Thursday, December 19, 2013

Stantec Inc.

I do not own this stock of Stantec Inc. (TSX-STN, NYSE-STN). I bought this stock in April of 2008 to make some capital gains. It was a non-dividend paying stock at that point. I lot of people were recommending it as a great stock. The reason it was recommend is that it is in the infrastructure business. There are many that think this company will profit from government money promised for infrastructure building.

I bought this stock for capital gains in April 2008. I sold in September 2011. I wanted to get rid of non-core stocks and this stock had not produced capital gains. I had a capital loss of 22.6%.

An interesting development is that this stock started to pay dividends in 2012. In 2013, it increased its dividend by 10%. Yield is currently extremely low at 0.95%. The median yield for 2012 would be 1.78%. Perhaps this stock will turn into a dividend growth stock. Only time will tell.

The return to the end of 2012 was very low for the past 5 years. However, this stock has gained some 75% this year. The return to date is 18.72% and 20.47% per year over the past 5 and 10 years. The capital gain portion of this return is at 18.26% and 20.23% per year over these periods. Dividend portion these return would be 0.23% and 0.46% per year over these periods.

The outstanding shares have not grown over the past 5 years and have grown just 2.3% per year over the past 10 years. Shares were increased for Share Issues and Stock Options and decreased for Buy Backs. The company has grown its revenue, earnings and cash flow quite well over the past 5 and 10 years.

Revenue per Share growth is 15% and 13% per year over the past 5 and 10 years. Earnings per Share have grown at the rate of 12% and 17% per year over the past 5 and 10 years. Cash Flow per Share has grown at the rate of 14% and 17% per year over the past 5 and 10 years.

The Return on Equity is generally good. The ROE for 2012 is 16.6%. The 5 year median ROE is at 10.2%. The ROE on comprehensive income is close to the ROE on net income, coming in at 15.7% for 2012. The ROE for 2013 is expected to come in at around 17%.

The Liquidity Ratio is at 1.71 and the current one is 1.74. These are good. The Debt Ratio is also quite good at 1.98 and the current one is at 2.07. I would like to see the Leverage and Debt/Equity Ratios a little lower but they are fine at 2.02 and 1.02 for 2012. They are currently better and fine at 1.93 and 0.93.

This stock is doing very well. It is growing quite nicely and it has started to buy a dividend. This was a nice stock to analyze and not complex as some other stocks have been. See my spreadsheet at stn.htm.

This is the first of two parts. Second part will be posted on Friday, December 19, 2013 and will be available here.

Stantec, founded in 1954, provides professional consulting services in planning, engineering, architecture, interior design, landscape architecture, surveying, environmental sciences, project management, and project economics for infrastructure and facilities projects. We support public and private sector clients in a diverse range of markets, at every stage, from initial concept and financial feasibility to project completion and beyond. Their services are provided on projects around the world operating out of more than 170 locations in North America and 4 locations internationally. Its web site is here Stantec.

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.

No comments:

Post a Comment