On my other blog I am today writing about building an Emergency Fund...continue...
I do not own this stock Superior Plus Corp (TSX-SPB, OTC-SUUIF). I started to follow this stock as it was an income trust company that was talked about in the Money Reporter from MPL Communications. This company changed to a corporation from a unit trust (TSX-SPF.UN) in 2009.
In 2011 after this company changed to a corporation, it lowered the dividend by some 63%. Since then the dividend payouts or distributions have not changed. Dividends are down by 17.5% per year and 11% per year over the past 5 and 10 years. Prior to 2011 the dividends did fluctuate, with increases some years and decreases other years.
There were 3 years of negative earnings over the past 10 years. If you add together the EPS for the last 5 years you get a negative value of $0.87. The 5 year running average EPS is a negative $0.17. If you have negative earnings, they are obviously paying out more in dividends then they are earning. The 5 year median Dividend Payout Ratio for cash flow is 76.5%.
The current Liquidity Ratio is good at 1.50, but this is an unusually high ratio for this company. The current Debt Ratio is low at 1.37. The assets can cover the liabilities, but most people want to see a better ratio and one at least at 1.50. The current Leverage and Debt/Equity Ratio are ok at 3.68 and 2.68 (not either high or low).
Revenues per Share are up over the past 5 and 10 years. Using the 5 year running averages, I get growth of 5.5% per year and 8.3% per year over these periods. Earnings are down no matter how you look at them. Cash Flows per Share are down if you look at them over the past 5 and 10 years. However, there is no growth if you use 5 year running averages over the past 5 and 10 years.
When I look at insider trading, I find $7.8M of insider selling and $1.2M of insider buying. Insiders do not have any thing called options, but they have option like vehicles called Rights Business Performance Share Units, Rights Business Restricted Share Units, Rights Performance Share Units, Rights Deferred Share Units and Rights Restricted Share Units. Insiders also own Convertible Debentures with interest rates for around 5.75% to 7.5%. There are very good rates.
The CEO has shares worth $19.2M and has options worth $2M. The CFO has shares worth $3.4M and has options worth $6.3M. An officer has shares worth $2.5M and has options worth $1.6M. A director has shares worth $0.5M and has options worth $0.3M. This is just to give you an idea on insider share ownership and option values.
When I look at analysts' recommendations, I find Buy and Hold recommendations. The consensus recommendation is a Buy recommendation. The 12 month consensus stock price is $13.10. This implies a total return of 7.28% with 4.7% from dividends and 2.58% from capital gains.
The current Price/Earnings Ratio is 12.96 which is not bad. It is close, but higher than the 5 year median high of 12.52. This is based on a stock price of $12.77 and 2013 of $0.99. However, there has been 2 years within the past 5 years that the P/E was negative, so median values may not tell you much.
I get a Graham price of $9.83. The current Price/Graham price Ratio is 1.30. The 10 year median P/GP Ratios are 0.87, 1.19 and 1.62. This put the stock price on the high side, but still in reasonable territory. The 10 year median Price/Book Value per Share Ratio is 2.36 and the current ratio is 24% higher at 2.93. This suggests that the stock price is relatively high. However, the Book Value has been declining over the past 5 and 10 years.
One analyst thought the company was a longer-term turnaround story that has a current good yield of 4.7%. A Forbes article says that looking at a chart of dividends from this company says that you cannot trust the current one to continue. A G&M article talks about this company being a turnaround story.
I still do not like it. Yes, it is paying down its debt. It may make money in the future, but it has not proven it that it can. It has been all over the place with dividends. So, who knows what it might do with dividends in the future. It may have had good reasons to change the dividends the way that it has.
However, I like the way a company like Leon's handle their dividends. If they have extra money, they pay out an extra dividend. They do not raise the based dividends unless they are sure that they can continue with them. This is a better way of handling dividends for shareholders that increasing them in good times and decreasing them when things are not so good.
Yes, it may be a turnaround story, but considering the risks, I cannot image anyone would get a good reward for the turnaround. If I go into a turnaround situation, I want the possibility of a very good return in deed. See my spreadsheet at spb.htm.
Superior Plus Corp. is a group of diversified businesses that operate within three primary divisions. Superior's Energy Services division provides distribution, wholesale procurement and related services in relation to propane, heating oil and other refined fuels throughout Canada and the North Eastern United States. Superior's Specialty Chemicals division is a leading supplier of sodium chlorate and related technology to the pulp and paper sector and a regional Midwest supplier of chloralkali and potassium based products. Superior's Construction Products Distribution division is a leading distributor of walls, ceilings and insulation products to the Canadian and United States construction industry. Its web site is here Superior Plus.
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, July 31, 2013
Tuesday, July 30, 2013
Newfoundland Capital Corp 2
I do not own this stock Newfoundland Capital Corp (TSX-NCC.A, TSX-NCC.B). I started to follow this stock as it was suggested as a decent dividend paying stock for investment purposes. It is not on any dividend lists that I follow. This is probably because dividends have been inconsistent.
When I look at insiders trading, I find a small amount of insider buying and no insider selling. There are two classes of shares, the subordinate voting shares of Class A and the multiple voting shares of Class B. One officer of the company has practically all the Class B shares. There are no only options under this company but other option like vehicles called Share Appreciation Rights.
The CEO has shares worth $7.5M and has options worth $4.3M. The CFO has shares worth $0.2M and has options worth $0.2M. An officer has shares worth $0.3M and has options worth $1.4M. Another officer has shares worth $132.4M of Class A Shares and almost all the Class B shares worth $32Mand has options worth $6.4M. A director has shares worth $4 M 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 per Share Ratios are 12.56, 15.81 and 19.07. The current P/E Ratio is 12.88 based on a stock price of $8.50 and 2013 earnings estimate of $0.66. By this measure the stock is relatively cheap.
I get a Graham Price of $7.86. The 10 year low, median and high median Price/Graham Price Ratios are 1.07, 1.24 and 1.41. The current P/GP Ratio is 1.08. This suggests also that the stock is relatively cheap.
The 10 year median Price/Book Value per Share Ratio is 2.08. The current ratio is 2.04 a value some 98% of the 10 year ratio. This ratio suggests that the stock price is relatively reasonable.
The current dividend yield is 2.12% and the 5 year median dividend yield is 1.66%. The current dividend yield is some 28% higher than the 5 year medina yield. This test suggests that the stock price is cheap. (Note that the 10 year median dividend yield is a bit lower at 1.61%.)
When I look at analysts' recommendations, I find only one analyst following this stock and the recommendation is a Hold. The 12 month stock price is given as $10.00 and this implies a total return of 19.76% with 2.12% from Dividends and $17.65% from capital gains. (To me the recommendation of a Hold and a 12 months total return of almost 20% do not match up. You would think that a Hold recommendation would have a much lower 12 month total return.)
If you look at the last 12 months which includes the most recent quarterly report of March 2013, compared the 12 month ending at the end of 2012, EPS are up by 14%. However, if you look at revenues and cash flow, the growth is marginal. The estimates for 2013 do show that growth in EPS would greatly outstrip growth in Revenues and Cash Flow (89% growth compared to 4.5% and 8.7% growth, respectively).
The stock price spiked over 25% in April 2013. However, I cannot find any reason for this. There is not much coverage for this stock. Above, I could only find one analysts giving this stock a rating. I find this an interesting company. You would buy it for diversifications purposes.
I cannot see why the one analyst gives this stock a Hold rating. Perhaps this is because EPS were down last year. However, EPS tend to fluctuate quite a bit for this stock. Also perhaps if you look at the P/E using last 12 month's earnings (to March 2013), the P/E would be 21.25, a relatively high P/E for this company. Also, the estimates given last year, only the Revenue estimates were close. The estimates for EPS and CFPS were quite a bit off.
However, I think that the test that is the best is the dividend yield one and this is signally a cheap price. The P/B Ratio is signaling a reasonable price and I think that these two tests are the best to use. The company has a reasonable dividend and does raise dividends, although not consistently, but dividend growth is good. The company has decent growth and the balance sheet is fine. The ROE is good. I do not see why it is not given a buy rating. See my spreadsheet at ncc.htm.
This is the second of two parts. The first part was posted on Monday, July 29th, 2013 and is available here.
Newfoundland Capital Corporation Limited also owns and operates Newcap Radio. Newcap Radio is one of Canada's leading radio broadcasters with 79 licenses across Canada. The Company reaches millions of listeners each week through a variety of formats and is a recognized industry leader in radio programming, sales and networking. The Company has 58 FM and 21 AM licenses spanning the country employing over 800 radio professionals in Canada. Newfoundland Capital Corporation Limited also owns and operates the Glynmill Inn, Corner Brook, Newfoundland and Labrador. Its web site is here Newfoundland Capital Corp.
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 insiders trading, I find a small amount of insider buying and no insider selling. There are two classes of shares, the subordinate voting shares of Class A and the multiple voting shares of Class B. One officer of the company has practically all the Class B shares. There are no only options under this company but other option like vehicles called Share Appreciation Rights.
The CEO has shares worth $7.5M and has options worth $4.3M. The CFO has shares worth $0.2M and has options worth $0.2M. An officer has shares worth $0.3M and has options worth $1.4M. Another officer has shares worth $132.4M of Class A Shares and almost all the Class B shares worth $32Mand has options worth $6.4M. A director has shares worth $4 M 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 per Share Ratios are 12.56, 15.81 and 19.07. The current P/E Ratio is 12.88 based on a stock price of $8.50 and 2013 earnings estimate of $0.66. By this measure the stock is relatively cheap.
I get a Graham Price of $7.86. The 10 year low, median and high median Price/Graham Price Ratios are 1.07, 1.24 and 1.41. The current P/GP Ratio is 1.08. This suggests also that the stock is relatively cheap.
The 10 year median Price/Book Value per Share Ratio is 2.08. The current ratio is 2.04 a value some 98% of the 10 year ratio. This ratio suggests that the stock price is relatively reasonable.
The current dividend yield is 2.12% and the 5 year median dividend yield is 1.66%. The current dividend yield is some 28% higher than the 5 year medina yield. This test suggests that the stock price is cheap. (Note that the 10 year median dividend yield is a bit lower at 1.61%.)
When I look at analysts' recommendations, I find only one analyst following this stock and the recommendation is a Hold. The 12 month stock price is given as $10.00 and this implies a total return of 19.76% with 2.12% from Dividends and $17.65% from capital gains. (To me the recommendation of a Hold and a 12 months total return of almost 20% do not match up. You would think that a Hold recommendation would have a much lower 12 month total return.)
If you look at the last 12 months which includes the most recent quarterly report of March 2013, compared the 12 month ending at the end of 2012, EPS are up by 14%. However, if you look at revenues and cash flow, the growth is marginal. The estimates for 2013 do show that growth in EPS would greatly outstrip growth in Revenues and Cash Flow (89% growth compared to 4.5% and 8.7% growth, respectively).
The stock price spiked over 25% in April 2013. However, I cannot find any reason for this. There is not much coverage for this stock. Above, I could only find one analysts giving this stock a rating. I find this an interesting company. You would buy it for diversifications purposes.
I cannot see why the one analyst gives this stock a Hold rating. Perhaps this is because EPS were down last year. However, EPS tend to fluctuate quite a bit for this stock. Also perhaps if you look at the P/E using last 12 month's earnings (to March 2013), the P/E would be 21.25, a relatively high P/E for this company. Also, the estimates given last year, only the Revenue estimates were close. The estimates for EPS and CFPS were quite a bit off.
However, I think that the test that is the best is the dividend yield one and this is signally a cheap price. The P/B Ratio is signaling a reasonable price and I think that these two tests are the best to use. The company has a reasonable dividend and does raise dividends, although not consistently, but dividend growth is good. The company has decent growth and the balance sheet is fine. The ROE is good. I do not see why it is not given a buy rating. See my spreadsheet at ncc.htm.
This is the second of two parts. The first part was posted on Monday, July 29th, 2013 and is available here.
Newfoundland Capital Corporation Limited also owns and operates Newcap Radio. Newcap Radio is one of Canada's leading radio broadcasters with 79 licenses across Canada. The Company reaches millions of listeners each week through a variety of formats and is a recognized industry leader in radio programming, sales and networking. The Company has 58 FM and 21 AM licenses spanning the country employing over 800 radio professionals in Canada. Newfoundland Capital Corporation Limited also owns and operates the Glynmill Inn, Corner Brook, Newfoundland and Labrador. Its web site is here Newfoundland Capital Corp.
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, July 29, 2013
Newfoundland Capital Corp
On my other blog I am today writing about why people should have an Emergency Fund...continue...
I do not own this stock Newfoundland Capital Corp (TSX-NCC.A, TSX-NCC.B). I started to follow this stock as it was suggested as a decent dividend paying stock for investment purposes. It is not on any dividend lists that I follow. This is probably because dividends have been inconsistent.
As far as I can see, they started paying dividends in 1997, but then paid none between 2000 and 2002, inclusive. Dividends were restarted in 2003. The growth in dividends over the past 5 and 9 years is 12.5% and 20.6% per year. However, a lot of years did not have dividend increases. The most recent dividend increase was in 2011 for a 50% increase. There has been no increase since.
The Dividend Payout Ratios are good, with the 5 year median DPR for earnings at 22.2% and the DPR for cash flow at 21.7%. The DPR for 2012 was almost 52%, but this is expected to move down to 27% in 2013. Some analysts expect slight dividend increases in 2014 or 2015. The current dividend yield is 2.12% and the 5 year median is 1.66%.
Investors of this stock have done well over the past 5 and 10 years with total returns at 8.87% and 14.23% per year over these periods. The dividend portion of these returns is at 1.66% and 1.92% per year, respectively and the capital gain portion is at 7.21% and 12.81% per year, respectively.
Outstanding shares have declined over the past 5 and 10 years at the rate of 2.6% and 1.8% per year. The decline has been in the Class A shares, which are subordinate voting shares. Class B shares are multiple voting shares. Shares have increased due to stock options and decreased due to Buy Backs. Mostly, the 5 year running growth over the past 5 and 10 years has been better than the 5 and 10 year growth.
Revenue has grown at 5.8% per year and 9.7% per year over the past 5 and 10 years. Revenue per Share has grown at 8.7% and 10.7% per year over the past 5 and 10 years. The 5 and 10 years growth using 5 year running averages is similar. Growth in Revenue has been rather smooth.
There is a big difference in the 5 year running growth of EPS over the past 5 and 10 years compared to the 5 and 10 year growth. The 5 and 10 year 5 year running growth in EPS is at 3% and 17% per year over the past 5 and 10 years. EPS over the past 5 years is down by 10% per year and over the past 10 years up by 3.4% per year. Earnings do fluctuate year by year.
Cash Flow per Share has grown over the past 5 and 10 years no matter how you measure it. The CFPS growth over the past 5 and 10 years is at 16.4% and 7.4% per year, respectively. If you look at the 5 year running average growth over the past 5 and 10 years, you get growth at 12% and 10% per year, respectively.
Return on Equity has fluctuated over the years and the 5 year median ROE is just over 10% at 10.5%. The ROE for 2012 financial year is 9.1%. The ROE based on Comprehensive Income is better at 10.1%, a value 10% high than the ROE based on net income. This is a positive.
The Liquidity Ratio is low coming in at just 0.97. This means that current assets cannot cover current liabilities. It needs the cash flow to move this ratio into decent territory and it is still rather low at 1.44. The Debt Ratio is much better at 2.05. The Leverage and Debt/Equity Ratios are low and therefore quite good at 1.95 and 0.95.
You would buy this stock for diversification purposes. You would have to be able to put up with fluctuating earnings, but you might get some very good dividend yields on your initial purchase price over the longer term. Also, dividends are only paid semi-annually, not in the general quarterly manner. See my spreadsheet at ncc.htm.
This is the first of two parts. Second part will be posted on Tuesday, July 30th, 2013 and will be here.
Newfoundland Capital Corporation Limited also owns and operates Newcap Radio. Newcap Radio is one of Canada's leading radio broadcasters with 79 licenses across Canada. The Company reaches millions of listeners each week through a variety of formats and is a recognized industry leader in radio programming, sales and networking. The Company has 58 FM and 21 AM licenses spanning the country employing over 800 radio professionals in Canada. Newfoundland Capital Corporation Limited also owns and operates the Glynmill Inn, Corner Brook, Newfoundland and Labrador. Its web site is here Newfoundland Capital Corp.
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 Newfoundland Capital Corp (TSX-NCC.A, TSX-NCC.B). I started to follow this stock as it was suggested as a decent dividend paying stock for investment purposes. It is not on any dividend lists that I follow. This is probably because dividends have been inconsistent.
As far as I can see, they started paying dividends in 1997, but then paid none between 2000 and 2002, inclusive. Dividends were restarted in 2003. The growth in dividends over the past 5 and 9 years is 12.5% and 20.6% per year. However, a lot of years did not have dividend increases. The most recent dividend increase was in 2011 for a 50% increase. There has been no increase since.
The Dividend Payout Ratios are good, with the 5 year median DPR for earnings at 22.2% and the DPR for cash flow at 21.7%. The DPR for 2012 was almost 52%, but this is expected to move down to 27% in 2013. Some analysts expect slight dividend increases in 2014 or 2015. The current dividend yield is 2.12% and the 5 year median is 1.66%.
Investors of this stock have done well over the past 5 and 10 years with total returns at 8.87% and 14.23% per year over these periods. The dividend portion of these returns is at 1.66% and 1.92% per year, respectively and the capital gain portion is at 7.21% and 12.81% per year, respectively.
Outstanding shares have declined over the past 5 and 10 years at the rate of 2.6% and 1.8% per year. The decline has been in the Class A shares, which are subordinate voting shares. Class B shares are multiple voting shares. Shares have increased due to stock options and decreased due to Buy Backs. Mostly, the 5 year running growth over the past 5 and 10 years has been better than the 5 and 10 year growth.
Revenue has grown at 5.8% per year and 9.7% per year over the past 5 and 10 years. Revenue per Share has grown at 8.7% and 10.7% per year over the past 5 and 10 years. The 5 and 10 years growth using 5 year running averages is similar. Growth in Revenue has been rather smooth.
There is a big difference in the 5 year running growth of EPS over the past 5 and 10 years compared to the 5 and 10 year growth. The 5 and 10 year 5 year running growth in EPS is at 3% and 17% per year over the past 5 and 10 years. EPS over the past 5 years is down by 10% per year and over the past 10 years up by 3.4% per year. Earnings do fluctuate year by year.
Cash Flow per Share has grown over the past 5 and 10 years no matter how you measure it. The CFPS growth over the past 5 and 10 years is at 16.4% and 7.4% per year, respectively. If you look at the 5 year running average growth over the past 5 and 10 years, you get growth at 12% and 10% per year, respectively.
Return on Equity has fluctuated over the years and the 5 year median ROE is just over 10% at 10.5%. The ROE for 2012 financial year is 9.1%. The ROE based on Comprehensive Income is better at 10.1%, a value 10% high than the ROE based on net income. This is a positive.
The Liquidity Ratio is low coming in at just 0.97. This means that current assets cannot cover current liabilities. It needs the cash flow to move this ratio into decent territory and it is still rather low at 1.44. The Debt Ratio is much better at 2.05. The Leverage and Debt/Equity Ratios are low and therefore quite good at 1.95 and 0.95.
You would buy this stock for diversification purposes. You would have to be able to put up with fluctuating earnings, but you might get some very good dividend yields on your initial purchase price over the longer term. Also, dividends are only paid semi-annually, not in the general quarterly manner. See my spreadsheet at ncc.htm.
This is the first of two parts. Second part will be posted on Tuesday, July 30th, 2013 and will be here.
Newfoundland Capital Corporation Limited also owns and operates Newcap Radio. Newcap Radio is one of Canada's leading radio broadcasters with 79 licenses across Canada. The Company reaches millions of listeners each week through a variety of formats and is a recognized industry leader in radio programming, sales and networking. The Company has 58 FM and 21 AM licenses spanning the country employing over 800 radio professionals in Canada. Newfoundland Capital Corporation Limited also owns and operates the Glynmill Inn, Corner Brook, Newfoundland and Labrador. Its web site is here Newfoundland Capital Corp.
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, July 26, 2013
Evertz Technologies 2
On my other blog I am today writing about a silly anti-capitalist statement ...continue...
I own this stock of Evertz Technologies (TSX-ET, OTC-EVTZF). This company was founded in 1966, but it only went public in 2006. They started to pay dividends in 2008. I bought this stock in October 2011for my trading account. I have made a total return of 14.23% per year with 4.79% from dividends and with 9.44% from capital gains.
When I look at insider trading, I find $2M of insider selling and no insider buying. The CEO has shares worth $335.7M and has no options. The CFO has shares worth $0.1M and has options worth $0.6M. An officer has shares worth $32M and has options worth $1.4M. Another officer has shares worth $336.4M and has no options. A director has shares worth $0.4M and has options worth $0.6M. This is just to give you an idea on insider share ownership and option values. As you can see, there is a lot of insider ownership by a few insiders.
The 5 year low, median and high median Price/Earnings Ratios are 13.84, 16.47 and 19.02. The current P/E Ratio is 17.19. This ratio suggests that the current price is relatively reasonable. This is based on a stock price of $13.92 and EPS for 2013 of $0.81.
I get a Graham Price of $10.03. The 10 year low, median and high median Price/Graham Price Ratios are 1.30, 1.67 and 2.03. The current P/GP Ratio would be 1.39. This ratio also suggests a relatively reasonable price.
The 10 year Price/Book Value per Share Ratio is 3.46 and the current P/B Ratio is 2.52 a value some 73% of the 10 year ratio. This suggests a relatively cheap stock price. However, a P/B Ratio is not particularly low, so stock price might be considered to be reasonable.
The 5 year median dividend yield is 2.27% and the current dividend yield at 4.6% is 102% higher. This suggests that the stock price is very cheap. The dividends have been increasing faster than the stock price. Generally, stock prices tend to increase at the dividend increase rate. However, in this case, the dividend increases has coincided with increasing Dividend Payout Ratios. The DPR for earnings has increased by 30% and for cash flow by 26%. So the increase in dividend yield may not be as good as it first appears. So we might be back to a reasonable stock price.
When I look at the analysts' recommendations, I find Buy and Hold Recommendations. There are more Hold recommendations, so the consensus recommendation is a Hold. The 12 month stock price consensus is $15.40. This implies a total return of 15.23% with 4.6% from dividends and 10.63% from capital gains.
There are comments on this stock by blogger FSYard. A couple of analysts issued downgrades for this stock. CanTech has also recently commented on Evertz. Joe Zaller of Devoncroft comments on the most recent financial results.
I plan to hold on to my current shares. I expect to do well in the longer term on this tech stock. I feel that the current price is a reasonable one. See my spreadsheet at et.htm.
This is the second of two parts. The first part was posted on Thursday, July 25, 2013 and is available here.
Evertz Technologies Limited designs, manufactures and markets video and audio infrastructure equipment for the production, post production, broadcast and internet protocol television ("IPTV") industry. Its web site is here Evertz.
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 Evertz Technologies (TSX-ET, OTC-EVTZF). This company was founded in 1966, but it only went public in 2006. They started to pay dividends in 2008. I bought this stock in October 2011for my trading account. I have made a total return of 14.23% per year with 4.79% from dividends and with 9.44% from capital gains.
When I look at insider trading, I find $2M of insider selling and no insider buying. The CEO has shares worth $335.7M and has no options. The CFO has shares worth $0.1M and has options worth $0.6M. An officer has shares worth $32M and has options worth $1.4M. Another officer has shares worth $336.4M and has no options. A director has shares worth $0.4M and has options worth $0.6M. This is just to give you an idea on insider share ownership and option values. As you can see, there is a lot of insider ownership by a few insiders.
The 5 year low, median and high median Price/Earnings Ratios are 13.84, 16.47 and 19.02. The current P/E Ratio is 17.19. This ratio suggests that the current price is relatively reasonable. This is based on a stock price of $13.92 and EPS for 2013 of $0.81.
I get a Graham Price of $10.03. The 10 year low, median and high median Price/Graham Price Ratios are 1.30, 1.67 and 2.03. The current P/GP Ratio would be 1.39. This ratio also suggests a relatively reasonable price.
The 10 year Price/Book Value per Share Ratio is 3.46 and the current P/B Ratio is 2.52 a value some 73% of the 10 year ratio. This suggests a relatively cheap stock price. However, a P/B Ratio is not particularly low, so stock price might be considered to be reasonable.
The 5 year median dividend yield is 2.27% and the current dividend yield at 4.6% is 102% higher. This suggests that the stock price is very cheap. The dividends have been increasing faster than the stock price. Generally, stock prices tend to increase at the dividend increase rate. However, in this case, the dividend increases has coincided with increasing Dividend Payout Ratios. The DPR for earnings has increased by 30% and for cash flow by 26%. So the increase in dividend yield may not be as good as it first appears. So we might be back to a reasonable stock price.
When I look at the analysts' recommendations, I find Buy and Hold Recommendations. There are more Hold recommendations, so the consensus recommendation is a Hold. The 12 month stock price consensus is $15.40. This implies a total return of 15.23% with 4.6% from dividends and 10.63% from capital gains.
There are comments on this stock by blogger FSYard. A couple of analysts issued downgrades for this stock. CanTech has also recently commented on Evertz. Joe Zaller of Devoncroft comments on the most recent financial results.
I plan to hold on to my current shares. I expect to do well in the longer term on this tech stock. I feel that the current price is a reasonable one. See my spreadsheet at et.htm.
This is the second of two parts. The first part was posted on Thursday, July 25, 2013 and is available here.
Evertz Technologies Limited designs, manufactures and markets video and audio infrastructure equipment for the production, post production, broadcast and internet protocol television ("IPTV") industry. Its web site is here Evertz.
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, July 25, 2013
Evertz Technologies
I own this stock of Evertz Technologies (TSX-ET, OTC-EVTZF). I got the idea to investigate this stock from a G&M article. It is a small cap tech company with a very good dividend (4.6%) and strong balance sheet (Liquidity Ratio of 8.92).
This company was founded in 1966, but it only went public in 2006. They started to pay dividends in 2008. I bought this stock in October 2011for my trading account. I have made a total return of 14.23% per year with 4.79% from dividends and with 9.44% from capital gains.
Dividends are good, as I have said, with the current dividend is quite good at 4.6%. However, the 5 year median dividend yield is lower at 2.27%. The growth in dividends over the past 5 year is 23.73% per year. The most recent dividend increase was in 2013 with an increase at 14.3%. The Dividend Payout Ratios are quite good with the 5 year median DPR for earnings at 39% and for cash flow at 30%.
However, total return has not been so great especially for the last 5 years. The 5 year total return is a loss of 1.51% per year, with a capital loss of 3.81% and with dividends at 2.3%. The 7 year total return is better with the return at 7.47% per year and capital gain at 5.17% per year and dividends at 2.3%.
The outstanding shares have marginally increased over the past 5 and 8 years at 0.37% and 1.61% per year, respectively. Outstanding shares have increased due to stock options and decreased due to Buy Backs. In most cases, the growth in 5 year running averages is higher than for exactly 5 or 10 years of growth. This mostly occurs because exactly 5 or 10 years ago were great financial years.
The 5 and 7year growth in Revenue per Share using 5 year running averages is at 13% and 20% per year. The 5 and 10 year growth is 2.6% and 21% per year. The 7 year growth is at 10.5% per year. EPS is down over the past 5 year at 5.5% per year, but up over the past 5 year using the 5 year running averages at 13.4%. The 10 year growth in EPS runs at 90% per year because 10 years ago, profits were tiny. EPS has fluctuated over the years.
There is no growth in Cash Flow over the past 5, with Cash Flow per Share down by 2% per year. The 8 year growth in CFPS runs at 48.2% per year. The 5 year running average 5 year growth in CFPS is 8.3% per year. Cash Flow has fluctuated quite a bit over the years.
The Return on Equity is good with the ROE for the financial year ending in April 2013 at 16% and the 5 year median higher at 20.2%. The ROE on comprehensive income also comes in at 16% for the April 2013 financial year. The 5 year median ROE on comprehensive income is close at 19.2%.
The Balance Sheet is very strong and has been since 2007. The current Liquidity Ratio is 8.92, and the 5 year median ratio is also 8.92. The Debt Ratio is 8.37 and this ratio has a 5 year median also of 8.37. The Leverage and Debt/Equity Ratios are very low at 1.17 and 0.14, respectively. The company has little debt.
One problem with this stock is finding financial statements. The company does not have them on their site. The company issues press releases with financial data (but these too are not on the company's site). I found the financial statements for 2013 on the Morningstar site.
The article I read said it was looking for stocks with dividends, a strong dose of safety and a dash of growth potential. This stock does have a strong balance sheet with dividends increasing faster than the stock price. I expect to do well by this stock in the longer term, but you have to keep an eye on such stocks. See my spreadsheet at et.htm.
This is the first of two parts. Second part will be posted on July 26, 2013 and will be here.
Evertz Technologies Limited designs, manufactures and markets video and audio infrastructure equipment for the production, post production, broadcast and internet protocol television ("IPTV") industry. Its web site is here Evertz.
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 company was founded in 1966, but it only went public in 2006. They started to pay dividends in 2008. I bought this stock in October 2011for my trading account. I have made a total return of 14.23% per year with 4.79% from dividends and with 9.44% from capital gains.
Dividends are good, as I have said, with the current dividend is quite good at 4.6%. However, the 5 year median dividend yield is lower at 2.27%. The growth in dividends over the past 5 year is 23.73% per year. The most recent dividend increase was in 2013 with an increase at 14.3%. The Dividend Payout Ratios are quite good with the 5 year median DPR for earnings at 39% and for cash flow at 30%.
However, total return has not been so great especially for the last 5 years. The 5 year total return is a loss of 1.51% per year, with a capital loss of 3.81% and with dividends at 2.3%. The 7 year total return is better with the return at 7.47% per year and capital gain at 5.17% per year and dividends at 2.3%.
The outstanding shares have marginally increased over the past 5 and 8 years at 0.37% and 1.61% per year, respectively. Outstanding shares have increased due to stock options and decreased due to Buy Backs. In most cases, the growth in 5 year running averages is higher than for exactly 5 or 10 years of growth. This mostly occurs because exactly 5 or 10 years ago were great financial years.
The 5 and 7year growth in Revenue per Share using 5 year running averages is at 13% and 20% per year. The 5 and 10 year growth is 2.6% and 21% per year. The 7 year growth is at 10.5% per year. EPS is down over the past 5 year at 5.5% per year, but up over the past 5 year using the 5 year running averages at 13.4%. The 10 year growth in EPS runs at 90% per year because 10 years ago, profits were tiny. EPS has fluctuated over the years.
There is no growth in Cash Flow over the past 5, with Cash Flow per Share down by 2% per year. The 8 year growth in CFPS runs at 48.2% per year. The 5 year running average 5 year growth in CFPS is 8.3% per year. Cash Flow has fluctuated quite a bit over the years.
The Return on Equity is good with the ROE for the financial year ending in April 2013 at 16% and the 5 year median higher at 20.2%. The ROE on comprehensive income also comes in at 16% for the April 2013 financial year. The 5 year median ROE on comprehensive income is close at 19.2%.
The Balance Sheet is very strong and has been since 2007. The current Liquidity Ratio is 8.92, and the 5 year median ratio is also 8.92. The Debt Ratio is 8.37 and this ratio has a 5 year median also of 8.37. The Leverage and Debt/Equity Ratios are very low at 1.17 and 0.14, respectively. The company has little debt.
One problem with this stock is finding financial statements. The company does not have them on their site. The company issues press releases with financial data (but these too are not on the company's site). I found the financial statements for 2013 on the Morningstar site.
The article I read said it was looking for stocks with dividends, a strong dose of safety and a dash of growth potential. This stock does have a strong balance sheet with dividends increasing faster than the stock price. I expect to do well by this stock in the longer term, but you have to keep an eye on such stocks. See my spreadsheet at et.htm.
This is the first of two parts. Second part will be posted on July 26, 2013 and will be here.
Evertz Technologies Limited designs, manufactures and markets video and audio infrastructure equipment for the production, post production, broadcast and internet protocol television ("IPTV") industry. Its web site is here Evertz.
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, July 24, 2013
ONEX Corp
On my other blog I am today writing about Bubbles ...continue...
I do not own this stock ONEX Corp (TSX-OCX, OTC-ONEXF), but I used. I bought it at the end of 2001 and sold in April of 2008. I made some 5.9% return including dividends. I mistook this stock for a Dividend Paying stock. Sometimes it is a good idea to review the sort of stock that we should not buy.
Why I say I mistook it for a dividend paying stock is because they pay a dividend. However, if you look at the spreadsheet, you will see that there has been no growth. In fact, dividends were the same from 1995 until this year. They are currently paying out some 1% of its cash flow in dividends. The current yield at 0.30% is way below 1%. This yield includes the big dividend rise of 2013. I seriously do not know why they even bother to pay a dividend.
It is really hard to say where they are going with dividends, as they just recently raised dividends by some 36%. However, this is not much to get excited about as dividend yield is just 0.3%. I still do not know why they bother with a dividend.
This stock is sort of like a hedge fund in that it buys or invests in companies to make money. It seemed to be a good idea when I bought it. Unfortunately, this company was a growth company until 2001. I really bought it at the wrong time. It was making some headway by 2008 and then came the second bear market and then it has been recovering ever since.
Total Returns over the past 5 and 10 years is at 3.95% and 10.56% with 0.31% and 0.43% from dividends and 3.66% and 10.10% from capital gains. This is really not a growth stock. However, the stock is up almost 20% this year and 31 % year over year, which is in growth stock territory.
The company only has had good growth in cash flow. If you look at the 5 year running averages over the past 5 and 10 years you get growth at 16% and 13% per year. Revenue growth using 5 year running averages over the past 5 and 10 years gets you growth of 10% and 7% per year.
There is no growth in earnings, but earnings fluctuate a lot. 2011 was a great year for Earnings, but they had a loss in 2012. There is also a loss in the 1st quarter of 2013. An interesting thing about earnings for 2012 is that there is a negative EPS, but there is positive net income for the company. This is because all the profits went to the non-control interest.
The Liquidity Ratios are good, with 5 year median ratio at 1.70. The Debt Ratio is low with a 5 year median at just 1.43 and a current one lower at 1.16. (I would like to see this at 1.50 or above.) The Leverage and Debt/Equity Ratios are very high with current ratios at 29.55 and 25.40, respectively.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. Most of the recommendations are a Hold and the consensus recommendation would be a Hold. The 12 month consensus stock price is $51.10. This implies a 12 month return of 2.77%, with 0.30% from dividends and 2.47% from capital gains.
Proactive Investor site talks positively about Onex Corp. There is an interesting article in Rehub Canada about Carestream Health Inc. raising debt money to give to shareholders, including ONEX Corp.
I would not invest in this company today. It is not a growth company and it is not a dividend paying company, so for me I would not see any point in the investment. See my spreadsheet at ocx.htm.
Onex is one of North America's oldest investment firm committed to acquiring and building high-quality businesses in partnership with talented management teams. Onex manages investment platforms focused on private equity, real estate and credit securities. Gerald Schwartz is a major owner Its web site is here ONEX.
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 ONEX Corp (TSX-OCX, OTC-ONEXF), but I used. I bought it at the end of 2001 and sold in April of 2008. I made some 5.9% return including dividends. I mistook this stock for a Dividend Paying stock. Sometimes it is a good idea to review the sort of stock that we should not buy.
Why I say I mistook it for a dividend paying stock is because they pay a dividend. However, if you look at the spreadsheet, you will see that there has been no growth. In fact, dividends were the same from 1995 until this year. They are currently paying out some 1% of its cash flow in dividends. The current yield at 0.30% is way below 1%. This yield includes the big dividend rise of 2013. I seriously do not know why they even bother to pay a dividend.
It is really hard to say where they are going with dividends, as they just recently raised dividends by some 36%. However, this is not much to get excited about as dividend yield is just 0.3%. I still do not know why they bother with a dividend.
This stock is sort of like a hedge fund in that it buys or invests in companies to make money. It seemed to be a good idea when I bought it. Unfortunately, this company was a growth company until 2001. I really bought it at the wrong time. It was making some headway by 2008 and then came the second bear market and then it has been recovering ever since.
Total Returns over the past 5 and 10 years is at 3.95% and 10.56% with 0.31% and 0.43% from dividends and 3.66% and 10.10% from capital gains. This is really not a growth stock. However, the stock is up almost 20% this year and 31 % year over year, which is in growth stock territory.
The company only has had good growth in cash flow. If you look at the 5 year running averages over the past 5 and 10 years you get growth at 16% and 13% per year. Revenue growth using 5 year running averages over the past 5 and 10 years gets you growth of 10% and 7% per year.
There is no growth in earnings, but earnings fluctuate a lot. 2011 was a great year for Earnings, but they had a loss in 2012. There is also a loss in the 1st quarter of 2013. An interesting thing about earnings for 2012 is that there is a negative EPS, but there is positive net income for the company. This is because all the profits went to the non-control interest.
The Liquidity Ratios are good, with 5 year median ratio at 1.70. The Debt Ratio is low with a 5 year median at just 1.43 and a current one lower at 1.16. (I would like to see this at 1.50 or above.) The Leverage and Debt/Equity Ratios are very high with current ratios at 29.55 and 25.40, respectively.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. Most of the recommendations are a Hold and the consensus recommendation would be a Hold. The 12 month consensus stock price is $51.10. This implies a 12 month return of 2.77%, with 0.30% from dividends and 2.47% from capital gains.
Proactive Investor site talks positively about Onex Corp. There is an interesting article in Rehub Canada about Carestream Health Inc. raising debt money to give to shareholders, including ONEX Corp.
I would not invest in this company today. It is not a growth company and it is not a dividend paying company, so for me I would not see any point in the investment. See my spreadsheet at ocx.htm.
Onex is one of North America's oldest investment firm committed to acquiring and building high-quality businesses in partnership with talented management teams. Onex manages investment platforms focused on private equity, real estate and credit securities. Gerald Schwartz is a major owner Its web site is here ONEX.
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, July 23, 2013
Loblaw Companies Ltd 2
On my other blog I am today writing about Australia Investing by Dividend Ninja ...continue...
I do not own this stock Loblaw Companies Ltd (TSX-L, OTC-LBLCF), but I used to. I bought this stock in 1996 because it was doing great. It was on Mike Higgs' dividend growth stocks list. However, I sold in 2007 because of problems it was having with its tech upgrade to its supply system. I made a return of 10.14% per year on this stock, with 8.23% from capital gains and 1.91% from dividends.
When I look at insider trading, I find $4.2M of insider selling and $4.1M of net insider selling. The insider buying is minimal. Insiders not only have options, but option like vehicles called Performance Share Units, Restricted Share Units and Rights - Deferred Share Units.
The CEO has shares worth $13.9M and has options worth $66.6M. The CFO has shares worth $0.3M and has options worth $15.4M. An officer has few shares and has options worth $1.7M. Another officer has shares worth $0.2M and has options worth $19.3M. A director has shares worth $0.8M and a few options. George Weston Limited has shares worth $8.5B and W. Galen Weston has shares worth $179M. 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 per Share Ratios are 13.20, 15.79 and 17.79. The current P/E Ratio at 18.46 suggests that the stock price is a bit high. This P/E is based on a stock price if $47.80 and 2013 earnings of $2.59.
I get a Graham Price of $36.79 for 2013 and the current Price/Graham Price Ratio is 1.30. The 10 year low, median and high median P/GP Ratios are 1.15, 1.36 and 1.52. The current P/GP Ratio of 1.30 suggests that the stock price is reasonable.
I get a 10 year median Price/Book Value per Share of 1.82. The current P/B Ratio is higher at 2.06. However it is only some 12% higher and this suggests the stock price is reasonable.
The 5 year median dividend yield is 2.31% and the current dividend yield is 2.01%, a value some 13% lower. Although for a good price you would want the current dividend yield to be higher than the 5 year dividend yield, the current dividend yield is only 13% lower and suggests that the stock price is reasonable.
When I look at analysts' recommendations, I find Buy, Hold and Underperform recommendations. The vast majority of the recommendations are a Buy and the consensus recommendation would be a buy. The 12 month consensus stock price if $53.10. This implies a total return of 13.1%, with 2.01 from dividends and 11.09% from capital gains.
A couple of things are happening with Loblaw. One is the spin-off of its real estate into a REIT. See a financial post article on this spin-off. The other thing is the bid to buy Shoppers Drug Mart.
The Motley Fool reviews this stock. However, this report basically tells people who own Shoppers what their options are. I have Shoppers (TSX-SC) and I will probably sell. A Globe & Mail article from 2012 says that Loblaw is not expected to benefit from its tech updates until 2014.
The stock price would appear relatively reasonable at this time. The stock of Loblaw may once again be a dividend growth stock. However, a lot is happening and therefore it has higher risk. See my spreadsheet at lob.htm.
This is the second of two parts. The first part was posted on Monday, July 22, 2013 and is available here.
Loblaw Companies Limited, a subsidiary of George Weston Limited, is Canada's largest food retailer and a leading provider of drugstore, general merchandise and financial products and services. Loblaw offers Canada's strongest control (private) label program, including the unique President's Choice, no name and Joe Fresh brands. In addition, the Company makes available to consumers President's Choice financial services and offers the PC point loyalty program. Its web site is here Loblaw.
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 Loblaw Companies Ltd (TSX-L, OTC-LBLCF), but I used to. I bought this stock in 1996 because it was doing great. It was on Mike Higgs' dividend growth stocks list. However, I sold in 2007 because of problems it was having with its tech upgrade to its supply system. I made a return of 10.14% per year on this stock, with 8.23% from capital gains and 1.91% from dividends.
When I look at insider trading, I find $4.2M of insider selling and $4.1M of net insider selling. The insider buying is minimal. Insiders not only have options, but option like vehicles called Performance Share Units, Restricted Share Units and Rights - Deferred Share Units.
The CEO has shares worth $13.9M and has options worth $66.6M. The CFO has shares worth $0.3M and has options worth $15.4M. An officer has few shares and has options worth $1.7M. Another officer has shares worth $0.2M and has options worth $19.3M. A director has shares worth $0.8M and a few options. George Weston Limited has shares worth $8.5B and W. Galen Weston has shares worth $179M. 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 per Share Ratios are 13.20, 15.79 and 17.79. The current P/E Ratio at 18.46 suggests that the stock price is a bit high. This P/E is based on a stock price if $47.80 and 2013 earnings of $2.59.
I get a Graham Price of $36.79 for 2013 and the current Price/Graham Price Ratio is 1.30. The 10 year low, median and high median P/GP Ratios are 1.15, 1.36 and 1.52. The current P/GP Ratio of 1.30 suggests that the stock price is reasonable.
I get a 10 year median Price/Book Value per Share of 1.82. The current P/B Ratio is higher at 2.06. However it is only some 12% higher and this suggests the stock price is reasonable.
The 5 year median dividend yield is 2.31% and the current dividend yield is 2.01%, a value some 13% lower. Although for a good price you would want the current dividend yield to be higher than the 5 year dividend yield, the current dividend yield is only 13% lower and suggests that the stock price is reasonable.
When I look at analysts' recommendations, I find Buy, Hold and Underperform recommendations. The vast majority of the recommendations are a Buy and the consensus recommendation would be a buy. The 12 month consensus stock price if $53.10. This implies a total return of 13.1%, with 2.01 from dividends and 11.09% from capital gains.
A couple of things are happening with Loblaw. One is the spin-off of its real estate into a REIT. See a financial post article on this spin-off. The other thing is the bid to buy Shoppers Drug Mart.
The Motley Fool reviews this stock. However, this report basically tells people who own Shoppers what their options are. I have Shoppers (TSX-SC) and I will probably sell. A Globe & Mail article from 2012 says that Loblaw is not expected to benefit from its tech updates until 2014.
The stock price would appear relatively reasonable at this time. The stock of Loblaw may once again be a dividend growth stock. However, a lot is happening and therefore it has higher risk. See my spreadsheet at lob.htm.
This is the second of two parts. The first part was posted on Monday, July 22, 2013 and is available here.
Loblaw Companies Limited, a subsidiary of George Weston Limited, is Canada's largest food retailer and a leading provider of drugstore, general merchandise and financial products and services. Loblaw offers Canada's strongest control (private) label program, including the unique President's Choice, no name and Joe Fresh brands. In addition, the Company makes available to consumers President's Choice financial services and offers the PC point loyalty program. Its web site is here Loblaw.
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, July 22, 2013
Loblaw Companies Ltd
On my other blog I am today writing about my politics ...continue...
I do not own this stock Loblaw Companies Ltd (TSX-L, OTC-LBLCF), but I used to. I bought this stock in 1996 because it was doing great. It was on Mike Higgs' dividend growth stocks list. However, I sold in 2007 because of problems it was having with its tech upgrade to its supply system. I made a return of 10.14% per year on this stock, with 8.23% from capital gains and 1.91% from dividends. In 2007, it was the second year of no dividend increase.
This stock just might be changing back into a dividend growth stock. For the first time since 2005, the company has raised their dividends in 2012 by 4.8%. They have also raised their dividends in 2013 by 9.1%. Prior to 2005, this company had a good reputation of for increasing dividends. The dividend growth back then was around 17.5% per year.
The Dividend Payout Ratios today are not as good as they were prior to 2005 in regards to earnings. Prior to 2005, the DPR for earnings was below 20%. The DPR for earnings was 37% for 2012. It is expected to be around 36% for 2013. The DPR for Cash Flow was always quite low and it is roughly the same with a 5 year DPR rate of 15% with the DPR for CF the same for 2012. Stock prices are still almost 35% below those reached in 2004.
However, shareholders would seem to be again earning money on this stock with the total return at 6.57% per year over the past 5 years. The dividends would be some 2.28% per year of that return and the capital gains would be some 4.28% of that return. Over the past 10 years, shareholders would probably have just broken even.
The outstanding shares have increased marginally (less than 1% per year) over the past 5 and 10 years. They have increased due to DRIP and stock options and decreased due to buy backs. Mostly over the past 5 and 10 years there has been growth in revenue, earnings and cash flow. Some growth is better than others.
The Revenue has increased by 1.5% and 3.2% per year over the past 5 and 10 years. Revenue per Share has increased by 1% and 3% per year over the past 5 and 10 years. Earnings per Share is up by 13.7% over the past 5 years, but down by 1.5% per year over the past 10 years. However, earnings are rather volatile and using the 5 year running averages, I get EPS growth of 4% and 3% per year over the past 5 and 10 years.
The Cash Flow per Share has grown by 5% and 3% per year over the past 5 and 10 years. Book Value per Share has grown at the rate of 2.4% and 4.3% per year over the past 5 and 10 years.
Return on Equity has most years been good with a 5 year median of 10.5%. The ROE for the financial year ending in 2012 was 10.1%. The ROE on comprehensive income is close behind, but below 10% at 9.8% for 2012 and for the 5 year median.
The balance sheet is ok, but not that strong. The Liquidity Ratio is current at 1.27. If you add in expected cash flow less dividends you get to a decent 1.58. The Debt Ratios are fine, with a current one at 1.60. The Leverage and Debt/Equity Ratios are also fine and currently at 2.67 and 1.67.
It certainly is a good sign that the company feels confident enough to raise the dividends in 2012 and 2013. It seems like there is a turnaround in place for this company. Also most view the purchase of Shopper Drug Mart as a positive. See my spreadsheet at lob.htm.
This is the first of two parts. Second part will be posted on Tuesday, July 23rd, 2013 and will be here.
Loblaw Companies Limited, a subsidiary of George Weston Limited, is Canada's largest food retailer and a leading provider of drugstore, general merchandise and financial products and services. Loblaw offers Canada's strongest control (private) label program, including the unique President's Choice, no name and Joe Fresh brands. In addition, the Company makes available to consumers President's Choice financial services and offers the PC point loyalty program. Its web site is here Loblaw.
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 Loblaw Companies Ltd (TSX-L, OTC-LBLCF), but I used to. I bought this stock in 1996 because it was doing great. It was on Mike Higgs' dividend growth stocks list. However, I sold in 2007 because of problems it was having with its tech upgrade to its supply system. I made a return of 10.14% per year on this stock, with 8.23% from capital gains and 1.91% from dividends. In 2007, it was the second year of no dividend increase.
This stock just might be changing back into a dividend growth stock. For the first time since 2005, the company has raised their dividends in 2012 by 4.8%. They have also raised their dividends in 2013 by 9.1%. Prior to 2005, this company had a good reputation of for increasing dividends. The dividend growth back then was around 17.5% per year.
The Dividend Payout Ratios today are not as good as they were prior to 2005 in regards to earnings. Prior to 2005, the DPR for earnings was below 20%. The DPR for earnings was 37% for 2012. It is expected to be around 36% for 2013. The DPR for Cash Flow was always quite low and it is roughly the same with a 5 year DPR rate of 15% with the DPR for CF the same for 2012. Stock prices are still almost 35% below those reached in 2004.
However, shareholders would seem to be again earning money on this stock with the total return at 6.57% per year over the past 5 years. The dividends would be some 2.28% per year of that return and the capital gains would be some 4.28% of that return. Over the past 10 years, shareholders would probably have just broken even.
The outstanding shares have increased marginally (less than 1% per year) over the past 5 and 10 years. They have increased due to DRIP and stock options and decreased due to buy backs. Mostly over the past 5 and 10 years there has been growth in revenue, earnings and cash flow. Some growth is better than others.
The Revenue has increased by 1.5% and 3.2% per year over the past 5 and 10 years. Revenue per Share has increased by 1% and 3% per year over the past 5 and 10 years. Earnings per Share is up by 13.7% over the past 5 years, but down by 1.5% per year over the past 10 years. However, earnings are rather volatile and using the 5 year running averages, I get EPS growth of 4% and 3% per year over the past 5 and 10 years.
The Cash Flow per Share has grown by 5% and 3% per year over the past 5 and 10 years. Book Value per Share has grown at the rate of 2.4% and 4.3% per year over the past 5 and 10 years.
Return on Equity has most years been good with a 5 year median of 10.5%. The ROE for the financial year ending in 2012 was 10.1%. The ROE on comprehensive income is close behind, but below 10% at 9.8% for 2012 and for the 5 year median.
The balance sheet is ok, but not that strong. The Liquidity Ratio is current at 1.27. If you add in expected cash flow less dividends you get to a decent 1.58. The Debt Ratios are fine, with a current one at 1.60. The Leverage and Debt/Equity Ratios are also fine and currently at 2.67 and 1.67.
It certainly is a good sign that the company feels confident enough to raise the dividends in 2012 and 2013. It seems like there is a turnaround in place for this company. Also most view the purchase of Shopper Drug Mart as a positive. See my spreadsheet at lob.htm.
This is the first of two parts. Second part will be posted on Tuesday, July 23rd, 2013 and will be here.
Loblaw Companies Limited, a subsidiary of George Weston Limited, is Canada's largest food retailer and a leading provider of drugstore, general merchandise and financial products and services. Loblaw offers Canada's strongest control (private) label program, including the unique President's Choice, no name and Joe Fresh brands. In addition, the Company makes available to consumers President's Choice financial services and offers the PC point loyalty program. Its web site is here Loblaw.
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, July 19, 2013
Power Corp of Canada 2
On my other blog I am today writing Mike Weber's Canadian Dividend All-Star List ...continue...
I do not own this stock Power Corp of Canada (TSX-POW, OTC-PWCDF). I started following this stock because it was on the Dividend Achievers, the Dividend Aristocrats lists and also on Mike Higgs' list. I would not buy it because I have shares in Power Financial, which this company controls.
When I look at insider trading, I find $12.8M of insider selling and $12.7M of net insider selling. The selling is by the CFO and officers. There is a bit of insider buying by officers as officers seem to be holding on to their Deferred Share Units.
The 5 year low, median and high median Price/Earnings per Share Ratios were 10.94, 14.82 and 16.41. The current P/E Ratio is 12.17 and shows that the stock price is reasonable. The current P/E Ratio is based on a stock price of $29.34 and 2013 earnings of $2.41.
I get a Graham price of $39.24. The 10 year low, median and high median Price/Graham Price Ratios are 0.80, 0.98 and 1.17. The current P/GP Ratio is 0.75. This suggests that the current stock price of $29.34 is low.
The 10 year median Price/Book Value per Share Ratio is 1.96. The current P/B Ratio is just 1.03 a value some 53% lower. Any value at 80% or lower says the stock price is cheap.
The current dividend yield is 3.95% and the 5 year median is 4.61%. The dividend yield has been treading up and this stock has a 10 year median dividend yield of 3.10%. Generally with the current dividend yield lower than the 5 year median dividend yield, the stock price would be considered to be on the high side. However, this company has not raised their dividends since 2008. The company prior to that raised the dividend every year.
Both the P/GP Ratio test and the P/B Ratio tests suggest that this stock price is cheap and I would currently go along with these tests.
When I look at analysts' recommendations, I find Buy and Hold recommendations. Most of the recommendations are a Hold recommendation and the consensus recommendation would be a Hold. The 12 month consensus stock price is $29.90. This implies a 12 month total return of 5.86%, with 3.95% from dividends and 1.91% from capital gains.
To make good money over the longer term, you should be buying good companies when they are cheap. Yes, this can be a risk because companies are generally cheap for a reason. The main reason this company is cheap is mainly because it has insurance companies in its holdings and insurance companies are doing poorly in the current economic climate of low interest rates. However, low interest rates will not last forever.
There is a positive item on Seeking Alpha comparing this company to Berkshire Hathaway. Global News talks about Great West Life's recent purchase of Irish Life. Great West Life is part of the stable of companies controlled by Power Corp. The blogger 25000 Dividends talks about recently purchasing Power Corp.
I would not own this stock because I have stock in Power Financial. Power Financial has also been doing poorly. I have held on to my Power Financial stock because the current economic climate of lower interest rates is not going to last forever. Power Financial is controlled by Power Corp. See my spreadsheet at pow.htm.
This is the second of two parts. The first part was posted on Thursday, July 18th, 2013 and is available here.
Power Corporation of Canada is a diversified international management and holding company with interests in companies in the financial services, communications and other business sectors in North America, Europe and Asia. Some of it subsidiary companies include Power Financial, the Pargesa group and Gesca and Square Victoria Digital Properties. Controlling shareholder of Power Corp of Canada is Paul Desmarais. They have 30.1%, but have 64.6% voting control. Its web site is here Power Corp.
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 Power Corp of Canada (TSX-POW, OTC-PWCDF). I started following this stock because it was on the Dividend Achievers, the Dividend Aristocrats lists and also on Mike Higgs' list. I would not buy it because I have shares in Power Financial, which this company controls.
When I look at insider trading, I find $12.8M of insider selling and $12.7M of net insider selling. The selling is by the CFO and officers. There is a bit of insider buying by officers as officers seem to be holding on to their Deferred Share Units.
The 5 year low, median and high median Price/Earnings per Share Ratios were 10.94, 14.82 and 16.41. The current P/E Ratio is 12.17 and shows that the stock price is reasonable. The current P/E Ratio is based on a stock price of $29.34 and 2013 earnings of $2.41.
I get a Graham price of $39.24. The 10 year low, median and high median Price/Graham Price Ratios are 0.80, 0.98 and 1.17. The current P/GP Ratio is 0.75. This suggests that the current stock price of $29.34 is low.
The 10 year median Price/Book Value per Share Ratio is 1.96. The current P/B Ratio is just 1.03 a value some 53% lower. Any value at 80% or lower says the stock price is cheap.
The current dividend yield is 3.95% and the 5 year median is 4.61%. The dividend yield has been treading up and this stock has a 10 year median dividend yield of 3.10%. Generally with the current dividend yield lower than the 5 year median dividend yield, the stock price would be considered to be on the high side. However, this company has not raised their dividends since 2008. The company prior to that raised the dividend every year.
Both the P/GP Ratio test and the P/B Ratio tests suggest that this stock price is cheap and I would currently go along with these tests.
When I look at analysts' recommendations, I find Buy and Hold recommendations. Most of the recommendations are a Hold recommendation and the consensus recommendation would be a Hold. The 12 month consensus stock price is $29.90. This implies a 12 month total return of 5.86%, with 3.95% from dividends and 1.91% from capital gains.
To make good money over the longer term, you should be buying good companies when they are cheap. Yes, this can be a risk because companies are generally cheap for a reason. The main reason this company is cheap is mainly because it has insurance companies in its holdings and insurance companies are doing poorly in the current economic climate of low interest rates. However, low interest rates will not last forever.
There is a positive item on Seeking Alpha comparing this company to Berkshire Hathaway. Global News talks about Great West Life's recent purchase of Irish Life. Great West Life is part of the stable of companies controlled by Power Corp. The blogger 25000 Dividends talks about recently purchasing Power Corp.
I would not own this stock because I have stock in Power Financial. Power Financial has also been doing poorly. I have held on to my Power Financial stock because the current economic climate of lower interest rates is not going to last forever. Power Financial is controlled by Power Corp. See my spreadsheet at pow.htm.
This is the second of two parts. The first part was posted on Thursday, July 18th, 2013 and is available here.
Power Corporation of Canada is a diversified international management and holding company with interests in companies in the financial services, communications and other business sectors in North America, Europe and Asia. Some of it subsidiary companies include Power Financial, the Pargesa group and Gesca and Square Victoria Digital Properties. Controlling shareholder of Power Corp of Canada is Paul Desmarais. They have 30.1%, but have 64.6% voting control. Its web site is here Power Corp.
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, July 18, 2013
Power Corp of Canada
I do not own this stock Power Corp of Canada (TSX-POW, OTC-PWCDF). I started following this stock because it was on the Dividend Achievers, the Dividend Aristocrats lists and also on Mike Higgs' list. I would not buy it because I have shares in Power Financial, which this company controls.
This company has a lot of its holdings in insurance companies. Insurance companies have not done well for a while because of low interest rates. This company was previously considered to be a dividend growth company and indeed had a great record of increasing their dividends.
However, the company has not increased their dividends since 2009. The last increase in 2008 was for only 4.4%, a much lower increase rate that this company has been giving. Still the 10 year dividend growth is at 16.6% and the 5 year dividend growth is at 4.8%. Some analysts do expect perhaps a small dividend increase this year or next. Most do not. The dividend yield has increased as has occurred on other insurance stock. Dividend yield used to be at or below 2%. The current dividend yield is 3.95%.
The problem is that the Dividend Payout Ratio for earnings has gone from south of 30% to north of 60%. However, the DPR for cash flow has not really increased and the 5 year median DPR for cash flow is currently around 9.8%.
This stock, as well as the stock market has been moving higher lately. It looks like we are going to have a summer rally this year. However, the returns on this stock have not been great lately. The 5 year total return to the end of last year was a 5.3% per year loss. The dividend portion of the return was 3.45% per year and the capital loss was at 8.76% per year. However, over 10 years the total return was 7.64%, with 4.14% per year from dividends and 3.5% per year in capital gains.
Shares have increased marginally (way less than 1% per year) over the past 5 and 10 years. Shares have increased due to stock options. Growth has not been great lately for this stock and the 10 year growth figures are better than the 5 year growth figures.
Revenue per Share is up by 5.5% per year and 6.9% per year over the past 5 and 10 years when looking at 5 year running averages. Earnings per Share is down by 6.8% per year if looking at 5 year running averages, but up 3.8% per year over the past 10 years. Cash Flow per Share is up by 5.6% and 17.6% per year when looking at 5 year running averages over the past 5 and 10 years.
When looking at Return on Equity, this has been good lately and was only really low in 2008 and 2009. The ROE for the financial year ending in December 2012 was 27.2%. The ROE for comprehensive income was fairly close at 25.5% and only 6% different.
The Liquidity Ratio is not that important on financial firms and this firm's liquidity Ratio has always been quite good with a 5 year median at 1.75. A more important ratio is the Debt Ratio and this is good for a financial firm coming in a 1.11. The Leverage and Debt/Equity Ratios got quite high over the past few years and quite high for the financial year ending in 2012 coming in at 26.90 and 24.25. They are much better and more in line with other financial firms for the 1st quarter of 2013 coming in at 19.65 and 17.92.
This stock has not done that well over the most recent financial difficulties. However, when the economic climate changes, I am sure that it will become, once again, a dividend growth company. See my spreadsheet at pow.htm.
This is the first of two parts. Second part will be posted on Friday, July 19th, 2013 and will be here.
Power Corporation of Canada is a diversified international management and holding company with interests in companies in the financial services, communications and other business sectors in North America, Europe and Asia. Some of it subsidiary companies include Power Financial, the Pargesa group and Gesca and Square Victoria Digital Properties. Controlling shareholder of Power Corp of Canada is Paul Desmarais. They have 30.1%, but have 64.6% voting control. Its web site is here Power Corp.
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 company has a lot of its holdings in insurance companies. Insurance companies have not done well for a while because of low interest rates. This company was previously considered to be a dividend growth company and indeed had a great record of increasing their dividends.
However, the company has not increased their dividends since 2009. The last increase in 2008 was for only 4.4%, a much lower increase rate that this company has been giving. Still the 10 year dividend growth is at 16.6% and the 5 year dividend growth is at 4.8%. Some analysts do expect perhaps a small dividend increase this year or next. Most do not. The dividend yield has increased as has occurred on other insurance stock. Dividend yield used to be at or below 2%. The current dividend yield is 3.95%.
The problem is that the Dividend Payout Ratio for earnings has gone from south of 30% to north of 60%. However, the DPR for cash flow has not really increased and the 5 year median DPR for cash flow is currently around 9.8%.
This stock, as well as the stock market has been moving higher lately. It looks like we are going to have a summer rally this year. However, the returns on this stock have not been great lately. The 5 year total return to the end of last year was a 5.3% per year loss. The dividend portion of the return was 3.45% per year and the capital loss was at 8.76% per year. However, over 10 years the total return was 7.64%, with 4.14% per year from dividends and 3.5% per year in capital gains.
Shares have increased marginally (way less than 1% per year) over the past 5 and 10 years. Shares have increased due to stock options. Growth has not been great lately for this stock and the 10 year growth figures are better than the 5 year growth figures.
Revenue per Share is up by 5.5% per year and 6.9% per year over the past 5 and 10 years when looking at 5 year running averages. Earnings per Share is down by 6.8% per year if looking at 5 year running averages, but up 3.8% per year over the past 10 years. Cash Flow per Share is up by 5.6% and 17.6% per year when looking at 5 year running averages over the past 5 and 10 years.
When looking at Return on Equity, this has been good lately and was only really low in 2008 and 2009. The ROE for the financial year ending in December 2012 was 27.2%. The ROE for comprehensive income was fairly close at 25.5% and only 6% different.
The Liquidity Ratio is not that important on financial firms and this firm's liquidity Ratio has always been quite good with a 5 year median at 1.75. A more important ratio is the Debt Ratio and this is good for a financial firm coming in a 1.11. The Leverage and Debt/Equity Ratios got quite high over the past few years and quite high for the financial year ending in 2012 coming in at 26.90 and 24.25. They are much better and more in line with other financial firms for the 1st quarter of 2013 coming in at 19.65 and 17.92.
This stock has not done that well over the most recent financial difficulties. However, when the economic climate changes, I am sure that it will become, once again, a dividend growth company. See my spreadsheet at pow.htm.
This is the first of two parts. Second part will be posted on Friday, July 19th, 2013 and will be here.
Power Corporation of Canada is a diversified international management and holding company with interests in companies in the financial services, communications and other business sectors in North America, Europe and Asia. Some of it subsidiary companies include Power Financial, the Pargesa group and Gesca and Square Victoria Digital Properties. Controlling shareholder of Power Corp of Canada is Paul Desmarais. They have 30.1%, but have 64.6% voting control. Its web site is here Power Corp.
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, July 17, 2013
Jean Coutu Group Inc 2
On my other blog I am today writing about our debt ...continue...
I do not own this stock of Jean Coutu Group Inc (TSX-PJC.A, OTC-JCOUF), but I used to. I bought this stock first in 2000 for my RRSP account. In 2004, I bought some for my trading account. In 2007, I was looking to buy a condo and so had to raise some money for a mortgage. I sold this stock in both accounts. It was not doing well. I started to follow this stock as it was on Mike Higgs' list of dividend growth stocks. It was also on Investment Reporter's stock list.
When I look at insider trading I find $6.6M of insider selling and net insider selling of $6.5M. The insider selling is by officers of the company only. The company has also been buying back Class A Shares. Not only is there options, but there are other option like vehicles called Share Rights (two types) and Performance Share Units. Jean Coutu owns all the Class B multiple voting shares.
The CEO has shares no shares and has options worth $13.8M. The CFO has shares worth $0.5M and has options worth $5.6M. An officer has no shares and has options worth $1M. Most directors have few shares and have few options. A couple of directors related to Jean Coutu have Class A shares worth $192m. 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 9.80, 11.42 and 13.05. The current P/E Ratio is 18.61 based on next year's EPS of $1.04 and a stock price of $19.35. This says that the current price is high.
I get a Graham Price of $11.79. The 10 year low, median and high median Price/Graham Price Ratios are 1.29, 1.60 and 1.89. The current P/GP Ratio is 1.64. This says that the stock price is relatively reasonable.
The 10 year Price/Book Value per Share Ratio is 3.17. The current P/B Ratio is 3.26, a value that is 3% higher than the 10 year ratio and this suggests that the stock price is reasonable.
I get a 5 year median dividend yield of 2.29%. The current yield is 1.76%. The current yield is 24% lower than the 5 year median dividend yield. What you want is a current yield higher than the 5 year median. The 10 year median dividend yield of 1.55% is lower than the current one by 13%. The current stock price is probably relatively reasonable. There is not usually such a big difference between the 5 year and 10 year median dividend yields.
When I look at the analysts' recommendations, I get Buy, Hold and Underperform recommendations. The consensus recommendation is a Hold. The 12 month consensus stock price is $18.10. This implies a negative total return of 4.7% with 1.76% from dividends and 6.46% capital loss.
Analysts think that this is a well-run business, but wonder if there is any more acquisitions for this company. It has grown in the past by acquisitions and they have not always been successful in this. They have a significant cash balance which could soon be in the neighborhood of $300M and people are wondering what they will do with it. They sold their Rite Aid Shares (NYSE-RAD). See news item in Street Insider.
The Montreal Gazette talks about their new big distribution center and that it could support a Canadian expansion for Jean Coutu Group. There was recently a jump in the shares of this company and the financial post think that it may be the next takeover target.
The current stock price has jumped in the last few days to one over $19. The current price seems reasonable, but if it continues to rise, it may not stay reasonable. See my spreadsheet at pjc.htm.
This is the second of two parts. The first part was posted on Tuesday, July 16th, 2013 and is available here.
The Jean Coutu Group operates a network of 343 franchised drugstores in Canada located in the provinces of Québec, New Brunswick and Ontario (under the banners of PJC Jean Coutu, PJC Clinique and PJC Santé Beauté). Controlling shareholder is Jean Coutu. He has 55%, but has 92.5% voting control. Its web site is here Jean Coutu.
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 Jean Coutu Group Inc (TSX-PJC.A, OTC-JCOUF), but I used to. I bought this stock first in 2000 for my RRSP account. In 2004, I bought some for my trading account. In 2007, I was looking to buy a condo and so had to raise some money for a mortgage. I sold this stock in both accounts. It was not doing well. I started to follow this stock as it was on Mike Higgs' list of dividend growth stocks. It was also on Investment Reporter's stock list.
When I look at insider trading I find $6.6M of insider selling and net insider selling of $6.5M. The insider selling is by officers of the company only. The company has also been buying back Class A Shares. Not only is there options, but there are other option like vehicles called Share Rights (two types) and Performance Share Units. Jean Coutu owns all the Class B multiple voting shares.
The CEO has shares no shares and has options worth $13.8M. The CFO has shares worth $0.5M and has options worth $5.6M. An officer has no shares and has options worth $1M. Most directors have few shares and have few options. A couple of directors related to Jean Coutu have Class A shares worth $192m. 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 9.80, 11.42 and 13.05. The current P/E Ratio is 18.61 based on next year's EPS of $1.04 and a stock price of $19.35. This says that the current price is high.
I get a Graham Price of $11.79. The 10 year low, median and high median Price/Graham Price Ratios are 1.29, 1.60 and 1.89. The current P/GP Ratio is 1.64. This says that the stock price is relatively reasonable.
The 10 year Price/Book Value per Share Ratio is 3.17. The current P/B Ratio is 3.26, a value that is 3% higher than the 10 year ratio and this suggests that the stock price is reasonable.
I get a 5 year median dividend yield of 2.29%. The current yield is 1.76%. The current yield is 24% lower than the 5 year median dividend yield. What you want is a current yield higher than the 5 year median. The 10 year median dividend yield of 1.55% is lower than the current one by 13%. The current stock price is probably relatively reasonable. There is not usually such a big difference between the 5 year and 10 year median dividend yields.
When I look at the analysts' recommendations, I get Buy, Hold and Underperform recommendations. The consensus recommendation is a Hold. The 12 month consensus stock price is $18.10. This implies a negative total return of 4.7% with 1.76% from dividends and 6.46% capital loss.
Analysts think that this is a well-run business, but wonder if there is any more acquisitions for this company. It has grown in the past by acquisitions and they have not always been successful in this. They have a significant cash balance which could soon be in the neighborhood of $300M and people are wondering what they will do with it. They sold their Rite Aid Shares (NYSE-RAD). See news item in Street Insider.
The Montreal Gazette talks about their new big distribution center and that it could support a Canadian expansion for Jean Coutu Group. There was recently a jump in the shares of this company and the financial post think that it may be the next takeover target.
The current stock price has jumped in the last few days to one over $19. The current price seems reasonable, but if it continues to rise, it may not stay reasonable. See my spreadsheet at pjc.htm.
This is the second of two parts. The first part was posted on Tuesday, July 16th, 2013 and is available here.
The Jean Coutu Group operates a network of 343 franchised drugstores in Canada located in the provinces of Québec, New Brunswick and Ontario (under the banners of PJC Jean Coutu, PJC Clinique and PJC Santé Beauté). Controlling shareholder is Jean Coutu. He has 55%, but has 92.5% voting control. Its web site is here Jean Coutu.
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, July 16, 2013
Jean Coutu Group Inc
I do not own this stock of Jean Coutu Group Inc (TSX-PJC.A, OTC-JCOUF), but I used to. I bought this stock first in 2000 for my RRSP account. In 2004, I bought some for my trading account. It had increasing dividends, a good P/E Ratio and it was a stock I already owned. In 2007, I was looking to buy a condo and so had to raise some money for a mortgage. This company was not doing that well at the moment, so I sold.
I started to follow this stock as it was on Mike Higgs' list of dividend growth stocks. It was also on Investment Reporters stock list. For a company history, see Wikipedia.
For the stock I bought in 2000 and sold in 2007, I made a profit of 11.54% per year. Of my return, 10.41% per year was from capital gains and 1.13% per year was from dividends. For the stock I bought in 2004, I lost 7.92% per year with a capital loss of 8.63% per year and dividends at 0.79% per year.
This company has a very good record for dividend increases, with the 5 and 10 year growth in dividends at 15% and 11% per year, respectively. The dividends have been rather low, but the current one is respectable at 1.8%. However, before 2007, the dividend yield was 1% or less generally.
When I originally bought this stock it was considered to be a dividend growth stock. However, it did have serious problems starting in 2007 and had losses in both the 2008 and 2009 financial years. Generally speaking, shareholders have done better over the past 5 years than over the past 10 years. It would seem that the problems are behind this company.
For example, the total return over the past 5 years is at 7.3% per year, with 5.4% from capital gains and 1.9% from dividends. Over the past 10 years, stockholders have broken even with dividends at 1.2% per year and capital losses at 1.2% per year.
Over the past 5 and 10 years, the shares outstanding have decreased by 2.89% and 0.55% per year. Shares have increased due to stock options and decreased due to buy backs. There are also two classes of shares, with the Class A shares on the TSX being Subordinate Voting shares and Class B shares being multiple voting shares. As far as I can see Jean Coutu owns all the Class B shares.
Revenues are up by 10% per year over the past 5 and down by 3.8% 10 years. Revenue per Share is up by 13.6% per year over the past 5 years, but down by 3.3% per year over the past 10 years. Earnings per Share are up by 24% and 14% per year over the past 5 and 10 years. Cash Flow per Share is up by 16% per year over the past 5 years and even over the past 10 years.
As with a lot of family owned businesses, the debt ratios are very good. The current Liquidity Ratio is 2.06 and the current Debt Ratio is 5.17. The current Leverage and Debt/Equity Ratios are also very good at 1.24 and 0.24.
The Return on Equity was very high for the financial year ending March 2013 at 50%. The ROE on comprehensive income was close and even better at 53%. The 12 month ROE ending in the first quarter of 2014 with a financial date of June is more normal at 21%.
This stock seems to becoming a dividend growth stock again. See my spreadsheet at pjc.htm.
This is the first of two parts. Second part will be posted on Wednesday, July 17th, 2013 and will be here.
The Jean Coutu Group operates a network of 343 franchised drugstores in Canada located in the provinces of Quebec, New Brunswick and Ontario (under the banners of PJC Jean Coutu, PJC Clinique and PJC Santé Beauté). Controlling shareholder is Jean Coutu. He has 55%, but has 92.5% voting control. Its web site is here Jean Coutu.
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 started to follow this stock as it was on Mike Higgs' list of dividend growth stocks. It was also on Investment Reporters stock list. For a company history, see Wikipedia.
For the stock I bought in 2000 and sold in 2007, I made a profit of 11.54% per year. Of my return, 10.41% per year was from capital gains and 1.13% per year was from dividends. For the stock I bought in 2004, I lost 7.92% per year with a capital loss of 8.63% per year and dividends at 0.79% per year.
This company has a very good record for dividend increases, with the 5 and 10 year growth in dividends at 15% and 11% per year, respectively. The dividends have been rather low, but the current one is respectable at 1.8%. However, before 2007, the dividend yield was 1% or less generally.
When I originally bought this stock it was considered to be a dividend growth stock. However, it did have serious problems starting in 2007 and had losses in both the 2008 and 2009 financial years. Generally speaking, shareholders have done better over the past 5 years than over the past 10 years. It would seem that the problems are behind this company.
For example, the total return over the past 5 years is at 7.3% per year, with 5.4% from capital gains and 1.9% from dividends. Over the past 10 years, stockholders have broken even with dividends at 1.2% per year and capital losses at 1.2% per year.
Over the past 5 and 10 years, the shares outstanding have decreased by 2.89% and 0.55% per year. Shares have increased due to stock options and decreased due to buy backs. There are also two classes of shares, with the Class A shares on the TSX being Subordinate Voting shares and Class B shares being multiple voting shares. As far as I can see Jean Coutu owns all the Class B shares.
Revenues are up by 10% per year over the past 5 and down by 3.8% 10 years. Revenue per Share is up by 13.6% per year over the past 5 years, but down by 3.3% per year over the past 10 years. Earnings per Share are up by 24% and 14% per year over the past 5 and 10 years. Cash Flow per Share is up by 16% per year over the past 5 years and even over the past 10 years.
As with a lot of family owned businesses, the debt ratios are very good. The current Liquidity Ratio is 2.06 and the current Debt Ratio is 5.17. The current Leverage and Debt/Equity Ratios are also very good at 1.24 and 0.24.
The Return on Equity was very high for the financial year ending March 2013 at 50%. The ROE on comprehensive income was close and even better at 53%. The 12 month ROE ending in the first quarter of 2014 with a financial date of June is more normal at 21%.
This stock seems to becoming a dividend growth stock again. See my spreadsheet at pjc.htm.
This is the first of two parts. Second part will be posted on Wednesday, July 17th, 2013 and will be here.
The Jean Coutu Group operates a network of 343 franchised drugstores in Canada located in the provinces of Quebec, New Brunswick and Ontario (under the banners of PJC Jean Coutu, PJC Clinique and PJC Santé Beauté). Controlling shareholder is Jean Coutu. He has 55%, but has 92.5% voting control. Its web site is here Jean Coutu.
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, July 15, 2013
EnerCare Inc
On my other blog I am today writing about charity ...continue...
I do not own this stock EnerCare Inc (TSX-ECI, OTC-CSUWF). This was one of a few income trusts I followed because it was recommended by MPL communications. Like other income trusts, it converted to a corporation. This company cut their dividend at the same time by about 50% (2009). However, they still make a dividend payment each month which some dividend investors appreciate.
The company started modestly to again increase their dividends in 2012. The most recent increase was for 1.8% in 2013. However, they are straggling to make a profit lately and the Dividend Payout Ratio for earnings is way too high. They are not also expected to make a profit in 2013. It is expected the DPR will be around 259% for 2014 if dividends do not change. However, the DPR for cash flow is fair, running around 35%.
Most analysts expect this company to again have a loss in 2013. The consensus EPS for 2013 is -$0.08. Some analysts expect them to make a slight profit and others to have a much larger loss. Certainly the first quarterly results of 2013 shows a bigger loss that the 1st quarter of 2012. All the analysts expect the company to make a profit in 2014.
The bright spot on this stock is that they are growing their revenue. Revenue is has grown by 9% and 7% per year over the past 5 and 9 years. Revenue per Share has grown at 5.6% and 5.3% per year over the past 5 and 9 years.
There is growth in cash flow over the past 9 years, but not over the past 5 years. People who have held on to this stock for 10 years has made money, but not over the past 5 years. However, the 10 year good return was because of dividends at 11.25% per year. There was a slight capital loss.
The debt ratios are not very good. The Liquidity Ratio is currently only 1.21. If you add in cash flow after dividends it rises to 2.68. A lot of utility companies rely on cash flow to give them a better Liquidity Ratio. However, the Debt Ratio is also low at 1.11 currently. It has always been quite low and the company has a 5 year median Debt Ratio of just 1.20. Most utilities have better Debt Ratios.
The Leverage and Debt/Equity Ratios are a bit high at 10.04 and 9.04. These ratios have been rising over the past few years. They were better for the financial year of 2012 at 8.39 and 7.39. The 2012 ratios are more typical of utility companies.
When doing stock price tests, I cannot use my usual P/E or dividend yield tests. P/E is not much good when a company has no profit and dividend yield is not good for income trusts that have cut their dividends. I get a Graham Price of just $1.47 and the P/GP Ratio is 6.15 which on any basis say the stock price is very high. The 10 year median P/B Ratio is 2.39, a fair value. However, the current P/B Ratio is 6.58 a very high value.
The 5 year Price/Cash Flow per Share Ratio is 3.63 and the current ratio is 30% higher at 4.72. This says that the stock price is relatively high. The only good showing is the Price/Sales (or Revenue) per Share Ratio. The 5 year median P/S is 1.81 and the current one is 1.86 only 2.7% higher and this says that the stock price is relatively reasonable.
When I look at analysts' recommendations, I get Strong Buy, Buy and Hold recommendations. The consensus recommendation would be a Buy. This is a very common analysts' recommendation for stocks. The 12 months stock price consensus is $10.80. This implies an 18.77% return with 7.52% from dividends and 11.26% from capital gains.
A number of analysts say that they like the good dividend, currently at around 7.5%. They think it is safe and might be increased again in 2015. The site Seeking Alpha talks about recent insider buying.
However, you should think carefully before buying high yield stocks. They are generally high for a reason. This stock has no profit for 2012 and few expect one for 2013. This will be a short report as I do not have enough days to do long reports on all the stocks I am following. See my spreadsheet at eci.htm.
EnerCare Inc owns a portfolio of waterheaters and other portfolio assets, which they rent to primarily residential customers. They rent out waterheaters in the GTA and southern Ontario. EnerCare also owns EnerCare Connections Inc., a leading sub-metering company, with metering contracts for condominium and apartment suites in Ontario, Alberta and elsewhere in Canada. Its web site is here EnerCare.
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 EnerCare Inc (TSX-ECI, OTC-CSUWF). This was one of a few income trusts I followed because it was recommended by MPL communications. Like other income trusts, it converted to a corporation. This company cut their dividend at the same time by about 50% (2009). However, they still make a dividend payment each month which some dividend investors appreciate.
The company started modestly to again increase their dividends in 2012. The most recent increase was for 1.8% in 2013. However, they are straggling to make a profit lately and the Dividend Payout Ratio for earnings is way too high. They are not also expected to make a profit in 2013. It is expected the DPR will be around 259% for 2014 if dividends do not change. However, the DPR for cash flow is fair, running around 35%.
Most analysts expect this company to again have a loss in 2013. The consensus EPS for 2013 is -$0.08. Some analysts expect them to make a slight profit and others to have a much larger loss. Certainly the first quarterly results of 2013 shows a bigger loss that the 1st quarter of 2012. All the analysts expect the company to make a profit in 2014.
The bright spot on this stock is that they are growing their revenue. Revenue is has grown by 9% and 7% per year over the past 5 and 9 years. Revenue per Share has grown at 5.6% and 5.3% per year over the past 5 and 9 years.
There is growth in cash flow over the past 9 years, but not over the past 5 years. People who have held on to this stock for 10 years has made money, but not over the past 5 years. However, the 10 year good return was because of dividends at 11.25% per year. There was a slight capital loss.
The debt ratios are not very good. The Liquidity Ratio is currently only 1.21. If you add in cash flow after dividends it rises to 2.68. A lot of utility companies rely on cash flow to give them a better Liquidity Ratio. However, the Debt Ratio is also low at 1.11 currently. It has always been quite low and the company has a 5 year median Debt Ratio of just 1.20. Most utilities have better Debt Ratios.
The Leverage and Debt/Equity Ratios are a bit high at 10.04 and 9.04. These ratios have been rising over the past few years. They were better for the financial year of 2012 at 8.39 and 7.39. The 2012 ratios are more typical of utility companies.
When doing stock price tests, I cannot use my usual P/E or dividend yield tests. P/E is not much good when a company has no profit and dividend yield is not good for income trusts that have cut their dividends. I get a Graham Price of just $1.47 and the P/GP Ratio is 6.15 which on any basis say the stock price is very high. The 10 year median P/B Ratio is 2.39, a fair value. However, the current P/B Ratio is 6.58 a very high value.
The 5 year Price/Cash Flow per Share Ratio is 3.63 and the current ratio is 30% higher at 4.72. This says that the stock price is relatively high. The only good showing is the Price/Sales (or Revenue) per Share Ratio. The 5 year median P/S is 1.81 and the current one is 1.86 only 2.7% higher and this says that the stock price is relatively reasonable.
When I look at analysts' recommendations, I get Strong Buy, Buy and Hold recommendations. The consensus recommendation would be a Buy. This is a very common analysts' recommendation for stocks. The 12 months stock price consensus is $10.80. This implies an 18.77% return with 7.52% from dividends and 11.26% from capital gains.
A number of analysts say that they like the good dividend, currently at around 7.5%. They think it is safe and might be increased again in 2015. The site Seeking Alpha talks about recent insider buying.
However, you should think carefully before buying high yield stocks. They are generally high for a reason. This stock has no profit for 2012 and few expect one for 2013. This will be a short report as I do not have enough days to do long reports on all the stocks I am following. See my spreadsheet at eci.htm.
EnerCare Inc owns a portfolio of waterheaters and other portfolio assets, which they rent to primarily residential customers. They rent out waterheaters in the GTA and southern Ontario. EnerCare also owns EnerCare Connections Inc., a leading sub-metering company, with metering contracts for condominium and apartment suites in Ontario, Alberta and elsewhere in Canada. Its web site is here EnerCare.
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, July 12, 2013
Dorel Industries Inc
On my other blog I am today writing about Toronto's Mayor ...continue...
I do not own this stock Dorel Industries Inc. (TSX-DII.B, OTC-DIIBF), but I used to. I bought the stock because it was recommended by Investment Reporter of MPL Communications. They have recommended some very good stocks over the years. I bought this stock in 1999 and 2000 and held it until 2006. I sold as I felt that the stock was going nowhere. My loss was 1.2% per year or 7.7% in total. When I held it, it was not paying a dividend.
This stock started to pay dividends in 2007. It has a good record in dividend increases with growth of 16.8% per year over the past 5 years in CDN$ (and 15.8% in US$). They are paying dividends in US$. The last dividend increase was 100% in 2012 in US$. They haven't increased dividend every year, but in most years.
The Dividend Payout Ratios are quite good with the 5 year median at 15.6% for earnings and 10.5% for Cash Flow. Even with the recent increased in dividends; the 2013 DPR for earnings is expected to be at 34.7% and for Cash Flow at 22.1%. These figures are in CDN$.
The problem I see is that Canadians have not made much off this stock. The 5 and 10 year total return for Canadians is at 5.67% and 1.20% per year, respectively. The capital gain portion of this return is 3.69% and 0.20% per year, respectively. The dividend portion of this return is at 1.98% and 1.00% per year, respectively. US investors have done better.
There has been some growth in revenues, earnings and cash flow. For example, cash flow has grown at the rate of 3.6% and 4.2% per year over the past 5 and 10 years. It is, of course, better in US$ than in CDN$. For example, Sales have grown at 9.6% per year over the past 10 years in US$, but at only 5.4% in CDN$.
They have a very strong balance sheet. This is typical of family owned firms. The only problem I see is that intangible and goodwill assets are a high percentage of the market cap at 87%. However, this is better than in 2011 when the intangible and goodwill assets were 119% of the market cap. Often times when these assets are persistently higher than the market cap, there will be a write down of these assets and this is why it can be a problem.
The Return on Equity for this stock used to be higher than 10%, but this has not been true for the last 2 years. The 5 year median ROE is at 9.7%. The ROE for the financial year of 2012 was 8.3%. The ROE for the last 12 months ending in March 2013 is lower at 7.7%.
The ROE on comprehensive income has varied quite a bit from the ROE on net income. The 5 year median difference is with the ROE on comprehensive income being 12.4% lower. This might imply that the quality of the earnings is not as good as they appear. This is just a warning.
When I look at analysts' recommendations, I find Buy, Hold and Underperform recommendations. The consensus recommendation would be a Hold.
When I take a look at my stock price tests, the P/E Ratios test says the stock is reasonable, but towards the high end of the reasonable range. The current P/E Ratio of 10.25 is just below the 5 year median high P/E Ratio of 10.73. The P/B Ratio says that the stock price is reasonable as the current P/B Ratio is 92% of the 10 year median P/B.
The P/GP Ratio price test says the stock price is reasonable as the current P/GP Ratio is the same as the 10 year median P/GP Ratio. The dividend yield test says that stock is cheap as the current dividend yield of 3.38% is 58% higher than the 5 year median dividend yield of 2.13%.
There is a Financial Post column on the first quarterly results of this company. People remark on the good dividend yield of 3.4%. Some analysts think that the stock price is cheap. To me, only the dividend yield test says it is cheap. Usually, I would go by this test; however, they did just recently raise the dividend by 100%, so maybe this is not the best test to use.
The site Proactive Investors talk about the effects of the announcement by Dorel Industries of lower than expected 2nd quarterly results. The Mideast Times site talks about some recent re-ratings by analysts.
Although this stock is up by 37% since I bought this stock, this works out only to 2.37% per year in capital gains over a 13 year period. Even when I considering the median dividend yield over the past 5 years, the dividend would only push my return to 4.5% per year. Better, but I still think that I made the right decision in selling this stock. See my spreadsheet at dii.htm.
Dorel Industries Inc. is a world class juvenile products and bicycle company. Dorel's branded products include Safety 1st, Quinny, Cosco, Maxi-Cosi and Bébé Confort in Juvenile, as well as Cannondale, Schwinn, GT, Mongoose and SUGOI in Recreational/Leisure. Dorel's Home Furnishings segment markets a wide assortment of furniture products, both domestically produced and imported. Dorel has facilities in seventeen countries, and sales worldwide. There concentrated ownership of this company by the Schwartz family (66%) and Segel family (17%). There are two classes of shares, Class A with multiple voting (10) and Class B, with subordinate voting rates (1). Its web site is here Dorel Industries.
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 Dorel Industries Inc. (TSX-DII.B, OTC-DIIBF), but I used to. I bought the stock because it was recommended by Investment Reporter of MPL Communications. They have recommended some very good stocks over the years. I bought this stock in 1999 and 2000 and held it until 2006. I sold as I felt that the stock was going nowhere. My loss was 1.2% per year or 7.7% in total. When I held it, it was not paying a dividend.
This stock started to pay dividends in 2007. It has a good record in dividend increases with growth of 16.8% per year over the past 5 years in CDN$ (and 15.8% in US$). They are paying dividends in US$. The last dividend increase was 100% in 2012 in US$. They haven't increased dividend every year, but in most years.
The Dividend Payout Ratios are quite good with the 5 year median at 15.6% for earnings and 10.5% for Cash Flow. Even with the recent increased in dividends; the 2013 DPR for earnings is expected to be at 34.7% and for Cash Flow at 22.1%. These figures are in CDN$.
The problem I see is that Canadians have not made much off this stock. The 5 and 10 year total return for Canadians is at 5.67% and 1.20% per year, respectively. The capital gain portion of this return is 3.69% and 0.20% per year, respectively. The dividend portion of this return is at 1.98% and 1.00% per year, respectively. US investors have done better.
There has been some growth in revenues, earnings and cash flow. For example, cash flow has grown at the rate of 3.6% and 4.2% per year over the past 5 and 10 years. It is, of course, better in US$ than in CDN$. For example, Sales have grown at 9.6% per year over the past 10 years in US$, but at only 5.4% in CDN$.
They have a very strong balance sheet. This is typical of family owned firms. The only problem I see is that intangible and goodwill assets are a high percentage of the market cap at 87%. However, this is better than in 2011 when the intangible and goodwill assets were 119% of the market cap. Often times when these assets are persistently higher than the market cap, there will be a write down of these assets and this is why it can be a problem.
The Return on Equity for this stock used to be higher than 10%, but this has not been true for the last 2 years. The 5 year median ROE is at 9.7%. The ROE for the financial year of 2012 was 8.3%. The ROE for the last 12 months ending in March 2013 is lower at 7.7%.
The ROE on comprehensive income has varied quite a bit from the ROE on net income. The 5 year median difference is with the ROE on comprehensive income being 12.4% lower. This might imply that the quality of the earnings is not as good as they appear. This is just a warning.
When I look at analysts' recommendations, I find Buy, Hold and Underperform recommendations. The consensus recommendation would be a Hold.
When I take a look at my stock price tests, the P/E Ratios test says the stock is reasonable, but towards the high end of the reasonable range. The current P/E Ratio of 10.25 is just below the 5 year median high P/E Ratio of 10.73. The P/B Ratio says that the stock price is reasonable as the current P/B Ratio is 92% of the 10 year median P/B.
The P/GP Ratio price test says the stock price is reasonable as the current P/GP Ratio is the same as the 10 year median P/GP Ratio. The dividend yield test says that stock is cheap as the current dividend yield of 3.38% is 58% higher than the 5 year median dividend yield of 2.13%.
There is a Financial Post column on the first quarterly results of this company. People remark on the good dividend yield of 3.4%. Some analysts think that the stock price is cheap. To me, only the dividend yield test says it is cheap. Usually, I would go by this test; however, they did just recently raise the dividend by 100%, so maybe this is not the best test to use.
The site Proactive Investors talk about the effects of the announcement by Dorel Industries of lower than expected 2nd quarterly results. The Mideast Times site talks about some recent re-ratings by analysts.
Although this stock is up by 37% since I bought this stock, this works out only to 2.37% per year in capital gains over a 13 year period. Even when I considering the median dividend yield over the past 5 years, the dividend would only push my return to 4.5% per year. Better, but I still think that I made the right decision in selling this stock. See my spreadsheet at dii.htm.
Dorel Industries Inc. is a world class juvenile products and bicycle company. Dorel's branded products include Safety 1st, Quinny, Cosco, Maxi-Cosi and Bébé Confort in Juvenile, as well as Cannondale, Schwinn, GT, Mongoose and SUGOI in Recreational/Leisure. Dorel's Home Furnishings segment markets a wide assortment of furniture products, both domestically produced and imported. Dorel has facilities in seventeen countries, and sales worldwide. There concentrated ownership of this company by the Schwartz family (66%) and Segel family (17%). There are two classes of shares, Class A with multiple voting (10) and Class B, with subordinate voting rates (1). Its web site is here Dorel Industries.
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, July 11, 2013
DirectCash Payments Inc
I do not own this stock DirectCash Payments Inc. (TSX-DCI, OTC-DCTFF). I wanted to review stocks touted in the 2009 Money Show. There was a lot of talk at this show about some of the Unit Trust being currently good buys with very good yield. This is one of the stocks that were recommended. This is why I started to following this company.
A lot of old income trust companies are having a hard time getting the Dividend Payout Ratios into good shape, especially, the DPR for Earnings. The DPR for Earnings has been much too high for this company. For the financial year ending in 2012 it was 300%. For 2013 it is expected to be over 1,000%. The DPR for cash flow is doing better. The 5 year median DPR for Cash Flow is 60%. This DPR is expected to be in the mid 30% range over the next couple of years.
There has been no dividend increases since 2007. The 5 and 7 year growth in dividends is at 0% and 3.7% per year. No one seems to expect any dividend growth anytime soon. The dividend yield has been decreasing since the company convert to a corporation. The current one is high at 5.86%. The company has promised not to decrease dividends.
Just because dividends are not increasing, that does not mean that shareholders have not made money. The 5 and 8 year total returns are at 23.25% and 14.59%. The dividend portion of this return was 9.36% and 7.87% per year over the past 5 and 8 years. The capital gains portion of this return was 13.89% and 6.72% per year over the past 5 and 8 years. Note that in the future, the dividend portion of the return will be lower as the dividend yield has moved lower.
The debt ratios are rather low on this company. The Liquidity Ratio for the financial year ending in 2012 is 1.15. If you add in cash flow after dividends the ratio goes to a better 1.53. However, the 5 year median Liquidity Ratio is just 0.88 and the 5 year median Liquidity Ratio adding in cash flow after dividends is just 1.06. If the Liquidity Ratio is under 1.00, it means that the current assets cannot cover the current liabilities.
The Debt Ratio is generally good. The ratio for the financial year ending in 2012 is 1.48 (but I would prefer one that was 1.50 or higher). The 5 year median Debt Ratio is good at 2.05. This ratio deals with total assets and total liabilities. The current Leverage and Debt/Equity Ratios are rather high at 3.08 and 2.08. The 5 year median ratios are much better at 1.91 and 0.91, respectively.
They took out more debt in 2012 for acquisition purposes. The debt ratios have improved for the 1st quarter of 2013 with a Liquidity Ratio of 1.19. If you had in cash flow estimates exclusive of dividends it rises to 2.04. The Debt Ratio increases to 1.50 for this first quarter. Leverage and Debt/Equity Ratios are still rather high but a bit better at 3.01 and 2.01.
Growth in revenue, earnings, cash flow and book value has been quite good over the past 5 and 7 years. For example, Revenue per Share has grown at 12% and 16% per year, respectively. Cash Flow has grown at 13% and 12% per year over the past 5 and 7 years. Earnings have been rather erratic. Earnings for 2006 were $0.19, for 2007 were $0.05, for 2011 were $1.47, for 2012 were $0.46.
When I look at analysts’ recommendations, I find only a Strong Buy and a Hold recommendation. The consensus would therefore be a Buy. The 12 month stock price consensus is $27.50. This implies a total return of 22.63% with 5.86% from dividends and 13.77% from capital gains.
A number of analysts seem to like this company and remark on the high dividend yield. One thought after the current debt is reduced that they may be in a position to raise dividends. There is a current payday loan class action suit going on in Manitoba that they are involved with. They offer products that support payday loan companies among other customers.
Looking at my stock price tests, they all point to the stock price being relatively high. For example, the current P/E Ratio is 196.25. The 7 year P/B Ratio is 2.07 and the current one is 33% higher at 2.76. I am really not interested in companies that cannot growth their dividends. See my spreadsheet at dci.htm.
DirectCash is the leading provider of ATMs, debit terminals, prepaid phone cards and prepaid cash cards in Canada. They have built a substantial technological, sales and service infrastructure that enables them to offer convenient and secure revenue streams for businesses across the country. DirectCash operates in Canada, the United States and Mexico. Over 40% owned by Gallacher family. Its web site is here DirectCash.
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.
A lot of old income trust companies are having a hard time getting the Dividend Payout Ratios into good shape, especially, the DPR for Earnings. The DPR for Earnings has been much too high for this company. For the financial year ending in 2012 it was 300%. For 2013 it is expected to be over 1,000%. The DPR for cash flow is doing better. The 5 year median DPR for Cash Flow is 60%. This DPR is expected to be in the mid 30% range over the next couple of years.
There has been no dividend increases since 2007. The 5 and 7 year growth in dividends is at 0% and 3.7% per year. No one seems to expect any dividend growth anytime soon. The dividend yield has been decreasing since the company convert to a corporation. The current one is high at 5.86%. The company has promised not to decrease dividends.
Just because dividends are not increasing, that does not mean that shareholders have not made money. The 5 and 8 year total returns are at 23.25% and 14.59%. The dividend portion of this return was 9.36% and 7.87% per year over the past 5 and 8 years. The capital gains portion of this return was 13.89% and 6.72% per year over the past 5 and 8 years. Note that in the future, the dividend portion of the return will be lower as the dividend yield has moved lower.
The debt ratios are rather low on this company. The Liquidity Ratio for the financial year ending in 2012 is 1.15. If you add in cash flow after dividends the ratio goes to a better 1.53. However, the 5 year median Liquidity Ratio is just 0.88 and the 5 year median Liquidity Ratio adding in cash flow after dividends is just 1.06. If the Liquidity Ratio is under 1.00, it means that the current assets cannot cover the current liabilities.
The Debt Ratio is generally good. The ratio for the financial year ending in 2012 is 1.48 (but I would prefer one that was 1.50 or higher). The 5 year median Debt Ratio is good at 2.05. This ratio deals with total assets and total liabilities. The current Leverage and Debt/Equity Ratios are rather high at 3.08 and 2.08. The 5 year median ratios are much better at 1.91 and 0.91, respectively.
They took out more debt in 2012 for acquisition purposes. The debt ratios have improved for the 1st quarter of 2013 with a Liquidity Ratio of 1.19. If you had in cash flow estimates exclusive of dividends it rises to 2.04. The Debt Ratio increases to 1.50 for this first quarter. Leverage and Debt/Equity Ratios are still rather high but a bit better at 3.01 and 2.01.
Growth in revenue, earnings, cash flow and book value has been quite good over the past 5 and 7 years. For example, Revenue per Share has grown at 12% and 16% per year, respectively. Cash Flow has grown at 13% and 12% per year over the past 5 and 7 years. Earnings have been rather erratic. Earnings for 2006 were $0.19, for 2007 were $0.05, for 2011 were $1.47, for 2012 were $0.46.
When I look at analysts’ recommendations, I find only a Strong Buy and a Hold recommendation. The consensus would therefore be a Buy. The 12 month stock price consensus is $27.50. This implies a total return of 22.63% with 5.86% from dividends and 13.77% from capital gains.
A number of analysts seem to like this company and remark on the high dividend yield. One thought after the current debt is reduced that they may be in a position to raise dividends. There is a current payday loan class action suit going on in Manitoba that they are involved with. They offer products that support payday loan companies among other customers.
Looking at my stock price tests, they all point to the stock price being relatively high. For example, the current P/E Ratio is 196.25. The 7 year P/B Ratio is 2.07 and the current one is 33% higher at 2.76. I am really not interested in companies that cannot growth their dividends. See my spreadsheet at dci.htm.
DirectCash is the leading provider of ATMs, debit terminals, prepaid phone cards and prepaid cash cards in Canada. They have built a substantial technological, sales and service infrastructure that enables them to offer convenient and secure revenue streams for businesses across the country. DirectCash operates in Canada, the United States and Mexico. Over 40% owned by Gallacher family. Its web site is here DirectCash.
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, July 10, 2013
Alliance Grain Traders Inc 2
On my other blog I am today writing about Middle East Christians ...continue...
I do not own this stock Alliance Grain Traders Inc. (TSX-AGT, OTC-AGXXF). I wanted to review all the income trust stocks touted in the 2009 Money Show. There was a lot of talk at this show about some of the Unit Trust being currently good buys with very good yield. This stock has already converted to a corporation in 2009.
When I look at insider trading, I find some insider buying and no insider selling. The CEO has shares worth $75M and has options worth $2.7M. The CFO has shares worth $0.3M and has options worth $1.1M. An officer has shares worth $0.5M and has options worth $1.7M. A director has shares worth $0.1M and has no options. This is just to give you an idea on insider share ownership and option values.
The 5 year Price/Earnings Ratios are very low due to negative recent earnings. The 8 year low, median and high median Price/Earnings Ratios are 9.33, 10.99 and 12.66 seem more valid. The current P/E Ratio is 13.01 based on a stock price of 13.66 and 2013 earnings estimates $1.05. This shows a relatively high stock price. However, on an absolute basis a P/E of 13.66 is not particularly high.
I get a current Graham price of $17.87. The 10 year low, median and high median Price/Graham Price Ratios are 0.88, 0.96 and 1.10. The current P/GP Ratio is 0.76. This implies a relatively low stock price. Also, when the P/GP Ratio is 1.00 or below, it implies a stock price is absolutely low.
The 10 year median Price/Book Value per Share Ratio is 1.31. The current P/B Ratio is just 1.01, a value only some 77% of the 10 year median. This implies that the stock price is relatively low. A P/B Ratio below 1.50 is generally considered good.
The 5 year median dividend yield is 2.84%. The current dividend yield is 4.39%, a value that is 55% higher. This relatively high dividend yield points to a relatively cheap price.
When I look at analysts' recommendations, I find Strong Buy, Buy, Hold and Underperform recommendations. The consensus recommendation is a Buy. The 12 month consensus stock price is $14.80. This implies a total return of 12.74% with 4.39% from dividends and 8.35% from capital gains.
The company has had problems over the last few years, but analysts feel that the company is fundamentally sound. There is a report in the financial post from 2012 that talks a bit about this. E-research has a recent upbeat report on this company. Siemens says talks about recent re-ratings of this company by analysts. The Happy Capitalism site has a more technical take on this stock.
This certainly is an interesting company and the stock is quite cheap. See my spreadsheet at agt.htm.
This is the second of two parts. The first part was posted on Tuesday, July 9th, 2013 and is available here.
Alliance Grain Traders Inc through its subsidiaries, Alliance Pulse Processors Inc. ("Alliance") and Arbel Group ("Arbel"), is engaged in the business of sourcing and processing (cleaning, splitting, sorting and bagging) specialty crops, primarily for export markets. Alliance and its subsidiaries in Canada, U.S., Australia and Turkey handle the full range of pulses and specialty crops including lentils, peas, chickpeas, beans and canary seed through six processing plants. The company recent bought the Arbel Group of Mersin, Turkey. Its web site is here Alliance Grain Traders.
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 Alliance Grain Traders Inc. (TSX-AGT, OTC-AGXXF). I wanted to review all the income trust stocks touted in the 2009 Money Show. There was a lot of talk at this show about some of the Unit Trust being currently good buys with very good yield. This stock has already converted to a corporation in 2009.
When I look at insider trading, I find some insider buying and no insider selling. The CEO has shares worth $75M and has options worth $2.7M. The CFO has shares worth $0.3M and has options worth $1.1M. An officer has shares worth $0.5M and has options worth $1.7M. A director has shares worth $0.1M and has no options. This is just to give you an idea on insider share ownership and option values.
The 5 year Price/Earnings Ratios are very low due to negative recent earnings. The 8 year low, median and high median Price/Earnings Ratios are 9.33, 10.99 and 12.66 seem more valid. The current P/E Ratio is 13.01 based on a stock price of 13.66 and 2013 earnings estimates $1.05. This shows a relatively high stock price. However, on an absolute basis a P/E of 13.66 is not particularly high.
I get a current Graham price of $17.87. The 10 year low, median and high median Price/Graham Price Ratios are 0.88, 0.96 and 1.10. The current P/GP Ratio is 0.76. This implies a relatively low stock price. Also, when the P/GP Ratio is 1.00 or below, it implies a stock price is absolutely low.
The 10 year median Price/Book Value per Share Ratio is 1.31. The current P/B Ratio is just 1.01, a value only some 77% of the 10 year median. This implies that the stock price is relatively low. A P/B Ratio below 1.50 is generally considered good.
The 5 year median dividend yield is 2.84%. The current dividend yield is 4.39%, a value that is 55% higher. This relatively high dividend yield points to a relatively cheap price.
When I look at analysts' recommendations, I find Strong Buy, Buy, Hold and Underperform recommendations. The consensus recommendation is a Buy. The 12 month consensus stock price is $14.80. This implies a total return of 12.74% with 4.39% from dividends and 8.35% from capital gains.
The company has had problems over the last few years, but analysts feel that the company is fundamentally sound. There is a report in the financial post from 2012 that talks a bit about this. E-research has a recent upbeat report on this company. Siemens says talks about recent re-ratings of this company by analysts. The Happy Capitalism site has a more technical take on this stock.
This certainly is an interesting company and the stock is quite cheap. See my spreadsheet at agt.htm.
This is the second of two parts. The first part was posted on Tuesday, July 9th, 2013 and is available here.
Alliance Grain Traders Inc through its subsidiaries, Alliance Pulse Processors Inc. ("Alliance") and Arbel Group ("Arbel"), is engaged in the business of sourcing and processing (cleaning, splitting, sorting and bagging) specialty crops, primarily for export markets. Alliance and its subsidiaries in Canada, U.S., Australia and Turkey handle the full range of pulses and specialty crops including lentils, peas, chickpeas, beans and canary seed through six processing plants. The company recent bought the Arbel Group of Mersin, Turkey. Its web site is here Alliance Grain Traders.
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, July 9, 2013
Alliance Grain Traders Inc
On my other blog I am today writing about diversification ...continue...
I do not own this stock Alliance Grain Traders Inc. (TSX-AGT, OTC-AGXXF). I wanted to review all the income trust stocks touted in the 2009 Money Show. There was a lot of talk at this show about some of the Unit Trust being currently good buys with very good yield. This stock has already converted to a corporation in 2009.
As an income trust the yield was around 7% and then it declined to 2% with the change to a corporation. The 5 year median dividend yield is 2.84%. However, the current dividend yield is 4.39% as the stock price has been on the decline.
There was some initial dividend growth and this stock has 5 and 10 year dividend growth at 3.3% and 6.4% per year. The last dividend increase was for 11.1% and was in 2011. There was no dividend increased in 2012 and no so far in 2013. Analysts do not expect any increases in 2013. (Note that this stock went on the stock exchange in 2005, so there are no 10 year statistics for this stock.)
Earnings have not been good over the past few years and so the Dividend Payout Ratios for Earnings has been high. The DPR for earnings for 2012 was 176%. The DPR for earnings 2013 is expected to be 57% and for 2014 at 43%. The 5 year median DPR for cash flow is 42% and is expected to be 30% in 2013.
Shareholders have made some money on this stock. The total return over the past 5 and 8 years is at 10.67% and 19.86% per year. The dividend portion of these returns is at 5.08% and 7.11% per year over the past 5 and 8 years. The capital gains portion of these returns is at 5.59% and 12.75% per year over the past 5 and 8 years.
The outstanding shares have increased by 25.6% and 1880% over the past 5 and 7 years. Most of the increase is for issuance of units and shares. There has been some increase due to stock options. Revenue growth has been quite good, cash flow growth has been ok and there has not been much in the way of earnings growth over the past 5 years.
The growth in revenue is at 28% and 27% per year over the past 5 and 10 years. The cash flow growth is at 9.8% and 0% per year over the past 5 and 7 years. (The 5 year running growth over the past 3 years is at 4.5% per year.) EPS growth has been at a negative 18% per year over the past 5 year and at 8.7% per year over the past 7 years. (The 5 year running growth for earnings is at a negative 3% per year over the past 3 years.)
The Return on Equity was good until 2010. The 5 year median is at 6.1% and the ROE for the financial year of 2012 is at just 2.5%. The 12 month ROE at the first quarter of March 2013 is even lower at 1.5%. The ROE on comprehensive income has been inconsistent with the ROE on net income. Sometimes it was better and sometimes it was worse.
The Liquidity Ratio has often been low and as only 1.19 for the financial year of 2012. However, the current ratio is much better at 1.73. The Debt Ratio has been good and the one for 2012 was 1.61 and the current one is 1.57. The current Leverage and Debt/Equity Ratios are fine at 2.75 and 1.75.
A lot of x-income trust stocks are having a rough time switching to stock companies. This company is in agriculture and this is not a common type of stock for the TSX. I feel that this company has been in business too short of time to really get a good idea how it will perform over the longer term. See my spreadsheet at agt.htm.
This is the first of two parts. Second part will be posted on Wednesday, July 10, 2013 and will be here.
Alliance Grain Traders Inc through its subsidiaries, Alliance Pulse Processors Inc. ("Alliance") and Arbel Group ("Arbel"), is engaged in the business of sourcing and processing (cleaning, splitting, sorting and bagging) specialty crops, primarily for export markets. Alliance and its subsidiaries in Canada, U.S., Australia and Turkey handle the full range of pulses and specialty crops including lentils, peas, chickpeas, beans and canary seed through six processing plants. The company recent bought the Arbel Group of Mersin, Turkey. Its web site is here Alliance Grain Traders.
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 Alliance Grain Traders Inc. (TSX-AGT, OTC-AGXXF). I wanted to review all the income trust stocks touted in the 2009 Money Show. There was a lot of talk at this show about some of the Unit Trust being currently good buys with very good yield. This stock has already converted to a corporation in 2009.
As an income trust the yield was around 7% and then it declined to 2% with the change to a corporation. The 5 year median dividend yield is 2.84%. However, the current dividend yield is 4.39% as the stock price has been on the decline.
There was some initial dividend growth and this stock has 5 and 10 year dividend growth at 3.3% and 6.4% per year. The last dividend increase was for 11.1% and was in 2011. There was no dividend increased in 2012 and no so far in 2013. Analysts do not expect any increases in 2013. (Note that this stock went on the stock exchange in 2005, so there are no 10 year statistics for this stock.)
Earnings have not been good over the past few years and so the Dividend Payout Ratios for Earnings has been high. The DPR for earnings for 2012 was 176%. The DPR for earnings 2013 is expected to be 57% and for 2014 at 43%. The 5 year median DPR for cash flow is 42% and is expected to be 30% in 2013.
Shareholders have made some money on this stock. The total return over the past 5 and 8 years is at 10.67% and 19.86% per year. The dividend portion of these returns is at 5.08% and 7.11% per year over the past 5 and 8 years. The capital gains portion of these returns is at 5.59% and 12.75% per year over the past 5 and 8 years.
The outstanding shares have increased by 25.6% and 1880% over the past 5 and 7 years. Most of the increase is for issuance of units and shares. There has been some increase due to stock options. Revenue growth has been quite good, cash flow growth has been ok and there has not been much in the way of earnings growth over the past 5 years.
The growth in revenue is at 28% and 27% per year over the past 5 and 10 years. The cash flow growth is at 9.8% and 0% per year over the past 5 and 7 years. (The 5 year running growth over the past 3 years is at 4.5% per year.) EPS growth has been at a negative 18% per year over the past 5 year and at 8.7% per year over the past 7 years. (The 5 year running growth for earnings is at a negative 3% per year over the past 3 years.)
The Return on Equity was good until 2010. The 5 year median is at 6.1% and the ROE for the financial year of 2012 is at just 2.5%. The 12 month ROE at the first quarter of March 2013 is even lower at 1.5%. The ROE on comprehensive income has been inconsistent with the ROE on net income. Sometimes it was better and sometimes it was worse.
The Liquidity Ratio has often been low and as only 1.19 for the financial year of 2012. However, the current ratio is much better at 1.73. The Debt Ratio has been good and the one for 2012 was 1.61 and the current one is 1.57. The current Leverage and Debt/Equity Ratios are fine at 2.75 and 1.75.
A lot of x-income trust stocks are having a rough time switching to stock companies. This company is in agriculture and this is not a common type of stock for the TSX. I feel that this company has been in business too short of time to really get a good idea how it will perform over the longer term. See my spreadsheet at agt.htm.
This is the first of two parts. Second part will be posted on Wednesday, July 10, 2013 and will be here.
Alliance Grain Traders Inc through its subsidiaries, Alliance Pulse Processors Inc. ("Alliance") and Arbel Group ("Arbel"), is engaged in the business of sourcing and processing (cleaning, splitting, sorting and bagging) specialty crops, primarily for export markets. Alliance and its subsidiaries in Canada, U.S., Australia and Turkey handle the full range of pulses and specialty crops including lentils, peas, chickpeas, beans and canary seed through six processing plants. The company recent bought the Arbel Group of Mersin, Turkey. Its web site is here Alliance Grain Traders.
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, July 8, 2013
Home Capital Group 2
On my other blog I am today writing about oil, trains and pipelines ...continue...
I do not own this stock Home Capital Group (TSX-HCG, OTC-HMCBF). I started reviewing this company in September 2009. It is a dividend paying company and was coming up on lists of good dividend paying stocks. It is on some dividend paying companies lists that I look at.
When I look at insider trading, I find insider selling at $9.6M and net insider selling at $9.3M with some insider buying at $0.3M. Buying was by directors and selling was by CEO, officers and directors. Insiders not only have options, but have option like vehicles called Rights Performance Share Units, Rights Restricted Share Units and Rights Deferred Share Units.
The CEO has shares worth $104M and has options worth $5.4M. The CFO has no shares and has options worth $1.5M. An officer has shares worth $0.2M and has options worth $1.5M. A director has shares worth $0.3M and has options worth $1.5M. 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 6.59, 8.74 and 10.34. The current P/E Ratio is 7.79 based on a stock price of $56.69 and 2013 earnings estimates of $7.28. I get a Graham Price of $69.55. The 10 year low, median and high median Price/Graham Price Ratios are 0.34, 1.19 and 1.55. The current P/GP Ratio is 0.82. Both these tests show that the current price is reasonable.
The 10 year Price/Book Value per Share Ratio is 3.31. The current P/B Ratio is 1.92 a value only 58% of the 10 year median ratio. This test says that the stock is cheap.
The current dividend yield is 1.83%, a value some 3.5% higher than the 5 year median dividend yield of 1.77%. This stock price test shows that the stock price is reasonable. The current dividend is higher than the 5 year median and this is good. However, it is only 3.5% higher so this means the price is reasonable.
The analysts' recommendations are Strong Buy, Buy and Hold. The consensus recommendation is a Buy. The 12 month stock price consensus is $68.70. This implies a 12 month total return of 23.02%, with 1.83% from dividends and 21.19% from capital gains.
Apparently some US Hedge fund managers have been shorting this stock thinking that Canada will also have a real estate meltdown. Certainly, Canadians do not think this. It is a well-run company that is selling at a relatively reasonable to cheap price by my stock tests.
The Canadian Blogger wrote about Home Capital Group in May 2013. He addresses the fact that there are Americans short selling this stock. There is another interesting review by the Common Equity blogger.
The one thing I do not like is that the EPS/CF Ratio is often over 1.00. This means that the cash flow per share is lower than the earnings per share. However, this is just a warning. UC-Berkeley accounting professor Richard Sloan has found through a number of academic studies that companies with low accrual ratios (cash flow higher than earnings) outperform companies with high accrual ratios (earnings higher than cash flow). See Richard Sloan's paper. No stock is perfect.
See my spreadsheet at hcg.htm. This is the second of two parts. The first part was posted on Friday, July 5th, 2013 and is available here.
Home Capital Group Inc. operates through one subsidiary, Home Trust Company, to provide mortgage lending, deposit, retail credit and credit card issuing services. They have subprime mortgages. Its stock is widely held. Its web site is here Home Capital.
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 Home Capital Group (TSX-HCG, OTC-HMCBF). I started reviewing this company in September 2009. It is a dividend paying company and was coming up on lists of good dividend paying stocks. It is on some dividend paying companies lists that I look at.
When I look at insider trading, I find insider selling at $9.6M and net insider selling at $9.3M with some insider buying at $0.3M. Buying was by directors and selling was by CEO, officers and directors. Insiders not only have options, but have option like vehicles called Rights Performance Share Units, Rights Restricted Share Units and Rights Deferred Share Units.
The CEO has shares worth $104M and has options worth $5.4M. The CFO has no shares and has options worth $1.5M. An officer has shares worth $0.2M and has options worth $1.5M. A director has shares worth $0.3M and has options worth $1.5M. 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 6.59, 8.74 and 10.34. The current P/E Ratio is 7.79 based on a stock price of $56.69 and 2013 earnings estimates of $7.28. I get a Graham Price of $69.55. The 10 year low, median and high median Price/Graham Price Ratios are 0.34, 1.19 and 1.55. The current P/GP Ratio is 0.82. Both these tests show that the current price is reasonable.
The 10 year Price/Book Value per Share Ratio is 3.31. The current P/B Ratio is 1.92 a value only 58% of the 10 year median ratio. This test says that the stock is cheap.
The current dividend yield is 1.83%, a value some 3.5% higher than the 5 year median dividend yield of 1.77%. This stock price test shows that the stock price is reasonable. The current dividend is higher than the 5 year median and this is good. However, it is only 3.5% higher so this means the price is reasonable.
The analysts' recommendations are Strong Buy, Buy and Hold. The consensus recommendation is a Buy. The 12 month stock price consensus is $68.70. This implies a 12 month total return of 23.02%, with 1.83% from dividends and 21.19% from capital gains.
Apparently some US Hedge fund managers have been shorting this stock thinking that Canada will also have a real estate meltdown. Certainly, Canadians do not think this. It is a well-run company that is selling at a relatively reasonable to cheap price by my stock tests.
The Canadian Blogger wrote about Home Capital Group in May 2013. He addresses the fact that there are Americans short selling this stock. There is another interesting review by the Common Equity blogger.
The one thing I do not like is that the EPS/CF Ratio is often over 1.00. This means that the cash flow per share is lower than the earnings per share. However, this is just a warning. UC-Berkeley accounting professor Richard Sloan has found through a number of academic studies that companies with low accrual ratios (cash flow higher than earnings) outperform companies with high accrual ratios (earnings higher than cash flow). See Richard Sloan's paper. No stock is perfect.
See my spreadsheet at hcg.htm. This is the second of two parts. The first part was posted on Friday, July 5th, 2013 and is available here.
Home Capital Group Inc. operates through one subsidiary, Home Trust Company, to provide mortgage lending, deposit, retail credit and credit card issuing services. They have subprime mortgages. Its stock is widely held. Its web site is here Home Capital.
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, July 5, 2013
Home Capital Group
On my other blog I am today writing about Air Canada and airplane stocks ...continue...
I do not own this stock Home Capital Group (TSX-HCG, OTC-HMCBF). I started reviewing this company in September 2009. It is a dividend paying company and was coming up on lists of good dividend paying stocks. It is on some dividend paying companies lists that I look at.
The company has a good history of increasing dividends. The 5 and 10 year growth in dividends is 15% and 31% per year. The last increased occurred in 2012 and the increased was for 18%. The Dividend Payout Ratios are also good, with 5 year medians at 14% for earnings and 16% for cash flow.
One thing though, the yield is low. The 5 year median is 1.8%. However, the dividend yield on this stock has also spent time with a yield under 1%. The current dividend yield is also 1.8%.
Shareholders have done well, especially over the past 10 years. The 5 and 10 year total returns are at 8.5% and 25.22%. The dividend portion of this return was 1.39% and 1.88%, respectively. The capital gains portion of this return was 7.11% and 23.34%, respectively.
The number of shares outstanding has barely changed over the past 5 and 10 years. The shares have increased due to Stock Options and decreased due to buy backs. All the growth figures are very good.
Revenue per Share has increased by 10% and 17.8% per year over the past 5 and 10 years. Earnings per Share have increased by 19.8% and 16.8% per year over the past 5 and 10 years. Cash Flow per Share has increased by 29% and 29.7% per year over the past 5 and 10 years.
The Return on Equity is at 22.9% for the financial year ending in 2012. The 5 year median ROE is at 24.1%. The ROE based on comprehensive income is close at 23.5% for the financial year ending in 2012.
The Liquidity Ratio has not much importance for financial stocks as it does for other types of stocks and it is fine for this stock. The Debt Ratios are rather typical for financial stocks with the current ratio at 1.06. The current Leverage and Debt/Equity Ratios are rather high at 18.95 and 17.95, but these are rather typical for financial stocks.
This stock seems to have done amazingly well for its shareholders. There is an interesting report I found called Donville Kent ROE Reporter. It has good things to say about this stock. See the pdf report. It is rather a long report, so you should do a find on "Home Capital" to find out what they say about this company.
However, I must admit that in putting together information from the financial statements for my spreadsheet was not easy. I could not find all that I was looking for. I viewed G&M and Google looked at values they got. They did not agree on items and I could not figure out how they got the values that they got in some instances. See my spreadsheet at hcg.htm.
This is the first of two parts. Second part will be posted on Monday, July 8th 2013 and will be here.
Home Capital Group Inc. operates through one subsidiary, Home Trust Company, to provide mortgage lending, deposit, retail credit and credit card issuing services. They have subprime mortgages. Its stock is widely held. Its web site is here Home Capital.
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 Home Capital Group (TSX-HCG, OTC-HMCBF). I started reviewing this company in September 2009. It is a dividend paying company and was coming up on lists of good dividend paying stocks. It is on some dividend paying companies lists that I look at.
The company has a good history of increasing dividends. The 5 and 10 year growth in dividends is 15% and 31% per year. The last increased occurred in 2012 and the increased was for 18%. The Dividend Payout Ratios are also good, with 5 year medians at 14% for earnings and 16% for cash flow.
One thing though, the yield is low. The 5 year median is 1.8%. However, the dividend yield on this stock has also spent time with a yield under 1%. The current dividend yield is also 1.8%.
Shareholders have done well, especially over the past 10 years. The 5 and 10 year total returns are at 8.5% and 25.22%. The dividend portion of this return was 1.39% and 1.88%, respectively. The capital gains portion of this return was 7.11% and 23.34%, respectively.
The number of shares outstanding has barely changed over the past 5 and 10 years. The shares have increased due to Stock Options and decreased due to buy backs. All the growth figures are very good.
Revenue per Share has increased by 10% and 17.8% per year over the past 5 and 10 years. Earnings per Share have increased by 19.8% and 16.8% per year over the past 5 and 10 years. Cash Flow per Share has increased by 29% and 29.7% per year over the past 5 and 10 years.
The Return on Equity is at 22.9% for the financial year ending in 2012. The 5 year median ROE is at 24.1%. The ROE based on comprehensive income is close at 23.5% for the financial year ending in 2012.
The Liquidity Ratio has not much importance for financial stocks as it does for other types of stocks and it is fine for this stock. The Debt Ratios are rather typical for financial stocks with the current ratio at 1.06. The current Leverage and Debt/Equity Ratios are rather high at 18.95 and 17.95, but these are rather typical for financial stocks.
This stock seems to have done amazingly well for its shareholders. There is an interesting report I found called Donville Kent ROE Reporter. It has good things to say about this stock. See the pdf report. It is rather a long report, so you should do a find on "Home Capital" to find out what they say about this company.
However, I must admit that in putting together information from the financial statements for my spreadsheet was not easy. I could not find all that I was looking for. I viewed G&M and Google looked at values they got. They did not agree on items and I could not figure out how they got the values that they got in some instances. See my spreadsheet at hcg.htm.
This is the first of two parts. Second part will be posted on Monday, July 8th 2013 and will be here.
Home Capital Group Inc. operates through one subsidiary, Home Trust Company, to provide mortgage lending, deposit, retail credit and credit card issuing services. They have subprime mortgages. Its stock is widely held. Its web site is here Home Capital.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
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