise. The good part of this is that the EPS are positive.
The cash flow per share has the same problem as the EPS in that they fluctuate, but they are positive. The CFPS is up 3.5% and 4.7% per year over the past 5 and 10 years. The book value per share has increased by 3.9% per year over the past 5 and 10 years.
The return on equity was good at 10.3% (for the financial year ending in 2011). This has varied over the years and the 5 year median ROE is lower at 9%. Unfortunately, the ROE on comprehensive income is lower with the ROE for 2011 at just 7.2% and the 5 year median ROE also at 7.2%. The ROE on comprehensive income tends to be lower than the ROE on net income and this can call into question the quality of the earnings. (That is that the EPS may not be quite as good as they first appear to be.)
The Liquidity Ratios tend to be quite good with the ratio for 2011 at 1.66 and the current one being at 1.93. They also have strong cash flows, and the Liquidity Ratio with cash flow after dividend is at 2.24 for 2011and has a 5 year median of 2.19. The Debt Ratio is also good with the ratio for 2011 being at 2.03 and the current one at 2.12.
The current Leverage and Debt/Equity Ratios are 1.90 and 0.90. These ratios have been higher in the past as the 5 year median ratios are 2.36 and 1.36, respectively. Generally speaking, when a stock is mostly owned by insiders or a family, you tend to get good debt ratios and this stock is no different.
The reason people buy dividend growth stocks, which this stock is one of, is that because the dividends paid on your original investment grows over time. For this stock, after 10 years, you could have twice the yield on your stock purchase money today or after 20 years your dividend on your stock purchase money today could be close to 10%.
This stock has been a solid investment for dividend investing shareholders.
CCL Industries Inc. provides state-of-the-art specialty packaging solutions to some of the world's largest producers of consumer brands in personal care, cosmetic, healthcare, household and specialty food and beverage products. CCL is the world's largest supplier of innovative and secure labeling solutions to leading global companies in the consumer product and healthcare sectors and supplies aluminum containers and plastic tubes for major consumer brands of personal care, household products and specialty food and beverages. With headquarters in Toronto, Ontario, Canada, CCL Industries operates production facilities in North America, Europe, Latin America, Asia and Australia. Its web site is here CCL. See my spreadsheet at ccl.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
Monday, November 26, 2012
Canada Bread Co. 2
On my other blog I am today writing about the different types of dividend stock...continue...
I do not own this stock of Canada Bread Co. (TSX-CBY, OTC-CBDLF) but I used to. I held it in the past from 1999 to 2000, but I sold as I thought it was going nowhere. One thing that has occurred since I owned this stock is that it merged with Maple Leaf's baking division and now Maple Leaf owns 90% of Canada Bread. It also recently upped their dividend to 4%. It is a stock MPL Communications occasionally talks about.
When I look at the insider trading reporting, I find no insider buying and no insider selling. Generally insiders own some shares in the company, but not much. There are no options outstanding. What insiders do have is shares and options in Maple Leaf Foods Inc. For example the CEO of this company has $6.3m in shares in Maple Leaf and almost $22M in options in Maple Leaf. (As mentioned on Friday, Maple Leaf Foods own 90% of this company.)
There some institutional holder in this stock. However, this is little. Some 4 institutions own some 1.8% of the outstanding shares. Over the past 3 months they have decreased their ownership by 7%.
The 5 year low, median and high median Price/Earnings Ratios are 15.76, 20.47 and 23.44. The current P/E ratio of 16.26 is based on a stock price of $49.75 and 2012 earnings $3.06. This relatively low P/E ratio suggests that the current stock price is relatively low.
I get a Graham Price of $42.64. The 10 year low, median and high median Price/Graham Price Ratios are 0.99, 125 and 1.28. The current ratio of 1.17 is towards the low end and this low Ratio suggests that the stock price is reasonable to low.
I get a 10 year Price/Book Value per share Ratio of 2.00. The current P/B Ratio is 1.88 and this is at 94% of the 10 year median ratio. This low P/B Ratios suggests that the stock price is reasonable.
The Dividend Yield test would not be a good one here because of the recent high dividend increases. The 5 year median Dividend yield is just 0.49 and the current yield is more than 700% higher at 4.02%.
It would appear from all the above that the current stock price is relatively speaking reasonable to low.
As far as I can see there is only one analyst following this stock and the recommendation for this stock is a Hold. The 12 months stock price is $53.00. This implies a 10.55% total return with 4.02% from dividends and 6.53% from capital gains. I cannot find out why. Barchart gives a favorable technical opinion on this stock.
One problem with this company is lack of liquidity in share trading. This is because of Maple Leaf Foods large ownership. A number of analyst remarked about this company being in a stable business. One thought that the dividend is likely to grow in the future.
There is an interesting ad for Dempster's bread (one of Canada Bread's brands) talked about at the Financial Post. They also have an interesting article about consumers wanting to go gluten free and how this might affect earnings for Maple Leaf Foods and this company.
Canada Bread is a leading manufacturer and marketer of value-added flour based products, including fresh bread, rolls, bagels and sweet goods, frozen partially baked or par-baked breads and bagels, and specialty pasta and sauces. The Company markets products under a number of leading brand names, including Dempster's, Olafson's, POM, Ben's and Olivieri. Canada Bread has operations in Canada, the United States and the United Kingdom. Its web site is here Canada Bread. See my spreadsheet at cby.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 or StockTwits.
I do not own this stock of Canada Bread Co. (TSX-CBY, OTC-CBDLF) but I used to. I held it in the past from 1999 to 2000, but I sold as I thought it was going nowhere. One thing that has occurred since I owned this stock is that it merged with Maple Leaf's baking division and now Maple Leaf owns 90% of Canada Bread. It also recently upped their dividend to 4%. It is a stock MPL Communications occasionally talks about.
When I look at the insider trading reporting, I find no insider buying and no insider selling. Generally insiders own some shares in the company, but not much. There are no options outstanding. What insiders do have is shares and options in Maple Leaf Foods Inc. For example the CEO of this company has $6.3m in shares in Maple Leaf and almost $22M in options in Maple Leaf. (As mentioned on Friday, Maple Leaf Foods own 90% of this company.)
There some institutional holder in this stock. However, this is little. Some 4 institutions own some 1.8% of the outstanding shares. Over the past 3 months they have decreased their ownership by 7%.
The 5 year low, median and high median Price/Earnings Ratios are 15.76, 20.47 and 23.44. The current P/E ratio of 16.26 is based on a stock price of $49.75 and 2012 earnings $3.06. This relatively low P/E ratio suggests that the current stock price is relatively low.
I get a Graham Price of $42.64. The 10 year low, median and high median Price/Graham Price Ratios are 0.99, 125 and 1.28. The current ratio of 1.17 is towards the low end and this low Ratio suggests that the stock price is reasonable to low.
I get a 10 year Price/Book Value per share Ratio of 2.00. The current P/B Ratio is 1.88 and this is at 94% of the 10 year median ratio. This low P/B Ratios suggests that the stock price is reasonable.
The Dividend Yield test would not be a good one here because of the recent high dividend increases. The 5 year median Dividend yield is just 0.49 and the current yield is more than 700% higher at 4.02%.
It would appear from all the above that the current stock price is relatively speaking reasonable to low.
As far as I can see there is only one analyst following this stock and the recommendation for this stock is a Hold. The 12 months stock price is $53.00. This implies a 10.55% total return with 4.02% from dividends and 6.53% from capital gains. I cannot find out why. Barchart gives a favorable technical opinion on this stock.
One problem with this company is lack of liquidity in share trading. This is because of Maple Leaf Foods large ownership. A number of analyst remarked about this company being in a stable business. One thought that the dividend is likely to grow in the future.
There is an interesting ad for Dempster's bread (one of Canada Bread's brands) talked about at the Financial Post. They also have an interesting article about consumers wanting to go gluten free and how this might affect earnings for Maple Leaf Foods and this company.
Canada Bread is a leading manufacturer and marketer of value-added flour based products, including fresh bread, rolls, bagels and sweet goods, frozen partially baked or par-baked breads and bagels, and specialty pasta and sauces. The Company markets products under a number of leading brand names, including Dempster's, Olafson's, POM, Ben's and Olivieri. Canada Bread has operations in Canada, the United States and the United Kingdom. Its web site is here Canada Bread. See my spreadsheet at cby.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 or StockTwits.
Friday, November 23, 2012
Canada Bread Co.
I do not own this stock of Canada Bread Co. (TSX-CBY) but I used to. I held it in the past from 1999 to 2000, but I sold as I thought it was going nowhere. One thing that has occurred since I owned this stock is that it merged with Maple Leaf's baking division and now Maple Leaf owns 90% of Canada Bread. It is a stock MPL Communications occasionally talks about.
At one time this stock was just masquerading as dividend paying stock. Why I say it is masquerading as a dividend paying stock? Its dividend was very low (less than 1%) and the dividend did not change from 1992 to 2010. However, lately this stock has changed its dividend policy. In 2011 it raised its yield to around 1.8% and for 2012 it raised it to around 4%. I have looked for an explanation for this, but I have found none.
The new dividend policy changes everything. However, since the company does not say why they have changed it, it is hard to know what will happen in the future. The Dividend Payout Ratios were very low in the past at around 10% for earnings and around 6 or 7% for cash flow. The DPR for 2012 is expected to be around 55% for earnings and 33% for cash flow. This new ratios are fine.
The dividend increases have been substantial. The first increase was for 233% and the second one was a 150% increase. It will be interesting to see what the company does in the future. It would have been helpful for the company to say something about the new dividend policy in an annual statement or on their site.
The total return over the past 5 years is a loss of 3.69% per year. The capital loss is at 4.29% per year and the dividend income is at 0.61% per year. The total return over the past 10 years is much better with a return of 8.24% per year with capital gain of 7.34% per year and dividend returns at 0.9% per year. The total return in the future will change as the dividend yield has increased substantially.
There was a change in outstanding shares in 2003 when the company raised money to pay down debt. This gives the company an increase in outstanding shares of 1.73% over the past 10 years. The outstanding shares have not changed in the past 5 years.
The growth in revenue over the past 5 and 10 years is running at 3.6% and 8.9% per year. The growth in revenue per share over the past 5 and 10 years is at 3.6% and 7.1% per year.
The growth in earnings per share is at 0% and 7.7% per year over the past 5 and 10 years. The growth in cash flow per share over the past 5 and 10 years is at 7.4% and 13.5%. The growth in book value per share is 2.4% and 8.3% per year over the past 5 and 10 years.
The Return on Equity is just ok. The ROE for the financial year ending in 2011 was 7.8% and the 5 year median ROE is a bit better at 9.2%. The ROE based on comprehensive income is lower at6.2%. This ROE has a 5 year median value of 6.2% also. This is quite low. The ROE on comprehensive income speaks to the quality of the ROE on net income.
The Liquidity Ratios has always been low, but it has been improving lately. The ratio for the financial year of 2011 was 1.03 and the current one is 1.20. The fairly good cash flow can make up for this, but it would be better if the Liquidity Ratio is higher.
The Liquidity Ratio with cash flow after dividend is 1.44 for the financial year ending in 2011. Using figures for the last 12 months to the end of the financial period of September 2012, the Liquidity Ratio with cash flow after dividend is 1.62. This is even better as you would want this ratio to be at least at 1.50.
The change in dividend policy really changes the investment characteristics of this stock. It might become of interest to people who like dividend paying stock. However, there is the problem of trading illiquidity as 90% of the shares are owned by Maple Leaf Foods Inc.
Canada Bread is a leading manufacturer and marketer of value-added flour based products, including fresh bread, rolls, bagels and sweet goods, frozen partially baked or par-baked breads and bagels, and specialty pasta and sauces. The Company markets products under a number of leading brand names, including Dempster's, Olafson's, POM, Ben's and Olivieri. Canada Bread has operations in Canada, the United States and the United Kingdom. Its web site is here Canada Bread. See my spreadsheet at cby.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 or StockTwits.
At one time this stock was just masquerading as dividend paying stock. Why I say it is masquerading as a dividend paying stock? Its dividend was very low (less than 1%) and the dividend did not change from 1992 to 2010. However, lately this stock has changed its dividend policy. In 2011 it raised its yield to around 1.8% and for 2012 it raised it to around 4%. I have looked for an explanation for this, but I have found none.
The new dividend policy changes everything. However, since the company does not say why they have changed it, it is hard to know what will happen in the future. The Dividend Payout Ratios were very low in the past at around 10% for earnings and around 6 or 7% for cash flow. The DPR for 2012 is expected to be around 55% for earnings and 33% for cash flow. This new ratios are fine.
The dividend increases have been substantial. The first increase was for 233% and the second one was a 150% increase. It will be interesting to see what the company does in the future. It would have been helpful for the company to say something about the new dividend policy in an annual statement or on their site.
The total return over the past 5 years is a loss of 3.69% per year. The capital loss is at 4.29% per year and the dividend income is at 0.61% per year. The total return over the past 10 years is much better with a return of 8.24% per year with capital gain of 7.34% per year and dividend returns at 0.9% per year. The total return in the future will change as the dividend yield has increased substantially.
There was a change in outstanding shares in 2003 when the company raised money to pay down debt. This gives the company an increase in outstanding shares of 1.73% over the past 10 years. The outstanding shares have not changed in the past 5 years.
The growth in revenue over the past 5 and 10 years is running at 3.6% and 8.9% per year. The growth in revenue per share over the past 5 and 10 years is at 3.6% and 7.1% per year.
The growth in earnings per share is at 0% and 7.7% per year over the past 5 and 10 years. The growth in cash flow per share over the past 5 and 10 years is at 7.4% and 13.5%. The growth in book value per share is 2.4% and 8.3% per year over the past 5 and 10 years.
The Return on Equity is just ok. The ROE for the financial year ending in 2011 was 7.8% and the 5 year median ROE is a bit better at 9.2%. The ROE based on comprehensive income is lower at6.2%. This ROE has a 5 year median value of 6.2% also. This is quite low. The ROE on comprehensive income speaks to the quality of the ROE on net income.
The Liquidity Ratios has always been low, but it has been improving lately. The ratio for the financial year of 2011 was 1.03 and the current one is 1.20. The fairly good cash flow can make up for this, but it would be better if the Liquidity Ratio is higher.
The Liquidity Ratio with cash flow after dividend is 1.44 for the financial year ending in 2011. Using figures for the last 12 months to the end of the financial period of September 2012, the Liquidity Ratio with cash flow after dividend is 1.62. This is even better as you would want this ratio to be at least at 1.50.
The change in dividend policy really changes the investment characteristics of this stock. It might become of interest to people who like dividend paying stock. However, there is the problem of trading illiquidity as 90% of the shares are owned by Maple Leaf Foods Inc.
Canada Bread is a leading manufacturer and marketer of value-added flour based products, including fresh bread, rolls, bagels and sweet goods, frozen partially baked or par-baked breads and bagels, and specialty pasta and sauces. The Company markets products under a number of leading brand names, including Dempster's, Olafson's, POM, Ben's and Olivieri. Canada Bread has operations in Canada, the United States and the United Kingdom. Its web site is here Canada Bread. See my spreadsheet at cby.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 or StockTwits.
Thursday, November 22, 2012
Goodfellow Inc 2
I own this stock Goodfellow Inc. (TSX-GDL, OTC-GFELF). I had read a favorable report on this stock in 2009 and at one time the Investment Reporting was pushing this stock. I bought some stock in December 2010 and then some more in February 2011. I now have had this stock for 2 years and have lost 18.4% per year, including dividends or 19.8% per year excluding dividends.
The one thing to notice about this company is that insiders own over 60% of the outstanding shares. Insiders have some options, but everyone has a lot of shares a few options, comparatively. What the insider shows is that there has been no insider selling or insider buying over the past year. What it also shows is that the company is buying back shares on the open market for cancellation.
An interesting note Stephen Jarislowsky owns almost 13% of this company. Jarislowsky is a highly thought of Canadian Financier. You can see an entry on his on Wikipedia. He talked about being the “Warren Buffett” of Canada.
According Reuters there are 2 institutions that hold 12% of the outstanding shares. There has been no buys or sells within the last 3 months.
The 5 year low, median and high median Price/Earnings Ratios are 5.41, 11.20 and 18.37. The current P/E ratio is 11.00 based on 2013 earnings of $0.75 and stock price of $8.25. This ratio says that the stock price is reasonable. However, if you use the earnings for the financial year ending in August 2012 of $.51, the P/E is 16.18. This says that the stock price is relatively high, but reasonable.
With the increased in dividends for 2013, the company seems to be suggesting an EPS for 2013 of $.70 to $0.79. This level of earnings would give a current P/E of 11.79 to 10.44. This would suggest the stock price is relatively reasonable for this stock.
I get a Graham price of $15.17. The 10 year low, median, and high median Price/Graham Price Ratios are 0.49, 0.63 and 0.75. The current P/GP Ratio of 0.54 would suggest that the stock price is relatively reasonable. Also, companies are considered a good buy when the stock price is at or below the Graham Price.
I get a 10 year median Price/Book Value Ratio of 0.92. The current P/B Ratio at 0.61 shows that the stock price is relatively cheap as this current ratio is only 65% of the 10 year median P/B Ratio.
I get a 5 year median dividend yield of 5.38%. The current dividend yield is 3.64%. By this test the stock price is high as the current dividend yield is some 32% lower than the 5 year median dividend yield. The 10 year median dividend yield is 4.08% but this is still some 10% higher than the current dividend yield. It shows a possible better stock price, but not a great stock price. The problem with this test is that the dividends tend to fluctuate.
There is some disagreement with my tests as to how good the current stock price is. Generally you would go with the dividend yield test unless there are reasons not to. The dividend yield test shows that the stock price is rather high. This may not be a good indicator because dividends do fluctuate. The next one to go with is the P/B Ratio. This ratio shows that the stock price is cheap. If you split the difference, you get a reasonable stock price.
On a technical level, Bar Chart gives this stock a buy rating. (Some analysts feel you should do fundamental analysis to determine what to buy and do technical analysis to determine when to buy.)
I can find no analysts reporting on this stock. I plan to hold what I have. My expectations would be that over the long term this stock will return me 8 to 10% per year, including dividends. I have a small position in this stock and this will not change. I live off my dividends and this stock’s dividends do fluctuate.
Goodfellow Inc. is one of eastern Canada's largest independent re-manufacturers and distributors of lumber and hardwood flooring products. The company serves customers throughout Canada, the United States and abroad including the UK and China and the Middle East. H.Q is Delson, Quebec, just outside Montreal. Its web site is here Goodfellow. See my spreadsheet at gdl.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 or StockTwits.
The one thing to notice about this company is that insiders own over 60% of the outstanding shares. Insiders have some options, but everyone has a lot of shares a few options, comparatively. What the insider shows is that there has been no insider selling or insider buying over the past year. What it also shows is that the company is buying back shares on the open market for cancellation.
An interesting note Stephen Jarislowsky owns almost 13% of this company. Jarislowsky is a highly thought of Canadian Financier. You can see an entry on his on Wikipedia. He talked about being the “Warren Buffett” of Canada.
According Reuters there are 2 institutions that hold 12% of the outstanding shares. There has been no buys or sells within the last 3 months.
The 5 year low, median and high median Price/Earnings Ratios are 5.41, 11.20 and 18.37. The current P/E ratio is 11.00 based on 2013 earnings of $0.75 and stock price of $8.25. This ratio says that the stock price is reasonable. However, if you use the earnings for the financial year ending in August 2012 of $.51, the P/E is 16.18. This says that the stock price is relatively high, but reasonable.
With the increased in dividends for 2013, the company seems to be suggesting an EPS for 2013 of $.70 to $0.79. This level of earnings would give a current P/E of 11.79 to 10.44. This would suggest the stock price is relatively reasonable for this stock.
I get a Graham price of $15.17. The 10 year low, median, and high median Price/Graham Price Ratios are 0.49, 0.63 and 0.75. The current P/GP Ratio of 0.54 would suggest that the stock price is relatively reasonable. Also, companies are considered a good buy when the stock price is at or below the Graham Price.
I get a 10 year median Price/Book Value Ratio of 0.92. The current P/B Ratio at 0.61 shows that the stock price is relatively cheap as this current ratio is only 65% of the 10 year median P/B Ratio.
I get a 5 year median dividend yield of 5.38%. The current dividend yield is 3.64%. By this test the stock price is high as the current dividend yield is some 32% lower than the 5 year median dividend yield. The 10 year median dividend yield is 4.08% but this is still some 10% higher than the current dividend yield. It shows a possible better stock price, but not a great stock price. The problem with this test is that the dividends tend to fluctuate.
There is some disagreement with my tests as to how good the current stock price is. Generally you would go with the dividend yield test unless there are reasons not to. The dividend yield test shows that the stock price is rather high. This may not be a good indicator because dividends do fluctuate. The next one to go with is the P/B Ratio. This ratio shows that the stock price is cheap. If you split the difference, you get a reasonable stock price.
On a technical level, Bar Chart gives this stock a buy rating. (Some analysts feel you should do fundamental analysis to determine what to buy and do technical analysis to determine when to buy.)
I can find no analysts reporting on this stock. I plan to hold what I have. My expectations would be that over the long term this stock will return me 8 to 10% per year, including dividends. I have a small position in this stock and this will not change. I live off my dividends and this stock’s dividends do fluctuate.
Goodfellow Inc. is one of eastern Canada's largest independent re-manufacturers and distributors of lumber and hardwood flooring products. The company serves customers throughout Canada, the United States and abroad including the UK and China and the Middle East. H.Q is Delson, Quebec, just outside Montreal. Its web site is here Goodfellow. See my spreadsheet at gdl.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 or StockTwits.
Wednesday, November 21, 2012
Goodfellow Inc
On my other blog I am today writing about DB and DC Pension plans...continue...
I own this stock Goodfellow Inc. (TSX-GDL). I had read a favorable report on this stock in 2009 and at one time the Investment Reporting was pushing this stock. I bought some stock in December 2010 and then some more in February 2011. The stock has not been doing well lately, so I have just held it and not bought anymore. I now have had this stock for 2 years and have lost 18.4% per year, including dividends or 19.8% excluding dividends. Or, in other words my stock is down by 32%. My dividends account for only 1.4% of the return.
Dividends have fluctuated on this stock. They paid what they can afford to and this is why they fluctuated. They also only pay dividends twice a year, not the general quarterly dividends. When I bought this stock, dividends had just been reduced by 66.7%. They were reduced from $.30 semi-annually to $.10 semi-annually.
The company has increased the dividends by some 50% to $.15 semi-annually for the 2013 financial year. However, you only know what the dividend is going to just before it is granted as they declared the dividends in a news release just before it is paid.
The company has the financial year in August each year. To August 2012 the 5 year total return was a 6.11% per year loss, with a 10.39% per year capital loss and dividends at 3.68% per year. To August 2012, the 10 year total return was 9.75% per year with a capital gain of 2.66% per year and dividends at 7.56% per year.
Over the past 5 year outstanding shares have decreased by 0.15% and over the past 10 years they have increased by 0.14%. These are just marginal changes. There are some options, but few. Recently the company has been buying back shares.
When I look at revenue growth and revenue growth per share over the past 5 and 10 years, the growth rate is 0%. Earnings per share are down over both the last 5 and 10 years at 19.62% over the past 5 years and by 5.31% over the past 10 years. There have been no years of negative earnings, but earnings tend to fluctuate.
Cash Flow per Share is also down by 38% per year and 17% per year over the past 5 and 10 years. Here again, there has been no years of negative cash flow, but cash flow does fluctuate. Book Value per share growth is so-so, with growth of 3% per year over the past 5 years and 6% per year over the past 10 years.
Mostly Return on Equity has not been great, but this has also fluctuated between 13% and 2.5%. The ROE for the financial year ending in August 2012 is quite low at 3.8%. The 5 year median value is better at 6.9%. The ROE on comprehensive income is the same as the ROE on net income.
The debt ratios are very good. This stock is greatly affected by the business cycle and you would want the debt ratios to be very good. The current Liquidity Ratio is 2.28. The current Debt Ratio is 2.64. Generally speaking you want these ratios to be 1.50 or better. However, the company is right to have such strong debt ratios to see them though the bad times that come in their industry.
The current Leverage and Debt/Equity Ratios are also good at 1.61 and 0.61.
I plan to continue to hold this stock as I feel that I will do fine in it over the longer term. However, I do not have a large investment in this company and will probably never have a very large investment in the company.
Goodfellow Inc. is one of eastern Canada's largest independent re-manufacturers and distributors of lumber and hardwood flooring products. The company serves customers throughout Canada, the United States and abroad including the UK and China and the Middle East. H.Q is Delson, Quebec, just outside Montreal. It is about 60% owned by insiders. Its web site is here Goodfellow. See my spreadsheet at gdl.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 or StockTwits.
I own this stock Goodfellow Inc. (TSX-GDL). I had read a favorable report on this stock in 2009 and at one time the Investment Reporting was pushing this stock. I bought some stock in December 2010 and then some more in February 2011. The stock has not been doing well lately, so I have just held it and not bought anymore. I now have had this stock for 2 years and have lost 18.4% per year, including dividends or 19.8% excluding dividends. Or, in other words my stock is down by 32%. My dividends account for only 1.4% of the return.
Dividends have fluctuated on this stock. They paid what they can afford to and this is why they fluctuated. They also only pay dividends twice a year, not the general quarterly dividends. When I bought this stock, dividends had just been reduced by 66.7%. They were reduced from $.30 semi-annually to $.10 semi-annually.
The company has increased the dividends by some 50% to $.15 semi-annually for the 2013 financial year. However, you only know what the dividend is going to just before it is granted as they declared the dividends in a news release just before it is paid.
The company has the financial year in August each year. To August 2012 the 5 year total return was a 6.11% per year loss, with a 10.39% per year capital loss and dividends at 3.68% per year. To August 2012, the 10 year total return was 9.75% per year with a capital gain of 2.66% per year and dividends at 7.56% per year.
Over the past 5 year outstanding shares have decreased by 0.15% and over the past 10 years they have increased by 0.14%. These are just marginal changes. There are some options, but few. Recently the company has been buying back shares.
When I look at revenue growth and revenue growth per share over the past 5 and 10 years, the growth rate is 0%. Earnings per share are down over both the last 5 and 10 years at 19.62% over the past 5 years and by 5.31% over the past 10 years. There have been no years of negative earnings, but earnings tend to fluctuate.
Cash Flow per Share is also down by 38% per year and 17% per year over the past 5 and 10 years. Here again, there has been no years of negative cash flow, but cash flow does fluctuate. Book Value per share growth is so-so, with growth of 3% per year over the past 5 years and 6% per year over the past 10 years.
Mostly Return on Equity has not been great, but this has also fluctuated between 13% and 2.5%. The ROE for the financial year ending in August 2012 is quite low at 3.8%. The 5 year median value is better at 6.9%. The ROE on comprehensive income is the same as the ROE on net income.
The debt ratios are very good. This stock is greatly affected by the business cycle and you would want the debt ratios to be very good. The current Liquidity Ratio is 2.28. The current Debt Ratio is 2.64. Generally speaking you want these ratios to be 1.50 or better. However, the company is right to have such strong debt ratios to see them though the bad times that come in their industry.
The current Leverage and Debt/Equity Ratios are also good at 1.61 and 0.61.
I plan to continue to hold this stock as I feel that I will do fine in it over the longer term. However, I do not have a large investment in this company and will probably never have a very large investment in the company.
Goodfellow Inc. is one of eastern Canada's largest independent re-manufacturers and distributors of lumber and hardwood flooring products. The company serves customers throughout Canada, the United States and abroad including the UK and China and the Middle East. H.Q is Delson, Quebec, just outside Montreal. It is about 60% owned by insiders. Its web site is here Goodfellow. See my spreadsheet at gdl.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 or StockTwits.
Tuesday, November 20, 2012
Calian Technologies Ltd 2
I own this stock of Calian Technologies Ltd (TSX-CTY). I first bought this stock in May of 2011 and then bought some more in April of 2012. To date I have made 18.18% per year with 17.6% from capital gain and 0.58% from dividends. It is not that dividends are low, as the 5 year median dividend yield is 5.23%, but it is just that this is a fast rising company.
When I look at the insider trading reporting I find no insider buying and insider selling is at $0.8M. Selling is by everyone but the CFO and it appears to be people cashing in their options. Options are often thought of as part of insider salaries.
There are not only options, but also Deferred Share Units. There are options outstanding and insiders seem to have more options that shares, generally, and there are not a lot of options outstanding. The CEO has shares worth $1.6M and options worth around half that.
The 5 year low, median and high median Price/Earnings Ratios are 9.54, 10.23 and 10.90. There is little variation in these values. The current P/E at 11.28 is a bit higher. However, a P/E of 11.28 is not a high P/E.
I get a Graham Price of $19.11. The 10 year low, median, high median Price/Graham Price Ratios are 0.84, 0.95 and 1.07. The current P/GP Ratio at 1.08 shows that the stock price is slightly high. But here again, a 1.08 P/GP Ratio is not that high.
I get a 10 year Price/Book Value per Share Ratio of 2.25. The current one is 2.33 and is 3% higher. This shows the stock price to be relatively slightly higher than the median stock price.
I get a 5 year median dividend yield of 5.23%. The current yield is 5.42% which is some 3.7% higher. This suggests a slight better than median stock price.
When there is conflict about the price, generally you go with the dividend yield test. However, all these tests show that the stock price is relatively at an median price. So, the stock price would be reasonable.
When I look for analysts' recommendations there seems to be only one analyst following this stock and the recommendation is a Hold. The 12 month stock price is $23 and this implies a total return of 16.8% with 11.38% from capital gains and 5.42% from dividends.
The blogger Smart Amateur explains, in the early part of this year, why he thinks that this stock is a Hold. Recently, Happy Capitalism has said that he thinks the stock will pull back and provide a good entry point.
The Happy Capitalism blogger may have a point. This is November and often stocks pull back in November before a general year end rise.
Calian sells technology services to industry and government in Canada and around the world. Calian provides customers with ready access to an exceptional team of engineers, telecommunications and technology professionals, health care professionals and other highly qualified staff. Its web site is here Calian. See my spreadsheet at cty.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 or StockTwits.
When I look at the insider trading reporting I find no insider buying and insider selling is at $0.8M. Selling is by everyone but the CFO and it appears to be people cashing in their options. Options are often thought of as part of insider salaries.
There are not only options, but also Deferred Share Units. There are options outstanding and insiders seem to have more options that shares, generally, and there are not a lot of options outstanding. The CEO has shares worth $1.6M and options worth around half that.
The 5 year low, median and high median Price/Earnings Ratios are 9.54, 10.23 and 10.90. There is little variation in these values. The current P/E at 11.28 is a bit higher. However, a P/E of 11.28 is not a high P/E.
I get a Graham Price of $19.11. The 10 year low, median, high median Price/Graham Price Ratios are 0.84, 0.95 and 1.07. The current P/GP Ratio at 1.08 shows that the stock price is slightly high. But here again, a 1.08 P/GP Ratio is not that high.
I get a 10 year Price/Book Value per Share Ratio of 2.25. The current one is 2.33 and is 3% higher. This shows the stock price to be relatively slightly higher than the median stock price.
I get a 5 year median dividend yield of 5.23%. The current yield is 5.42% which is some 3.7% higher. This suggests a slight better than median stock price.
When there is conflict about the price, generally you go with the dividend yield test. However, all these tests show that the stock price is relatively at an median price. So, the stock price would be reasonable.
When I look for analysts' recommendations there seems to be only one analyst following this stock and the recommendation is a Hold. The 12 month stock price is $23 and this implies a total return of 16.8% with 11.38% from capital gains and 5.42% from dividends.
The blogger Smart Amateur explains, in the early part of this year, why he thinks that this stock is a Hold. Recently, Happy Capitalism has said that he thinks the stock will pull back and provide a good entry point.
The Happy Capitalism blogger may have a point. This is November and often stocks pull back in November before a general year end rise.
Calian sells technology services to industry and government in Canada and around the world. Calian provides customers with ready access to an exceptional team of engineers, telecommunications and technology professionals, health care professionals and other highly qualified staff. Its web site is here Calian. See my spreadsheet at cty.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 or StockTwits.
Monday, November 19, 2012
Calian Technologies Ltd
On my other blog I have written about people feeling like geniuses when their stocks go up ...continue...
On my book blog I have written about Peter Diamandis's book on abundance. This is a wonderful, optimistic view of our future...continue...
I own this stock of Calian Technologies Ltd (TSX-CTY). I got interested in following this stock after reading about it a G&M Number Cruncher column of April 2011. See column called Where "debt" is a dirty word . (I included this link as I had no trouble accessing this older document on G&M.) Also the Financial Blogger has this stock on his Top Ten Canadian Dividend Stocks list of September 2009.
I first bought this stock in May of 2011 and then bought some more in April of 2012. To date I have made 18.18% per year with 17.6% from capital gain and 0.58% from dividends. It is not that dividends are low, as the 5 year median dividend yield is 5.23%, but it is just that this is a fast rising tech company.
The dividend growth on this stock is very, very good. The company just started to pay dividends in 2003 and the dividend growth over the past 5 and 9 years is 20% and 23% per year. However, the most recent yearly increase is just 12%. The Dividend Payout Ratios are good with the one for earnings having a 5 year median ratio of 45% and the one for cash flow having a 5 year median ratio of 40%.
Total returns over the past 5 and 10 years is at 15.16% and 24.45%, with 8.83% and 17.98% coming from capital gains and 6.32% and 6.47% coming from dividends. Over this period of time dividends represented 41.72% and 26.47% of the total return. These figures are to September 2012 as the financial year for this company ends in September each year.
The outstanding shares have declined by 1.67% and 0.47% over the past 5 and 10 years. Shares grow because of stock options and shares issued under the employee purchases plan and shrink because the company is buying back shares.
Revenues have grown at 4.4% and 6% over the past 5 and 10 years. Revenues per share have grown at the rate of 6.2% and 6.5% per year over these periods. Earnings per Share are up by 10.8% and 16.2% over the past 5 and 10 years. Cash Flow per Share is up by 15.5% and 11.6% per year over the past 5 and 10 years. Book Value per Share is up 8% and 10.6% over the past 5 and 10 years.
Most of the growth under this stock in the past has been quite good. Analysts however expect growth to slow in 2013 with EPS down slightly and revenue up slightly.
The return on equity for the financial year ending in September 2012 is very good at 20.7%. The same goes for the 5 year median ROE at 20.9%. The ROE based on comprehensive income is similar with the ROE for September 2012 at 22.1% and the 5 year median at 19.8%.
The last thing to talk about is the debt ratios. They are very good for this company and will provide the company with a good cushion in the bad times. The Liquidity Ratio is 2.44, plus the company has a strong cash flow. The Debt Ratio is 2.91. What I am looking for is these ratios to be at 1.50 or higher. However, this is a small tech company and it will be a more risky investment than average investment.
The current Leverage and Debt/Equity Ratios are also quite good at 1.52 and 0.52. The 5 year median ratios are also good with Liquidity ratio at 2.28, the Debt Ratio at 2.81 and the Leverage and Debt/Equity Ratios at 1.62 and 0.62, respectively.
This has been a great little company. I expect to continue to do well with it. However, you should only consider the company if you can take on the risk. One other thing it has going to for it is the dividends. Dividends tend to give stability to companies.
I have read a number of times that historically companies with dividends have done better than companies without. An article in Business Week in the early part of this year states that dividend paying stocks show that they are less volatile. I think you would do better in the long haul if you loss less in the bear markets even though you do less well in bull markets. The higher the hit you take in the bear markets, the harder it is to recover in the bull markets. This is just a thought.
Calian sells technology services to industry and government in Canada and around the world. Calian provides customers with ready access to an exceptional team of engineers, telecommunications and technology professionals, health care professionals and other highly qualified staff. Its web site is here Calian. See my spreadsheet at cty.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 or StockTwits.
On my book blog I have written about Peter Diamandis's book on abundance. This is a wonderful, optimistic view of our future...continue...
I own this stock of Calian Technologies Ltd (TSX-CTY). I got interested in following this stock after reading about it a G&M Number Cruncher column of April 2011. See column called Where "debt" is a dirty word . (I included this link as I had no trouble accessing this older document on G&M.) Also the Financial Blogger has this stock on his Top Ten Canadian Dividend Stocks list of September 2009.
I first bought this stock in May of 2011 and then bought some more in April of 2012. To date I have made 18.18% per year with 17.6% from capital gain and 0.58% from dividends. It is not that dividends are low, as the 5 year median dividend yield is 5.23%, but it is just that this is a fast rising tech company.
The dividend growth on this stock is very, very good. The company just started to pay dividends in 2003 and the dividend growth over the past 5 and 9 years is 20% and 23% per year. However, the most recent yearly increase is just 12%. The Dividend Payout Ratios are good with the one for earnings having a 5 year median ratio of 45% and the one for cash flow having a 5 year median ratio of 40%.
Total returns over the past 5 and 10 years is at 15.16% and 24.45%, with 8.83% and 17.98% coming from capital gains and 6.32% and 6.47% coming from dividends. Over this period of time dividends represented 41.72% and 26.47% of the total return. These figures are to September 2012 as the financial year for this company ends in September each year.
The outstanding shares have declined by 1.67% and 0.47% over the past 5 and 10 years. Shares grow because of stock options and shares issued under the employee purchases plan and shrink because the company is buying back shares.
Revenues have grown at 4.4% and 6% over the past 5 and 10 years. Revenues per share have grown at the rate of 6.2% and 6.5% per year over these periods. Earnings per Share are up by 10.8% and 16.2% over the past 5 and 10 years. Cash Flow per Share is up by 15.5% and 11.6% per year over the past 5 and 10 years. Book Value per Share is up 8% and 10.6% over the past 5 and 10 years.
Most of the growth under this stock in the past has been quite good. Analysts however expect growth to slow in 2013 with EPS down slightly and revenue up slightly.
The return on equity for the financial year ending in September 2012 is very good at 20.7%. The same goes for the 5 year median ROE at 20.9%. The ROE based on comprehensive income is similar with the ROE for September 2012 at 22.1% and the 5 year median at 19.8%.
The last thing to talk about is the debt ratios. They are very good for this company and will provide the company with a good cushion in the bad times. The Liquidity Ratio is 2.44, plus the company has a strong cash flow. The Debt Ratio is 2.91. What I am looking for is these ratios to be at 1.50 or higher. However, this is a small tech company and it will be a more risky investment than average investment.
The current Leverage and Debt/Equity Ratios are also quite good at 1.52 and 0.52. The 5 year median ratios are also good with Liquidity ratio at 2.28, the Debt Ratio at 2.81 and the Leverage and Debt/Equity Ratios at 1.62 and 0.62, respectively.
This has been a great little company. I expect to continue to do well with it. However, you should only consider the company if you can take on the risk. One other thing it has going to for it is the dividends. Dividends tend to give stability to companies.
I have read a number of times that historically companies with dividends have done better than companies without. An article in Business Week in the early part of this year states that dividend paying stocks show that they are less volatile. I think you would do better in the long haul if you loss less in the bear markets even though you do less well in bull markets. The higher the hit you take in the bear markets, the harder it is to recover in the bull markets. This is just a thought.
Calian sells technology services to industry and government in Canada and around the world. Calian provides customers with ready access to an exceptional team of engineers, telecommunications and technology professionals, health care professionals and other highly qualified staff. Its web site is here Calian. See my spreadsheet at cty.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 or StockTwits.
Friday, November 16, 2012
Cenovus Energy Inc 2
I do not own this stock of Cenovus Energy Inc. (TSX-CVE, NYSE-CVE). I did own the predecessor company of EnCana. I sometimes venture into oil and gas companies and they are a large part of the TSX. I like to know what is going on in this sector, but I really do not like investing much in it. Currently I hold some Husky (TSX-HSE) and Canadian Natural Resources Ltd. (TSX-CNQ).
When I look at insider trading I find a minimal amount of insider buying and $6.1M of insider selling. There is a net of insider selling of $6M. The insider selling seems to be of options. Insiders often treat options as part of their salary.
There are lots of options outstanding and insider do own a fair bit of stock. For example the CEO owns $3.6M in shares and has $45.7M in options. The CFO has $0.5M in shares and has $14M in options. An officer has $3.4M in shares and $35M in options. A director has $5M in shares and $5M in options. (This is just a sampling.)
The 5 year low, median and high median Price/Earnings Ratios are 14.76, 17.69 and 20.62. The current P/E Ratio is 16.73 based on a stock price of $33.79 and 2012 earnings of $2.02. This shows that the stock price is reasonable. (Note that the P/E ratios for the 10 year period are also lower than the above 5 year period shows and are 9.47, 11.60 and 14.68. Usually, you do not see such a difference between the 5 and 10 year median values.)
I get a Graham Price of $24.60. The 10 year low, median and high median Price/Graham Price Ratios are 0.83, 1.09 and 1.25. The current ratio is 1.37 and shows the stock price is high. However, the P/GP Ratios have been moving up lately and the 5 year low, median and high medina P/GP Ratios are 1.23, 1.46 and 1.67. The stock price has been growing fast than the Graham Price.
The 10 year median Price/Book Value per share Ratio is 2.01 (and the 5 year median value is higher at 2.48). The current P/B Ratio at 2.54 is some 26% above the 10 year ratio. This rather higher ratio suggests that the current stock price is a bit high.
The 5 year median dividend yield is 2.76 and the current dividend yield is 2.60% and it is some 5.6% lower than the 5 year dividend yield and suggests a reasonable to high stock price.
What we can say is that there were big changes for the company when it was split from EnCana, which was 3 years ago. The 5 year values are probably valid. So we can say that the company's stock price is not cheap. We may even be able to say it is reasonable.
When I look at analysts' recommendations I find Strong Buy, Buy and Hold. There are a lot of Buy recommendations and the consensus recommendation would be a Buy recommendation. The 12 months stock price is $41.90. This implies a total return of 26.6% with 24% coming from capital gain and 2.6% from dividends.
A number of analysts feel that this stock can still grow over well over the next while. Others call it a low cost producer and a company that is well run. I guess to want to buy this stock you would have to be bullish on oil and not everyone is.
Here is a positive report on Cenovus entitled "Suncor, Cenovus and Husky get praise from JPMorgan" at the Financial Post. Also another one with title of "Suncor, Cenovus work around crude oil discount" at the Financial Post.
Analysts at National Bank cut their price target on shares of Cenovus Energy from $41.00 to $40.00 in a research note to investors on Friday. Analysts at RBC Capital reiterated an outperform rating on shares of Cenovus Energy as did analysts at BMO Capital. See Zolmax News.
If you want a company into oil of the Oil Sands, this stock seems to be reasonably price.
Cenovus Energy Inc. is an integrated oil company. The Company's operations include enhanced oil recovery (EOR) properties and established crude oil and natural gas production in Alberta and Saskatchewan. It also has ownership interests in two refineries in Illinois and Texas, United States. Its web site is here Cenovus. See my spreadsheet at cve.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 or StockTwits.
When I look at insider trading I find a minimal amount of insider buying and $6.1M of insider selling. There is a net of insider selling of $6M. The insider selling seems to be of options. Insiders often treat options as part of their salary.
There are lots of options outstanding and insider do own a fair bit of stock. For example the CEO owns $3.6M in shares and has $45.7M in options. The CFO has $0.5M in shares and has $14M in options. An officer has $3.4M in shares and $35M in options. A director has $5M in shares and $5M in options. (This is just a sampling.)
The 5 year low, median and high median Price/Earnings Ratios are 14.76, 17.69 and 20.62. The current P/E Ratio is 16.73 based on a stock price of $33.79 and 2012 earnings of $2.02. This shows that the stock price is reasonable. (Note that the P/E ratios for the 10 year period are also lower than the above 5 year period shows and are 9.47, 11.60 and 14.68. Usually, you do not see such a difference between the 5 and 10 year median values.)
I get a Graham Price of $24.60. The 10 year low, median and high median Price/Graham Price Ratios are 0.83, 1.09 and 1.25. The current ratio is 1.37 and shows the stock price is high. However, the P/GP Ratios have been moving up lately and the 5 year low, median and high medina P/GP Ratios are 1.23, 1.46 and 1.67. The stock price has been growing fast than the Graham Price.
The 10 year median Price/Book Value per share Ratio is 2.01 (and the 5 year median value is higher at 2.48). The current P/B Ratio at 2.54 is some 26% above the 10 year ratio. This rather higher ratio suggests that the current stock price is a bit high.
The 5 year median dividend yield is 2.76 and the current dividend yield is 2.60% and it is some 5.6% lower than the 5 year dividend yield and suggests a reasonable to high stock price.
What we can say is that there were big changes for the company when it was split from EnCana, which was 3 years ago. The 5 year values are probably valid. So we can say that the company's stock price is not cheap. We may even be able to say it is reasonable.
When I look at analysts' recommendations I find Strong Buy, Buy and Hold. There are a lot of Buy recommendations and the consensus recommendation would be a Buy recommendation. The 12 months stock price is $41.90. This implies a total return of 26.6% with 24% coming from capital gain and 2.6% from dividends.
A number of analysts feel that this stock can still grow over well over the next while. Others call it a low cost producer and a company that is well run. I guess to want to buy this stock you would have to be bullish on oil and not everyone is.
Here is a positive report on Cenovus entitled "Suncor, Cenovus and Husky get praise from JPMorgan" at the Financial Post. Also another one with title of "Suncor, Cenovus work around crude oil discount" at the Financial Post.
Analysts at National Bank cut their price target on shares of Cenovus Energy from $41.00 to $40.00 in a research note to investors on Friday. Analysts at RBC Capital reiterated an outperform rating on shares of Cenovus Energy as did analysts at BMO Capital. See Zolmax News.
If you want a company into oil of the Oil Sands, this stock seems to be reasonably price.
Cenovus Energy Inc. is an integrated oil company. The Company's operations include enhanced oil recovery (EOR) properties and established crude oil and natural gas production in Alberta and Saskatchewan. It also has ownership interests in two refineries in Illinois and Texas, United States. Its web site is here Cenovus. See my spreadsheet at cve.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 or StockTwits.
Thursday, November 15, 2012
Cenovus Energy Inc
I do not own this stock of Cenovus Energy Inc. (TSX-CVE, NYSE-CVE). I did own the predecessor company of EnCana. However, when they were going to split EnCana into two companies, I sold my shares. I have very little of this company and did not want to have to deal with two even smaller holdings. I held this company (as Alberta Energy Co) from 2000 to 2000 and then as EnCana from 2006 to 2009. I made a return of 15% per year on these holdings. My first holding gave me an 18% per year return and my second holding gave me a 9.5% per year return.
I sometimes venture into oil and gas companies and they are a large part of the TSX. I like to know what is going on in this sector, but I really do not like investing much in it. Currently I hold some Husky (TSX-HSE) and Canadian Natural Resources Ltd. (TSX-CNQ).
First of all I should say that my spreadsheet follows Alberta Energy Company Ltd. to EnCana to Cenovus. The dividend growth looks really good with growth over the past 5 and 10 years at 31% and 24% per year. However, since the change to Cenovus, there has been one increase of 10% in 2011. Dividends did not increase in 2010 and so far, have not increased in 2012.
The dividend yield is decent at 2.6% and the 5 year median dividend yield is 2.76%. However, prior to 2008 dividends were hovering around 1%, which is a rather low dividend. The 5 year median Dividend Payout Ratio for earnings is quite good at 45%. However, since 2009 DPR for earnings would be closer to 60%. The DPR for cash flow is around 20% after before 2009 and was under 10% prior.
The total return for the last 5 and 10 years was 7.6% and 15.04% per year. The dividend portion was 2.63% and 2.2% per year and the capital gains were 4.97% and 12.84% per year. Dividend made up 35% and 15% of the total return over the past 5 and 10 years.
The change in outstanding shares is down 0.6% per year over the past 5 years and up 4% per year over the past 10 years. Outstanding shares are only up slightly since 2009. Revenue is up 12% and 17% per year over the past 5 and 10 years. Revenue per Share is up 13% and 12% per year over the past 5 and 10 years.
Over the past 5 years, earnings are down 13% per year. Over the past 10 years earnings are up 9% per year. Over the past 5 and 10 years, cash flow is up 5% and 8% per year, respectively. Over the past 5 and 10 years Book Value is 0% and 13% per year.
The current Liquidity Ratio is 1.49, which is just ok and this ratio has been lower as it has a 5 year median value of just1.15. However, this stock has had strong cash flow and including cash flow after dividends, the ratio would be a very good 1.94 for a 5 year median value.
The Debt Ratio has always been quite good and this stock has a current ratio of 1.70. The current Leverage and Debt/Equity Ratios are fine at 2.42 and 1.42.
The Return on Equity for the financial year ending in 2011 was 15.7% and the 5 year median ROE is 15.7%. These are good values. The ROE on comprehensive income is a little higher at 16.2% and this ROE has a 5 year median of 13% because this ROE has been a bit lower than the ROE on net income over the past few years.
Shareholders have done well in this stock. However, note that often dividends on oil and gas companies can fluctuate with the price of oil and gas.
Cenovus Energy Inc. is an integrated oil company. The Company's operations include enhanced oil recovery (EOR) properties and established crude oil and natural gas production in Alberta and Saskatchewan. It also has ownership interests in two refineries in Illinois and Texas, United States. Its web site is here Cenovus. See my spreadsheet at cve.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 or StockTwits.
I sometimes venture into oil and gas companies and they are a large part of the TSX. I like to know what is going on in this sector, but I really do not like investing much in it. Currently I hold some Husky (TSX-HSE) and Canadian Natural Resources Ltd. (TSX-CNQ).
First of all I should say that my spreadsheet follows Alberta Energy Company Ltd. to EnCana to Cenovus. The dividend growth looks really good with growth over the past 5 and 10 years at 31% and 24% per year. However, since the change to Cenovus, there has been one increase of 10% in 2011. Dividends did not increase in 2010 and so far, have not increased in 2012.
The dividend yield is decent at 2.6% and the 5 year median dividend yield is 2.76%. However, prior to 2008 dividends were hovering around 1%, which is a rather low dividend. The 5 year median Dividend Payout Ratio for earnings is quite good at 45%. However, since 2009 DPR for earnings would be closer to 60%. The DPR for cash flow is around 20% after before 2009 and was under 10% prior.
The total return for the last 5 and 10 years was 7.6% and 15.04% per year. The dividend portion was 2.63% and 2.2% per year and the capital gains were 4.97% and 12.84% per year. Dividend made up 35% and 15% of the total return over the past 5 and 10 years.
The change in outstanding shares is down 0.6% per year over the past 5 years and up 4% per year over the past 10 years. Outstanding shares are only up slightly since 2009. Revenue is up 12% and 17% per year over the past 5 and 10 years. Revenue per Share is up 13% and 12% per year over the past 5 and 10 years.
Over the past 5 years, earnings are down 13% per year. Over the past 10 years earnings are up 9% per year. Over the past 5 and 10 years, cash flow is up 5% and 8% per year, respectively. Over the past 5 and 10 years Book Value is 0% and 13% per year.
The current Liquidity Ratio is 1.49, which is just ok and this ratio has been lower as it has a 5 year median value of just1.15. However, this stock has had strong cash flow and including cash flow after dividends, the ratio would be a very good 1.94 for a 5 year median value.
The Debt Ratio has always been quite good and this stock has a current ratio of 1.70. The current Leverage and Debt/Equity Ratios are fine at 2.42 and 1.42.
The Return on Equity for the financial year ending in 2011 was 15.7% and the 5 year median ROE is 15.7%. These are good values. The ROE on comprehensive income is a little higher at 16.2% and this ROE has a 5 year median of 13% because this ROE has been a bit lower than the ROE on net income over the past few years.
Shareholders have done well in this stock. However, note that often dividends on oil and gas companies can fluctuate with the price of oil and gas.
Cenovus Energy Inc. is an integrated oil company. The Company's operations include enhanced oil recovery (EOR) properties and established crude oil and natural gas production in Alberta and Saskatchewan. It also has ownership interests in two refineries in Illinois and Texas, United States. Its web site is here Cenovus. See my spreadsheet at cve.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 or StockTwits.
Wednesday, November 14, 2012
Exco Technologies Ltd 2
On my other blog I have written about beating the market...continue...
I do not own this stock of Exco Technologies (TSX-XTC). This is a stock given as a recommendation by Keystone at the Toronto Money Show of 2012. I decided to check into it as it is a small tech company that is paying dividends. Also, I decided to review this stock because Keystone has recommended some very good stocks in the past.
When I look at insider trading I find $0.5M of insider buying and $1.5M of insider selling with $1M of net insider selling. The insider buying was for every category and insider selling was by CEO and officers. The company was also buying back shares for cancellation. Insiders do have options (with directors also having Deferred Share Units), but in all categories, most insiders have more common shares than options. There is a fair amount insider ownership. Looking at insider with big positions, they have 35% of the outstanding shares.
There seems to be 6 institutions that own some 15% of the outstanding shares. Over the past 3 months they have sold 3.7% of their shares. (It would appear that one institution closed its position in these shares.)
The 5 year low, median and high median Price/Earnings Ratios (excluding negative P/Es of 2008 and 2009) are 7.00, 7.63 and 9.46. The current P/E ratio using current stock price of $4.97 and September 2013 earnings of 0.61 is 8.15. This would suggest the stock price is a bit high, but reasonable. However, a P/E of 8.15 is a low one on an absolute basis.
I get a Graham Price of $6.85 and the 10 year low, median and high median Price/Graham Price is 0.82, 1.20 and 1.47. The current P/GP Ratio is 0.73 and this would suggest a cheap current stock price.
I get a 10 year Price/Book Value Ratio of 1.14 and a current P/B Ratio of 1.45. The current one is some 27% higher than the 10 year ratio and this suggests that the stock price is a bit high. (The problem with this test is that Book Value will drop if there are negative earning years.)
The 5 year dividend yield is 2.8% and the current dividend yield is 3%, a value almost some 8% higher. This also suggests that the stock price reasonable to low. If you get mixed signals, you probably should go with the dividend yield unless there is a reason not to.
When I look at analysts' recommendations, I find Strong Buy and Buy. The consensus recommendations would be a Strong Buy. The 12 month stock price is 6.25. This implies a total return of 28.17%, with 25.75% from capital gains and 2.41% from dividends.
There is an interesting article about small cap dividend paying Canadian Stocks at Seeking Alpha that includes this stock.
It is obvious that some analysts are treating this stock as a hot one. The stock is up some 47% over the past year, although most of that gain was in the first part of 2012 and it has been quite flat since. Maybe it will take off at the end of this year if the economy stays fine. I feel certain that the US will not go over the fiscal cliff, although I think that any deal will probably be at the 11th hour.
It would seem that the stock price is low to reasonable. (The big thing is not to overbuy for a stock.)
Exco is a global designer, developer and manufacturer of dies, moulds, equipment, components and assemblies to the die-cast, extrusion and automotive industries. The Die Casting and Extrusion Technology groups operations are based in Canada, U.S., Mexico and Colombia and primarily serve automotive and industrial markets throughout the world. The Automotive Solutions Group has facilities are located in Canada, U.S., Mexico and Morocco and supply the North American, European and Asian markets. Its web site is here Exco. See my spreadsheet at xtc.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 or StockTwits.
I do not own this stock of Exco Technologies (TSX-XTC). This is a stock given as a recommendation by Keystone at the Toronto Money Show of 2012. I decided to check into it as it is a small tech company that is paying dividends. Also, I decided to review this stock because Keystone has recommended some very good stocks in the past.
When I look at insider trading I find $0.5M of insider buying and $1.5M of insider selling with $1M of net insider selling. The insider buying was for every category and insider selling was by CEO and officers. The company was also buying back shares for cancellation. Insiders do have options (with directors also having Deferred Share Units), but in all categories, most insiders have more common shares than options. There is a fair amount insider ownership. Looking at insider with big positions, they have 35% of the outstanding shares.
There seems to be 6 institutions that own some 15% of the outstanding shares. Over the past 3 months they have sold 3.7% of their shares. (It would appear that one institution closed its position in these shares.)
The 5 year low, median and high median Price/Earnings Ratios (excluding negative P/Es of 2008 and 2009) are 7.00, 7.63 and 9.46. The current P/E ratio using current stock price of $4.97 and September 2013 earnings of 0.61 is 8.15. This would suggest the stock price is a bit high, but reasonable. However, a P/E of 8.15 is a low one on an absolute basis.
I get a Graham Price of $6.85 and the 10 year low, median and high median Price/Graham Price is 0.82, 1.20 and 1.47. The current P/GP Ratio is 0.73 and this would suggest a cheap current stock price.
I get a 10 year Price/Book Value Ratio of 1.14 and a current P/B Ratio of 1.45. The current one is some 27% higher than the 10 year ratio and this suggests that the stock price is a bit high. (The problem with this test is that Book Value will drop if there are negative earning years.)
The 5 year dividend yield is 2.8% and the current dividend yield is 3%, a value almost some 8% higher. This also suggests that the stock price reasonable to low. If you get mixed signals, you probably should go with the dividend yield unless there is a reason not to.
When I look at analysts' recommendations, I find Strong Buy and Buy. The consensus recommendations would be a Strong Buy. The 12 month stock price is 6.25. This implies a total return of 28.17%, with 25.75% from capital gains and 2.41% from dividends.
There is an interesting article about small cap dividend paying Canadian Stocks at Seeking Alpha that includes this stock.
It is obvious that some analysts are treating this stock as a hot one. The stock is up some 47% over the past year, although most of that gain was in the first part of 2012 and it has been quite flat since. Maybe it will take off at the end of this year if the economy stays fine. I feel certain that the US will not go over the fiscal cliff, although I think that any deal will probably be at the 11th hour.
It would seem that the stock price is low to reasonable. (The big thing is not to overbuy for a stock.)
Exco is a global designer, developer and manufacturer of dies, moulds, equipment, components and assemblies to the die-cast, extrusion and automotive industries. The Die Casting and Extrusion Technology groups operations are based in Canada, U.S., Mexico and Colombia and primarily serve automotive and industrial markets throughout the world. The Automotive Solutions Group has facilities are located in Canada, U.S., Mexico and Morocco and supply the North American, European and Asian markets. Its web site is here Exco. See my spreadsheet at xtc.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 or StockTwits.
Tuesday, November 13, 2012
Exco Technologies Ltd
I do not own this stock of Exco Technologies(TSX-XTC). This is a stock given as a recommendation by Keystone at the Toronto Money Show of 2012. I decided to check into it as it is a small tech company that is paying dividends. Also, I decided to review this stock because Keystone has recommended some very good stocks in the past. One first thing I liked about this stock is that I had no trouble finding their financial statements and their site had statements going back to 1997.
I generally do like it when a company continues to pay dividends when not earning any money. They did not earn money in 2006, then in 2008 and 2009. However, they said they continued with the dividends as they had enough cash flow to pay them. They were right on this as the 5 year median Dividend Payout Ratios for Cash Flow is just 20% and the for Adjusted Cash flow is 17%.
Dividend is a decent 2.4% and the 5 year medina dividend is at 2.8%. The dividends have grown over the past 5 and 8 years at 16% and 9.7% per year, respectively. Dividends were started in 2003.
As far as total return is concerned, investors have not made any. In fact, stock is really back to where it was in 1997, some 15 years ago. (Although there have been stocks splits in the past.) The only change is that dividends are now being paid, as dividend payments started in 2003. (Even with dividends, the investors in this stock are just about breaking even after 5 and 10 years.
The change in outstanding shares over the past 5 years is that they are down 0.28% and over the past 10 years they are up 0.42%. These are nominal changes and mostly the changes are for issuance of shares under Employee Stock Purchase Plan and for Stock Option Plan. They have also purchased and cancel shares.
There is not much in the way of growth in revenue, with revenue down 1.1% over the past 5 years and up 0.8% over the past 10 years. The revenue per share is down 0.8% over the past 5 years and up 0.4% over the past 10 years.
There is some growth in Earnings per Share with 5 year growth in EPS at 4.9% per year and 10 year growth at 2.7% per year. There were three years in the past 5 years where there were earnings losses. Cash flow growth is a bit mixed with 5 year growth at 2.5% per year and over the past 10 years cash flow has declined by 2.5%. However, cash flow has always been positive.
Book value growth has not been good either. Book value has declined by 2.5% per year over the past 5 years. (This would be mainly because of earnings losses.) Book Value has increased over the past 10 years by 1% per year.
The return on equity for the year ending September 2011 was good at 11.3%. However, 5 year median ROE is just 2.1% for the financial year ending in September 2011. (There were losses during the past 5 years.) The ROE for the last 12 months is a bit better at 14%. The ROE on comprehensive income for the year ending September 2011 is 12.1%. This has a 5 year median value of -1.7% as there were years of comprehensive losses within the past 5 years.
The Liquidity Ratio has always been quite good and the one for the financial year ending in September 2011 was at 3.31. The current Liquidity Ratio is also quite good at 3.69. The Debt Ratio is also very good with the current one at 5.37. The current Leverage and Debt/Equity Ratios are also quite good at 1.23 and 0.23.
This stock is a bit of a disappointment to me. I know that they are in the auto industry and probably have done well considering what other such companies in this industry have done. However Keystone's stocks have generally been quite profitable companies to invest in and this company just isn't profitable for current shareholders.
What Keystone said they liked was that they felt that the company has a great future ahead. They also liked the dividend with nice increases, the Dividend Payout Ratio for cash flow and that management and insiders owned 35% of the company. I discussed the dividends above and insiders do own at least 35% of this company.
Exco is a global designer, developer and manufacturer of dies, moulds, equipment, components and assemblies to the die-cast, extrusion and automotive industries. The Die Casting and Extrusion Technology groups operations are based in Canada, U.S., Mexico and Colombia and primarily serve automotive and industrial markets throughout the world. The Automotive Solutions Group has facilities are located in Canada, U.S., Mexico and Morocco and supply the North American, European and Asian markets. Its web site is here Exco. See my spreadsheet at xtc.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 or StockTwits.
I generally do like it when a company continues to pay dividends when not earning any money. They did not earn money in 2006, then in 2008 and 2009. However, they said they continued with the dividends as they had enough cash flow to pay them. They were right on this as the 5 year median Dividend Payout Ratios for Cash Flow is just 20% and the for Adjusted Cash flow is 17%.
Dividend is a decent 2.4% and the 5 year medina dividend is at 2.8%. The dividends have grown over the past 5 and 8 years at 16% and 9.7% per year, respectively. Dividends were started in 2003.
As far as total return is concerned, investors have not made any. In fact, stock is really back to where it was in 1997, some 15 years ago. (Although there have been stocks splits in the past.) The only change is that dividends are now being paid, as dividend payments started in 2003. (Even with dividends, the investors in this stock are just about breaking even after 5 and 10 years.
The change in outstanding shares over the past 5 years is that they are down 0.28% and over the past 10 years they are up 0.42%. These are nominal changes and mostly the changes are for issuance of shares under Employee Stock Purchase Plan and for Stock Option Plan. They have also purchased and cancel shares.
There is not much in the way of growth in revenue, with revenue down 1.1% over the past 5 years and up 0.8% over the past 10 years. The revenue per share is down 0.8% over the past 5 years and up 0.4% over the past 10 years.
There is some growth in Earnings per Share with 5 year growth in EPS at 4.9% per year and 10 year growth at 2.7% per year. There were three years in the past 5 years where there were earnings losses. Cash flow growth is a bit mixed with 5 year growth at 2.5% per year and over the past 10 years cash flow has declined by 2.5%. However, cash flow has always been positive.
Book value growth has not been good either. Book value has declined by 2.5% per year over the past 5 years. (This would be mainly because of earnings losses.) Book Value has increased over the past 10 years by 1% per year.
The return on equity for the year ending September 2011 was good at 11.3%. However, 5 year median ROE is just 2.1% for the financial year ending in September 2011. (There were losses during the past 5 years.) The ROE for the last 12 months is a bit better at 14%. The ROE on comprehensive income for the year ending September 2011 is 12.1%. This has a 5 year median value of -1.7% as there were years of comprehensive losses within the past 5 years.
The Liquidity Ratio has always been quite good and the one for the financial year ending in September 2011 was at 3.31. The current Liquidity Ratio is also quite good at 3.69. The Debt Ratio is also very good with the current one at 5.37. The current Leverage and Debt/Equity Ratios are also quite good at 1.23 and 0.23.
This stock is a bit of a disappointment to me. I know that they are in the auto industry and probably have done well considering what other such companies in this industry have done. However Keystone's stocks have generally been quite profitable companies to invest in and this company just isn't profitable for current shareholders.
What Keystone said they liked was that they felt that the company has a great future ahead. They also liked the dividend with nice increases, the Dividend Payout Ratio for cash flow and that management and insiders owned 35% of the company. I discussed the dividends above and insiders do own at least 35% of this company.
Exco is a global designer, developer and manufacturer of dies, moulds, equipment, components and assemblies to the die-cast, extrusion and automotive industries. The Die Casting and Extrusion Technology groups operations are based in Canada, U.S., Mexico and Colombia and primarily serve automotive and industrial markets throughout the world. The Automotive Solutions Group has facilities are located in Canada, U.S., Mexico and Morocco and supply the North American, European and Asian markets. Its web site is here Exco. See my spreadsheet at xtc.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 or StockTwits.
Monday, November 12, 2012
Canadian Oil Sands 2
On my other blog I have written about current dividend growth...continue...
I do not own this stock of Canadian Oil Sands (TSX-COS). I started to follow it in 2010 because when anyone talks about investing in the Canadian Oil Sands sector, this is the stock that seems to be mentioned first. As with any other investment in oil companies, if the dividend is good, then it will vary according to the price of oil.
Looking at insider trading, I find that over the past year there is $3M in insider selling and $0.6M in insider buying for a net insider selling of $2.4M. Insiders not only have options, but Performance Units and Deferred Share Units.
There are a lot of options outstanding and some people with millions in shares. For example, the CEO has $26.6M in shares and $27M in options. An officer has $1.6M in shares and $3.7M in options. A director has 0.6M in shares and 0.2M in options.
It would seem that some 211 institutions hold shares in this company equal to 30% of the outstanding shares. Over the past 3 months they have reduced their holdings marginally (i.e. by less than 1%).
The 5 year low, median and high median Price/Earnings Ratios are 13.39, 15.50 and 17.61. The current P/E ratio is 10.24 based on 2012 earnings of $1.35 and current stock price of $20.59. This low P/E ratio suggests that the stock price is cheap.
I get a Graham Price of $20.41 and the 10 year low, median and high median Price/Graham Price Ratios are 0.86, 1.37 and 1.66. The current P/GP Ratio at 0.91 shows that the current stock price is reasonable.
I get a 10 year Price/Book Value per share Ratio of 2.96 and the current P/B Ratio at 2.24 shows that the current stock price is cheap. The current ratio is only 76% of the 10 year median ratio.
The current dividend yield is 6.8% and the 5 year median dividend yield is 5.16%. The current year is some 32% higher than the 5 year dividend yield is this shows that the current stock price is cheap.
The analysts' recommendations are Strong Buy, Hold and Underperform. (There is no Buy recommendation.) The consensus recommendation would be a Hold. The 12 month consensus stock price is $21.60. This suggests a total return of 11.7% with 6.8% from dividends and 4.9% from capital gains.
Analysts talk about their good dividend (6.8%). Also mentioned is the bottleneck of getting oil sands oil to refiners in Midwest US because of lack of pipeline capacity. There is a financial post article saying that all of Canada benefits from the oil sands development.
It would appear that this is a good company and the stock is relatively cheap. However, this statement also depends on the future price of oil.
Canadian Oil Sands Trust provides a pure investment opportunity in the oil sands through its 36.74% interest in the Syncrude Project. Syncrude is an experienced oil sands operator, producing a high-quality crude oil for the past 30 years. With large, bitumen-rich leases located in the sweet spot of the Athabasca oil sands deposit and a fully integrated upgrading facility that produces 100% light, sweet crude oil, the quality of their Syncrude asset is very good. Its web site is here CDN Oil Sands. See my spreadsheet at cos.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 or StockTwits.
I do not own this stock of Canadian Oil Sands (TSX-COS). I started to follow it in 2010 because when anyone talks about investing in the Canadian Oil Sands sector, this is the stock that seems to be mentioned first. As with any other investment in oil companies, if the dividend is good, then it will vary according to the price of oil.
Looking at insider trading, I find that over the past year there is $3M in insider selling and $0.6M in insider buying for a net insider selling of $2.4M. Insiders not only have options, but Performance Units and Deferred Share Units.
There are a lot of options outstanding and some people with millions in shares. For example, the CEO has $26.6M in shares and $27M in options. An officer has $1.6M in shares and $3.7M in options. A director has 0.6M in shares and 0.2M in options.
It would seem that some 211 institutions hold shares in this company equal to 30% of the outstanding shares. Over the past 3 months they have reduced their holdings marginally (i.e. by less than 1%).
The 5 year low, median and high median Price/Earnings Ratios are 13.39, 15.50 and 17.61. The current P/E ratio is 10.24 based on 2012 earnings of $1.35 and current stock price of $20.59. This low P/E ratio suggests that the stock price is cheap.
I get a Graham Price of $20.41 and the 10 year low, median and high median Price/Graham Price Ratios are 0.86, 1.37 and 1.66. The current P/GP Ratio at 0.91 shows that the current stock price is reasonable.
I get a 10 year Price/Book Value per share Ratio of 2.96 and the current P/B Ratio at 2.24 shows that the current stock price is cheap. The current ratio is only 76% of the 10 year median ratio.
The current dividend yield is 6.8% and the 5 year median dividend yield is 5.16%. The current year is some 32% higher than the 5 year dividend yield is this shows that the current stock price is cheap.
The analysts' recommendations are Strong Buy, Hold and Underperform. (There is no Buy recommendation.) The consensus recommendation would be a Hold. The 12 month consensus stock price is $21.60. This suggests a total return of 11.7% with 6.8% from dividends and 4.9% from capital gains.
Analysts talk about their good dividend (6.8%). Also mentioned is the bottleneck of getting oil sands oil to refiners in Midwest US because of lack of pipeline capacity. There is a financial post article saying that all of Canada benefits from the oil sands development.
It would appear that this is a good company and the stock is relatively cheap. However, this statement also depends on the future price of oil.
Canadian Oil Sands Trust provides a pure investment opportunity in the oil sands through its 36.74% interest in the Syncrude Project. Syncrude is an experienced oil sands operator, producing a high-quality crude oil for the past 30 years. With large, bitumen-rich leases located in the sweet spot of the Athabasca oil sands deposit and a fully integrated upgrading facility that produces 100% light, sweet crude oil, the quality of their Syncrude asset is very good. Its web site is here CDN Oil Sands. See my spreadsheet at cos.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 or StockTwits.
Friday, November 9, 2012
Canadian Oil Sands
I do not own this stock of Canadian Oil Sands (TSX-COS). I started to follow it in 2010 because when anyone talks about investing in the Canadian Oil Sands sector, this is the stock that seems to be mentioned first. As with any other investment in oil companies, if the dividend is good, then it will vary according to the price of oil.
Currently the yield on this stock is very good at 6.8%. Because the stock dividend varies, there is no 5 year growth in dividends. I have a 10 year growth in dividends at 8.42% per year. The thing is that over time you can get a lot in dividends. Look at the total return over the past 5 and 10 years. The dividend portion of the total return attributable to dividends is 6.47% and 8.07% per year over these periods.
The total return over the past 5 was a loss of .07% per year, which is not good. However, the total return over the past 10 years was 19.75% per year. There was a capital loss of 6.54% per year over the past 5 years and a capital gain of 11.68% per year over the past 10 years.
The outstanding shares have grown at the rate of 0.57% and 5.49% per year over the past 5 and 10 years. In 2003, the outstanding shares doubled because of new shares issued. Other than that most of the increases are small and are mostly for stock options issued.
Revenue has grown over the past 5 and 10 years at the rate of 9.2% and 20% per year. The Revenue per Share has grown at the rate 8.6% and 13.8% per year over the past 5 and 10 years. (The difference is, of course, due to changes in outstanding shares.)
Earnings per Share have grown at the rate of 5.8% and 14.8% per year over the past 5 and 10 years. EPS is expected to be lower for 2012 than it was for 2011, but EPS does tend to fluctuate for this stock. However, EPS is always positive. Cash Flow per Share has grown at the rate of 10.5% and 17.2% per year over the past 5 and 10 years. Book Value per Share has grown at the rate of 0.7% and 11.9% per year over the past 5 and 10 years. Growth is a bit inconsistent, but generally good.
Return on Equity for the financial year ending December 2011 was very good at 27.2%. The 5 year median ROE is also very good at 22.4%. The ROE based on the comprehensive income is not far off the ROE on net income and was 24.1% for the financial year ending in December 2011. The 5 year median ROE on comprehensive income is closer at 22.2%.
The current Liquidity Ratio is 1.93, which is very good. The 5 year median Ratio is also very good at 2.05. Also this stock does have a strong cash flow. The current Debt Ratio is also very good at 1.81. The 5 year ratio is good at 2.29. The current Leverage Debt/Equity Ratios are also fine at 2.23 and 1.23.
This is different from other dividend stocks I follow in that the dividend fluctuates. However, you can earn great dividends over time if you can stand the risk.
Canadian Oil Sands Trust provides a pure investment opportunity in the oil sands through its 36.74% interest in the Syncrude Project. Syncrude is an experienced oil sands operator, producing a high-quality crude oil for the past 30 years. With large, bitumen-rich leases located in the sweet spot of the Athabasca oil sands deposit and a fully integrated upgrading facility that produces 100% light, sweet crude oil, the quality of their Syncrude asset is very good. Its web site is here CDN Oil Sands. See my spreadsheet at cos.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 or StockTwits.
Currently the yield on this stock is very good at 6.8%. Because the stock dividend varies, there is no 5 year growth in dividends. I have a 10 year growth in dividends at 8.42% per year. The thing is that over time you can get a lot in dividends. Look at the total return over the past 5 and 10 years. The dividend portion of the total return attributable to dividends is 6.47% and 8.07% per year over these periods.
The total return over the past 5 was a loss of .07% per year, which is not good. However, the total return over the past 10 years was 19.75% per year. There was a capital loss of 6.54% per year over the past 5 years and a capital gain of 11.68% per year over the past 10 years.
The outstanding shares have grown at the rate of 0.57% and 5.49% per year over the past 5 and 10 years. In 2003, the outstanding shares doubled because of new shares issued. Other than that most of the increases are small and are mostly for stock options issued.
Revenue has grown over the past 5 and 10 years at the rate of 9.2% and 20% per year. The Revenue per Share has grown at the rate 8.6% and 13.8% per year over the past 5 and 10 years. (The difference is, of course, due to changes in outstanding shares.)
Earnings per Share have grown at the rate of 5.8% and 14.8% per year over the past 5 and 10 years. EPS is expected to be lower for 2012 than it was for 2011, but EPS does tend to fluctuate for this stock. However, EPS is always positive. Cash Flow per Share has grown at the rate of 10.5% and 17.2% per year over the past 5 and 10 years. Book Value per Share has grown at the rate of 0.7% and 11.9% per year over the past 5 and 10 years. Growth is a bit inconsistent, but generally good.
Return on Equity for the financial year ending December 2011 was very good at 27.2%. The 5 year median ROE is also very good at 22.4%. The ROE based on the comprehensive income is not far off the ROE on net income and was 24.1% for the financial year ending in December 2011. The 5 year median ROE on comprehensive income is closer at 22.2%.
The current Liquidity Ratio is 1.93, which is very good. The 5 year median Ratio is also very good at 2.05. Also this stock does have a strong cash flow. The current Debt Ratio is also very good at 1.81. The 5 year ratio is good at 2.29. The current Leverage Debt/Equity Ratios are also fine at 2.23 and 1.23.
This is different from other dividend stocks I follow in that the dividend fluctuates. However, you can earn great dividends over time if you can stand the risk.
Canadian Oil Sands Trust provides a pure investment opportunity in the oil sands through its 36.74% interest in the Syncrude Project. Syncrude is an experienced oil sands operator, producing a high-quality crude oil for the past 30 years. With large, bitumen-rich leases located in the sweet spot of the Athabasca oil sands deposit and a fully integrated upgrading facility that produces 100% light, sweet crude oil, the quality of their Syncrude asset is very good. Its web site is here CDN Oil Sands. See my spreadsheet at cos.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 or StockTwits.
Thursday, November 8, 2012
Ballard Power Systems Inc 2
I do not own this stock of Ballard Power Systems Inc. (TSX-BLD, NASDAQ-BLDP), but I used to. This stock was one of a number of stocks I bought in the late 1990's to get a basket full of small cap stocks. I bought a number of small caps, but I never made money on any of them. The main problem was the bear market that occurred in the 2000. None of my stock recovered from that.
There is a minimal amount of insider selling according to the insider trading report. There is not insider buying. Everyone has more options than shares. Not only are there options, but there are Deferred Share Units, Restricted Share Units, Units Deferred Share Units and Units Restricted Share Units.
NASDAQ says that as of September 30. 2012, 45 institutions hold 5.62% of the shares of this company, and shares have increased by 18% over the past year.
I can reach not conclusion on stock price using Price/Earnings because there are not earnings. This also presents a problem for Graham No. as this number is based partly on earnings also.
The 10 year median Price/Book Value per Share Ratio is 1.19. The current Ratio is 0.77. This current ratio is only some 65% of the 10 year median Ratio and this low ratio suggests a cheap stock price. The ratio being under 1.00 also suggests a cheap stock price. (This is because stock is selling lower than the book value.)
The 5 year median Price/Sales Ratio is 3.57. The current P/S Ratio is just 0.88. This low current ratio suggests the stock price is cheap. The P/S Ratio being below 1.00 also suggests a good stock price. (Often analysts look at P/S Ratio on companies that are not earning any profits to help decide if the stock price is appropriate.)
When I look at analysts' recommendations I find Buy and Hold recommendations. The consensus recommendation would be a Hold. The 12 month consensus stock is $2.00 and this implies capital gains of 186%. There are, of course, analysts that think giving a 12 month stock price is nonsense.
A couple of analysts said that they stopped following this company has it cannot make any money. See post by Seeking Alpha. He does not much care for Ballard. However, another blogger on Seeking Alpha quite likes Ballard.
There is an article in Canadian Business about Ballard signing a supply deal with a new African Distributor. There is also a recent article in Canadian Newswire about Ballard fuel cells being reliable during Hurricane Sandy.
I must admit that I have been disappointed in this company because it does not seem capable of making money.
Ballard Power Systems designs and manufactures clean energy hydrogen fuel cells. Better energy, delivered through our focused fuel cell innovations, offers the Power to Change end-user applications, while also improving the environment. Its web site is here Ballard. See my spreadsheet at bld.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 or StockTwits.
There is a minimal amount of insider selling according to the insider trading report. There is not insider buying. Everyone has more options than shares. Not only are there options, but there are Deferred Share Units, Restricted Share Units, Units Deferred Share Units and Units Restricted Share Units.
NASDAQ says that as of September 30. 2012, 45 institutions hold 5.62% of the shares of this company, and shares have increased by 18% over the past year.
I can reach not conclusion on stock price using Price/Earnings because there are not earnings. This also presents a problem for Graham No. as this number is based partly on earnings also.
The 10 year median Price/Book Value per Share Ratio is 1.19. The current Ratio is 0.77. This current ratio is only some 65% of the 10 year median Ratio and this low ratio suggests a cheap stock price. The ratio being under 1.00 also suggests a cheap stock price. (This is because stock is selling lower than the book value.)
The 5 year median Price/Sales Ratio is 3.57. The current P/S Ratio is just 0.88. This low current ratio suggests the stock price is cheap. The P/S Ratio being below 1.00 also suggests a good stock price. (Often analysts look at P/S Ratio on companies that are not earning any profits to help decide if the stock price is appropriate.)
When I look at analysts' recommendations I find Buy and Hold recommendations. The consensus recommendation would be a Hold. The 12 month consensus stock is $2.00 and this implies capital gains of 186%. There are, of course, analysts that think giving a 12 month stock price is nonsense.
A couple of analysts said that they stopped following this company has it cannot make any money. See post by Seeking Alpha. He does not much care for Ballard. However, another blogger on Seeking Alpha quite likes Ballard.
There is an article in Canadian Business about Ballard signing a supply deal with a new African Distributor. There is also a recent article in Canadian Newswire about Ballard fuel cells being reliable during Hurricane Sandy.
I must admit that I have been disappointed in this company because it does not seem capable of making money.
Ballard Power Systems designs and manufactures clean energy hydrogen fuel cells. Better energy, delivered through our focused fuel cell innovations, offers the Power to Change end-user applications, while also improving the environment. Its web site is here Ballard. See my spreadsheet at bld.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 or StockTwits.
Wednesday, November 7, 2012
Ballard Power Systems Inc
On my other blog I have written about investors being individuals and part of a mob...continue...
In the late 1990's I read about investing in small cap stock. The article said that you should invest in a basket that contained at least 5 stocks. The theory was that you could only lose what you have invested, but the sky's the limit to what you can gain. What you needed was only about 20% or 2 in 5 stocks being successful to make money on small caps. So, I bought a number of small caps, but I never made money on any of them.
The main problem was the bear market that occurred in the 2000. None of my stock recovered from that. Take this company, Ballard Power Systems Inc. (TSX-BLD, NASDAQ-BLDP), which I invested in, in 1997 and sold in 2006. I lost 5.3% per year or 38% of my investment. While, at least this stock is still around and on the stock market. I still think that fuel cells are a good idea, but I am also curious to see if they will ever make any money.
There are a couple of things that complicate viewing this stock. One is that its financial statements are in US$. The other thing is the change in outstanding shares. When outstanding shares change you get different growth rates between the company's growth and growth per share. Most of what I look at is growth per share.
For this company, the outstanding shares have gone down by 5.84% and 2.13% per year over the past 5 and 10 years. Mostly the outstanding shares have gone up a bit each year because stock options. However in 2008, for value received, Ford and Daimler returned some 34M shares to the company and these shares were cancelled. That year the outstanding shares fell 29% and this accounts for the decreasing shares over the past 5 and 10 years.
Revenue has grown by 8.8% and 7.7% per year over the past 5 and 10 years. Revenue per share has grown at the rate of 15.5% and 10% per year over the past 5 and 10 years. The difference in growth is due, of course, to the change in outstanding shares. Both these growth rates are lower in CDN$ terms.
There is no growth in earnings per share because this company has had positive earnings in very few years. Lately all earnings has been negative. Analysts feel that the company's losses will decrease over the next two years but do not see any positive EPS.
Looking at this on the CDN or US Stock exchange still shows the same thing. The stock price has been going down since 2000. In CDN terms, stock price has fallen 30% and 31% per year over the 5 and 10 years. Drop in stock price in US$ terms is similar.
There is also no growth in cash flow (or cash flow per share) as this company has no positive cash flow. As far as book value is concerned, this stock hit the top in 2001 and book value has been declining ever since. In CDN$ terms, book value is down 19% and 22% per year over the past 5 and 10 years.
Because there are no earnings, there is no Return on Equity.
The Liquidity Ratio is quite good at 1.88 for the financial year ending in December 2011. However, when you include the cash flow in this ratio it is down to 1.08. When you also consider spending on assets, this ratio is down to 0.99.
The Debt Ratio for the financial year ending in 2011 is good at 2.27. The current Debt Ratio is lower at 2.07. However, this is still a very good ratio. The current Leverage and Debt/Equity Ratios are fine at 1.93 and 0.93.
I think that the last thing to mention is that Cash and Cash Equivalents was $20M at the end of December 2011 and it is currently half of that, at $10M, at the end of September 2012. They do seem to be trying to reduce their costs.
I must admit that I am no longer interested in investing in a company that is not making any money. I still hope that they are able to make a go of their fuel cell technology.
Ballard Power Systems designs and manufactures clean energy hydrogen fuel cells. Better energy, delivered through our focused fuel cell innovations, offers the Power to Change end-user applications, while also improving the environment. Its web site is here Ballard. See my spreadsheet at bld.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
In the late 1990's I read about investing in small cap stock. The article said that you should invest in a basket that contained at least 5 stocks. The theory was that you could only lose what you have invested, but the sky's the limit to what you can gain. What you needed was only about 20% or 2 in 5 stocks being successful to make money on small caps. So, I bought a number of small caps, but I never made money on any of them.
The main problem was the bear market that occurred in the 2000. None of my stock recovered from that. Take this company, Ballard Power Systems Inc. (TSX-BLD, NASDAQ-BLDP), which I invested in, in 1997 and sold in 2006. I lost 5.3% per year or 38% of my investment. While, at least this stock is still around and on the stock market. I still think that fuel cells are a good idea, but I am also curious to see if they will ever make any money.
There are a couple of things that complicate viewing this stock. One is that its financial statements are in US$. The other thing is the change in outstanding shares. When outstanding shares change you get different growth rates between the company's growth and growth per share. Most of what I look at is growth per share.
For this company, the outstanding shares have gone down by 5.84% and 2.13% per year over the past 5 and 10 years. Mostly the outstanding shares have gone up a bit each year because stock options. However in 2008, for value received, Ford and Daimler returned some 34M shares to the company and these shares were cancelled. That year the outstanding shares fell 29% and this accounts for the decreasing shares over the past 5 and 10 years.
Revenue has grown by 8.8% and 7.7% per year over the past 5 and 10 years. Revenue per share has grown at the rate of 15.5% and 10% per year over the past 5 and 10 years. The difference in growth is due, of course, to the change in outstanding shares. Both these growth rates are lower in CDN$ terms.
There is no growth in earnings per share because this company has had positive earnings in very few years. Lately all earnings has been negative. Analysts feel that the company's losses will decrease over the next two years but do not see any positive EPS.
Looking at this on the CDN or US Stock exchange still shows the same thing. The stock price has been going down since 2000. In CDN terms, stock price has fallen 30% and 31% per year over the 5 and 10 years. Drop in stock price in US$ terms is similar.
There is also no growth in cash flow (or cash flow per share) as this company has no positive cash flow. As far as book value is concerned, this stock hit the top in 2001 and book value has been declining ever since. In CDN$ terms, book value is down 19% and 22% per year over the past 5 and 10 years.
Because there are no earnings, there is no Return on Equity.
The Liquidity Ratio is quite good at 1.88 for the financial year ending in December 2011. However, when you include the cash flow in this ratio it is down to 1.08. When you also consider spending on assets, this ratio is down to 0.99.
The Debt Ratio for the financial year ending in 2011 is good at 2.27. The current Debt Ratio is lower at 2.07. However, this is still a very good ratio. The current Leverage and Debt/Equity Ratios are fine at 1.93 and 0.93.
I think that the last thing to mention is that Cash and Cash Equivalents was $20M at the end of December 2011 and it is currently half of that, at $10M, at the end of September 2012. They do seem to be trying to reduce their costs.
I must admit that I am no longer interested in investing in a company that is not making any money. I still hope that they are able to make a go of their fuel cell technology.
Ballard Power Systems designs and manufactures clean energy hydrogen fuel cells. Better energy, delivered through our focused fuel cell innovations, offers the Power to Change end-user applications, while also improving the environment. Its web site is here Ballard. See my spreadsheet at bld.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 or StockTwits.
Tuesday, November 6, 2012
ARC Resources Ltd. 2
I do not own this stock of ARC Resources Ltd (TSX-ARX). I originally started to follow this stock in 2009 because it was suggested that this stock, which was then an income trust, was a good one for your new Tax Free Saving Accounts (TFSA) The Company was converted from an Income Trust ARC Energy Trust (TSX-AET.UN) to ARC Resources Ltd. (TSX-ARX) in January 2011.
The insider trading report shows insider selling at $1.1M and a bit of insider buying. Net insider selling is at $1.08M. Insider selling is by CEO, officers and directors. Insiders not only have options, but also have Performance Share Units (PSU) and Restricted Share Units (RSU). There is a lot of options and option like vehicles outstanding. Insiders also own shares worth in the millions. For example, the CEO has $9M of shares and $7.7M of options. One Director owns shares worth almost $20M.
Reuters says that 125 institutions own 26% of the outstanding shares and that over the past 3 month they have decreased their holdings by 8%.
The 5 year low, median and high median Price/Earnings Ratios are 12.22, 17.51 and 22.80. The current P/E Ratio is 67.36. This is because the company is not expected to earnings much this year. Using earnings for 2013 does not help much as that P/E ratio is 47.55. Looking at this ratio, the stock price is relatively high.
I get a current Graham Price of $9.31. The Price/Graham Price Ratio is 2.60. The 10 year low, median and high median P/GP Ratios are 0.89, 1.14 and 1.39. By this ratio, the stock price is relatively high. Part of the problems is also that the Graham Price formula includes the current EPS.
The 10 year median Price/Book Value per Share Ratio is 2.17. The current P/B Ratio is some 5% higher at 2.26. This P/B Ratio shows that the stock price is reasonable.
The dividend yield test will not be much good as the dividends have come down because of the change from an income trust to a corporation. However, what I can say is that dividends on these sorts of companies were expected to fall into a 4% to 5% range and the current dividend at 4.95% is at the top of the range.
Looking at Price/Cash Flow per Share, I get a 5 year median P/CF Ratio of 7.59 and a current P/CF Ratio of 10.10 a value that is 33% higher. This current high P/CF Ratio suggests that the stock is relatively expensive.
Looking at all the price check, it would appear that at this time, the stock price is not cheap and might be a bit higher, relatively speaking.
When I look at analysts' recommendations, I find Buy and Hold recommendations. There are a lot of Hold recommendations and the consensus recommendation would be a Hold. The 12 month stock price is $25.50. This implies a 10.1% total return with 5.15% from capital gain and $4.95% from dividends.
One analysts thought that ratios (like P/S, P/CF and P/B) was higher other companies in the same industry. One mentioned that others in industry were growing revenue, but this company was not. Others mentioned that the company was heavily into natural gas its problem is the weakness in natural gas prices. Another analyst mentioned that he thought that the company had good managers. Another mentioned that the yield is 5% and therefore quite good.
The National Post has a recent article called "Winter of Discontent Seen Ahead for Canada's Natural Gas Producers" and mentions ARC Resources. The author thought that gas prices will remain weak for some time. In August 2012, Jeff Young of NexGen Financial Corp. issued a Sell recommendation on this stock.
It is hard to pin down how reasonable the stock price is on this company. It would seem relatively high by a number of ratios, like P/CF and P/S. I looked at Price/Sales Ratios and the 5 year P/S Ratio is 4.07 and the current P/S Ratio is 5.26 a values some 30% higher. So comments on relatively current high ratios would seem to be valid.
ARC Resources Ltd. is one of Canada's leading conventional oil and gas companies. Its focus is on acquiring and developing long-life oil and gas properties across western Canada. Industry: Oil and Gas (Oil and Gas Producers) Its web site is here ARC Resources. See my spreadsheet at arx.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 or StockTwits.
The insider trading report shows insider selling at $1.1M and a bit of insider buying. Net insider selling is at $1.08M. Insider selling is by CEO, officers and directors. Insiders not only have options, but also have Performance Share Units (PSU) and Restricted Share Units (RSU). There is a lot of options and option like vehicles outstanding. Insiders also own shares worth in the millions. For example, the CEO has $9M of shares and $7.7M of options. One Director owns shares worth almost $20M.
Reuters says that 125 institutions own 26% of the outstanding shares and that over the past 3 month they have decreased their holdings by 8%.
The 5 year low, median and high median Price/Earnings Ratios are 12.22, 17.51 and 22.80. The current P/E Ratio is 67.36. This is because the company is not expected to earnings much this year. Using earnings for 2013 does not help much as that P/E ratio is 47.55. Looking at this ratio, the stock price is relatively high.
I get a current Graham Price of $9.31. The Price/Graham Price Ratio is 2.60. The 10 year low, median and high median P/GP Ratios are 0.89, 1.14 and 1.39. By this ratio, the stock price is relatively high. Part of the problems is also that the Graham Price formula includes the current EPS.
The 10 year median Price/Book Value per Share Ratio is 2.17. The current P/B Ratio is some 5% higher at 2.26. This P/B Ratio shows that the stock price is reasonable.
The dividend yield test will not be much good as the dividends have come down because of the change from an income trust to a corporation. However, what I can say is that dividends on these sorts of companies were expected to fall into a 4% to 5% range and the current dividend at 4.95% is at the top of the range.
Looking at Price/Cash Flow per Share, I get a 5 year median P/CF Ratio of 7.59 and a current P/CF Ratio of 10.10 a value that is 33% higher. This current high P/CF Ratio suggests that the stock is relatively expensive.
Looking at all the price check, it would appear that at this time, the stock price is not cheap and might be a bit higher, relatively speaking.
When I look at analysts' recommendations, I find Buy and Hold recommendations. There are a lot of Hold recommendations and the consensus recommendation would be a Hold. The 12 month stock price is $25.50. This implies a 10.1% total return with 5.15% from capital gain and $4.95% from dividends.
One analysts thought that ratios (like P/S, P/CF and P/B) was higher other companies in the same industry. One mentioned that others in industry were growing revenue, but this company was not. Others mentioned that the company was heavily into natural gas its problem is the weakness in natural gas prices. Another analyst mentioned that he thought that the company had good managers. Another mentioned that the yield is 5% and therefore quite good.
The National Post has a recent article called "Winter of Discontent Seen Ahead for Canada's Natural Gas Producers" and mentions ARC Resources. The author thought that gas prices will remain weak for some time. In August 2012, Jeff Young of NexGen Financial Corp. issued a Sell recommendation on this stock.
It is hard to pin down how reasonable the stock price is on this company. It would seem relatively high by a number of ratios, like P/CF and P/S. I looked at Price/Sales Ratios and the 5 year P/S Ratio is 4.07 and the current P/S Ratio is 5.26 a values some 30% higher. So comments on relatively current high ratios would seem to be valid.
ARC Resources Ltd. is one of Canada's leading conventional oil and gas companies. Its focus is on acquiring and developing long-life oil and gas properties across western Canada. Industry: Oil and Gas (Oil and Gas Producers) Its web site is here ARC Resources. See my spreadsheet at arx.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 or StockTwits.
Monday, November 5, 2012
ARC Resources Ltd.
On my other blog I have an interview with Crystal, a young investor...continue..
I do not own this stock of ARC Resources Ltd (TSX-ARX). I originally started to follow this stock in 2009 because it was suggested that this stock, which was then an income trust, was a good one for your new Tax Free Saving Accounts (TFSA) The Company was converted from an Income Trust ARC Energy Trust (TSX-AET.UN) to ARC Resources Ltd. (TSX-ARX) in January 2011.
This first thing I should say about this stock it pays good dividend but it is in the oil and gas business, so its distributions can vary depending on the price of oil and gas. For these sorts of energy companies, people have made good money over the years. Some other energy companies pay low dividends that increase over time. An example of this would be Canadian Natural Resources (TSX-CNQ). I talked about this in a post post that I did last year.
The current dividend yield is 4.95% and the 5 year median dividend yield is 7.73%. When this stock was changing from an income trust to a corporation, its distributions came down a lot. The decrease was 55% and is a big decrease in distributions for this company. It was thought at the time companies were changing from income trusts to corporations that yield would come down to a 4 to 5% range. This is what this company has done.
The 5 and 10 year distribution change for this company is distribution decreases of 13% and 6% per year over these periods. (This has a lot to do with the 55% decrease in 2009.) However, a lot of the total return for this company is in distributions, with total return over the past 5 and 10 years at 10.25% and 20.18% per year, respectively. The distribution portion of this return is 7.86% and 12.28% per year, respectively. The capital gain portion of the total return is 2.39% and 7.89% per year, respectively. Distributions were 77% and 61% of total returns over the past 5 and 10 years.
Because dividend yield is down, you would expect to have lower distributions in your total return going forward. However, you can expect good dividend returns over time. The 5 year median Dividend Payout Ratios for this company is 120% for earnings, 62% for cash flow and 51% for adjusted cash flow. Because it is an oil and gas company, the DPRs for cash flow are more important than those for earnings. Dividends have remained flat for the last 3 years.
The outstanding shares (or units) have been increasing by 7 % and 10% per year over the past 5 and 10 years. When this company was an income trust, shareholders could directly redeem their shares through the company and this accounted for some of the change in units. The company has a DRIP plan whereby shareholders can use their distributions to purchase more shares. The company has issued shares to raise money and has also used shares for acquisitions.
Revenues for this company have increased by 3.2% and 10.8% per year over the past 5 and 10 years. Revenues per Share for this company has decline by 3.7% per year over the past 5 year. Revenues per Shares for this company have increased by 0.7% per year over the past 10 years. The difference between revenue and revenue per share changes are, of course, due to changes in outstanding shares.
Earnings per share have declined by 15% and 3.2% per year over the past 5 and 10 years. Earnings can vary depending on the price of oil and gas. The cash flow has declined by 4.7% per year over the past 5 years and has increased by 2% per year over the past 10 years. Note that this company does not have years of negative earnings or negative cash flow. Earnings and cash flow does vary from year to years. Also the Earnings/Cash Flow ratio is below 1.00.
Book Value per share has increased by 3.4% and 4% per year over the past 5 and 10 years.
The Return on Equity is 9.1% for the financial year ending in 2011. The 5 year median ROE is 9.5%. This is just below the good range of 10% to 15%. The ROE based on comprehensive income is the same as for net income. This is good.
The current Liquidity Ratio is just 0.72, which is low and this Liquidity Ratio has always been low and has a 5 year median ratio of 0.72. However, the company has a strong cash flow and if you include the cash flow less distributions in this ratio it become 1.95, a very good ratio.
The current Debt Ratio is 2.39. This ratio has always been good and has a 5year median ratio of 2.46. The current Leverage and Debt/Equity Ratios are also good at 1.72 and 0.72.
The shareholders of this company get a very good dividend yield at almost 5%, but this is oil and gas and so is risky. The other problem is that actual dividends could vary again, but over the long term you could make a very good return in dividends.
ARC Resources Ltd. is one of Canada's leading conventional oil and gas companies. Its focus is on acquiring and developing long-life oil and gas properties across western Canada. Industry: Oil and Gas (Oil and Gas Producers) Its web site is here ARC Resources. See my spreadsheet at arx.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 or StockTwits.
I do not own this stock of ARC Resources Ltd (TSX-ARX). I originally started to follow this stock in 2009 because it was suggested that this stock, which was then an income trust, was a good one for your new Tax Free Saving Accounts (TFSA) The Company was converted from an Income Trust ARC Energy Trust (TSX-AET.UN) to ARC Resources Ltd. (TSX-ARX) in January 2011.
This first thing I should say about this stock it pays good dividend but it is in the oil and gas business, so its distributions can vary depending on the price of oil and gas. For these sorts of energy companies, people have made good money over the years. Some other energy companies pay low dividends that increase over time. An example of this would be Canadian Natural Resources (TSX-CNQ). I talked about this in a post post that I did last year.
The current dividend yield is 4.95% and the 5 year median dividend yield is 7.73%. When this stock was changing from an income trust to a corporation, its distributions came down a lot. The decrease was 55% and is a big decrease in distributions for this company. It was thought at the time companies were changing from income trusts to corporations that yield would come down to a 4 to 5% range. This is what this company has done.
The 5 and 10 year distribution change for this company is distribution decreases of 13% and 6% per year over these periods. (This has a lot to do with the 55% decrease in 2009.) However, a lot of the total return for this company is in distributions, with total return over the past 5 and 10 years at 10.25% and 20.18% per year, respectively. The distribution portion of this return is 7.86% and 12.28% per year, respectively. The capital gain portion of the total return is 2.39% and 7.89% per year, respectively. Distributions were 77% and 61% of total returns over the past 5 and 10 years.
Because dividend yield is down, you would expect to have lower distributions in your total return going forward. However, you can expect good dividend returns over time. The 5 year median Dividend Payout Ratios for this company is 120% for earnings, 62% for cash flow and 51% for adjusted cash flow. Because it is an oil and gas company, the DPRs for cash flow are more important than those for earnings. Dividends have remained flat for the last 3 years.
The outstanding shares (or units) have been increasing by 7 % and 10% per year over the past 5 and 10 years. When this company was an income trust, shareholders could directly redeem their shares through the company and this accounted for some of the change in units. The company has a DRIP plan whereby shareholders can use their distributions to purchase more shares. The company has issued shares to raise money and has also used shares for acquisitions.
Revenues for this company have increased by 3.2% and 10.8% per year over the past 5 and 10 years. Revenues per Share for this company has decline by 3.7% per year over the past 5 year. Revenues per Shares for this company have increased by 0.7% per year over the past 10 years. The difference between revenue and revenue per share changes are, of course, due to changes in outstanding shares.
Earnings per share have declined by 15% and 3.2% per year over the past 5 and 10 years. Earnings can vary depending on the price of oil and gas. The cash flow has declined by 4.7% per year over the past 5 years and has increased by 2% per year over the past 10 years. Note that this company does not have years of negative earnings or negative cash flow. Earnings and cash flow does vary from year to years. Also the Earnings/Cash Flow ratio is below 1.00.
Book Value per share has increased by 3.4% and 4% per year over the past 5 and 10 years.
The Return on Equity is 9.1% for the financial year ending in 2011. The 5 year median ROE is 9.5%. This is just below the good range of 10% to 15%. The ROE based on comprehensive income is the same as for net income. This is good.
The current Liquidity Ratio is just 0.72, which is low and this Liquidity Ratio has always been low and has a 5 year median ratio of 0.72. However, the company has a strong cash flow and if you include the cash flow less distributions in this ratio it become 1.95, a very good ratio.
The current Debt Ratio is 2.39. This ratio has always been good and has a 5year median ratio of 2.46. The current Leverage and Debt/Equity Ratios are also good at 1.72 and 0.72.
The shareholders of this company get a very good dividend yield at almost 5%, but this is oil and gas and so is risky. The other problem is that actual dividends could vary again, but over the long term you could make a very good return in dividends.
ARC Resources Ltd. is one of Canada's leading conventional oil and gas companies. Its focus is on acquiring and developing long-life oil and gas properties across western Canada. Industry: Oil and Gas (Oil and Gas Producers) Its web site is here ARC Resources. See my spreadsheet at arx.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 or StockTwits.
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