I do not own this stock (TSX-GDI, OTC-xxx). I got the name from MPL Communications' Buy and Sell Adviser email. The write up was by Keystone Publications. I have found that stocks recommended by Keystone Publications and especially by Ryan Irving of Keystone to be good to great stock. So I investigated this stock.
Well, it is hard to say if this was a waste of time or not. The write-up says that the company has been profitable during the 11 years of a public company. This is not true as they had losses in 2003 and 2004. This is a long time ago, but still they were rather large earnings deficits.
There is a $12M investment by Geosam Investments Limited owned by George Armoyan. There is an interesting article on him at Globe Advisors. The article calls him the best investor in Canada that you have never heard of. There is a News Wire article dated in 2007, where George Armoyan buys more units in this company. Then his company was Clarke Inc.
There is a positive report on this company by Canadian Dividend Investor blogger.
The main good thing I see about this stock is the very good dividend yield which is currently at 6.89%. It used to be higher when it was an income trust, but with the change to a corporation, dividends were decreased by almost 40%. They are managing the transition from Income Trust to Corporation well. The dividends were lowered and the Dividend Payout Ratios seems to be under control.
Shareholders have made money on this stock. The 5 year total return was 11.28% per year. However, 11.08% per year was from dividends and only 0.23% from capital gains. With the dividends lower, you will not get the same return.
In the past the company has been paying out in dividends more than they have earned. However, the DPR for earnings has been decreased and was at 70% and 84% in 2011 and 2012. They have also paid out more than the cash flow in the past, but for DPR for CFPS was at 47% and 32% for 2011 and 2012.
There are things that I do not like about this stock. The Debt Ratio is just 0.94. That means that the assets cannot cover the liabilities. The Liquidity Ratio is good at 1.67. The company's book value is negative and it has been negative for the last 3 years. This is mainly because they have paid out more in dividends than they could afford to pay.
The company has been very busy buying back shares. Outstanding shares have decreased by 7.4% and 5.1/% per year over the past 5 and 10 years. Revenues have only increased by 0.9% and 7.3% per year over the past 5 and 10 years. However, the Revenue per Share has increased by 9% and 13% per year.
When the per share values are lower than the total values (i.e. Revenue per Share vs. Revenue) this might point to the fact that the growth, when there is any, of EPS and CFPS is not as good as it might look. Would not the shareholders have been better served if debt was paid down rather than the company buying back shares?
The thing is that companies with weak balance sheets, as this company has, have a greater chance of going bankrupt in hard times than companies with strong balance sheets. The current economic climate is not great and especially at this time I personally prefer companies with strong balance sheets.
The only standard stock price test I can do is the Price/Earnings Ratio test. The 5 year low, median and high median P/E Ratios are 5.96, 7.59 and 9.22. There is no analysts following this stock so using the last 12 month EPS that I have and that is for the financial year of 2012, I get a P/E of 12.16. On a relative basis, this P/E is high. (On an absolute basis it is not particularly high. A P/E of 30 or more is considered high and a P/E of 10 or less is considered to be low.)
With a negative book value, I cannot do the Graham Price test or the Book Value test. The dividend yield test would not be good because of recent dividend decline and the structural change from an Income Trust to a Corporation.
If you look at the 5 year median Price/Cash Flow per Share Ratio, I get one of 5.19. The current P/CF Ratio is at 4.67 a value that is 10% lower and suggests a reasonable price. If you look at the 5 year median Price/Sales per Share Ratio, I get one at 0.73. The current P/S Ratio is 0.93, a value some 27.6% higher and this suggests that the stock price is relatively high. (Although on an absolute basis, a P/S Ratio at 1.00 or lower is considered to be low ratio and therefore a good stock price.)
It seems that some people think that this company will do very well for the shareholders in the end and they may be right. However, I do not think that this is a small cap stock that I would like to buy. I do not favour small companies (or any company) with a weak balance sheet. However, the problem is with the Debt Ratio rather than the Liquidity Ratio. See my spreadsheet at gdi.htm.
General Donlee is a leading solution provider of complex machined products, serving the Aerospace, Oil and Gas, and Nuclear and Power Generation industries. Its web site is here General Donlee.
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, April 30, 2013
Monday, April 29, 2013
Thomson Reuters Corp 2
On my other blog I am today writing about Median Calculations ...continue...
I own this stock of Thomson Reuters Corp (TSX-TRI, NYSE-TRI). I have held this stock since 1985 and have made 7.03% total return per year with 3.21% per year from capital gains and 3.82% per year from dividends. This is not a great showing, but it is acceptable given the current economic climate.
When I look at insider buying, I find $5.8M of insider buying and 1.2M of insider selling. We have net insider buying of $4.6M. All of the buying is by directors and the selling is by officers. Insiders not only have options, but option like vehicles called Deferred Share Units and Restricted Share Units.
The CEO has shares worth $5.9M and has options are worth $78M. The CFO has shares worth $1.4M and has options worth $20.3M. An officer has shares worth $0.2M and has options worth $8M. A director has shares worth $0.6M and has no options. This is just to give you an idea on insider share ownership and option values.
The 5 year low, median and high median Price/Earnings Ratios are 14.46, 18.38 and 22.30. The current P/E Ratio is 25.2 based on 2013 earnings estimates of $1.32 US$ or 1.34 CDN$ and a current stock price of $33.72 CDN$. This would suggest that the stock price is relatively high. (However, P/E Ratios are decreasing as the 10 year high median P/E is 25.93.)
I get a Graham Price of $25.17. The 10 year low, median and high median Price/Graham Price Ratios are 1.26, 1.50 and 1.64. The current P/GP Ratio 1.34 and this suggests a reasonable price.
I get a 10 year median Price/Book Value per Share Ratio of 1.59 and a current P/B Ratio of 1.60. These ratios are almost identical and they suggest that the stock price is reasonable.
I get a 5 year median Dividend Yield of 3.60% and a current dividend yield of 3.91%. The current dividend yield is above the 5 year median dividend yield by 8.5% and this is good. However, the current dividend yield is not higher by a lot and current dividend yield suggests a reasonable stock price.
When I look at the analysts' recommendations, I get Strong Buy, Buy, Hold and Underperform recommendations. There are a lot of analysts following this stock. The consensus would be a Hold and most analysts' recommendation on this stock is a Hold. The 12 month consensus stock price is $31.30. This is below the current stock price and implies a loss of 3.27%, with 3.91% from dividends and a capital loss of 7.18%.
The Wall Cheat Sheet blogger talks about Analysts expectations for earnings declining. This is true as analysts expect both lower earnings and lower revenue for 2013. The Passive Income Earner blogger has reviewed this stock in January of this year and the review is a bit negative also.
I plan to hold on to my current shares. Analysts do feel that 2013 will not be a great year for this company, but expect things to improve in 2014 and 2015. I must admit that I have heard this before on this stock. But we are in tough economic times and the company is holding its own. It may be a buy if things do improve over the next while. I think that you would need to see this company's stock cheap before it would be a good buy at present. It is encouraging to see insider buying. See my spreadsheet at tri.htm.
Thomson Reuters Corp is the leading source of intelligent information for businesses and professionals. The company delivers this must-have insight to the financial, legal, tax and accounting, healthcare and science and media markets, powered by the world's most trusted news organization. They derive the majority of their revenues from selling electronic content and services to professionals, primarily on a subscription basis. Its web site is here Thomson Reuters.
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 of Thomson Reuters Corp (TSX-TRI, NYSE-TRI). I have held this stock since 1985 and have made 7.03% total return per year with 3.21% per year from capital gains and 3.82% per year from dividends. This is not a great showing, but it is acceptable given the current economic climate.
When I look at insider buying, I find $5.8M of insider buying and 1.2M of insider selling. We have net insider buying of $4.6M. All of the buying is by directors and the selling is by officers. Insiders not only have options, but option like vehicles called Deferred Share Units and Restricted Share Units.
The CEO has shares worth $5.9M and has options are worth $78M. The CFO has shares worth $1.4M and has options worth $20.3M. An officer has shares worth $0.2M and has options worth $8M. A director has shares worth $0.6M and has no options. This is just to give you an idea on insider share ownership and option values.
The 5 year low, median and high median Price/Earnings Ratios are 14.46, 18.38 and 22.30. The current P/E Ratio is 25.2 based on 2013 earnings estimates of $1.32 US$ or 1.34 CDN$ and a current stock price of $33.72 CDN$. This would suggest that the stock price is relatively high. (However, P/E Ratios are decreasing as the 10 year high median P/E is 25.93.)
I get a Graham Price of $25.17. The 10 year low, median and high median Price/Graham Price Ratios are 1.26, 1.50 and 1.64. The current P/GP Ratio 1.34 and this suggests a reasonable price.
I get a 10 year median Price/Book Value per Share Ratio of 1.59 and a current P/B Ratio of 1.60. These ratios are almost identical and they suggest that the stock price is reasonable.
I get a 5 year median Dividend Yield of 3.60% and a current dividend yield of 3.91%. The current dividend yield is above the 5 year median dividend yield by 8.5% and this is good. However, the current dividend yield is not higher by a lot and current dividend yield suggests a reasonable stock price.
When I look at the analysts' recommendations, I get Strong Buy, Buy, Hold and Underperform recommendations. There are a lot of analysts following this stock. The consensus would be a Hold and most analysts' recommendation on this stock is a Hold. The 12 month consensus stock price is $31.30. This is below the current stock price and implies a loss of 3.27%, with 3.91% from dividends and a capital loss of 7.18%.
The Wall Cheat Sheet blogger talks about Analysts expectations for earnings declining. This is true as analysts expect both lower earnings and lower revenue for 2013. The Passive Income Earner blogger has reviewed this stock in January of this year and the review is a bit negative also.
I plan to hold on to my current shares. Analysts do feel that 2013 will not be a great year for this company, but expect things to improve in 2014 and 2015. I must admit that I have heard this before on this stock. But we are in tough economic times and the company is holding its own. It may be a buy if things do improve over the next while. I think that you would need to see this company's stock cheap before it would be a good buy at present. It is encouraging to see insider buying. See my spreadsheet at tri.htm.
Thomson Reuters Corp is the leading source of intelligent information for businesses and professionals. The company delivers this must-have insight to the financial, legal, tax and accounting, healthcare and science and media markets, powered by the world's most trusted news organization. They derive the majority of their revenues from selling electronic content and services to professionals, primarily on a subscription basis. Its web site is here Thomson Reuters.
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, April 26, 2013
Thomson Reuters Corp
I own this stock of Thomson Reuters Corp (TSX-TRI, NYSE-TRI). I have held this stock since 1985 and have made 7.03% total return per year with 3.21% per year from capital gains and 3.82% per year from dividends.
The problem is that I hold this stock in my Canadian Trading Accounting. For US investors, this stock has made some money for them over the past 10 years, but not over the past 5. For Canadian investor this company has not made money for them over the past 5 or 10 years. However, the loss over the past 10 years is less than 1% per year.
One other problem is that the dividend is paid in US$. This means that each dividend payment is different, depending on the current currency exchange rate. In most year, the dividends have increased as the dividends paid in US$ have increased. However, there have been years where the dividend payments have gone down for Canadian investors.
The dividends have only increased by 3.8% and 1.3% per year over the past 5 and 10 years in CDN$ terms, but have increased by 5.5% and 6.2% per year in US$ terms. The CDN$ used to be worth a lot less than the US$, but has been close to par for several years now.
The company reports in US$ and has done better in US$ terms than in CDN$ terms as far as growth goes over the past 5 and 10 year. Also, the number of outstanding shares has increased by 2.4% and 5.3% per year over the past 5 and 10 years. The main increase has to do with shares issued in the amalgamation of Thomson and Reuters. Shares have increased because of stock options and DRIP. Shares have been decreased because of share buy backs.
Revenue has increased over the past 5 and 10 years by 12.7% and 5.5% per year in US$. Revenue has increased by 9.9% and 1% per year over the past 5 and 10 years in CDN$. Revenue per Share has increased by 7% and 3% per year over the past 5 and 10 years in US$. Revenue per Share has increased by 4.3% per year over the past 5 years and it has decreased by 1.3% per year over the past 10 years in CDN$.
Growth in EPS is much better than Revenue growth. Growth in Cash Flow per Share is worse. CFPS is up by 2.5% and 3.2% per year over the past 5 and 10 years in US$. CFPS is down by 2.4% and 1.1% per year over the past 5 and 10 years in CDN$.
I was wrong about the Return on Equity in my original report. There was a miscalculation in my spreadsheet. ROE on net income on this stock is 12.1%. The 5 year median ROE is low at 6.9%. The ROE on comprehensive income is 10.7%, a value 12% lower. It is not that big of a difference, but might point to the quality of the earnings. I have reloaded the corrected spreadsheet.
The last thing to look at is the debt ratios. The Liquidity Ratio is rather low at just 0.83. That means that the current assets cannot cover the current liabilities. If you add in cash flow after dividends, you get a more respectable ratio of 1.17. (I would rather see Liquidity at 1.50). The Debt Ratio is very good at 2.19. The Leverage and Debt/Equity Ratios are also very good at 1.90 and 0.88.
The thing is that you can get international exposure with Canadian stocks by investing in international companies. This would be a reason to invest in this company. The problem with this, of course, is that it also exposes you to currency fluctuations.
This stock has not performed as well as I would have hoped, but these are tough economic times. I still think that it has a good long term future. See my spreadsheet at tri.htm.
Thomson Reuters Corp is the leading source of intelligent information for businesses and professionals. The company delivers this must-have insight to the financial, legal, tax and accounting, healthcare and science and media markets, powered by the world's most trusted news organization. They derive the majority of their revenues from selling electronic content and services to professionals, primarily on a subscription basis. Its web site is here Thomson Reuters.
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 problem is that I hold this stock in my Canadian Trading Accounting. For US investors, this stock has made some money for them over the past 10 years, but not over the past 5. For Canadian investor this company has not made money for them over the past 5 or 10 years. However, the loss over the past 10 years is less than 1% per year.
One other problem is that the dividend is paid in US$. This means that each dividend payment is different, depending on the current currency exchange rate. In most year, the dividends have increased as the dividends paid in US$ have increased. However, there have been years where the dividend payments have gone down for Canadian investors.
The dividends have only increased by 3.8% and 1.3% per year over the past 5 and 10 years in CDN$ terms, but have increased by 5.5% and 6.2% per year in US$ terms. The CDN$ used to be worth a lot less than the US$, but has been close to par for several years now.
The company reports in US$ and has done better in US$ terms than in CDN$ terms as far as growth goes over the past 5 and 10 year. Also, the number of outstanding shares has increased by 2.4% and 5.3% per year over the past 5 and 10 years. The main increase has to do with shares issued in the amalgamation of Thomson and Reuters. Shares have increased because of stock options and DRIP. Shares have been decreased because of share buy backs.
Revenue has increased over the past 5 and 10 years by 12.7% and 5.5% per year in US$. Revenue has increased by 9.9% and 1% per year over the past 5 and 10 years in CDN$. Revenue per Share has increased by 7% and 3% per year over the past 5 and 10 years in US$. Revenue per Share has increased by 4.3% per year over the past 5 years and it has decreased by 1.3% per year over the past 10 years in CDN$.
Growth in EPS is much better than Revenue growth. Growth in Cash Flow per Share is worse. CFPS is up by 2.5% and 3.2% per year over the past 5 and 10 years in US$. CFPS is down by 2.4% and 1.1% per year over the past 5 and 10 years in CDN$.
I was wrong about the Return on Equity in my original report. There was a miscalculation in my spreadsheet. ROE on net income on this stock is 12.1%. The 5 year median ROE is low at 6.9%. The ROE on comprehensive income is 10.7%, a value 12% lower. It is not that big of a difference, but might point to the quality of the earnings. I have reloaded the corrected spreadsheet.
The last thing to look at is the debt ratios. The Liquidity Ratio is rather low at just 0.83. That means that the current assets cannot cover the current liabilities. If you add in cash flow after dividends, you get a more respectable ratio of 1.17. (I would rather see Liquidity at 1.50). The Debt Ratio is very good at 2.19. The Leverage and Debt/Equity Ratios are also very good at 1.90 and 0.88.
The thing is that you can get international exposure with Canadian stocks by investing in international companies. This would be a reason to invest in this company. The problem with this, of course, is that it also exposes you to currency fluctuations.
This stock has not performed as well as I would have hoped, but these are tough economic times. I still think that it has a good long term future. See my spreadsheet at tri.htm.
Thomson Reuters Corp is the leading source of intelligent information for businesses and professionals. The company delivers this must-have insight to the financial, legal, tax and accounting, healthcare and science and media markets, powered by the world's most trusted news organization. They derive the majority of their revenues from selling electronic content and services to professionals, primarily on a subscription basis. Its web site is here Thomson Reuters.
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, April 25, 2013
Toromont Industries Ltd 2
I own this stock of Toromont Industries Ltd. (TSX-TIH, OTC-TMTNF). This stock is complicated by the spin-off of Enerflex (TSX-EFX), which I sold, but for less than the spin off price. If I look at this company with Enerflex, I have a total return of 6.72% with 1.89% from dividends and 4.83% from capital gains. If I look just at this company I get a total return of 8.13% with 1.97% from dividends and 6.16% from capital gains.
When I look at insider trading I find $1.4M of insider selling and $1.3M of net insider selling with a little insider buying. Insiders not only have options, but options like vehicles like Rights Deferred Share Units (cash settled). Leith Wheeler Investment Counsel Ltd, a Vancouver based investment firm, owns some 9.6% of the outstanding shares worth some $162M.
The CEO has shares worth $1.4M and has options are worth $5M. The CFO has shares worth $0.6M and has options worth $4.3M. An officer has shares worth $4.9M and has options worth $1.4M. A director has shares worth $0.3M and has options worth $0.5M. This is just to give you an idea on insider share ownership and option values.
The 5 year low, median and high median Price/Earnings Ratios are 11.97, 14.06 and 15.99. The current P/E Ratio is 13.90 based on 2013 earnings of $1.59 and stock price of $22.10. This shows that the stock price is reasonable.
I get a Graham Price of $15.09 and 10 year low, median and high median Price/Graham Price Ratios of 1.12, 1.32 and 1.54. The current P/GP Ratio is 1.46. This shows that the stock price, although a bit high is still reasonable.
The Price/Book Value per Share test shows that the current P/B Ratio of 3.47 is some 24% higher than the 10 year P/B Ratio of 2.80. This shows a stock price that is high. The problem, of course, is that with the Enerflex spin off, the Book Value took a big hit. However, they only bought Enerflex in 2010. I think this is a cautionary note. They did not do well by shareholders in their buy and spin-off of Enerflex.
The last test is the dividend yield test. The current dividend yield is 2.35% and this is 5.5% higher than the 5 year median dividend yield of 2.23%. This shows that the stock price is relatively reasonable. You want a current yield higher than the 5 year median, but 5.5% is not that much higher, so stock price is reasonable.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus is a Buy. The 12 months consensus stock price is $24.70. This implies a total return of 14.11% with 2.35% from dividends and 11.76% from capital gains.
Pat McKeough thinks that both Toromont and Enerflex have done well since the Enerflex spin-off. (Does he realize that they only bought Enerflex in 2010 and spin it off in 2011?) John Sartz gives us a much more complete picture of the Toromont and Enerflex story. After reading his story, you may not think that Toromont's involvement with Enerflex was in the best interest of shareholders.
This has not been as good as investment as I had hoped. They did not create any shareholder value (in fact it negatively affected shareholder value) with their purchase and then spin-off of Enerflex. If you want to buy Toromont, my spreadsheet basically shows that the price is reasonable. See my spreadsheet at tih.htm.
There are two sections to this company. The Equipment Group is for Caterpillar dealerships. CIMCO is a market leader in the design, engineering, fabrication and installation of industrial and recreational refrigeration systems. Its web site is here Toromont.
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 $1.4M of insider selling and $1.3M of net insider selling with a little insider buying. Insiders not only have options, but options like vehicles like Rights Deferred Share Units (cash settled). Leith Wheeler Investment Counsel Ltd, a Vancouver based investment firm, owns some 9.6% of the outstanding shares worth some $162M.
The CEO has shares worth $1.4M and has options are worth $5M. The CFO has shares worth $0.6M and has options worth $4.3M. An officer has shares worth $4.9M and has options worth $1.4M. A director has shares worth $0.3M and has options worth $0.5M. This is just to give you an idea on insider share ownership and option values.
The 5 year low, median and high median Price/Earnings Ratios are 11.97, 14.06 and 15.99. The current P/E Ratio is 13.90 based on 2013 earnings of $1.59 and stock price of $22.10. This shows that the stock price is reasonable.
I get a Graham Price of $15.09 and 10 year low, median and high median Price/Graham Price Ratios of 1.12, 1.32 and 1.54. The current P/GP Ratio is 1.46. This shows that the stock price, although a bit high is still reasonable.
The Price/Book Value per Share test shows that the current P/B Ratio of 3.47 is some 24% higher than the 10 year P/B Ratio of 2.80. This shows a stock price that is high. The problem, of course, is that with the Enerflex spin off, the Book Value took a big hit. However, they only bought Enerflex in 2010. I think this is a cautionary note. They did not do well by shareholders in their buy and spin-off of Enerflex.
The last test is the dividend yield test. The current dividend yield is 2.35% and this is 5.5% higher than the 5 year median dividend yield of 2.23%. This shows that the stock price is relatively reasonable. You want a current yield higher than the 5 year median, but 5.5% is not that much higher, so stock price is reasonable.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus is a Buy. The 12 months consensus stock price is $24.70. This implies a total return of 14.11% with 2.35% from dividends and 11.76% from capital gains.
Pat McKeough thinks that both Toromont and Enerflex have done well since the Enerflex spin-off. (Does he realize that they only bought Enerflex in 2010 and spin it off in 2011?) John Sartz gives us a much more complete picture of the Toromont and Enerflex story. After reading his story, you may not think that Toromont's involvement with Enerflex was in the best interest of shareholders.
This has not been as good as investment as I had hoped. They did not create any shareholder value (in fact it negatively affected shareholder value) with their purchase and then spin-off of Enerflex. If you want to buy Toromont, my spreadsheet basically shows that the price is reasonable. See my spreadsheet at tih.htm.
There are two sections to this company. The Equipment Group is for Caterpillar dealerships. CIMCO is a market leader in the design, engineering, fabrication and installation of industrial and recreational refrigeration systems. Its web site is here Toromont.
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, April 24, 2013
Toromont Industries Ltd
On my other blog I am today writing about Investing Mistakes ...continue...
I own this stock of Toromont Industries Ltd. (TSX-TIH, OTC-TMTNF). This stock is complicated by the spin-off of Enerflex (TSX-EFX), which I sold, but for less than the spin off price. If I look at this company with Enerflex, I have a total return of 6.72% with 1.89% from dividends and 4.83% from capital gains. If I look just at this company I get a total return of 8.13% with 1.97% from dividends and 6.16% from capital gains.
I always like to talk about dividends and the dividend story on this stock is complicated by the Enerflex spin-off as dividends were decreased for Toromont Industries by the dividends to be paid by Enerflex. So this stock suffered a dividend decrease which leaves the dividends lower than what was paid in 2010. However, since this decrease, dividends were raised, the last raise being in 2013 at 8.3%.
The dividend is not bad at generally around 2% considering that the Dividend Payout Ratios are low. The 5 year median DPR for earnings is at 32% and the 5 year DPR for cash flow is at 25%. The current dividend yield is 2.35%.
The total return over the past 5 and 10 years is at 5.89% per year and 15.58% per year if we include Enerflex spin-off. The dividend portion of this return over the past 5 and 10 years is at 2.19% and 2.99% per year. The capital loss was at 5.68% per year over the past 5 years and the capital gain portion was at 7.40% per year over the past 10 years. The rest of the total return is related to the Enerflex spin off. However, I doubt that it was worth the spin-off price since it lost value immediately. However, the Enerflex stock did recover for those who have continued to hold it.
The outstanding shares have increased by 3.3% and 1.9% per year over the past 5 and 10 years. Shares have increased due to stock options and share issues and have decreased due to share buy backs.
Revenue has decreased by 4.6% per year and increased by 3.4% per year over the past 5 and 10 years. Revenue per Share has decreased by 7.6% per year and increased by 1.5% per year over the past 5 and 10 years. However, Revenue per Share has fared better looking at 5 year running averages and according to 5 year averages, Revenue per share has not changed over the past 5 years and is up by 6.4% per year over the past 10 years.
Earnings per Share is down by 3.7% per year and up by 9.3% per year over the past 5 and 10 years. EPS also looks better if taken from the 5 year running averages, where is has increased by 4.2% per year and 10.4% per year over the past 5 and 10 years.
Cash Flow per share shows the same sort of activity as it is down by 7.5% over the past 5 and has not change over the past 10 years, but the 5 year running increases over the past 5 and 10 years is at 2.5% and 6.6% per year.
The Return on Equity for 2012 is at 25.3% and the 5 year median ROE is at 18%. The ROE based on comprehensive income is at 24.3% and this is only 4% off the ROE on net income.
One good thing about this company is the strong balance sheet. The Liquidity Ratio for 2012 is at 2.15and the current one is 2.25. The Debt Ratio for 2012 is 2.04 and the current one is 2.08. The Leverage and Debt/Equity Ratios are also good with current ones at 1.92 and 0.92.
Since this is an industrial stock, it has not done badly in the current economic situation. The best thing about the stock is that it has a strong balance sheet. I bought this stock for diversifications and it is still a good hold for this reason. See my spreadsheet at tih.htm.
There are two sections to this company. The Equipment Group is for Caterpillar dealerships. CIMCO is a market leader in the design, engineering, fabrication and installation of industrial and recreational refrigeration systems. Its web site is here Toromont.
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 of Toromont Industries Ltd. (TSX-TIH, OTC-TMTNF). This stock is complicated by the spin-off of Enerflex (TSX-EFX), which I sold, but for less than the spin off price. If I look at this company with Enerflex, I have a total return of 6.72% with 1.89% from dividends and 4.83% from capital gains. If I look just at this company I get a total return of 8.13% with 1.97% from dividends and 6.16% from capital gains.
I always like to talk about dividends and the dividend story on this stock is complicated by the Enerflex spin-off as dividends were decreased for Toromont Industries by the dividends to be paid by Enerflex. So this stock suffered a dividend decrease which leaves the dividends lower than what was paid in 2010. However, since this decrease, dividends were raised, the last raise being in 2013 at 8.3%.
The dividend is not bad at generally around 2% considering that the Dividend Payout Ratios are low. The 5 year median DPR for earnings is at 32% and the 5 year DPR for cash flow is at 25%. The current dividend yield is 2.35%.
The total return over the past 5 and 10 years is at 5.89% per year and 15.58% per year if we include Enerflex spin-off. The dividend portion of this return over the past 5 and 10 years is at 2.19% and 2.99% per year. The capital loss was at 5.68% per year over the past 5 years and the capital gain portion was at 7.40% per year over the past 10 years. The rest of the total return is related to the Enerflex spin off. However, I doubt that it was worth the spin-off price since it lost value immediately. However, the Enerflex stock did recover for those who have continued to hold it.
The outstanding shares have increased by 3.3% and 1.9% per year over the past 5 and 10 years. Shares have increased due to stock options and share issues and have decreased due to share buy backs.
Revenue has decreased by 4.6% per year and increased by 3.4% per year over the past 5 and 10 years. Revenue per Share has decreased by 7.6% per year and increased by 1.5% per year over the past 5 and 10 years. However, Revenue per Share has fared better looking at 5 year running averages and according to 5 year averages, Revenue per share has not changed over the past 5 years and is up by 6.4% per year over the past 10 years.
Earnings per Share is down by 3.7% per year and up by 9.3% per year over the past 5 and 10 years. EPS also looks better if taken from the 5 year running averages, where is has increased by 4.2% per year and 10.4% per year over the past 5 and 10 years.
Cash Flow per share shows the same sort of activity as it is down by 7.5% over the past 5 and has not change over the past 10 years, but the 5 year running increases over the past 5 and 10 years is at 2.5% and 6.6% per year.
The Return on Equity for 2012 is at 25.3% and the 5 year median ROE is at 18%. The ROE based on comprehensive income is at 24.3% and this is only 4% off the ROE on net income.
One good thing about this company is the strong balance sheet. The Liquidity Ratio for 2012 is at 2.15and the current one is 2.25. The Debt Ratio for 2012 is 2.04 and the current one is 2.08. The Leverage and Debt/Equity Ratios are also good with current ones at 1.92 and 0.92.
Since this is an industrial stock, it has not done badly in the current economic situation. The best thing about the stock is that it has a strong balance sheet. I bought this stock for diversifications and it is still a good hold for this reason. See my spreadsheet at tih.htm.
There are two sections to this company. The Equipment Group is for Caterpillar dealerships. CIMCO is a market leader in the design, engineering, fabrication and installation of industrial and recreational refrigeration systems. Its web site is here Toromont.
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, April 23, 2013
Barrick Gold Corp
I own this stock of Barrick Gold Corp. (TSX-ABX, NYSE-ABX). As I said yesterday, I bought some of this stock recently because its stock price had fallen hard. I believed the market over reacted. I just bought 100 shares as I am living off my portfolio and do not have much to invest.
Although my spreadsheet shows that 5 year low, median and high median Price/Earnings Ratios for this stock to be rather reasonable at 9.46, 10.84 and 12.23, this has not always been the case. Earnings have been quite volatile. I looked at stock prices going back to the early 1990’s and they have been quite high. The stock prices were about as high as they were recently. However, P/E Ratios were quite high at times (the P/E Ratio hit 104.66 in 2001).
The stock prices were relatively low in the 1980 and were quite high in the 1990’s before falling in the late 1990’s and they rising again to peaks in 2008, 2010 and 2011. The dividend yield was below 1% or just over 1% until fairly recently. I bought the stock recently with a dividend yield of around 4.5% and a forward P/E of 4.36
For this company revenue has been climbing as has earnings. There is an earnings loss in 2012 mainly because of a write-of (or impairment charge) on their Lumwana copper mine in Zambia. Cash Flow is also climbing. Book Value per share has done nothing over the past 5 years, but is up by 8.6% over the past 10 years. The real interesting thing is that the stock price has not done much since the 1990’s. It has fluctuated, but really has gone nowhere.
There is a recent article in the Financial Post of recent troubles of Barrick Gold. The price of gold has plunged, a key project is halted and pension fund investors are up in arms about the recent $11.9M signing bonus that Barrick paid to co-chairman John Thornton last year. Here is a G&M article on Pension Fund investors reaction to John Thornton’s signing bonus.
Well, if the stock recovers I will do fine. There is no doubt in my mind that this is a risky choice. The stock has just tanked. The stock chase site shows a lot of recent Don’t Buy comments. Many people like Goldcorp (TSX-G, NYSE-GG) better. Are we in a correction for the stock market? Who know? If we are, it probably has only just begun. The other problem with gold stocks is the price of gold has recently dropped.
If you look at analysts’ recommendations there are Strong Buy, Buy and Hold recommendations, with a toss-up between Buy and Hold (because there a lots of Hold recommendations). The average 12 months consensus target price is $42.00 and this implies capital gains of around 129%. (However, a lot of things can happen in a year.)
The thing is this is a risky stock pick but if things are turned around, there are good profits to be made. Do I want to keep this stock permanently? I do not know yet. I have to see how the present crisis works out. See my spreadsheet at tih.htm.
Barrick Gold Corporation is a gold mining company with a portfolio of operating mines, and advanced exploration and development projects located across five continents. Its web site is here Barrick.
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.
Although my spreadsheet shows that 5 year low, median and high median Price/Earnings Ratios for this stock to be rather reasonable at 9.46, 10.84 and 12.23, this has not always been the case. Earnings have been quite volatile. I looked at stock prices going back to the early 1990’s and they have been quite high. The stock prices were about as high as they were recently. However, P/E Ratios were quite high at times (the P/E Ratio hit 104.66 in 2001).
The stock prices were relatively low in the 1980 and were quite high in the 1990’s before falling in the late 1990’s and they rising again to peaks in 2008, 2010 and 2011. The dividend yield was below 1% or just over 1% until fairly recently. I bought the stock recently with a dividend yield of around 4.5% and a forward P/E of 4.36
For this company revenue has been climbing as has earnings. There is an earnings loss in 2012 mainly because of a write-of (or impairment charge) on their Lumwana copper mine in Zambia. Cash Flow is also climbing. Book Value per share has done nothing over the past 5 years, but is up by 8.6% over the past 10 years. The real interesting thing is that the stock price has not done much since the 1990’s. It has fluctuated, but really has gone nowhere.
There is a recent article in the Financial Post of recent troubles of Barrick Gold. The price of gold has plunged, a key project is halted and pension fund investors are up in arms about the recent $11.9M signing bonus that Barrick paid to co-chairman John Thornton last year. Here is a G&M article on Pension Fund investors reaction to John Thornton’s signing bonus.
Well, if the stock recovers I will do fine. There is no doubt in my mind that this is a risky choice. The stock has just tanked. The stock chase site shows a lot of recent Don’t Buy comments. Many people like Goldcorp (TSX-G, NYSE-GG) better. Are we in a correction for the stock market? Who know? If we are, it probably has only just begun. The other problem with gold stocks is the price of gold has recently dropped.
If you look at analysts’ recommendations there are Strong Buy, Buy and Hold recommendations, with a toss-up between Buy and Hold (because there a lots of Hold recommendations). The average 12 months consensus target price is $42.00 and this implies capital gains of around 129%. (However, a lot of things can happen in a year.)
The thing is this is a risky stock pick but if things are turned around, there are good profits to be made. Do I want to keep this stock permanently? I do not know yet. I have to see how the present crisis works out. See my spreadsheet at tih.htm.
Barrick Gold Corporation is a gold mining company with a portfolio of operating mines, and advanced exploration and development projects located across five continents. Its web site is here Barrick.
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, April 22, 2013
Enbridge Inc 2
On my other blog I am today writing about Gold Stocks ...continue...
I own this stock of Enbridge Inc. (TSX-ENB, NYSE-ENB). I had followed this stock for some time before I bought it in 2005. I also bought some more in 2008 and 2009. I have made a total return on this stock of 21.04% per year with 3.23% per year from dividends and 17.81% from capital gains.
When I look at insider trading, I find some 48.4M of insider selling and $47.7M of net insider selling. There is only $0.7M of insider buying. The CFO has some 14.6M of insider selling. There are lots and lots of options and options like vehicles outstanding. I cannot get a value on them as all the options come with a strike price.
There is some insider ownership, with the CEO owing $5.5M in shares, the CFO owing 14.2M in shares, an officer owning $04.M in shares and a director owning $2M in shares.
The 5 year low, median and high median Price/Earnings Ratios are 18.05, 20.27 and 22.50. The current P/E is 25.52 based on a stock price of $46.19 and 2013 earnings of $1.81. I get a Graham price of $18.54. The low, median and high median10 year Price/Graham Price Ratios are 1.39, 1.54 and 1.69. The current P/GP is 2.49.
I get a 10 year Price/Book Value per Share Ratio of 2.89. The current P/B Ratio is 5.47 a value some 89% high. The current dividend yield is 2.73% and the 5 year median dividend yield is 3.26% a value some 16% higher.
All my stock price tests suggest that the stock is overpriced. They all suggest that the current price is relatively high to relatively very high.
When I look at the analysts' recommendations I find Buy, Hold and Underperform. However, the vast majority of the recommendations are a Buy. The 12 month consensus stock price is $48.60. This implies a total return of 7.95% with 2.73% from dividends and 5.22% from capital gains.
There is an interesting article at Pipeline Observer is that hedge funds are selling Enbridge.
I get the thesis about investors buying safe and solid utility companies for their dividends. However, every utility company I have reviewed lately has been overbought (or has a relatively high stock price). Personally, I would stay away from this sector until the stock prices are more reasonable.
What are all the investors who bought utility stocks for the dividends going to do when the stock market has a correction? They would have had dividends, but will have lost capital. I think that they will bail.
I am going to hold on to my shares. I do not sell shares of good companies just because they have a relatively high stock price. The market tends to under and over price stocks and I buy for the long term. However, I do not think that now is the time to buy utility stocks. Buying at high prices will materially affect the long term return from every very good stock. See my spreadsheet at enb.htm.
Enbridge is focused on three core businesses of crude oil and liquids pipelines, natural gas pipelines, and natural gas distribution. They operate in Canada and US. Its web site is here Enbridge.
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 of Enbridge Inc. (TSX-ENB, NYSE-ENB). I had followed this stock for some time before I bought it in 2005. I also bought some more in 2008 and 2009. I have made a total return on this stock of 21.04% per year with 3.23% per year from dividends and 17.81% from capital gains.
When I look at insider trading, I find some 48.4M of insider selling and $47.7M of net insider selling. There is only $0.7M of insider buying. The CFO has some 14.6M of insider selling. There are lots and lots of options and options like vehicles outstanding. I cannot get a value on them as all the options come with a strike price.
There is some insider ownership, with the CEO owing $5.5M in shares, the CFO owing 14.2M in shares, an officer owning $04.M in shares and a director owning $2M in shares.
The 5 year low, median and high median Price/Earnings Ratios are 18.05, 20.27 and 22.50. The current P/E is 25.52 based on a stock price of $46.19 and 2013 earnings of $1.81. I get a Graham price of $18.54. The low, median and high median10 year Price/Graham Price Ratios are 1.39, 1.54 and 1.69. The current P/GP is 2.49.
I get a 10 year Price/Book Value per Share Ratio of 2.89. The current P/B Ratio is 5.47 a value some 89% high. The current dividend yield is 2.73% and the 5 year median dividend yield is 3.26% a value some 16% higher.
All my stock price tests suggest that the stock is overpriced. They all suggest that the current price is relatively high to relatively very high.
When I look at the analysts' recommendations I find Buy, Hold and Underperform. However, the vast majority of the recommendations are a Buy. The 12 month consensus stock price is $48.60. This implies a total return of 7.95% with 2.73% from dividends and 5.22% from capital gains.
There is an interesting article at Pipeline Observer is that hedge funds are selling Enbridge.
I get the thesis about investors buying safe and solid utility companies for their dividends. However, every utility company I have reviewed lately has been overbought (or has a relatively high stock price). Personally, I would stay away from this sector until the stock prices are more reasonable.
What are all the investors who bought utility stocks for the dividends going to do when the stock market has a correction? They would have had dividends, but will have lost capital. I think that they will bail.
I am going to hold on to my shares. I do not sell shares of good companies just because they have a relatively high stock price. The market tends to under and over price stocks and I buy for the long term. However, I do not think that now is the time to buy utility stocks. Buying at high prices will materially affect the long term return from every very good stock. See my spreadsheet at enb.htm.
Enbridge is focused on three core businesses of crude oil and liquids pipelines, natural gas pipelines, and natural gas distribution. They operate in Canada and US. Its web site is here Enbridge.
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, April 19, 2013
Enbridge Inc
I own this stock of Enbridge Inc. (TSX-ENB, NYSE-ENB). I had followed this stock for some time before I bought it in 2005. I also bought some more in 2008 and 2009. I have made a total return on this stock of 21.04% per year with 3.23% per year from dividends and 17.81% from capital gains.
This is a stock with a reasonable dividend yield and good dividend increases. The 5 year median dividend yield is 3.26% and the 5 and 10 year dividend increases are at 12.9% and 11.5% per year. On my stock purchased in 2005, I started with a dividend yield of 2.78% and on that money I am now making a yield of 7.02%.
The dividend payout Ratios are fine for this company, with the 5 year median DPR for earnings at 66% and for Cash Flow at 32%. (See my site for information on Dividend Payout Ratios).
Over the past 5 and 10 years the outstanding shares have increased by 1.8% and 2.1% per year. The shares have been increased because of stock options and DRIP and share issues. There has been very nice growth in Revenue per Share at 14% and 16% per year over the past 5 and 10 years. Also adjusted EPS has grown nicely at13% and 9% per year over the past 5 and 10 years.
The Book Value has not grown much over the last 5 and 10 years with growth at just 3.8% and 5.7% per year. However this is because of change in accounting rules from CDN GAAP to US GAAP. If 2011 account was in US GAAP, then the Book Value would have grown between 2011 and 2012 instead of dropping.
The Return on Equity is good at 13.9% and with a 5 year median at also 13.9%. The ROE on comprehensive income is fine at 9%, but this makes it quite a bit lower than the ROE on net income. This is true of the difference between ROE on comprehensive income and net income generally. It can imply that the earnings are not of a good quality.
The thing I do not like about this stock is the high debt level. The current Liquidity Ratio is 0.93 and this is pretty typical of this stock. This means that the current assets do not cover the current liabilities. However, if you add in cash flow after dividends you get a better Liquidity Ratio of 1.21. This is low, but adequate. (Unfortunately, utility companies rely on cash flow to increase their Liquidity Ratios. This is not unusual.)
The Debt Ratio is also a bit low with a current ratio of 1.46. This is also typical of this stock. I prefer a Debt Ratio of at least 1.50. However, this is a utility stock and many utility stocks have rather high debt loads. The Leverage and Debt/Equity Ratios are also not what I like to see with these ratios at 6.94 and 4.77. These are higher than the 5 year medians of these ratios at 4.00 and 2.87 and a bit higher than most utility companies.
This is a core utility holding for me. It has a good history of paying and increasing its dividends. Although like a lot of utility companies, it does have a high debt load. However, investors have been well paid for the risk they take with this stock. See my spreadsheet at enb.htm.
Enbridge is focused on three core businesses of crude oil and liquids pipelines, natural gas pipelines, and natural gas distribution. They operate in Canada and US. Its web site is here Enbridge.
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.
This is a stock with a reasonable dividend yield and good dividend increases. The 5 year median dividend yield is 3.26% and the 5 and 10 year dividend increases are at 12.9% and 11.5% per year. On my stock purchased in 2005, I started with a dividend yield of 2.78% and on that money I am now making a yield of 7.02%.
The dividend payout Ratios are fine for this company, with the 5 year median DPR for earnings at 66% and for Cash Flow at 32%. (See my site for information on Dividend Payout Ratios).
Over the past 5 and 10 years the outstanding shares have increased by 1.8% and 2.1% per year. The shares have been increased because of stock options and DRIP and share issues. There has been very nice growth in Revenue per Share at 14% and 16% per year over the past 5 and 10 years. Also adjusted EPS has grown nicely at13% and 9% per year over the past 5 and 10 years.
The Book Value has not grown much over the last 5 and 10 years with growth at just 3.8% and 5.7% per year. However this is because of change in accounting rules from CDN GAAP to US GAAP. If 2011 account was in US GAAP, then the Book Value would have grown between 2011 and 2012 instead of dropping.
The Return on Equity is good at 13.9% and with a 5 year median at also 13.9%. The ROE on comprehensive income is fine at 9%, but this makes it quite a bit lower than the ROE on net income. This is true of the difference between ROE on comprehensive income and net income generally. It can imply that the earnings are not of a good quality.
The thing I do not like about this stock is the high debt level. The current Liquidity Ratio is 0.93 and this is pretty typical of this stock. This means that the current assets do not cover the current liabilities. However, if you add in cash flow after dividends you get a better Liquidity Ratio of 1.21. This is low, but adequate. (Unfortunately, utility companies rely on cash flow to increase their Liquidity Ratios. This is not unusual.)
The Debt Ratio is also a bit low with a current ratio of 1.46. This is also typical of this stock. I prefer a Debt Ratio of at least 1.50. However, this is a utility stock and many utility stocks have rather high debt loads. The Leverage and Debt/Equity Ratios are also not what I like to see with these ratios at 6.94 and 4.77. These are higher than the 5 year medians of these ratios at 4.00 and 2.87 and a bit higher than most utility companies.
This is a core utility holding for me. It has a good history of paying and increasing its dividends. Although like a lot of utility companies, it does have a high debt load. However, investors have been well paid for the risk they take with this stock. See my spreadsheet at enb.htm.
Enbridge is focused on three core businesses of crude oil and liquids pipelines, natural gas pipelines, and natural gas distribution. They operate in Canada and US. Its web site is here Enbridge.
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, April 18, 2013
Automodular Corp
I own this stock of Automodular Corp. (TSX-AM, OTC-AMZKF). Since January of 2012 I have used this small dividend paying small cap to use up small amounts of money in my TFSA. This includes money left after my main purchases in January and dividend income of this account.
I have some more dividend income at the moment, but I am just wondering if this stock will go lower in the current correction that seems underway. We are dealing with small amounts of money here, so the reason to do this is fun. To the end of March 2013 I have made a return of 104.23% per year, with 28.24% per year coming from dividends and 75.99% per year coming from capital gains.
As far as dividends go, this company paid dividends from 1992 to 2003 and then stopped. They paid a couple of dividends in 2008 and then a special dividend in 2010 and then restarted dividends in 2011. Note that there have been a number of years when this company paid special dividends. Recently special dividends were paid in 2010, 2011 and 2012.
This company did ok in the 2000 bear market and but did suffer in the 2008 bear market. Being in the automotive sector, you would expect the company to suffer in any recession. (Often recessions are started after a bear market starts, as occurred after the 2000 and 2008 bear markets.)
Shareholders that have held this stock for 10 years have not made any money. However, those that have held it for 5 years have. Over the past 5 years capital gains is only at 0.81% per year and dividends were at 14.24% per year giving a total return of 15.05% per year. All the money was from dividends and basically the dividends were special dividends.
There has been some growth in revenue and cash flow in the last 5 and 10 years. The really good growth has been in earnings. (Earnings growth over the past 5 years is at 20% per year.) Shares have decreased over the past 5 years at 4.8% per year and have increased over the past 10 by 4.1% per year. Shares have increased due to stock options and decreased due to buy backs. Currently there is not much in the way of options outstanding.
I get 5 year low, median and high median Price/Earnings Ratios of 1.18, 2.43 and 3.52. The only earnings we have are for last 12 months to December 2012 and that is at $0.82. The current stock price of $2.76 gives us a P/E of 3.37. I get a Graham Price of $6.12. The 10 year low, median and high median Price/Graham Price Ratios are 0.21, 0.47 and 0.66. The current P/GP Ratio is 0.45. On an absolute basis, these ratios are low. On a relative basis, the ratios just say that the stock price is reasonable.
The 10 year Price/Book Value per Share Ratio is 0.96 this is a low P/B Ratio. The current ratio at 1.36 is a reasonable ratio, but it says that the price is relatively high.
The last thing to look at is the dividend yield. Perhaps on a historical basis the dividend yield 8.70% is relatively good. However, the dividend yields of the last couple of years suggest that the stock price is reasonable as the median dividend yield is 8.75% over this period.
There is some insider ownership. The biggest ownership seems to be Franklin Templeton Investments Corp. with 23% of the outstanding shares worth currently around $12M. There does not appear to be any stock options outstanding currently.
There is a rather long and interesting review of this stock by a blogger called Rate Race Freedom. There is another interesting review on the blog Odd Ball Stocks. I cannot find any analysts following this stock.
The question on this stock is can it survive a severe downturn that will probably come before we get out of the current secular bear market. I held some small caps going into the first decline of this secular bear market in 2000 and they were all shattered in some way. I have dividend paying small caps now instead of just small caps, but I do not know if that will make a difference.
It might be an interesting ride. Of course, some of my initial basket of small caps only had revenue, but not much of earnings or cash flow. This is not the case with my current basket of small caps. My current small caps have revenue, earnings, cash flow, book value and dividends.
I think that this company has potential, has very good dividends, but it is risky. Also, the current price of $2.76 is a reasonable price. However, if a nice correction is coming, you might be able to pick this up at a very good price. See my spreadsheet at am.htm.
Automodular Corporation is a supplier of sub-assembly, sequencing and transportation services to the automotive industry - Ford's Oakville Assembly Plant and the renewable energy industry with Vestas Nacelles A/S. Its web site is here Automodular.
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 some more dividend income at the moment, but I am just wondering if this stock will go lower in the current correction that seems underway. We are dealing with small amounts of money here, so the reason to do this is fun. To the end of March 2013 I have made a return of 104.23% per year, with 28.24% per year coming from dividends and 75.99% per year coming from capital gains.
As far as dividends go, this company paid dividends from 1992 to 2003 and then stopped. They paid a couple of dividends in 2008 and then a special dividend in 2010 and then restarted dividends in 2011. Note that there have been a number of years when this company paid special dividends. Recently special dividends were paid in 2010, 2011 and 2012.
This company did ok in the 2000 bear market and but did suffer in the 2008 bear market. Being in the automotive sector, you would expect the company to suffer in any recession. (Often recessions are started after a bear market starts, as occurred after the 2000 and 2008 bear markets.)
Shareholders that have held this stock for 10 years have not made any money. However, those that have held it for 5 years have. Over the past 5 years capital gains is only at 0.81% per year and dividends were at 14.24% per year giving a total return of 15.05% per year. All the money was from dividends and basically the dividends were special dividends.
There has been some growth in revenue and cash flow in the last 5 and 10 years. The really good growth has been in earnings. (Earnings growth over the past 5 years is at 20% per year.) Shares have decreased over the past 5 years at 4.8% per year and have increased over the past 10 by 4.1% per year. Shares have increased due to stock options and decreased due to buy backs. Currently there is not much in the way of options outstanding.
I get 5 year low, median and high median Price/Earnings Ratios of 1.18, 2.43 and 3.52. The only earnings we have are for last 12 months to December 2012 and that is at $0.82. The current stock price of $2.76 gives us a P/E of 3.37. I get a Graham Price of $6.12. The 10 year low, median and high median Price/Graham Price Ratios are 0.21, 0.47 and 0.66. The current P/GP Ratio is 0.45. On an absolute basis, these ratios are low. On a relative basis, the ratios just say that the stock price is reasonable.
The 10 year Price/Book Value per Share Ratio is 0.96 this is a low P/B Ratio. The current ratio at 1.36 is a reasonable ratio, but it says that the price is relatively high.
The last thing to look at is the dividend yield. Perhaps on a historical basis the dividend yield 8.70% is relatively good. However, the dividend yields of the last couple of years suggest that the stock price is reasonable as the median dividend yield is 8.75% over this period.
There is some insider ownership. The biggest ownership seems to be Franklin Templeton Investments Corp. with 23% of the outstanding shares worth currently around $12M. There does not appear to be any stock options outstanding currently.
There is a rather long and interesting review of this stock by a blogger called Rate Race Freedom. There is another interesting review on the blog Odd Ball Stocks. I cannot find any analysts following this stock.
The question on this stock is can it survive a severe downturn that will probably come before we get out of the current secular bear market. I held some small caps going into the first decline of this secular bear market in 2000 and they were all shattered in some way. I have dividend paying small caps now instead of just small caps, but I do not know if that will make a difference.
It might be an interesting ride. Of course, some of my initial basket of small caps only had revenue, but not much of earnings or cash flow. This is not the case with my current basket of small caps. My current small caps have revenue, earnings, cash flow, book value and dividends.
I think that this company has potential, has very good dividends, but it is risky. Also, the current price of $2.76 is a reasonable price. However, if a nice correction is coming, you might be able to pick this up at a very good price. See my spreadsheet at am.htm.
Automodular Corporation is a supplier of sub-assembly, sequencing and transportation services to the automotive industry - Ford's Oakville Assembly Plant and the renewable energy industry with Vestas Nacelles A/S. Its web site is here Automodular.
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, April 17, 2013
Sun Life Financial Inc 2
On my other blog I am today writing about Dividend Growth Companies ...continue...
I own this stock of Sun Life Financial Inc. (TSX-SLF, NYSE-SLF). I first bought it in 2000 when it became a public company, although I have known this company for a longer period. I have not made much money, especially lately, under this company. I have made a total return of 3.8% per year, with 4.23% per year from dividends and a capital loss of 0.43% per year.
When I look at insider trading, I find insider selling of $6.3M and net insider selling at $5.8M. There is a bit of insider buying at 0.5M. Insider selling seems to be of options and buying seems to be under the company plan. There are a number of different options types with this company called Units Performance Share Units, Units Restricted Share Units, Units Sun Shares and Deferred Share Units besides options.
The CEO has shares worth $0.5M and has options are worth $42.6M. The CFO has some shares worth $0.1M and has options worth $13.7M. An officer has shares $0.5M and has options worth $11.4M. A director has shares worth $0.3M and has options worth $0.2M. This is just to give you an idea on insider share ownership and option values.
The 5 year low, median and high median Price/Earnings Ratios are 8.75, 10.40 and 12.05. The current P/E is 10.08 based on a current stock price of $27.57 and 2013 earnings of $2.57. (The 2013 earnings exclude the loss on sale of US Annuity Business as this gives a more realistic picture.)
I get a Graham Price of $35.91 and 10 year low, median and high median Price/Graham Price Ratio of 0.73, 0.96 and 1.06. The current P/GP Ratio is 0.77. (This calculation also uses 2013 earnings excluding loss on sale of US Annuity Business.) Both of these tests show that the stock price is reasonable.
I get a 10 year Price/Book Value per Share Ratio of 1.28 and a current P/B Ratio of 1.23. The current ratio is 96% of the 10 year ratio and suggests a reasonable stock price. The 5 year median Dividend Yield 5.44% and the current dividend yield is 5.22%. The current yield is 4% lower than the 5 year median dividend yield and suggests a reasonable stock price.
When I look at the analysts' recommendation I find recommendations of Buy, Hold and Underperform. Most of the recommendations are a Hold and the consensus recommendation is a Hold. The 12 month stock price consensus is $29.80. This implies a total return of 13.31%, with 8.09% from capital gains and 5.22% from dividends.
This article talks about the sale of US Annuities business and why there might be an earnings hit because of this sale. A number of analysts talk about how this company will do well when interest rates start to raise. (They will rise, eventually.)
I find very little recent information by analysts on this stock. No one seems to be talking much about Life Insurance companies. They have not done much over the last while and probably will not do much until interest rates start to rise. It might be more tempting stock if stock price was cheap, but it is not, it is just reasonable. See my spreadsheet at slf.htm.
Sun Life Financial is a leading international financial services organization providing a diverse range of protection and wealth accumulation products and services to individuals and corporate customers. Chartered in 1865, Sun Life Financial and its partners today have operations in key markets worldwide, including Canada, the United States, the United Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. Its web site is here Sun Life.
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 of Sun Life Financial Inc. (TSX-SLF, NYSE-SLF). I first bought it in 2000 when it became a public company, although I have known this company for a longer period. I have not made much money, especially lately, under this company. I have made a total return of 3.8% per year, with 4.23% per year from dividends and a capital loss of 0.43% per year.
When I look at insider trading, I find insider selling of $6.3M and net insider selling at $5.8M. There is a bit of insider buying at 0.5M. Insider selling seems to be of options and buying seems to be under the company plan. There are a number of different options types with this company called Units Performance Share Units, Units Restricted Share Units, Units Sun Shares and Deferred Share Units besides options.
The CEO has shares worth $0.5M and has options are worth $42.6M. The CFO has some shares worth $0.1M and has options worth $13.7M. An officer has shares $0.5M and has options worth $11.4M. A director has shares worth $0.3M and has options worth $0.2M. This is just to give you an idea on insider share ownership and option values.
The 5 year low, median and high median Price/Earnings Ratios are 8.75, 10.40 and 12.05. The current P/E is 10.08 based on a current stock price of $27.57 and 2013 earnings of $2.57. (The 2013 earnings exclude the loss on sale of US Annuity Business as this gives a more realistic picture.)
I get a Graham Price of $35.91 and 10 year low, median and high median Price/Graham Price Ratio of 0.73, 0.96 and 1.06. The current P/GP Ratio is 0.77. (This calculation also uses 2013 earnings excluding loss on sale of US Annuity Business.) Both of these tests show that the stock price is reasonable.
I get a 10 year Price/Book Value per Share Ratio of 1.28 and a current P/B Ratio of 1.23. The current ratio is 96% of the 10 year ratio and suggests a reasonable stock price. The 5 year median Dividend Yield 5.44% and the current dividend yield is 5.22%. The current yield is 4% lower than the 5 year median dividend yield and suggests a reasonable stock price.
When I look at the analysts' recommendation I find recommendations of Buy, Hold and Underperform. Most of the recommendations are a Hold and the consensus recommendation is a Hold. The 12 month stock price consensus is $29.80. This implies a total return of 13.31%, with 8.09% from capital gains and 5.22% from dividends.
This article talks about the sale of US Annuities business and why there might be an earnings hit because of this sale. A number of analysts talk about how this company will do well when interest rates start to raise. (They will rise, eventually.)
I find very little recent information by analysts on this stock. No one seems to be talking much about Life Insurance companies. They have not done much over the last while and probably will not do much until interest rates start to rise. It might be more tempting stock if stock price was cheap, but it is not, it is just reasonable. See my spreadsheet at slf.htm.
Sun Life Financial is a leading international financial services organization providing a diverse range of protection and wealth accumulation products and services to individuals and corporate customers. Chartered in 1865, Sun Life Financial and its partners today have operations in key markets worldwide, including Canada, the United States, the United Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. Its web site is here Sun Life.
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, April 16, 2013
Sun Life Financial Inc
I own this stock of Sun Life Financial Inc. (TSX-SLF, NYSE-SLF). I have followed and invested in this company for some time. I first bought it in 2000 when it became a public company, although I have known this company for a longer period. I have worked in several Life Insurance companies, however, never at Sun Life.
I have not made much money, especially lately, under this company. I have made a total return of 3.8% per year, with 4.23% per year from dividends and a capital loss of 0.43% per year. Over the past 5 years the company's total return is a loss of 10.82% per year, with the dividends were at 3.07% per year and with a capital loss of 13.89% per year. Over the past 10 years it has done a bit better with a total return of 4.09% per year with dividends at 4.22% per year and a capital loss of 0.13% per year.
The dividends on this stock have not changed since 2008. The 5 and 10 year dividend growth is at 1.76% and 9.9% per year. However, in the current economic climate the dividend yield is quite good. Last year the dividend was averaging around 6.1%, and currently it seems to be running around 5.2%. Some analysts think that the company will raise their dividend in 2015.
The outstanding shares have not changed much over the past 5 and 10 years. The outstanding shares are up by 1.2% per year over the past 5 years and have declined by 0.3% per year over the past 10 years. Shares have increased due to stock options, DRIP and share issues. Shares have decreased due to share buy backs.
What I see is no or little growth in the last 5 and 10 years in revenue, earnings, cash flow and book value. I cannot see much changing until there is an economic improvement. On the other hand I do not think that the firm is in any financial difficulty. I think that the company is strong enough to survive the current economic problems.
Currently I am holding on to my insurance stock. I believe that I will do just fine in the long term. Of course, this all depends on how you look at things. To me, on this stock, I am earning a good dividend while I wait for the insurance sector to do better. It may be a while before the economy improves. The main problem is the low interest rates and lower interest rates will not last forever. (However, such situations can last longer than anyone believes possible.)
I am collecting my dividends and will wait for better times. See my spreadsheet at slf.htm.
Sun Life Financial is a leading international financial services organization providing a diverse range of protection and wealth accumulation products and services to individuals and corporate customers. Chartered in 1865, Sun Life Financial and its partners today have operations in key markets worldwide, including Canada, the United States, the United Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. Its web site is here Sun Life.
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 not made much money, especially lately, under this company. I have made a total return of 3.8% per year, with 4.23% per year from dividends and a capital loss of 0.43% per year. Over the past 5 years the company's total return is a loss of 10.82% per year, with the dividends were at 3.07% per year and with a capital loss of 13.89% per year. Over the past 10 years it has done a bit better with a total return of 4.09% per year with dividends at 4.22% per year and a capital loss of 0.13% per year.
The dividends on this stock have not changed since 2008. The 5 and 10 year dividend growth is at 1.76% and 9.9% per year. However, in the current economic climate the dividend yield is quite good. Last year the dividend was averaging around 6.1%, and currently it seems to be running around 5.2%. Some analysts think that the company will raise their dividend in 2015.
The outstanding shares have not changed much over the past 5 and 10 years. The outstanding shares are up by 1.2% per year over the past 5 years and have declined by 0.3% per year over the past 10 years. Shares have increased due to stock options, DRIP and share issues. Shares have decreased due to share buy backs.
What I see is no or little growth in the last 5 and 10 years in revenue, earnings, cash flow and book value. I cannot see much changing until there is an economic improvement. On the other hand I do not think that the firm is in any financial difficulty. I think that the company is strong enough to survive the current economic problems.
Currently I am holding on to my insurance stock. I believe that I will do just fine in the long term. Of course, this all depends on how you look at things. To me, on this stock, I am earning a good dividend while I wait for the insurance sector to do better. It may be a while before the economy improves. The main problem is the low interest rates and lower interest rates will not last forever. (However, such situations can last longer than anyone believes possible.)
I am collecting my dividends and will wait for better times. See my spreadsheet at slf.htm.
Sun Life Financial is a leading international financial services organization providing a diverse range of protection and wealth accumulation products and services to individuals and corporate customers. Chartered in 1865, Sun Life Financial and its partners today have operations in key markets worldwide, including Canada, the United States, the United Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. Its web site is here Sun Life.
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, April 15, 2013
Barclays Bank PLC ADR 2
On my other blog I am today writing about my blog warning on investing ...continue...
I own this stock of Barclays Bank PLC ADR (UK-BARC, NYSE-BCS). This was one of my forays into international stock. I bought this stock in 2000 and today, I have 3.26% total return per year, with 5.45% per year from dividends and capital loss of 2.19% per year. This valuation is in US$. This stock was doing well until the 2008 crash.
According to the NASDAQ site, there was no insider trading over the past 12 months for this stock. I find it harder to find information on foreign stock. However, there seems to be insider ownership and outstanding share options. At the end of 2012 there were 820M outstanding options with strike prices ranging from £1.41 to £5.22 (or $2.14 and $7.94 US).
The 5 year low, median and high median Price/Earnings Ratios are 2.19, 9.66 and 12.95. (This is quite a spread in P/E Ratios.) The current P/E Ratios is 9.12 basic on stock price of $17.76 and 2013 EPS of $1.95. I get a Graham Price of $34.46 and 10 year Price/Graham Price Ratios of 0.54, 0.71 and 0.95. The current P/GP Ratios is 0.52. So the first test says the stock price is reasonable, but a bit high and the second says it is cheap.
The 10 year Price/Book Value per Share Ratio is 1.05. The current ratio is 0.67. This current ratio is only 63% of the 10 year ratios and says the stock is cheap. Also, if the P/B Ratio is below 1.00, this says the stock is cheap on an absolute basis. (Same story when the P/GP Ratio is below 1.00.)
The current dividend yield is 2.49%. The 5 year median dividend yield is some 7.7% lower at the 2.31%. This test says the stock price is reasonable and on the low side. (This may be a useful test as the dividends were dropped 4 years ago.) So it would seem that the stock price is reasonable and probably on the low side.
There is only one analyst following this stock as a US ADR. However, there are 30 analysts following this stock as a UK Bank. The analysts' recommendations are Strong Buy, Buy, Hold, Underperform and Sell. However, there is only 1 each of the last two recommendations. The consensus recommendation would be a Buy.
The 12 month stock price is £3.57 or $21.71 US$. This implies a total return of 24.69% with 2.49% from dividends and 22.2% from capital gains. (Of course, this is rather optimistic as the US stock exchanges seemed to have gone south strongly today.)
The Insider Monkey site says that Hedge funds are dropping this stock. On AOL today is a recent positive report from The Motley Fool. Goldman Sachs is less favorable and has downgraded Barclays PLC recently.
Personally, I will hold on to my shares. However, I feel that the bank has still a long way to go to recover and I am not tempted to buy more at present. See my spreadsheet at bcs.htm.
One of the largest financial services groups in the United Kingdom, Barclays is engaged in banking, investment banking and asset management worldwide. Its web site is here Barclays.
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 of Barclays Bank PLC ADR (UK-BARC, NYSE-BCS). This was one of my forays into international stock. I bought this stock in 2000 and today, I have 3.26% total return per year, with 5.45% per year from dividends and capital loss of 2.19% per year. This valuation is in US$. This stock was doing well until the 2008 crash.
According to the NASDAQ site, there was no insider trading over the past 12 months for this stock. I find it harder to find information on foreign stock. However, there seems to be insider ownership and outstanding share options. At the end of 2012 there were 820M outstanding options with strike prices ranging from £1.41 to £5.22 (or $2.14 and $7.94 US).
The 5 year low, median and high median Price/Earnings Ratios are 2.19, 9.66 and 12.95. (This is quite a spread in P/E Ratios.) The current P/E Ratios is 9.12 basic on stock price of $17.76 and 2013 EPS of $1.95. I get a Graham Price of $34.46 and 10 year Price/Graham Price Ratios of 0.54, 0.71 and 0.95. The current P/GP Ratios is 0.52. So the first test says the stock price is reasonable, but a bit high and the second says it is cheap.
The 10 year Price/Book Value per Share Ratio is 1.05. The current ratio is 0.67. This current ratio is only 63% of the 10 year ratios and says the stock is cheap. Also, if the P/B Ratio is below 1.00, this says the stock is cheap on an absolute basis. (Same story when the P/GP Ratio is below 1.00.)
The current dividend yield is 2.49%. The 5 year median dividend yield is some 7.7% lower at the 2.31%. This test says the stock price is reasonable and on the low side. (This may be a useful test as the dividends were dropped 4 years ago.) So it would seem that the stock price is reasonable and probably on the low side.
There is only one analyst following this stock as a US ADR. However, there are 30 analysts following this stock as a UK Bank. The analysts' recommendations are Strong Buy, Buy, Hold, Underperform and Sell. However, there is only 1 each of the last two recommendations. The consensus recommendation would be a Buy.
The 12 month stock price is £3.57 or $21.71 US$. This implies a total return of 24.69% with 2.49% from dividends and 22.2% from capital gains. (Of course, this is rather optimistic as the US stock exchanges seemed to have gone south strongly today.)
The Insider Monkey site says that Hedge funds are dropping this stock. On AOL today is a recent positive report from The Motley Fool. Goldman Sachs is less favorable and has downgraded Barclays PLC recently.
Personally, I will hold on to my shares. However, I feel that the bank has still a long way to go to recover and I am not tempted to buy more at present. See my spreadsheet at bcs.htm.
One of the largest financial services groups in the United Kingdom, Barclays is engaged in banking, investment banking and asset management worldwide. Its web site is here Barclays.
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, April 12, 2013
Barclays Bank PLC ADR
I own this stock of Barclays Bank PLC ADR (UK-BARC, NYSE-BCS). This was one of my forays into international stock. I bought this stock in 2000 and today, I have 3.26% total return per year, with 5.45% per year from dividends and capital loss of 2.19% per year. This valuation is in US$. This stock was doing well until the 2008 crash.
This stock is rather hard to valuate. I bought the stock off the New York market as an ADR. There are 4 UK shares for each ADR. The financial reports are in UK pounds. My stock is priced in US$ and of course, I really earning money only in CDN$. My spreadsheet on this stock has to deal with all three currencies.
With the 2008 crash, our banks have held up rather well, not so much the European Banks. Dividends initially dropped by 97% in 2009. They are up some 550% but they are still some 81% lower than pre-crash levels. Dividends are paid rather differently on this stock than for most Canadian and US stocks. At the end of the year a dividend is decided that can be paid at the first of the following year. At one time I got two dividends each year, with one in April (the large payment) and a final one in October. They have changed the dividends to 4 times a year with a larger one in March and 3 smaller in the other quarters of the year.
Outstanding shares have increased by 13% per year and 6% per year over the past 5 and 10 years. Shares have increased because of Stock Options, Share Issues and conversion of notes into shares. No matter how you look at this stock, there has not been much growth per share values in revenue, earnings or cash flow. Mostly these values have declined. There has been some growth in Book Value per Share at 4.4% and 7.9% per year over the past 5 and 10 years.
For 2012, this bank had an earnings loss. There was positive cash flow if you look at cash flow excluding working capital. Since there was an earnings loss in 2012, there is not a positive ROE. However, one problem I see is that the ROE for 2012 is a negative 0.4%. The ROE for comprehensive income is a negative 1%. This amounts to quite a difference.
The Debt Ratio on this bank is fairly normal at 1.04 although Canadian Banks have been moving this ratio up to 1.06. The Leverage and Debt/Equity Ratios at 27.81and 26.64 are a lot higher than Canadian Banks, but this bank has had these ratios high like this for a long time. (For example these ratios for the Royal Bank are 20.91and 19.75 which is rather normal for Canadian Banks.)
In Canadian Dollar terms, I have lost money for every 5 year period since 2008. Also I have basically just broken even, at the end of 2012 in CDN$ terms. Not a great showing. I plan to continue to hold this stock for the time being and it will be interesting to see if it can recover. See my spreadsheet at bcs.htm.
One of the largest financial services groups in the United Kingdom, Barclays is engaged in banking, investment banking and asset management worldwide. Its web site is here Barclays.
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.
This stock is rather hard to valuate. I bought the stock off the New York market as an ADR. There are 4 UK shares for each ADR. The financial reports are in UK pounds. My stock is priced in US$ and of course, I really earning money only in CDN$. My spreadsheet on this stock has to deal with all three currencies.
With the 2008 crash, our banks have held up rather well, not so much the European Banks. Dividends initially dropped by 97% in 2009. They are up some 550% but they are still some 81% lower than pre-crash levels. Dividends are paid rather differently on this stock than for most Canadian and US stocks. At the end of the year a dividend is decided that can be paid at the first of the following year. At one time I got two dividends each year, with one in April (the large payment) and a final one in October. They have changed the dividends to 4 times a year with a larger one in March and 3 smaller in the other quarters of the year.
Outstanding shares have increased by 13% per year and 6% per year over the past 5 and 10 years. Shares have increased because of Stock Options, Share Issues and conversion of notes into shares. No matter how you look at this stock, there has not been much growth per share values in revenue, earnings or cash flow. Mostly these values have declined. There has been some growth in Book Value per Share at 4.4% and 7.9% per year over the past 5 and 10 years.
For 2012, this bank had an earnings loss. There was positive cash flow if you look at cash flow excluding working capital. Since there was an earnings loss in 2012, there is not a positive ROE. However, one problem I see is that the ROE for 2012 is a negative 0.4%. The ROE for comprehensive income is a negative 1%. This amounts to quite a difference.
The Debt Ratio on this bank is fairly normal at 1.04 although Canadian Banks have been moving this ratio up to 1.06. The Leverage and Debt/Equity Ratios at 27.81and 26.64 are a lot higher than Canadian Banks, but this bank has had these ratios high like this for a long time. (For example these ratios for the Royal Bank are 20.91and 19.75 which is rather normal for Canadian Banks.)
In Canadian Dollar terms, I have lost money for every 5 year period since 2008. Also I have basically just broken even, at the end of 2012 in CDN$ terms. Not a great showing. I plan to continue to hold this stock for the time being and it will be interesting to see if it can recover. See my spreadsheet at bcs.htm.
One of the largest financial services groups in the United Kingdom, Barclays is engaged in banking, investment banking and asset management worldwide. Its web site is here Barclays.
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, April 11, 2013
Canadian Natural Resources 2
I own this stock of Canadian Natural Resources (TSX-CNQ, NYSE-CNQ). I bought this stock last year when the dividend yield was relatively high. I have not made much money as the stock is only up 1.32%. In quicken I have a 5.21% total return per year. (I bought it in September 2012.) Of the quicken return I have 4.55% from capital gain and 0.66% from dividends. I just bought more shares
When I look at insider trading, I find $9.3M of insider selling and $8.9M of net insider selling (with a minimal amount of insider buying.) Insiders seem to be selling off options. There are a lot of outstanding options for this company. As far as options are concerned, the company is not quite as bad as our banks, but it is getting there. There is also insider ownership.
The CEO has shares worth $69.4M and has options are worth $55M. The CFO has shares worth $24M and has options worth $22.6M. An officer has shares $8.3M and has options worth $4.6M. A director has shares worth $0.2M and has options worth $0.8M. This is just to give you an idea on insider share ownership and option values.
The 5 year low, median and high median Price/Earnings Ratios are 12.51, 19.28 and 23.53. The current P/E Ratio is 13.38 based on 2013 earnings of $2.43 and current stock price of $32.51. I get a Graham Price of $34.87. The 10 year low, median and high median Price/Graham Price Ratios are 0.87, 1.18 and 1.50. The current P/GP Ratio is 0.93. Both these tests say that the stock price is reasonable.
If you look at the Price/Book Value per Share ratios you get a different story. The 10 year median P/B Ratio is 2.00. The current P/B Ratio is 1.46. The current one is just 73% of the 10 year median ratio. This low current Ratio points to the stock being cheap. (A stock is cheap if the current P/E Ratio is 80% or less than the 10 year median ratio.)
The current dividend yield is 1.54% and the 5 year median dividend yield is 0.72%. The current yield is 113% higher than the 5 year median yield. This says the stock is cheap. (Also, the 10 year median dividend yield is 0.72% and the 10 year high median dividend yield is 1.06%.)
So, my stock testing says that the stock price runs from cheap to reasonable. The thing is that the test that show a reasonable price use estimates and the ones that show that the stock is cheap do not. A lot of dividend investors look to the dividend yield to tell them when to buy a dividend stock. Also, for the P/GP Ratio, a ratio of 0.93, on an absolute basis, says a company is cheap. (A ratio of 0.93 says that the stock price is lower than the Graham Price.)
When I look at the analysts' recommendations, I find Strong Buy, Buy and Hold. The vast majority of the recommendations are a Buy and the consensus recommendation would be a Buy. The 12 month consensus stock price target is $38.60. This implies that the total return would be 20.18% with 1.54 from dividends and 18.73% from capital gains.
There is an interesting article on this company in the Financial Post suggesting that stock of it and Suncor could surge next year. There is another take on this company at cnq.htm. It talks about estimating CNQ's fair value using discounted earnings plus equity model. (The problem with Seeking Alpha site is that they often do not allow you to go to the 2nd page if you are not a registered user.) You can also get a very nice overview of this stock from the Passive Income Earner blogger.
The reason I bought some of this stock is that it is a good company, it is a dividend growth stock and it is currently quite cheap, relatively. I am buying for the long term. I do not know or care if there will be much of an increase in the stock price by next year. It is good for my portfolio for the long term to buy good companies cheap. See my spreadsheet at cnq.htm.
Canadian Natural Resources Ltd. is a senior oil and natural gas exploration, development and production company. The Company's operations are focused in Western Canada, in the U.K. sector of the North Sea and in offshore West Africa. Its web site is here CDN Natural Resources.
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 $9.3M of insider selling and $8.9M of net insider selling (with a minimal amount of insider buying.) Insiders seem to be selling off options. There are a lot of outstanding options for this company. As far as options are concerned, the company is not quite as bad as our banks, but it is getting there. There is also insider ownership.
The CEO has shares worth $69.4M and has options are worth $55M. The CFO has shares worth $24M and has options worth $22.6M. An officer has shares $8.3M and has options worth $4.6M. A director has shares worth $0.2M and has options worth $0.8M. This is just to give you an idea on insider share ownership and option values.
The 5 year low, median and high median Price/Earnings Ratios are 12.51, 19.28 and 23.53. The current P/E Ratio is 13.38 based on 2013 earnings of $2.43 and current stock price of $32.51. I get a Graham Price of $34.87. The 10 year low, median and high median Price/Graham Price Ratios are 0.87, 1.18 and 1.50. The current P/GP Ratio is 0.93. Both these tests say that the stock price is reasonable.
If you look at the Price/Book Value per Share ratios you get a different story. The 10 year median P/B Ratio is 2.00. The current P/B Ratio is 1.46. The current one is just 73% of the 10 year median ratio. This low current Ratio points to the stock being cheap. (A stock is cheap if the current P/E Ratio is 80% or less than the 10 year median ratio.)
The current dividend yield is 1.54% and the 5 year median dividend yield is 0.72%. The current yield is 113% higher than the 5 year median yield. This says the stock is cheap. (Also, the 10 year median dividend yield is 0.72% and the 10 year high median dividend yield is 1.06%.)
So, my stock testing says that the stock price runs from cheap to reasonable. The thing is that the test that show a reasonable price use estimates and the ones that show that the stock is cheap do not. A lot of dividend investors look to the dividend yield to tell them when to buy a dividend stock. Also, for the P/GP Ratio, a ratio of 0.93, on an absolute basis, says a company is cheap. (A ratio of 0.93 says that the stock price is lower than the Graham Price.)
When I look at the analysts' recommendations, I find Strong Buy, Buy and Hold. The vast majority of the recommendations are a Buy and the consensus recommendation would be a Buy. The 12 month consensus stock price target is $38.60. This implies that the total return would be 20.18% with 1.54 from dividends and 18.73% from capital gains.
There is an interesting article on this company in the Financial Post suggesting that stock of it and Suncor could surge next year. There is another take on this company at cnq.htm. It talks about estimating CNQ's fair value using discounted earnings plus equity model. (The problem with Seeking Alpha site is that they often do not allow you to go to the 2nd page if you are not a registered user.) You can also get a very nice overview of this stock from the Passive Income Earner blogger.
The reason I bought some of this stock is that it is a good company, it is a dividend growth stock and it is currently quite cheap, relatively. I am buying for the long term. I do not know or care if there will be much of an increase in the stock price by next year. It is good for my portfolio for the long term to buy good companies cheap. See my spreadsheet at cnq.htm.
Canadian Natural Resources Ltd. is a senior oil and natural gas exploration, development and production company. The Company's operations are focused in Western Canada, in the U.K. sector of the North Sea and in offshore West Africa. Its web site is here CDN Natural Resources.
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, April 10, 2013
Canadian Natural Resources
On my other blog I am today writing about Cash Flow Statements ...continue...
I own this stock of Canadian Natural Resources (TSX-CNQ, NYSE-CNQ). I have been tracking this stock since 2008. This stock is on the dividend lists that I follow of Dividend Achievers (see resources) and Dividend Aristocrats (see indices).
It is a dividend growth stock. The 5 year median dividend yield is just 0.72%. The dividend growth rate is 20% per year over the past 5 years and 21% per year over the past 10 years. The 5 year median Dividend Payout Ratios are 14% for earnings and 5% for cash flow. The DPR for 2013 are expected to be higher at 20% for earnings and 8% for cash flow. The current dividend yield is 1.54%. (This is why I bought another 100 shares of this stock today. I do not have much money any longer to buy shares, but this stock is very out of favour at the moment.)
I had bought some shares late last year when the dividend yield was also good. At that time it was 1.32% and 80% above the 5 year median dividend yield. Now the current dividend yield is some 113% above the 5 year median dividend yield. The company has just raised the dividends and the increase is a 19% increase.
As I said above I just bought some of this stock late last year. The stock price is just up 2.5%. I do not expect much in the way of capital gains at the moment. The oil and gas stocks are very out of favour now. However, I am buying this stock for the future.
For shareholders who bought this stock 5 years ago, the total return is negative at 3.75% per year with dividends at .88% per year and a capital loss of 4.62% per year. For shareholders who bought this stock 10 years ago, the total return would be 18.68% per year, with dividends at 1.47% per year and capital gain at 17.21% per year. This is never going to be a great dividend producer; the value of this stock lays in the increase in dividends each year.
The outstanding shares have not really changed over the past 5 and 10 years. Outstanding shares have increased due to stock options and decreased due to buy backs. Revenue has increased by 5.24% per year and 14.77% per year over the past 5 and 10 years. Revenue per share has increased by 5% and 14.54% per year over the past 5 and 10 years.
The Earnings per Share is down by 6.6% per year over the past 5 years and up by 12.31% over the past 10 years. However, EPS does fluctuate on this stock. If you look at 5 year running averages, EPS is up by 7.17% per year and 17.72% per year over the past 5 and 10 years. The problem with looking at just the EPS 5 years ago and 10 years ago, you may not get an adequate picture of earnings over time as the EPS at 5 or 10 year period could be usually low or high compared with surrounding earnings for these periods.
Cash Flow per Share has decreased by 1.57% per year over the past 5 years and increased by 9.98% per year over the past 10 years. Here again you get a different picture if you look at 5 year running averages. With the 5 year running averages, the CFPS has increased by 6.18% and 14.97% per year over the past 5 and 10 years.
Book Value per Share has increased by 12.50% and 17.20% per year over the past 5 and 10 years.
When you look at Return on Equity for 2012 it is rather low at 7.8%. The ROE on comprehensive income is slightly better, but still low at 7.9%. 2012 was not a great year for this stock. Canadian oil is relatively cheap at present.
The Liquidity Ratio on this stock has never been great. The current one is just 0.48. If you exclude the current portion of the long term debt the Liquidity Ratio rises to just 0.63. This means that current assets cannot cover current liability. The company is relying on cash flow to pay current debt. If you look at the current Liquidity Ratio with cash flow after dividends, the ratio rises to 1.93, a very good value.
The Debt Ratio (comparing total assets and total liabilities) you get a very good ratio of 1.98. The current Leverage and Debt/Equity Ratios are fine at 2.02 and 1.02.
No matter how much some people want us to get off oil and especially oil from the oil sands; this is not going to happen anytime soon. I know that there are problems in getting Canadian oil to market because of the lack of pipelines. If it is not by pipelines, oil will be shipped somehow. I just saw the other day a train that must have had at least 100 oil tanker cars passing through Toronto, just north of where I live. I read the other say that Warren Buffet is invested in a railway company that has thousands of oil tanker cars on order.
I think that we will get off oil at some point, but not today. This is, of course, a risky stock because it is a resource stock. I do not invest much in resource stocks, but could not resist a good stock at relatively cheap prices that has such great dividend increases. See my spreadsheet at cnq.htm.
Canadian Natural Resources Ltd. is a senior oil and natural gas exploration, development and production company. The Company's operations are focused in Western Canada, in the U.K. sector of the North Sea and in offshore West Africa. Its web site is here CDN Natural Resources.
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 of Canadian Natural Resources (TSX-CNQ, NYSE-CNQ). I have been tracking this stock since 2008. This stock is on the dividend lists that I follow of Dividend Achievers (see resources) and Dividend Aristocrats (see indices).
It is a dividend growth stock. The 5 year median dividend yield is just 0.72%. The dividend growth rate is 20% per year over the past 5 years and 21% per year over the past 10 years. The 5 year median Dividend Payout Ratios are 14% for earnings and 5% for cash flow. The DPR for 2013 are expected to be higher at 20% for earnings and 8% for cash flow. The current dividend yield is 1.54%. (This is why I bought another 100 shares of this stock today. I do not have much money any longer to buy shares, but this stock is very out of favour at the moment.)
I had bought some shares late last year when the dividend yield was also good. At that time it was 1.32% and 80% above the 5 year median dividend yield. Now the current dividend yield is some 113% above the 5 year median dividend yield. The company has just raised the dividends and the increase is a 19% increase.
As I said above I just bought some of this stock late last year. The stock price is just up 2.5%. I do not expect much in the way of capital gains at the moment. The oil and gas stocks are very out of favour now. However, I am buying this stock for the future.
For shareholders who bought this stock 5 years ago, the total return is negative at 3.75% per year with dividends at .88% per year and a capital loss of 4.62% per year. For shareholders who bought this stock 10 years ago, the total return would be 18.68% per year, with dividends at 1.47% per year and capital gain at 17.21% per year. This is never going to be a great dividend producer; the value of this stock lays in the increase in dividends each year.
The outstanding shares have not really changed over the past 5 and 10 years. Outstanding shares have increased due to stock options and decreased due to buy backs. Revenue has increased by 5.24% per year and 14.77% per year over the past 5 and 10 years. Revenue per share has increased by 5% and 14.54% per year over the past 5 and 10 years.
The Earnings per Share is down by 6.6% per year over the past 5 years and up by 12.31% over the past 10 years. However, EPS does fluctuate on this stock. If you look at 5 year running averages, EPS is up by 7.17% per year and 17.72% per year over the past 5 and 10 years. The problem with looking at just the EPS 5 years ago and 10 years ago, you may not get an adequate picture of earnings over time as the EPS at 5 or 10 year period could be usually low or high compared with surrounding earnings for these periods.
Cash Flow per Share has decreased by 1.57% per year over the past 5 years and increased by 9.98% per year over the past 10 years. Here again you get a different picture if you look at 5 year running averages. With the 5 year running averages, the CFPS has increased by 6.18% and 14.97% per year over the past 5 and 10 years.
Book Value per Share has increased by 12.50% and 17.20% per year over the past 5 and 10 years.
When you look at Return on Equity for 2012 it is rather low at 7.8%. The ROE on comprehensive income is slightly better, but still low at 7.9%. 2012 was not a great year for this stock. Canadian oil is relatively cheap at present.
The Liquidity Ratio on this stock has never been great. The current one is just 0.48. If you exclude the current portion of the long term debt the Liquidity Ratio rises to just 0.63. This means that current assets cannot cover current liability. The company is relying on cash flow to pay current debt. If you look at the current Liquidity Ratio with cash flow after dividends, the ratio rises to 1.93, a very good value.
The Debt Ratio (comparing total assets and total liabilities) you get a very good ratio of 1.98. The current Leverage and Debt/Equity Ratios are fine at 2.02 and 1.02.
No matter how much some people want us to get off oil and especially oil from the oil sands; this is not going to happen anytime soon. I know that there are problems in getting Canadian oil to market because of the lack of pipelines. If it is not by pipelines, oil will be shipped somehow. I just saw the other day a train that must have had at least 100 oil tanker cars passing through Toronto, just north of where I live. I read the other say that Warren Buffet is invested in a railway company that has thousands of oil tanker cars on order.
I think that we will get off oil at some point, but not today. This is, of course, a risky stock because it is a resource stock. I do not invest much in resource stocks, but could not resist a good stock at relatively cheap prices that has such great dividend increases. See my spreadsheet at cnq.htm.
Canadian Natural Resources Ltd. is a senior oil and natural gas exploration, development and production company. The Company's operations are focused in Western Canada, in the U.K. sector of the North Sea and in offshore West Africa. Its web site is here CDN Natural Resources.
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, April 9, 2013
Artis REIT
I do not own this stock (TSX-AX.UN, OTC-ARESF). It has been mentioned recently as a good REIT to own. A number of people I correspond with mentioned this REIT. However, my first view of it is not positive. Distributions have only increased by 0.57% over the past 5 years. This is extremely low and way below inflation. This is one reason I would not buy this stock.
I looked at the tax information and the distributions are listed as Return of Capital at 100%. Sometimes return of capital is really return of capital. You may be getting a good yield, but if it is return of capital, this would not be a reason to buy this company. In fact it is a reason to avoid it.
Has it made money for its shareholders? Well, over the last 5 years the total return is 7.81% per year with 0.76% per year from capital gain and 7.05% per year from distributions. If you look back to the stocks beginning, the total return is a great 30.96% per year. However, if you go back 7 rather than 8 years to the beginning, the total return is lower at 9.6% per year with 2.12% from capital gain and 7.47% from distributions. The conclusion is that most of the total return is distributions for this stock.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus recommendations would be a Buy recommendation. The 12 month consensus stock price is $17.80. This implies a total return of 18.30% with 6.77% from Dividends and 11.53% from capital gains. It is obvious that analysts do expect capital gains in the future on this stock.
This blogger gives a map of REIT holdings at here at Dividend Gangster. Avrex Money site has compiled a list of all Canadian REITs. They rank this REIT first. Roger Conrad thinks this stock is a Buy.
There are a few of things that I do not like about this stock. The first is that until just recently, this stock has not made a profit. I tend not to like stocks that do not make a profit. Another thing is the increase in outstanding shares has been really high. Outstanding shares have increased over the past 5 years is 30% per year , and over the past 6 years at 40% per year and even higher if you look further back.
Another thing I do not like is the lack of an increase in distributions. Some analysts feel that there will be a modest increase in distributions in 2014, with a larger one in 2015. However, let's not pretend that anyone can see what the future really holds.
The final thing I do not like is the Dividend Payout Ratios. I do understand the use of FFO and AFFO to judge payout ratios rather than earnings. So that is fine. However, I really do not like the DPRs as they apply to cash flow for this stock. The 5 year median DPR for cash for is 102%. The problem I see with FFO and AFFO is that different people seem to calculate them differently and the calculations seem to change over time. I can go along with looking at DPR for FFO and AFFO instead of earnings, but I cannot go along with looking at them and disregard the DPR for cash flow. See my spreadsheet at ax.htm.
Artis REIT's portfolio is comprised of industrial, retail, and office space in Canada and the United States. Its web site is here Artis.
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 looked at the tax information and the distributions are listed as Return of Capital at 100%. Sometimes return of capital is really return of capital. You may be getting a good yield, but if it is return of capital, this would not be a reason to buy this company. In fact it is a reason to avoid it.
Has it made money for its shareholders? Well, over the last 5 years the total return is 7.81% per year with 0.76% per year from capital gain and 7.05% per year from distributions. If you look back to the stocks beginning, the total return is a great 30.96% per year. However, if you go back 7 rather than 8 years to the beginning, the total return is lower at 9.6% per year with 2.12% from capital gain and 7.47% from distributions. The conclusion is that most of the total return is distributions for this stock.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus recommendations would be a Buy recommendation. The 12 month consensus stock price is $17.80. This implies a total return of 18.30% with 6.77% from Dividends and 11.53% from capital gains. It is obvious that analysts do expect capital gains in the future on this stock.
This blogger gives a map of REIT holdings at here at Dividend Gangster. Avrex Money site has compiled a list of all Canadian REITs. They rank this REIT first. Roger Conrad thinks this stock is a Buy.
There are a few of things that I do not like about this stock. The first is that until just recently, this stock has not made a profit. I tend not to like stocks that do not make a profit. Another thing is the increase in outstanding shares has been really high. Outstanding shares have increased over the past 5 years is 30% per year , and over the past 6 years at 40% per year and even higher if you look further back.
Another thing I do not like is the lack of an increase in distributions. Some analysts feel that there will be a modest increase in distributions in 2014, with a larger one in 2015. However, let's not pretend that anyone can see what the future really holds.
The final thing I do not like is the Dividend Payout Ratios. I do understand the use of FFO and AFFO to judge payout ratios rather than earnings. So that is fine. However, I really do not like the DPRs as they apply to cash flow for this stock. The 5 year median DPR for cash for is 102%. The problem I see with FFO and AFFO is that different people seem to calculate them differently and the calculations seem to change over time. I can go along with looking at DPR for FFO and AFFO instead of earnings, but I cannot go along with looking at them and disregard the DPR for cash flow. See my spreadsheet at ax.htm.
Artis REIT's portfolio is comprised of industrial, retail, and office space in Canada and the United States. Its web site is here Artis.
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, April 8, 2013
Contrans Group Inc
On my other blog I am today writing about the Oil Sands...continue...
I do not own this stock of Contrans Group Inc. (TSX-CSS, OTC-CTFIF). I got this off an article in the Globe and Mail called "15 dividend stocks where payouts are expected to grow". This number cruncher article was looking for companies with earnings growth over the last 12 months and a decent Dividend Payout Ratio.
There were two stocks on the list that I have never heard of. This is one of them. I first checked into Contrans Group's dividends First of all it has a nice current dividend yield of 3.95%. Next I looked at its history in regards to dividends. What I found out is that it used to be an Income Trust company and had much higher dividends in the past.
When this company switched to a corporation it reduced dividends by 75% between 2009 and 2010. However, in 2011 they raised the dividend by 25%. Dividends were kept at the new rate throughout 2012. They again raised the dividend 25% in 2013.
Another thing to look at is whether or not shareholders have made any money on this stock. The answer to that question is yes, if we look at values to the end of 2012. However, most of the money was made in distributions or dividends, and very little in capital gains. The 5 and 10 years total return is 8.08% and 13.21% per year. The portion attributable to dividends is 6.92% and 11.81% per year. Capital gains were only at1.16% and 1.40% per year over these periods.
A couple of things I want to mention. The first thing is that the stock seems very volatile. The other thing is that since dividends are much lower, will total return be low in the future? Also, the current stock price ($12.66) is lower than it was 7 years ago in 2006.
I filled in some figures on my spreadsheet to complete 5 and 10 years figures to 2012 (the last financial year published). What basically shows up is that Revenue, Earnings and cash flow over the past 5 years is moving down.
Analysts seem to expect that this 2013 will be a good year for this company. However, they do not expect a good year in 2014. The stock has been moving up lately and the P/E of 13.61 based on 2013 earnings of $0.93 and a current stock price of $12.66. This is higher than the 5 year high median P/E Ratio of 12.05 and would therefore suggest that the stock price is rather high. (The 5 year low and median P/E Ratios are 9.94 and 10.99.)
When I look at analysts' recommendations, I see Buy and Hold recommendations. The consensus recommendation would be a Buy. The 12 months stock price consensus is $12.30. This implies a 12 month total return of 1.18%, with 4.95% from dividends and 2.84% capital loss.
The insider trading report shows minimal insider buying and $.07M of insider selling. The company is also buying back shares for cancellation. One good thing to note is that the CEO owns $41M in shares. He has no options. There are options granted, but not many.
Dividend increases are a little inconsistent, but they are good. The Dividend Payout Ratios are currently around 50% for earnings and 26% for cash flow. These DPRs are fine. I must admit I rather see more balance between the capital gains and dividends. This may change for this company as earnings grow. It is a company worth following. See my spreadsheet at css.htm.
Contrans Group Inc. (Contrans) is engaged in freight transportation. It provides freight transportation services to shippers located in Canada, as well as in the eastern, mid-western and southern United States. Its web site is here Contrans.
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 Contrans Group Inc. (TSX-CSS, OTC-CTFIF). I got this off an article in the Globe and Mail called "15 dividend stocks where payouts are expected to grow". This number cruncher article was looking for companies with earnings growth over the last 12 months and a decent Dividend Payout Ratio.
There were two stocks on the list that I have never heard of. This is one of them. I first checked into Contrans Group's dividends First of all it has a nice current dividend yield of 3.95%. Next I looked at its history in regards to dividends. What I found out is that it used to be an Income Trust company and had much higher dividends in the past.
When this company switched to a corporation it reduced dividends by 75% between 2009 and 2010. However, in 2011 they raised the dividend by 25%. Dividends were kept at the new rate throughout 2012. They again raised the dividend 25% in 2013.
Another thing to look at is whether or not shareholders have made any money on this stock. The answer to that question is yes, if we look at values to the end of 2012. However, most of the money was made in distributions or dividends, and very little in capital gains. The 5 and 10 years total return is 8.08% and 13.21% per year. The portion attributable to dividends is 6.92% and 11.81% per year. Capital gains were only at1.16% and 1.40% per year over these periods.
A couple of things I want to mention. The first thing is that the stock seems very volatile. The other thing is that since dividends are much lower, will total return be low in the future? Also, the current stock price ($12.66) is lower than it was 7 years ago in 2006.
I filled in some figures on my spreadsheet to complete 5 and 10 years figures to 2012 (the last financial year published). What basically shows up is that Revenue, Earnings and cash flow over the past 5 years is moving down.
Analysts seem to expect that this 2013 will be a good year for this company. However, they do not expect a good year in 2014. The stock has been moving up lately and the P/E of 13.61 based on 2013 earnings of $0.93 and a current stock price of $12.66. This is higher than the 5 year high median P/E Ratio of 12.05 and would therefore suggest that the stock price is rather high. (The 5 year low and median P/E Ratios are 9.94 and 10.99.)
When I look at analysts' recommendations, I see Buy and Hold recommendations. The consensus recommendation would be a Buy. The 12 months stock price consensus is $12.30. This implies a 12 month total return of 1.18%, with 4.95% from dividends and 2.84% capital loss.
The insider trading report shows minimal insider buying and $.07M of insider selling. The company is also buying back shares for cancellation. One good thing to note is that the CEO owns $41M in shares. He has no options. There are options granted, but not many.
Dividend increases are a little inconsistent, but they are good. The Dividend Payout Ratios are currently around 50% for earnings and 26% for cash flow. These DPRs are fine. I must admit I rather see more balance between the capital gains and dividends. This may change for this company as earnings grow. It is a company worth following. See my spreadsheet at css.htm.
Contrans Group Inc. (Contrans) is engaged in freight transportation. It provides freight transportation services to shippers located in Canada, as well as in the eastern, mid-western and southern United States. Its web site is here Contrans.
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, April 5, 2013
Canam Group Inc
I do not own this of Canam Group Inc. (TSX-CAM, OTC-CNMGA), but I did for a short while between 2011 and 2013. I bought this at the end part of 2011 because I thought that the market had gone overboard in punishing the stock because of a dividend cut and the company was having a tough time. I thought I could make a few thousand dollars for my RRIF account and that is what I did. I sold my stock in March of this year.
Companies that pay dividends get hit especially hard when they cut or delete dividends. However, I think that the company acted appropriately. It will probably start paying dividends again, but it is hard to say when this will happen. When they cut dividends they were not earning any money. However, they started to earn money again last year and are expected to earn money both this year and next.
The other problem with 2011 was not only did they not earning any money, but they also had a negative cash flow. Cash Flow was again positive in 2012 and is expected to be positive over the next couple of year also.
The outstanding shares have increased by 0.63% over the past 10 years and decreased by 3.16% over the past 5 years. Shares have increased when the company has bought shares for employees and have decreased when the company has bought shares on the open market.
Revenue has not grown over the past 5 and 10 years, but it has not declined much either. The company really has not recovered fully from 2008 and the stock is down some 14.81% per year over the past 5 years. However, the total return over the past 10 years is 3.69% per year with 1.57% from dividends and 1.12% from capital gains.
ROE has not been very good over the past few years. However, the debt ratios are quite good, with Liquidity Ratio currently at 2.28 and the Debt Ratio at 1.82. The Leverage and Debt/Equity Ratio are also fine at 2.22 and 1.22, respectively.
When I look at insider trading I find a minimal amount of insider selling and no insider buying. There does not seem to be much in the way of stock options, but there is insider ownership. The CEO has shares worth $1M and has no options. The CFO has a few shares and no stock options. An officer owns shares worth $59M which is some 16% of the outstanding shares. I.A. Michael Investment Counsel Ltd owns shares worth some $47M and this is some 13% of the outstanding shares.
There are a few analysts following this stock and analysts' recommendations are Buy and Hold with most recommendations being a Buy and the consensus recommendation being a Buy. The 12 months stock price consensus is $9.10. This implies a total return and capital gains of 13.75%.
The 5 year low, median and high median Price/Earnings Ratios are 9.90, 12.43 and 14.95. The current P/E ratio is 14.81 based on 2013 earnings of $0.54 and a current stock price of $8.00. The current Graham price is $10.26. The 10 year low, median and high median Price/Graham Price Ratios are 0.48, 0.66 and 0.90. The current P/GP Ratio is 0.78. Both these tests show the stock price to be reasonable, but a little high.
The 10 year median Price/Book Value per Share Ratio is 0.98. The current P/B Ratio is 0.92. The current P/B Ratio is 93% of the 10 year median Ratio. This test shows that the stock price is reasonable. (To be cheap, the current ratio would have to be only 80% of the 10 year median Ratio.) However, since the P/B Ratio is less than 1.00, this implies that on an absolute basis the stock price is cheap. (The P/GP Ratio being less than 1.00 also implies the same thing.)
I think that this stock is reasonably priced. However, the easy money from its recent problems has already been made. See my spreadsheet at cam.htm.
Canam Group specializes in the design and fabrication of construction products and solutions for the commercial, industrial, institutional, multi-unit residential, and bridge and highway infrastructure markets. This company has offices in Canada, US, Saudi Arabia, United Arab Emirates, India, Romania France and China. Its web site is here Canam.
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.
Companies that pay dividends get hit especially hard when they cut or delete dividends. However, I think that the company acted appropriately. It will probably start paying dividends again, but it is hard to say when this will happen. When they cut dividends they were not earning any money. However, they started to earn money again last year and are expected to earn money both this year and next.
The other problem with 2011 was not only did they not earning any money, but they also had a negative cash flow. Cash Flow was again positive in 2012 and is expected to be positive over the next couple of year also.
The outstanding shares have increased by 0.63% over the past 10 years and decreased by 3.16% over the past 5 years. Shares have increased when the company has bought shares for employees and have decreased when the company has bought shares on the open market.
Revenue has not grown over the past 5 and 10 years, but it has not declined much either. The company really has not recovered fully from 2008 and the stock is down some 14.81% per year over the past 5 years. However, the total return over the past 10 years is 3.69% per year with 1.57% from dividends and 1.12% from capital gains.
ROE has not been very good over the past few years. However, the debt ratios are quite good, with Liquidity Ratio currently at 2.28 and the Debt Ratio at 1.82. The Leverage and Debt/Equity Ratio are also fine at 2.22 and 1.22, respectively.
When I look at insider trading I find a minimal amount of insider selling and no insider buying. There does not seem to be much in the way of stock options, but there is insider ownership. The CEO has shares worth $1M and has no options. The CFO has a few shares and no stock options. An officer owns shares worth $59M which is some 16% of the outstanding shares. I.A. Michael Investment Counsel Ltd owns shares worth some $47M and this is some 13% of the outstanding shares.
There are a few analysts following this stock and analysts' recommendations are Buy and Hold with most recommendations being a Buy and the consensus recommendation being a Buy. The 12 months stock price consensus is $9.10. This implies a total return and capital gains of 13.75%.
The 5 year low, median and high median Price/Earnings Ratios are 9.90, 12.43 and 14.95. The current P/E ratio is 14.81 based on 2013 earnings of $0.54 and a current stock price of $8.00. The current Graham price is $10.26. The 10 year low, median and high median Price/Graham Price Ratios are 0.48, 0.66 and 0.90. The current P/GP Ratio is 0.78. Both these tests show the stock price to be reasonable, but a little high.
The 10 year median Price/Book Value per Share Ratio is 0.98. The current P/B Ratio is 0.92. The current P/B Ratio is 93% of the 10 year median Ratio. This test shows that the stock price is reasonable. (To be cheap, the current ratio would have to be only 80% of the 10 year median Ratio.) However, since the P/B Ratio is less than 1.00, this implies that on an absolute basis the stock price is cheap. (The P/GP Ratio being less than 1.00 also implies the same thing.)
I think that this stock is reasonably priced. However, the easy money from its recent problems has already been made. See my spreadsheet at cam.htm.
Canam Group specializes in the design and fabrication of construction products and solutions for the commercial, industrial, institutional, multi-unit residential, and bridge and highway infrastructure markets. This company has offices in Canada, US, Saudi Arabia, United Arab Emirates, India, Romania France and China. Its web site is here Canam.
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, April 4, 2013
Canadian Tire Corp 2
On my other blog I am today writing about Proxies ...continue...
I own this stock of Canadian Tire Corp (TSX-CTC.A, OTC- CDNAF). I first bought this stock in 2000 and then more in 2009 and 2010. I have made a total return of 10.09% per year on this stock, with 8.4% from capital gain and 1.69% from dividends. I made most of this return on the stock I bought in 2000.
When I look at insider trading I find some $26.1M of insider selling and $8.8M of Insider Buying. The net selling is at $17.3M. All insiders' selling is by the CFO and he seems to be selling off some of his non-voting Class A shares. Problem is you never really know why people sell shares. They could just need the money.
The CEO has Class A shares worth $1.9Mand has options are worth $55.9M. The CFO has Class A shares worth $61M and Common (voting) share worth $36.3M and has options worth $7.8M. CTC Dealers own $58M of Class A shares and $60.5M of Common shares. They have some 20% of the Common Shares. Martha Gardiner Billes has almost 62% of the Common shares. There is a lot of insider ownership.
Sun Life also owns substantial amount of Class A shares worth around $169M. Generally the Common (voting) shares sell at a premium to the Class A Shares. That premium is current running around $15.
I get 5 year low, median and high median Price/Earnings Ratios of 9.41, 11.12 and 12.26. The current P/E Ratio is 10.68. I get a Graham Price of $94.00. The 10 year low, median and high median Price/Graham Price Ratios are 0.68, 0.81 and 1.02. The current P/GP Ratio is 0.76. Both these tests suggest a reasonable stock price.
The 10 year median Price/Book Value per Share Ratio 1.35. The current P/B Ratio is 1.22. The current P/B Ratio is some 90% of the 10 year median ratio and this suggests a reasonable stock price.
The 5 year median Dividend Yield is 1.75%. The current dividend yield is 1.96% a value around 12% higher. It generally signals a good stock price when the current Dividend Yield is higher than the 5 year median Dividend Yield. However it is only 12% higher so the price looks more reasonable than cheap.
When I look at the analysts' recommendations I find Strong Buy, Buy and Hold. The consensus recommendation is a Buy. (This is the most common configuration for analysts' recommendations.) The 12 month consensus stock price is $78.60. This implies a total return of 11.94% with 1.96% from dividends and 9.98% from capital gains.
Of course the elephant in the room is that recent fall in the TSX. It is also interesting that the S&P500 is doing better than the TSX as it did not fall as much as the TSX yesterday and it was up a bit today. Are stocks going to get a lot cheaper soon? I do not know. We certainly are nowhere near solving the debt crisis. However, it is not May yet, so prices may hold up for a bit longer.
This is considered a growth stock. It has a low dividend yield, with a 5 year median dividend yield of 1.75%. The dividend increases are good with 10 year growth in dividend at 11.6%. Dividend Payout Ratios are good at 19% for earnings and 9% for cash flow. This would appear to be a good growth stock at a reasonable price. See my spreadsheet at ctc.htm.
Canadian Tire Corp engages in retail sales, financial services and petroleum sales. They own Canadian Tire Store, Gas Outlets, Parts Source Stores and Mark's Work Warehouse. The Canadian Tire stores offer a unique range of automotive, sports and leisure and home products. The company is controlled by the Billes family who own most of the voting shares. Its web site is here Canadian Tire.
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 of Canadian Tire Corp (TSX-CTC.A, OTC- CDNAF). I first bought this stock in 2000 and then more in 2009 and 2010. I have made a total return of 10.09% per year on this stock, with 8.4% from capital gain and 1.69% from dividends. I made most of this return on the stock I bought in 2000.
When I look at insider trading I find some $26.1M of insider selling and $8.8M of Insider Buying. The net selling is at $17.3M. All insiders' selling is by the CFO and he seems to be selling off some of his non-voting Class A shares. Problem is you never really know why people sell shares. They could just need the money.
The CEO has Class A shares worth $1.9Mand has options are worth $55.9M. The CFO has Class A shares worth $61M and Common (voting) share worth $36.3M and has options worth $7.8M. CTC Dealers own $58M of Class A shares and $60.5M of Common shares. They have some 20% of the Common Shares. Martha Gardiner Billes has almost 62% of the Common shares. There is a lot of insider ownership.
Sun Life also owns substantial amount of Class A shares worth around $169M. Generally the Common (voting) shares sell at a premium to the Class A Shares. That premium is current running around $15.
I get 5 year low, median and high median Price/Earnings Ratios of 9.41, 11.12 and 12.26. The current P/E Ratio is 10.68. I get a Graham Price of $94.00. The 10 year low, median and high median Price/Graham Price Ratios are 0.68, 0.81 and 1.02. The current P/GP Ratio is 0.76. Both these tests suggest a reasonable stock price.
The 10 year median Price/Book Value per Share Ratio 1.35. The current P/B Ratio is 1.22. The current P/B Ratio is some 90% of the 10 year median ratio and this suggests a reasonable stock price.
The 5 year median Dividend Yield is 1.75%. The current dividend yield is 1.96% a value around 12% higher. It generally signals a good stock price when the current Dividend Yield is higher than the 5 year median Dividend Yield. However it is only 12% higher so the price looks more reasonable than cheap.
When I look at the analysts' recommendations I find Strong Buy, Buy and Hold. The consensus recommendation is a Buy. (This is the most common configuration for analysts' recommendations.) The 12 month consensus stock price is $78.60. This implies a total return of 11.94% with 1.96% from dividends and 9.98% from capital gains.
Of course the elephant in the room is that recent fall in the TSX. It is also interesting that the S&P500 is doing better than the TSX as it did not fall as much as the TSX yesterday and it was up a bit today. Are stocks going to get a lot cheaper soon? I do not know. We certainly are nowhere near solving the debt crisis. However, it is not May yet, so prices may hold up for a bit longer.
This is considered a growth stock. It has a low dividend yield, with a 5 year median dividend yield of 1.75%. The dividend increases are good with 10 year growth in dividend at 11.6%. Dividend Payout Ratios are good at 19% for earnings and 9% for cash flow. This would appear to be a good growth stock at a reasonable price. See my spreadsheet at ctc.htm.
Canadian Tire Corp engages in retail sales, financial services and petroleum sales. They own Canadian Tire Store, Gas Outlets, Parts Source Stores and Mark's Work Warehouse. The Canadian Tire stores offer a unique range of automotive, sports and leisure and home products. The company is controlled by the Billes family who own most of the voting shares. Its web site is here Canadian Tire.
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, April 3, 2013
Canadian Tire Corp
I have finished loading up my RRSP/RRIF accounts with cash for withdrawals over the next few years, so I am ready for the next crash. I had a bit of extra money after selling off low dividend stocks in my RRSP account, so I bought some more Manulife Financial Corp (TSX-MFC). The current yield on this stock is 3.56%.
I own this stock of Canadian Tire Corp (TSX-CTC.A, OTC- CDNAF). I first bought this stock in 2000 and then more in 2009 and 2010. The later purchases were for my trading account. This stock is more suited for a trading account then an RRSP type account because the dividend rate is low. The 5 year median is just 1.75%.
This stock may have a low dividend rate for the dividend increases are good. Over the past 5 and 10 years, the dividends have increased by 10% and 11.6%, respectively. The last increase was in 2013 and that increase was for 16.7%. This is a consumer discretionary stock, so the dividend increases can vary a lot.
I have made a total return of 10.09% per year on this stock, with 8.4% from capital gain and 1.69% from dividends. I made most of this return on the stock I bought in 2000. Of you look just at the later purchases, I have made only 5.94% per year, with 1.67% from dividends and 4.27% from capital gains. I expect that over the longer term I will do better on these purchases.
The last 5 years have not been good for investors in this stock. Basically, people that invested 5 years ago have broken even on this stock with 1.33% from dividends and a capital loss of 1.33%. The 10 year return is much better at 9.5%, with 1.6% from dividends and 7.9% from capital gain. This is a consumer discretionary stock, so you should expect a decent return over the longer term, but not so much in the short term.
The number of outstanding shares have decreased by 0.8% over the past 5 years and increased by .16% over the past 10 years. These are just marginal changes. The outstanding shares have increased due to stock options and DRIP and decreased due to stock buy backs.
Revenue has increased by 5.8% and 6.8% per year over the past 5 and 10 years. Revenue per Share has increased by 5.9% and 6.6% per year over the past 5 and 10 years. This is not a great increase but it is decent.
Earnings per Share have grown by 5.6% and 9.2% per year over the past 5 and 10 years. Cash Flow per Share has increase 17% and 9.6% per year over the past 5 and 10 years. Book Value per Share has increased by 9.1% and 8.4% per year. So the company has done ok.
The Return on Equity for this stock mostly runs at 10% or better. It has a 5 year median ROE of 10.5% and an ROE of 10.5% for the financial year ending in 2012. The ROE on Comprehensive Income for 2012 is close to the ROE on Net Income. That ROE is 10%. The 5 year median ROE on Comprehensive income is 10.9%. The Net Income and Comprehensive Income have varied over the years.
This stock has two types of stocks, as there are voting and non-voting shares. The Type A stock, largely sold on the TSX, is the non-voting shares. There is a large insider ownership. Often this results in good debt ratios and this stock is no exception.
The current Liquidity Ratio is quite good at 1.68. The current Debt Ratio is also good at 1.57. The Leverage and Debt/Equity Ratios, while not that low are fine at 2.77 and 1.77.
Over the longer term, this stock should be a solid performer. You would buy it for diversification and for the increasing dividend. See my spreadsheet at ctc.htm.
Canadian Tire Corp engages in retail sales, financial services and petroleum sales. They own Canadian Tire Store, Gas Outlets, Parts Source Stores and Mark's Work Warehouse. The Canadian Tire stores offer a unique range of automotive, sports and leisure and home products. The company is controlled by the Billes family who own most of the voting shares. Its web site is here Canadian Tire.
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 of Canadian Tire Corp (TSX-CTC.A, OTC- CDNAF). I first bought this stock in 2000 and then more in 2009 and 2010. The later purchases were for my trading account. This stock is more suited for a trading account then an RRSP type account because the dividend rate is low. The 5 year median is just 1.75%.
This stock may have a low dividend rate for the dividend increases are good. Over the past 5 and 10 years, the dividends have increased by 10% and 11.6%, respectively. The last increase was in 2013 and that increase was for 16.7%. This is a consumer discretionary stock, so the dividend increases can vary a lot.
I have made a total return of 10.09% per year on this stock, with 8.4% from capital gain and 1.69% from dividends. I made most of this return on the stock I bought in 2000. Of you look just at the later purchases, I have made only 5.94% per year, with 1.67% from dividends and 4.27% from capital gains. I expect that over the longer term I will do better on these purchases.
The last 5 years have not been good for investors in this stock. Basically, people that invested 5 years ago have broken even on this stock with 1.33% from dividends and a capital loss of 1.33%. The 10 year return is much better at 9.5%, with 1.6% from dividends and 7.9% from capital gain. This is a consumer discretionary stock, so you should expect a decent return over the longer term, but not so much in the short term.
The number of outstanding shares have decreased by 0.8% over the past 5 years and increased by .16% over the past 10 years. These are just marginal changes. The outstanding shares have increased due to stock options and DRIP and decreased due to stock buy backs.
Revenue has increased by 5.8% and 6.8% per year over the past 5 and 10 years. Revenue per Share has increased by 5.9% and 6.6% per year over the past 5 and 10 years. This is not a great increase but it is decent.
Earnings per Share have grown by 5.6% and 9.2% per year over the past 5 and 10 years. Cash Flow per Share has increase 17% and 9.6% per year over the past 5 and 10 years. Book Value per Share has increased by 9.1% and 8.4% per year. So the company has done ok.
The Return on Equity for this stock mostly runs at 10% or better. It has a 5 year median ROE of 10.5% and an ROE of 10.5% for the financial year ending in 2012. The ROE on Comprehensive Income for 2012 is close to the ROE on Net Income. That ROE is 10%. The 5 year median ROE on Comprehensive income is 10.9%. The Net Income and Comprehensive Income have varied over the years.
This stock has two types of stocks, as there are voting and non-voting shares. The Type A stock, largely sold on the TSX, is the non-voting shares. There is a large insider ownership. Often this results in good debt ratios and this stock is no exception.
The current Liquidity Ratio is quite good at 1.68. The current Debt Ratio is also good at 1.57. The Leverage and Debt/Equity Ratios, while not that low are fine at 2.77 and 1.77.
Over the longer term, this stock should be a solid performer. You would buy it for diversification and for the increasing dividend. See my spreadsheet at ctc.htm.
Canadian Tire Corp engages in retail sales, financial services and petroleum sales. They own Canadian Tire Store, Gas Outlets, Parts Source Stores and Mark's Work Warehouse. The Canadian Tire stores offer a unique range of automotive, sports and leisure and home products. The company is controlled by the Billes family who own most of the voting shares. Its web site is here Canadian Tire.
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, April 2, 2013
Ballard Power Systems Inc
On my other blog I am today writing about Turnaround Situations continue...
I do not own this stock of Ballard Power Systems Inc. (TSX-BLD, NASDAQ-BLDP), but I did once. I fell in love with the idea of cars running with fuel cells. I could help save the environment and also make some money. It was very attractive. However, it did not work out. I probably should not have bought this stock based on an attractive new technology that would save the world.
I bought the stock in 1997 and at first it soared. However, by the time I sold it in 2006, I had a loss of 5.3% per year or a total 38% loss on my purchase. It is too bad, but it was a great idea. It was a good job I sold when I did because the current price is some 92% less than my purchase price. I did not have much invested, so I did not lose much. However I no longer buy small caps with good ideas. I want them also to be earning money and pay dividends. Why I did not invest much was that I generally test out stocks before I get into them in a major way.
The problem with analyzing this stock is that most ratios are meaningless because the company has no positive earnings and no positive cash flow. They only thing they have is revenue. So, using the Price/Sales per Share Ratios, I get a 5 year median P/S Ratio of 2.95 and a current one of 1.47. Since the current one is only 50% of the 5 year median Ratio, it means the stock is cheap. The above current P/S Ratio is based on $62M Revenue estimates for 2013 and the current stock price of $1.02.
I can also look at the Price/Book Value per Share Ratios. The 10 year median P/B Ratio is 1.00 and the current P/B Ratio is 1.47. The current P/B is some 46% higher than the 10 year median and suggests a rather high price. A problem with Book Value is that the Book Value on this stock has been decreasing rapidly.
When I look at insider trading, I find a small amount of both insider buying and insider selling. There are options and a number of option type vehicles like Deferred Share Units, Restricted Share Units, Units Deferred Share Units and Units Restricted Share Units. The CEO has shares worth $.7Mand has options are worth $4.2M. The CFO has shares worth $0.1M and has options worth $1 M.
When I look for analysts' recommendations, I find one Hold recommendation. The 12 month stock price consensus is $1.00. This implies no real change in stock price over the next year. However, I should point out that there seems to be only 1 analyst following this stock.
Ballard Power Systems shares soared in March 2013 on deal with Volkswagen. However, the stock only did soar initially and then it returned prior levels. See the article in the Vancouver Sun . This occurred several times when I had the stock. A number of car companies were interested in the technology. However, after a while they lost interest and Ballard was just doing stuff with generating electricity.
I am still following this stock as I find the fuel cell concept interesting. However, it is hard to say if this company will ever make any money for shareholders. It certainly was not the company's fault that the stock price soared so high in the tech bubble of 2000. It has occasionally made money, but whether or not this company will ever be profitable is hard to say. See my spreadsheet at bld.htm.
Ballard Power Systems Inc. is engaged in design, development, manufacture, sale and service of fuel cell products for a variety of applications, focusing on motive power (material handling and buses) and stationary power (back-up power and distributed generation). It is also engaged in proton exchange membrane (PEM) fuel cell development and commercialization. Its web site is here Ballard.
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 Ballard Power Systems Inc. (TSX-BLD, NASDAQ-BLDP), but I did once. I fell in love with the idea of cars running with fuel cells. I could help save the environment and also make some money. It was very attractive. However, it did not work out. I probably should not have bought this stock based on an attractive new technology that would save the world.
I bought the stock in 1997 and at first it soared. However, by the time I sold it in 2006, I had a loss of 5.3% per year or a total 38% loss on my purchase. It is too bad, but it was a great idea. It was a good job I sold when I did because the current price is some 92% less than my purchase price. I did not have much invested, so I did not lose much. However I no longer buy small caps with good ideas. I want them also to be earning money and pay dividends. Why I did not invest much was that I generally test out stocks before I get into them in a major way.
The problem with analyzing this stock is that most ratios are meaningless because the company has no positive earnings and no positive cash flow. They only thing they have is revenue. So, using the Price/Sales per Share Ratios, I get a 5 year median P/S Ratio of 2.95 and a current one of 1.47. Since the current one is only 50% of the 5 year median Ratio, it means the stock is cheap. The above current P/S Ratio is based on $62M Revenue estimates for 2013 and the current stock price of $1.02.
I can also look at the Price/Book Value per Share Ratios. The 10 year median P/B Ratio is 1.00 and the current P/B Ratio is 1.47. The current P/B is some 46% higher than the 10 year median and suggests a rather high price. A problem with Book Value is that the Book Value on this stock has been decreasing rapidly.
When I look at insider trading, I find a small amount of both insider buying and insider selling. There are options and a number of option type vehicles like Deferred Share Units, Restricted Share Units, Units Deferred Share Units and Units Restricted Share Units. The CEO has shares worth $.7Mand has options are worth $4.2M. The CFO has shares worth $0.1M and has options worth $1 M.
When I look for analysts' recommendations, I find one Hold recommendation. The 12 month stock price consensus is $1.00. This implies no real change in stock price over the next year. However, I should point out that there seems to be only 1 analyst following this stock.
Ballard Power Systems shares soared in March 2013 on deal with Volkswagen. However, the stock only did soar initially and then it returned prior levels. See the article in the Vancouver Sun . This occurred several times when I had the stock. A number of car companies were interested in the technology. However, after a while they lost interest and Ballard was just doing stuff with generating electricity.
I am still following this stock as I find the fuel cell concept interesting. However, it is hard to say if this company will ever make any money for shareholders. It certainly was not the company's fault that the stock price soared so high in the tech bubble of 2000. It has occasionally made money, but whether or not this company will ever be profitable is hard to say. See my spreadsheet at bld.htm.
Ballard Power Systems Inc. is engaged in design, development, manufacture, sale and service of fuel cell products for a variety of applications, focusing on motive power (material handling and buses) and stationary power (back-up power and distributed generation). It is also engaged in proton exchange membrane (PEM) fuel cell development and commercialization. Its web site is here Ballard.
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, April 1, 2013
Easter Monday
Since I stopped working, I have treated Easter Monday as a holiday. I became a single mother when my child was 3. The problem with Easter Monday was that the day care and schools were closed and I always had to scramble to get someone to babysit because I had to work. In the end I always got someone, but it was never fun.
I now have the opportunity to relax and enjoy this day, so I do.
I now have the opportunity to relax and enjoy this day, so I do.
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