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.

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