I own this stock of Bombardier Inc. (TSX-BBD.B, OTC-BDRAF). The buying of this stock was part of my early foray into industrial stocks in 1987. Up until 2001, I was making some 35% return per annum on this stock. When the stock first dropped in 2002, I had still made some 28% return per annum on this stock. Even by the lowest point in 2005, I had made some 13% per annum on this stock. By that time, it seemed to be turning itself around, so I never sold.
My return to date is not much different with the total return at 12.37%. Of this return, 7.65% is from capital gains and 4.72% is from dividends. This is not a dividend growth company. Dividends have changed over the years and the company paid no dividends between 2005 and 2008 inclusive. Dividends have remained the same since 2010. On my original purchase price for this stock I am earning a dividend yield of 17.3%.
This stock has gone down this year with total return over the past 5 years being a negative 4.69% per year with 1.82% per year from dividends and capital loss of 6.51% per year. The stock is up over the past 10 years with total return at 5.21% per year with dividends at 1.99% per year and capital gain at 3.23% per year.
The total outstanding shares have not really changed over the past 5 and 10 years. Shares have increased due to share issues and Stock Options. Shares have decreased because of buy backs. Also insiders have been changing from Class A (multiple Voting) to Class B (Subordinate Voting) shares. This company is reporting in US$ and has done so since 2004. The company has done better in US$ terms than in CDN$ terms.
Using 5 year running averages, I find revenue per share up by 2% and 1.5% per year over the past 5 and 10 years, EPS up by 15% and 12% per year over the past 5 and 10 years and cash flow per share up by 2% and down by 7% per year over the past 5 and 10 years. These values are all in US$ terms. So EPS is up nicely, but there is a way to go on revenue and cash flow.
The Return on Equity looks good coming in at 23.4% in 2013. However, why it looks so good is because book value is dropping. Debt Ratios do not look particularly good with Liquidity Ratio at 1.06 and if you add in cash flow after dividends it just reaches 1.15. The Debt Ratio is also low at just 1.09. Leverage and Debt/Equity Ratios are high at 11.99 and 10.99.
The 5 year low, median and high median Price/Earnings Ratios are 9.39, 12.34 and 14.94. The current P/E Ratio is 7.81. The current P/E Ratio is based on $0.46 CDN$ EPS and stock price of $3.60 CDN$. This stock test suggests that the stock is cheap.
I get a Graham Price of $3.63 CDN$. The 10 year low, median and high median Price/Graham Price Ratios are 1.09, 1.48 and 1.81. The current P/GP Ratio is 0.99 based on a stock price of $3.60 CDN$. This stock test suggests that the stock price is cheap.
I get a 10 year Price/Book Value per Share Ratio of 3.15. The current P/B Ratio is 2.58 based on a stock price $3.60 CDN$ and a BVPS of $1.27 CND$. The current P/B Ratio is just 82% of the 10 year P/B Ratio and this stock tests suggests that the stock price is reasonable, but towards to low end. Generally, a stock would be cheap if the current P/B Ratio is 80% or less of the 10 year P/B Ratio.
The current dividend yield is 2.87% based on a stock price of $3.60 CDN$ and dividends of $0.10 CND$. The 5 year median dividend yield is 2.18% a value some 32% lower. This stock test suggests that the stock price is cheap.
The analysts' recommendations for this stock are Strong Buy, Buy, Hold and Underperform. Most of the recommendations are a Hold and the consensus recommendation would be a Hold. The 12 month stock price consensus is $4.46. This implies a total return of 26.75% with 23.89% from capital gains and 2.87% from dividends.
In January of 2014, Bombardier said that they are laying off 1,700 aerospace employees due to C Series delays and declining orders. Another financial post article in February 2014 talks about the shares of Bombardier falling due to missed estimates for 2014 earnings. In happier news, an article in the Globe and Mail talks about Bombardier winning a rail contract in Australia.
The stock price appears cheap, but it would seem with reason. See my spreadsheet at bbd.htm.
Bombardier is a world-leading manufacturer of innovative transportation solutions, from commercial aircraft and business jets to rail transportation equipment, systems and services. Headquartered in Montreal, Canada, Bombardier has a presence in more than 60 countries. The Bombardier family controls 64% of the voting rights under this stock. Its web site is here Bombardier.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
Friday, February 28, 2014
Thursday, February 27, 2014
Home Capital Group 2
I do not own this stock of Home Capital Group (TSX-HCG, OTC-HMCBF). I started reviewing this company in September 2009. It is a dividend growth 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 of $8.8M and net insider selling at $8.7M. There is a very small amount of insider buying. Insiders not only have options, but have option like vehicles called Rights Performance Share Units, Rights Restricted Share Units and Rights Deferred Share Units. In 2013 outstanding shares were increased by 153,000 shares with a book value of $8.4M. This number of shares was worth $12.4M at the end of 2013.
The 5 year low, median and high median Price/Earnings Ratios are 6.79, 8.74 and 10.34. The current P/E Ratio is 10.14 based on a stock price of $85.05 and 2014 earnings estimate of $8.39. This stock price test suggests that the stock price is within the reasonable range, but towards the high end. Note there is some difference between the 5 year median and 10 year median P/E Ratios with the 10 year median high ratio at 12.37.
I get a Graham Price of $79.99. The 10 year low, median and high median Price/Graham price Ratios are 0.78, 0.95 and 1.26. The current P/GP Ratio is 1.06 based on a stock price of $85.05. This stock price test suggests that the stock price is in the reasonable range, but slightly above the median.
I get a 10 year median Price/Book Value per Share of 2.24 and a current P/B Ratio of 2.51 a value some 12% higher. The P/B Ratio is based on a stock price of $85.05 and a BVPS of $33.90. This stock price test suggests that the stock price is in the reasonable range and slightly above the median.
I get a 5 year median dividend yield of 1.59% and a current dividend yield of 1.50%, a value some 5.6% higher. This is based on a stock price of $85.05 and a current dividend of $1.28. This stock price test suggests that the stock price is reasonable, but above the median. I get an historical average dividend yield of 1.42%. The current dividend yield of 1.50 is some 6% lower and this stock price test suggests that the stock price is reasonable and below the median.
The analysts' recommendations are Strong Buy, Buy and Hold. The consensus recommendation is a Buy. The 12 month target stock price is $89.90. This suggests a total return of 7.2% with 1.5% from dividends and 5.7% from capital gains.
For a short talk from the president of the company on BNN, click here. The company had a good year in 2013 and raised the dividend 14% and plans a 2 for 1 stock split. The Motley Fool site gave quite a positive report on this stock in February of this year. In February of this year HCG forecasted a positive year ahead.
My stock price testing says that the stock price is reasonable to high reasonable. This is a financial and you might want to buy it for diversification and growing dividends. See my spreadsheet at hcg.htm.
This is the second of two parts. The first part was posted on Wednesday, February 26, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
When I look at insider trading, I find insider selling of $8.8M and net insider selling at $8.7M. There is a very small amount of insider buying. Insiders not only have options, but have option like vehicles called Rights Performance Share Units, Rights Restricted Share Units and Rights Deferred Share Units. In 2013 outstanding shares were increased by 153,000 shares with a book value of $8.4M. This number of shares was worth $12.4M at the end of 2013.
The 5 year low, median and high median Price/Earnings Ratios are 6.79, 8.74 and 10.34. The current P/E Ratio is 10.14 based on a stock price of $85.05 and 2014 earnings estimate of $8.39. This stock price test suggests that the stock price is within the reasonable range, but towards the high end. Note there is some difference between the 5 year median and 10 year median P/E Ratios with the 10 year median high ratio at 12.37.
I get a Graham Price of $79.99. The 10 year low, median and high median Price/Graham price Ratios are 0.78, 0.95 and 1.26. The current P/GP Ratio is 1.06 based on a stock price of $85.05. This stock price test suggests that the stock price is in the reasonable range, but slightly above the median.
I get a 10 year median Price/Book Value per Share of 2.24 and a current P/B Ratio of 2.51 a value some 12% higher. The P/B Ratio is based on a stock price of $85.05 and a BVPS of $33.90. This stock price test suggests that the stock price is in the reasonable range and slightly above the median.
I get a 5 year median dividend yield of 1.59% and a current dividend yield of 1.50%, a value some 5.6% higher. This is based on a stock price of $85.05 and a current dividend of $1.28. This stock price test suggests that the stock price is reasonable, but above the median. I get an historical average dividend yield of 1.42%. The current dividend yield of 1.50 is some 6% lower and this stock price test suggests that the stock price is reasonable and below the median.
The analysts' recommendations are Strong Buy, Buy and Hold. The consensus recommendation is a Buy. The 12 month target stock price is $89.90. This suggests a total return of 7.2% with 1.5% from dividends and 5.7% from capital gains.
For a short talk from the president of the company on BNN, click here. The company had a good year in 2013 and raised the dividend 14% and plans a 2 for 1 stock split. The Motley Fool site gave quite a positive report on this stock in February of this year. In February of this year HCG forecasted a positive year ahead.
My stock price testing says that the stock price is reasonable to high reasonable. This is a financial and you might want to buy it for diversification and growing dividends. See my spreadsheet at hcg.htm.
This is the second of two parts. The first part was posted on Wednesday, February 26, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
Wednesday, February 26, 2014
Home Capital Group
On my other blog I am today writing about what influenced my Investing continue...
I do not own this stock of 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 dividend yield is rather low with the 5 year median dividend yield at 1.59% and the current dividend yield at 1.50%. The dividend increases are good with the 5 and 10 year growth at 16.7% and 33.5% per year respectively. Dividend increases where large until 2008, when they slowed to around 14% to 20% per year.
The most recent increase was for 2014 and it was for 14.3%. This company often gives more than one increase in a year. Dividends between 2013 have grown by 18.5%. Increases have not been consistent and since they started to pay dividends in 2002, there was one year of no increases.
The Dividend Payout Ratios are good with the DPR for EPS at 14% and the CFPS at 14% also. The DPR for EPS for 2013 was at 15% and the CFPS was at 7%. For 2014 both these DPRs are expected to be around 15%.
The total return over the past 5 and 10 years has been at 16.88% and 11.47% per year with 1.64% and 1.19% per year from dividends and $15.24% and 10.27% per year from capital gains.
Outstanding shares have basically not changed over the past 5 and 10 years. The shares have increased due to stock options and decreased due to buy backs. Revenue, earnings and cash flow has grown well over the past 5 and 10 years.
Revenue per Share has grown at 9.6% and 17.06% per year over the past 5 and 10 years. If you look at 5 year running averages, especially over the past 5 years, the growth is better with growth at 12.4% and 18.9% per year. This is because growth in revenue is slowing.
The growth in earnings is also quite good with 5 and 10 years growth at 18.5% and 23.9% per year. Cash Flow growth is good with CFPS growth at 41.4% and 29.4% per year over the past 5 and 10 years. The 5 year running averages growth is not as good as there has been good growth over the past while, especially over the past 5 year. The growth using 5 year running averages is at 27% and 26% per year over the past 5 and 10 years.
The Return on Equity has been over 10% since 1998 and over 20% since 2002. This is a good showing. The ROE for 2013 is 21.8% with a 5 year median of 23.4%. The ROE on comprehensive income is close with the ROE at 20.5% for 2013 and with a 5 year median of 23.5%.
The Liquidity Ratio is very good at 4.56 for 2013. The debt ratios are typical of financials coming in at 1.06. The Leverage and Debt/Equity Ratios are typical of financials at 17.05 and 16.05.
This has been a solid financial stock for its shareholders and the company has seen solid growth. Analysts seem to expect slower growth for 2014, but better growth in 2015. The dividend yield is on the low side, but the dividend increases are good. See my spreadsheet at hcg.htm.
This is the first of two parts. The second part will be posted on Thursday, February 27, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
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. I do research for my own edification. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
I do not own this stock of 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 dividend yield is rather low with the 5 year median dividend yield at 1.59% and the current dividend yield at 1.50%. The dividend increases are good with the 5 and 10 year growth at 16.7% and 33.5% per year respectively. Dividend increases where large until 2008, when they slowed to around 14% to 20% per year.
The most recent increase was for 2014 and it was for 14.3%. This company often gives more than one increase in a year. Dividends between 2013 have grown by 18.5%. Increases have not been consistent and since they started to pay dividends in 2002, there was one year of no increases.
The Dividend Payout Ratios are good with the DPR for EPS at 14% and the CFPS at 14% also. The DPR for EPS for 2013 was at 15% and the CFPS was at 7%. For 2014 both these DPRs are expected to be around 15%.
The total return over the past 5 and 10 years has been at 16.88% and 11.47% per year with 1.64% and 1.19% per year from dividends and $15.24% and 10.27% per year from capital gains.
Outstanding shares have basically not changed over the past 5 and 10 years. The shares have increased due to stock options and decreased due to buy backs. Revenue, earnings and cash flow has grown well over the past 5 and 10 years.
Revenue per Share has grown at 9.6% and 17.06% per year over the past 5 and 10 years. If you look at 5 year running averages, especially over the past 5 years, the growth is better with growth at 12.4% and 18.9% per year. This is because growth in revenue is slowing.
The growth in earnings is also quite good with 5 and 10 years growth at 18.5% and 23.9% per year. Cash Flow growth is good with CFPS growth at 41.4% and 29.4% per year over the past 5 and 10 years. The 5 year running averages growth is not as good as there has been good growth over the past while, especially over the past 5 year. The growth using 5 year running averages is at 27% and 26% per year over the past 5 and 10 years.
The Return on Equity has been over 10% since 1998 and over 20% since 2002. This is a good showing. The ROE for 2013 is 21.8% with a 5 year median of 23.4%. The ROE on comprehensive income is close with the ROE at 20.5% for 2013 and with a 5 year median of 23.5%.
The Liquidity Ratio is very good at 4.56 for 2013. The debt ratios are typical of financials coming in at 1.06. The Leverage and Debt/Equity Ratios are typical of financials at 17.05 and 16.05.
This has been a solid financial stock for its shareholders and the company has seen solid growth. Analysts seem to expect slower growth for 2014, but better growth in 2015. The dividend yield is on the low side, but the dividend increases are good. See my spreadsheet at hcg.htm.
This is the first of two parts. The second part will be posted on Thursday, February 27, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
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. I do research for my own edification. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
Tuesday, February 25, 2014
Emera Inc. 2
I own this stock of Emera Inc. (TSX-EMA, OTC-EMRAF). I own this stock of Emera Inc. (TSX-EMA, OTC-EMRAF). In 2005, I want to buy something for my Locked-in RRSP. I think that this was an appropriate stock and has good value. I was using up excess cash in my account.
Over the past year of insider trading, there has just been some insider buying. Insider buying is at $0.4M. For this company there are not only options but other option like vehicles called DSU (Deferred Share Units) and Performance Share Units. Most of the buying was done by the CFO who was keeping his options as stock. This is a positive.
Outstanding Shares were increased 60,000 Shares in 2013 with a book value of $2.2M. This is quite different from 2012 were the outstanding shares were increased by 0.69M shares with a book value of $15M.
The 5 year low, median and high median Price/Earnings per Share Ratios are 1.28, 16.77 and 20.07. The current P/E ratio is 17.69 based on a stock price of $32.90 and 2014 earnings estimates of $1.86. This stock price test suggests that the stock price is reasonable, although to the higher end of reasonable.
I get a Graham Price of $25.68. The 10 year low, median and high median P/GP Ratios are 0.94, 1.10 and 1.24. The current P/GP Ratio is 1.28 based on a share price of $32.90. This stock price test suggests that the stock price is rather high. The main reason for this test being different from the P/E Ratio tests that the low growth in book value.
The 10 year median Price/Book Value per Share Ratio is 1.66. The current P/B Ratio is 2.09 a value some 26% higher. The current P/B Ratio is based on a BVPS of $15.76 and a stock price of $32.90. This stock price test suggests that the stock price is high.
The 5 year median dividend yield is 4.25% and the current dividend yield at 4.41% is some 3.7% higher. This stock test suggests that the stock price is reasonable. If you look at an historical average dividend yield, I get a value of 5.22% a value that is some 16% higher than the current dividend yield and suggests that the stock price is reasonable but towards the higher end of a reasonable range.
I calculate a more median historical dividend yield of around 4.76%. This is a value that is still above the current dividend yield, but only by 7%. What I can say is that the stock price is not cheap. It seems to be in a reasonable range, but towards the higher end of the reasonable range.
When I look at analysts' recommendations, I find Strong Buy, Buy, Hold and Underperform recommendations. The consensus recommendation would be a Hold. The 12 month stock price is $34.70. This implies a 9.88% total return with 4.41% from dividends and 5.47% from capital gains.
The Ticker Reporter site talks about an "outperform" rating of this company by Credit Suisse. The mention of $0.332 dividend payment for February 2014 would have to be in US$. The average rating is a Hold, but Scotiabank just issued a "sector perform" rating on this stock reported at the WKRB site. (See my blog for information on analyst ratings .)
An article in the Vancouver Sun reporting on information fromJonathan Ratner at Financial Post talks about Canada doing better in 2014 and surprising to the upside. He mentions capital spending by Canadian utility companies including Emera. Emera is involved with off-shore wind development in Maine. This company is part of S&P/TSX Canadian Dividend Aristocrats Index list. The Dividend Aristocrats is part of TSX site. Go to the "TSX Market Activity" and click on "Indices and Constituents" tab. I still look at these lists for stock ideas.
This is a solid utility company that currently getting a bit pricey. See my spreadsheet at ema.htm.
This is the second of two parts. The first part was posted on Monday, February 24, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
Emera Inc. is an energy and services company that has two wholly-owned regulated electric utility subsidiaries, of Nova Scotia Power Inc. and Bangor Hydro-Electric Company. Emera also owns 19% of St. Lucia Electricity Services Limited, and 25% of Grand Bahamas Power Company that serves 19,000 customers on the Caribbean island of Grand Bahamas. Emera also owns the Brunswick Pipeline; Bayside Power, in Saint John, New Brunswick; Emera Energy Services; a joint venture interest in Bear Swamp northern Massachusetts; a 12.9% interest in the Maritimes & Northeast Pipeline; and an 8.2% interest in Open Hydro. Its web site is here Emera.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
Over the past year of insider trading, there has just been some insider buying. Insider buying is at $0.4M. For this company there are not only options but other option like vehicles called DSU (Deferred Share Units) and Performance Share Units. Most of the buying was done by the CFO who was keeping his options as stock. This is a positive.
Outstanding Shares were increased 60,000 Shares in 2013 with a book value of $2.2M. This is quite different from 2012 were the outstanding shares were increased by 0.69M shares with a book value of $15M.
The 5 year low, median and high median Price/Earnings per Share Ratios are 1.28, 16.77 and 20.07. The current P/E ratio is 17.69 based on a stock price of $32.90 and 2014 earnings estimates of $1.86. This stock price test suggests that the stock price is reasonable, although to the higher end of reasonable.
I get a Graham Price of $25.68. The 10 year low, median and high median P/GP Ratios are 0.94, 1.10 and 1.24. The current P/GP Ratio is 1.28 based on a share price of $32.90. This stock price test suggests that the stock price is rather high. The main reason for this test being different from the P/E Ratio tests that the low growth in book value.
The 10 year median Price/Book Value per Share Ratio is 1.66. The current P/B Ratio is 2.09 a value some 26% higher. The current P/B Ratio is based on a BVPS of $15.76 and a stock price of $32.90. This stock price test suggests that the stock price is high.
The 5 year median dividend yield is 4.25% and the current dividend yield at 4.41% is some 3.7% higher. This stock test suggests that the stock price is reasonable. If you look at an historical average dividend yield, I get a value of 5.22% a value that is some 16% higher than the current dividend yield and suggests that the stock price is reasonable but towards the higher end of a reasonable range.
I calculate a more median historical dividend yield of around 4.76%. This is a value that is still above the current dividend yield, but only by 7%. What I can say is that the stock price is not cheap. It seems to be in a reasonable range, but towards the higher end of the reasonable range.
When I look at analysts' recommendations, I find Strong Buy, Buy, Hold and Underperform recommendations. The consensus recommendation would be a Hold. The 12 month stock price is $34.70. This implies a 9.88% total return with 4.41% from dividends and 5.47% from capital gains.
The Ticker Reporter site talks about an "outperform" rating of this company by Credit Suisse. The mention of $0.332 dividend payment for February 2014 would have to be in US$. The average rating is a Hold, but Scotiabank just issued a "sector perform" rating on this stock reported at the WKRB site. (See my blog for information on analyst ratings .)
An article in the Vancouver Sun reporting on information fromJonathan Ratner at Financial Post talks about Canada doing better in 2014 and surprising to the upside. He mentions capital spending by Canadian utility companies including Emera. Emera is involved with off-shore wind development in Maine. This company is part of S&P/TSX Canadian Dividend Aristocrats Index list. The Dividend Aristocrats is part of TSX site. Go to the "TSX Market Activity" and click on "Indices and Constituents" tab. I still look at these lists for stock ideas.
This is a solid utility company that currently getting a bit pricey. See my spreadsheet at ema.htm.
This is the second of two parts. The first part was posted on Monday, February 24, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
Emera Inc. is an energy and services company that has two wholly-owned regulated electric utility subsidiaries, of Nova Scotia Power Inc. and Bangor Hydro-Electric Company. Emera also owns 19% of St. Lucia Electricity Services Limited, and 25% of Grand Bahamas Power Company that serves 19,000 customers on the Caribbean island of Grand Bahamas. Emera also owns the Brunswick Pipeline; Bayside Power, in Saint John, New Brunswick; Emera Energy Services; a joint venture interest in Bear Swamp northern Massachusetts; a 12.9% interest in the Maritimes & Northeast Pipeline; and an 8.2% interest in Open Hydro. Its web site is here Emera.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
Monday, February 24, 2014
Emera Inc.
On my other blog I am today writing about Market Corrections continue...
I own this stock of Emera Inc. (TSX-EMA, OTC-EMRAF). In 2005, I want to buy something for my Locked-in RRSP. I think that this was an appropriate stock and has good value. I was using up excess cash in my account.
I have held this stock since 2005. I have made a total return of 9.8% per year with 5% from capital gains and 4.8% per year from dividends. The current dividend yield is 4.4% and I am making a yield of 7% on my original stock purchase after 9 years. My dividends have grown at the rate of 5.9% per year.
The dividends have increased at the rate of 7.9% and 5.1% per year over the past 5 and 10 years. So this stock has a good dividend and moderate dividend increases. The most recent increase in dividends occurred in 2013 and the increase was for 3.6% per year.
The total return on this stock over the past 5 and 10 years is 10.37% and 10.07% per year with 5.59% and 5.52% per year from capital gains and 4.78% and 4.55% per year from dividends.
The outstanding shares have increased by 3.4% and 2.1% per year over the past 5 and 10 years. Outstanding shares have increased due to stock options, DRIP, Employee Plan and Share Issues. There has been growth in revenues, earnings and cash flows. Some growth is moderate and some good.
Revenues have grown at 10.9% and 5.4% per year over the past 5 and 10 years. Revenue per Share has grown at 7.2% and 3.2% per year over the past 5 and 10 years. Revenue has grown fast than Revenue per Share because of the increasing outstanding shares.
Net Income has grown at 12% and 6% per year over the past 5 and 10 years. Earnings per Share have grown at 5.4% and 3.6% per year over the past 5 and 10 years. If you look at 5 year running averages, EPS has grown at 7.5% and 4.6% per year over the past 5 and 10 years.
Cash flow has increased by 12.7% and 9.21% per year over the past 5 and 10 years. Cash Flow per Share has grown at 9% and 7% per year over the past 5 and 10 years. However, if you look at the 5 year running averages for CFPS, the growth is only 3.5% and 3.3% per year over the past 5 and 10 years. This is because exactly 5 and 10 years ago cash flow was lower than the surrounding years.
The growth in Book Value per Share is rather low, with the growth just at 2.7% for both the last 5 years and the last 10 years. This is a negative.
The 5 year median Return on Equity is good with a value over 10% at 10.7%. However, the ROE was only over 10% 3 of the past 5 years. The 5 year median ROE on comprehensive income is just 7.3%. This ROE was only over 10% 2 of the last 5 years. However, the ROE on comprehensive income for 2013 is 19.4% compared to the ROE on net income at just 8.8%. This generally means that earnings are of good quality for 2013 and probably better than they appear.
The last thing to look at today is debt ratios. The Liquidity Ratio has always been low and like a lot of utility companies they depend on cash flow to fully cover current liabilities. The current Liquidity Ratio is 0.76. This means that current assets cannot cover current liabilities. If you add in cash flow after dividends, the Liquidity Ratio gets to just 1.01. If you exclude the current portion of the long term debt, the Liquidity Ratio is still below 1.00 at 0.97. If you again add in cash flow after dividends you get 1.28.
The Debt Ratio is also low at 1.48. I prefer it to be at 1.50. The Leverage and Debt/Equity Ratios are ok and are normal for utilities at 3.06 and 2.06.
This stock is a solid performer and provides a decent dividend with a moderate growth. If you have a dividend grow portfolio, this is one sort of stock that would be worthwhile having in your portfolio. See my spreadsheet at ema.htm.
This is the first of two parts. The second part will be posted on Tuesday, February 25, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
Emera Inc. is an energy and services company that has two wholly-owned regulated electric utility subsidiaries, of Nova Scotia Power Inc. and Bangor Hydro-Electric Company. Emera also owns 19% of St. Lucia Electricity Services Limited, and 25% of Grand Bahamas Power Company that serves 19,000 customers on the Caribbean island of Grand Bahamas. Emera also owns the Brunswick Pipeline; Bayside Power, in Saint John, New Brunswick; Emera Energy Services; a joint venture interest in Bear Swamp northern Massachusetts; a 12.9% interest in the Maritimes & Northeast Pipeline; and an 8.2% interest in Open Hydro. Its web site is here Emera.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
I own this stock of Emera Inc. (TSX-EMA, OTC-EMRAF). In 2005, I want to buy something for my Locked-in RRSP. I think that this was an appropriate stock and has good value. I was using up excess cash in my account.
I have held this stock since 2005. I have made a total return of 9.8% per year with 5% from capital gains and 4.8% per year from dividends. The current dividend yield is 4.4% and I am making a yield of 7% on my original stock purchase after 9 years. My dividends have grown at the rate of 5.9% per year.
The dividends have increased at the rate of 7.9% and 5.1% per year over the past 5 and 10 years. So this stock has a good dividend and moderate dividend increases. The most recent increase in dividends occurred in 2013 and the increase was for 3.6% per year.
The total return on this stock over the past 5 and 10 years is 10.37% and 10.07% per year with 5.59% and 5.52% per year from capital gains and 4.78% and 4.55% per year from dividends.
The outstanding shares have increased by 3.4% and 2.1% per year over the past 5 and 10 years. Outstanding shares have increased due to stock options, DRIP, Employee Plan and Share Issues. There has been growth in revenues, earnings and cash flows. Some growth is moderate and some good.
Revenues have grown at 10.9% and 5.4% per year over the past 5 and 10 years. Revenue per Share has grown at 7.2% and 3.2% per year over the past 5 and 10 years. Revenue has grown fast than Revenue per Share because of the increasing outstanding shares.
Net Income has grown at 12% and 6% per year over the past 5 and 10 years. Earnings per Share have grown at 5.4% and 3.6% per year over the past 5 and 10 years. If you look at 5 year running averages, EPS has grown at 7.5% and 4.6% per year over the past 5 and 10 years.
Cash flow has increased by 12.7% and 9.21% per year over the past 5 and 10 years. Cash Flow per Share has grown at 9% and 7% per year over the past 5 and 10 years. However, if you look at the 5 year running averages for CFPS, the growth is only 3.5% and 3.3% per year over the past 5 and 10 years. This is because exactly 5 and 10 years ago cash flow was lower than the surrounding years.
The growth in Book Value per Share is rather low, with the growth just at 2.7% for both the last 5 years and the last 10 years. This is a negative.
The 5 year median Return on Equity is good with a value over 10% at 10.7%. However, the ROE was only over 10% 3 of the past 5 years. The 5 year median ROE on comprehensive income is just 7.3%. This ROE was only over 10% 2 of the last 5 years. However, the ROE on comprehensive income for 2013 is 19.4% compared to the ROE on net income at just 8.8%. This generally means that earnings are of good quality for 2013 and probably better than they appear.
The last thing to look at today is debt ratios. The Liquidity Ratio has always been low and like a lot of utility companies they depend on cash flow to fully cover current liabilities. The current Liquidity Ratio is 0.76. This means that current assets cannot cover current liabilities. If you add in cash flow after dividends, the Liquidity Ratio gets to just 1.01. If you exclude the current portion of the long term debt, the Liquidity Ratio is still below 1.00 at 0.97. If you again add in cash flow after dividends you get 1.28.
The Debt Ratio is also low at 1.48. I prefer it to be at 1.50. The Leverage and Debt/Equity Ratios are ok and are normal for utilities at 3.06 and 2.06.
This stock is a solid performer and provides a decent dividend with a moderate growth. If you have a dividend grow portfolio, this is one sort of stock that would be worthwhile having in your portfolio. See my spreadsheet at ema.htm.
This is the first of two parts. The second part will be posted on Tuesday, February 25, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
Emera Inc. is an energy and services company that has two wholly-owned regulated electric utility subsidiaries, of Nova Scotia Power Inc. and Bangor Hydro-Electric Company. Emera also owns 19% of St. Lucia Electricity Services Limited, and 25% of Grand Bahamas Power Company that serves 19,000 customers on the Caribbean island of Grand Bahamas. Emera also owns the Brunswick Pipeline; Bayside Power, in Saint John, New Brunswick; Emera Energy Services; a joint venture interest in Bear Swamp northern Massachusetts; a 12.9% interest in the Maritimes & Northeast Pipeline; and an 8.2% interest in Open Hydro. Its web site is here Emera.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
Friday, February 21, 2014
ARC Resources Ltd. 2
On my other blog I am today writing about Making Money on a Dividend Portfolio continue...
I do not own this stock of ARC Resources Ltd. (TSX-ARX, OTC-AETUF). When TFSA first came out, this stock was recommended for this account as it was an income trust at that point and most of the distributions were taxable. This stock is no longer an income trust and the distributions are now dividends and taxed as normal Canadian dividends.
When I look at insider trading over the past year, I find insider selling of $3.4M and insider buying of $3.2M. Insiders not only have Stock Options, but also option like vehicles called Performance Share Units, Restricted Share Units and Deferred Share Units. Outstanding shares were increased by 0.568M shares in 2013 with a book value of $14.7M.
The 5 year low, median and high median Price/Earnings per Share Ratios are 20.18, 24.58 and 28.67. The current P/E Ratio is 31.36 based on a stock price of $29.79 and 2014 EPS estimate of $0.95. This stock test suggests that the stock price is relatively high. However, the low P/E Ratios over the past two years are 18.50 and 30.26. These are quite high P/E Ratios.
I get a Graham Price of $15.20. The 10 year low, median and high median Price/Graham Price Ratios are 0.93, 1.16 and 1.48. The current P/GP Ratio is 1.96 based on a stock price of $29.79. This stock price test suggests that the stock price is relatively high.
I get a 10 year Price/Book Value per Share Ratio of 2.25. I get a current P/B Ratio of 2.75 based on a stock price $29.79 and a Book Value of $10.81. The current P/B Ratio is 23% higher than the 10 year P/B Ratio. This stock test suggests that the stock price is relatively high.
I get a 5 year median dividend yield of 5.33%. The current dividend yield bases on a dividend of $1.20 and a stock price of $29.79 is 4.03%. The current yield is some 24% lower than the 5 year median dividend yield. This stock price test suggests that the stock price is relatively high.
When I look at analysts' recommendations, I find Buy, Hold and Underperform recommendations. Most of the recommendations are a Buy recommendation, so the consensus recommendation is a Buy. The 12 month consensus stock price is $31.60. This implies a total return of $10.10% with 4.03% from dividends and $6.08% from capital gains.
A couple of analysts have raised their target price on this stock recently. On this site it says that dividend is $0.0913, but everywhere else, including ARC Resources' site, the dividend is $0.10. On Stock Chase, Don Vialoux talks about this company having seasonal strength from the 3rd week in January right through until April each year.
All my stock tests suggest that the stock price is relatively high. The price of this stock is in the high range for this stock. It was only higher and slightly at that in 2006 and 2008. With the 12 month consensus stock price giving only a total return of 10%, you have to wonder if the risk is worth the return. It might do well in the short term, but it is not a long term buy at this price. See my spreadsheet at arx.htm.
This is the second of two parts. The first part was posted on Thursday, February 20, 2014 and is available here.
ARC Resources Ltd. is one of Canada's leading conventional oil and gas companies. Its focus is on acquiring and developing long-life oil and gas properties across western Canada. Industry: Oil and Gas (Oil and Gas Producers) Its web site is here ARC Resources.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
I do not own this stock of ARC Resources Ltd. (TSX-ARX, OTC-AETUF). When TFSA first came out, this stock was recommended for this account as it was an income trust at that point and most of the distributions were taxable. This stock is no longer an income trust and the distributions are now dividends and taxed as normal Canadian dividends.
When I look at insider trading over the past year, I find insider selling of $3.4M and insider buying of $3.2M. Insiders not only have Stock Options, but also option like vehicles called Performance Share Units, Restricted Share Units and Deferred Share Units. Outstanding shares were increased by 0.568M shares in 2013 with a book value of $14.7M.
The 5 year low, median and high median Price/Earnings per Share Ratios are 20.18, 24.58 and 28.67. The current P/E Ratio is 31.36 based on a stock price of $29.79 and 2014 EPS estimate of $0.95. This stock test suggests that the stock price is relatively high. However, the low P/E Ratios over the past two years are 18.50 and 30.26. These are quite high P/E Ratios.
I get a Graham Price of $15.20. The 10 year low, median and high median Price/Graham Price Ratios are 0.93, 1.16 and 1.48. The current P/GP Ratio is 1.96 based on a stock price of $29.79. This stock price test suggests that the stock price is relatively high.
I get a 10 year Price/Book Value per Share Ratio of 2.25. I get a current P/B Ratio of 2.75 based on a stock price $29.79 and a Book Value of $10.81. The current P/B Ratio is 23% higher than the 10 year P/B Ratio. This stock test suggests that the stock price is relatively high.
I get a 5 year median dividend yield of 5.33%. The current dividend yield bases on a dividend of $1.20 and a stock price of $29.79 is 4.03%. The current yield is some 24% lower than the 5 year median dividend yield. This stock price test suggests that the stock price is relatively high.
When I look at analysts' recommendations, I find Buy, Hold and Underperform recommendations. Most of the recommendations are a Buy recommendation, so the consensus recommendation is a Buy. The 12 month consensus stock price is $31.60. This implies a total return of $10.10% with 4.03% from dividends and $6.08% from capital gains.
A couple of analysts have raised their target price on this stock recently. On this site it says that dividend is $0.0913, but everywhere else, including ARC Resources' site, the dividend is $0.10. On Stock Chase, Don Vialoux talks about this company having seasonal strength from the 3rd week in January right through until April each year.
All my stock tests suggest that the stock price is relatively high. The price of this stock is in the high range for this stock. It was only higher and slightly at that in 2006 and 2008. With the 12 month consensus stock price giving only a total return of 10%, you have to wonder if the risk is worth the return. It might do well in the short term, but it is not a long term buy at this price. See my spreadsheet at arx.htm.
This is the second of two parts. The first part was posted on Thursday, February 20, 2014 and is available here.
ARC Resources Ltd. is one of Canada's leading conventional oil and gas companies. Its focus is on acquiring and developing long-life oil and gas properties across western Canada. Industry: Oil and Gas (Oil and Gas Producers) Its web site is here ARC Resources.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
Thursday, February 20, 2014
ARC Resources Ltd.
On my other blog I am today writing about Price/Earnings Ratios continue...
I do not own this stock of ARC Resources Ltd. (TSX-ARX, OTC-AETUF). When TFSA first came out, this stock was recommended for this account as it was an income trust at that point and most of the distributions were taxable. This stock is no longer an income trust and the distributions are now dividends and taxed as normal Canadian dividends.
This is a resource stock and the dividends have fluctuated over time. The dividends are quite good, with the current dividend yield at 4% and the 5 year median dividend yield 5.3%. What you can gain from these sorts of stocks is good dividend income over time.
The 5 and 10 year total returns are at 13.59% and 13.83% per year. The dividend portion of this return is at 5.20% and 8.56% per year. The capital gain portion of this return is at 8.59% and 5.27% per year.
The Dividend Payout Ratio for earnings for this stock has always been much too high for my liking and the 5 year median DPR for earnings 135% and the DPR for earnings for 2013 is 155%. The DPR for earnings is expected to be 126% for 2014 and be around 100% in 2016. A holdover from when the company was an income trust, the company says what their Distributable Cash Flow is. I am not keen on this measure.
The other DPR to look at is the DPR for Cash Flow per Share. Here the company is not doing badly with the 5 year median DPR for CFPS at51% and the DPR for CFPS at 45%. The DPR for CFPS is expected to be around 37% in 2014.
The outstanding shares have increased by 7.5% and 5.8% per year over the past 5 and 10 years. Whenever there is a big change in Outstanding Shares over time, it is necessary to look at total and per share values. For example, you should look at both Revenues and Revenues per Share. Shares have increased due to Stock Options, DRIP and Share Issues.
Revenue and Cash Flow are up over the past 10 years, but not over the past 5 years. There has only been a decline in Earnings. Revenue per Share, Earnings per Share and Cash per Share have declined over the past 5 and 10 years.
Revenue is up by 8.3% per year over the past 10 years, but is down by 1% per year over the past 5 years. Revenue per Share is up by 2.4% per year over the past 10 years, but is down by 7.9% per year over the past 5 years.
Earnings are down by 14.7% and 1.9% per year over the past 5 and 10 years. Earnings per share are down by 21% and 8.3% per year over the past 5 and 10 years. Both Earnings and EPS do fluctuate for this company.
Cash Flow is down by 1.8% per year over the past 5 years and up by 7.9% per year over the past 10 years. CFPS is down by 8.6% per year over the past 5 years and up by 2% per year over the past 10 years. Cash Flow also fluctuates for this company, but not quite as much as earnings fluctuate.
The Return on Equity has been close sometimes, but never has reach 10% in any year in the past 5 years. The 5 year median ROE is just 8.2%. The ROE for 2013 was lower at 7.1%. The ROE on comprehensive income for 2013 was also 7.1%.
The Liquidity Ratio is low at just 0.52 for 2013. This means that the current assets cannot cover the current liabilities. It does not improve much if you take off the current portion of the long term debt as it just reaches 0.58. If you include the cash flow after dividends, the Liquidity Ratio is 1.62. Since cash flow can fluctuate, you got to wonder if including cash flow is justified.
The Debt Ratio is good at 2.45 and this ratio has always been good. The 5 year median Debt Ratio is 2.52. The Leverage and Debt/Equity Ratios are good and have always been so. The current ratios are 1.69 and 0.69, respectively. The 5 year median ratios are also 1.69 and 0.69, respectively.
Via News Wire, the company confirms the March 2014 dividend at $0.10 per share and talks about their DRIP plan. See my spreadsheet at arx.htm.
This is the first of two parts. The second part will be posted on Friday, February 21, 2014 and will be available here.
ARC Resources Ltd. is one of Canada's leading conventional oil and gas companies. Its focus is on acquiring and developing long-life oil and gas properties across western Canada. Industry: Oil and Gas (Oil and Gas Producers) Its web site is here ARC Resources.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
I do not own this stock of ARC Resources Ltd. (TSX-ARX, OTC-AETUF). When TFSA first came out, this stock was recommended for this account as it was an income trust at that point and most of the distributions were taxable. This stock is no longer an income trust and the distributions are now dividends and taxed as normal Canadian dividends.
This is a resource stock and the dividends have fluctuated over time. The dividends are quite good, with the current dividend yield at 4% and the 5 year median dividend yield 5.3%. What you can gain from these sorts of stocks is good dividend income over time.
The 5 and 10 year total returns are at 13.59% and 13.83% per year. The dividend portion of this return is at 5.20% and 8.56% per year. The capital gain portion of this return is at 8.59% and 5.27% per year.
The Dividend Payout Ratio for earnings for this stock has always been much too high for my liking and the 5 year median DPR for earnings 135% and the DPR for earnings for 2013 is 155%. The DPR for earnings is expected to be 126% for 2014 and be around 100% in 2016. A holdover from when the company was an income trust, the company says what their Distributable Cash Flow is. I am not keen on this measure.
The other DPR to look at is the DPR for Cash Flow per Share. Here the company is not doing badly with the 5 year median DPR for CFPS at51% and the DPR for CFPS at 45%. The DPR for CFPS is expected to be around 37% in 2014.
The outstanding shares have increased by 7.5% and 5.8% per year over the past 5 and 10 years. Whenever there is a big change in Outstanding Shares over time, it is necessary to look at total and per share values. For example, you should look at both Revenues and Revenues per Share. Shares have increased due to Stock Options, DRIP and Share Issues.
Revenue and Cash Flow are up over the past 10 years, but not over the past 5 years. There has only been a decline in Earnings. Revenue per Share, Earnings per Share and Cash per Share have declined over the past 5 and 10 years.
Revenue is up by 8.3% per year over the past 10 years, but is down by 1% per year over the past 5 years. Revenue per Share is up by 2.4% per year over the past 10 years, but is down by 7.9% per year over the past 5 years.
Earnings are down by 14.7% and 1.9% per year over the past 5 and 10 years. Earnings per share are down by 21% and 8.3% per year over the past 5 and 10 years. Both Earnings and EPS do fluctuate for this company.
Cash Flow is down by 1.8% per year over the past 5 years and up by 7.9% per year over the past 10 years. CFPS is down by 8.6% per year over the past 5 years and up by 2% per year over the past 10 years. Cash Flow also fluctuates for this company, but not quite as much as earnings fluctuate.
The Return on Equity has been close sometimes, but never has reach 10% in any year in the past 5 years. The 5 year median ROE is just 8.2%. The ROE for 2013 was lower at 7.1%. The ROE on comprehensive income for 2013 was also 7.1%.
The Liquidity Ratio is low at just 0.52 for 2013. This means that the current assets cannot cover the current liabilities. It does not improve much if you take off the current portion of the long term debt as it just reaches 0.58. If you include the cash flow after dividends, the Liquidity Ratio is 1.62. Since cash flow can fluctuate, you got to wonder if including cash flow is justified.
The Debt Ratio is good at 2.45 and this ratio has always been good. The 5 year median Debt Ratio is 2.52. The Leverage and Debt/Equity Ratios are good and have always been so. The current ratios are 1.69 and 0.69, respectively. The 5 year median ratios are also 1.69 and 0.69, respectively.
Via News Wire, the company confirms the March 2014 dividend at $0.10 per share and talks about their DRIP plan. See my spreadsheet at arx.htm.
This is the first of two parts. The second part will be posted on Friday, February 21, 2014 and will be available here.
ARC Resources Ltd. is one of Canada's leading conventional oil and gas companies. Its focus is on acquiring and developing long-life oil and gas properties across western Canada. Industry: Oil and Gas (Oil and Gas Producers) Its web site is here ARC Resources.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
Wednesday, February 19, 2014
Manitoba Telecom Services Inc. 2
I own this stock of Manitoba Telecom Services Inc. (TSX-MBT, OTC-MOBAF). In 2006, I was look for something to buy and I wanted a good dividend paying Canadian Stock. TD recommended this stock as a current Buy. I checked the stock out and it looked good. By 2010 I was being to worry about this stock and I sold a third of what I had.
When I look at insider trading, I find no insider buying and very minimal insider selling. Insiders have stock options and other options like vehicles like Rights Performance Share Units, Rights Restricted Share Units and Rights Director Compensation Units. The outstanding shares were not increased in 2013 for stock options. There is some insider ownership with the CEO having shares worth around $4.2M and the CFO having shares worth around $0.4M.
The 5 year low, median and high median Price/Earnings per Share Ratios are 11.19, 12.32 and 13.50. The current P/E is 17.17 based on EPS estimates for 2014 of $1.75 and a stock price of $30.04. This stock price tests suggests that the current stock price is relatively expensive.
I get a Graham price of $23.69. The 10 year low, median and high median Price/Graham price Ratios are 0.99, 1.15 and 1.31. The current P/GP Ratio is 1.27. This stock price test suggests that the stock price is on the high side but still relatively reasonable.
The 10 year median Price/Book Value per Share Ratio is 2.09. The current P/B Ratio is 2.11 and this is very close to the 10 year P/B Ratio. This stock price tests suggests that the stock price is relatively reasonable.
The 5 year median Dividend Yield is 5.41% and the current Dividend Yield is 5.66%. Here again the 5 year median and current values are close and this suggests that the current stock price is relatively reasonable.
When I look at the analysts' recommendations, I find Buy, Hold and Underperform recommendations. The consensus recommendations would be a Hold recommendation. The 12 months stock price consensus us $30.20 which is very close to the current stock price of $30.04. This implies a 12 month total return of 6.19% with 0.53% from capital gains and 5.66% from dividends.
At the Stock Chase site there is a number of view of this company by analysts. For 2014 is there are two Buys, one Hold and one Don't Buy recommendations. At the Stockhouse site, Gaalen Engen talks about a recent pension judgment going against this company. The WKRB site talks about TD Securities still having a Buy rating on this stock even though it has lowered its target price to $32 from $33.
The stock price seems to be relatively reasonable. There does not seem to be any other bloggers following this stock as far as I can see. The problem with the stock I own is that I bought it before the dividend was cut and therefore paid a rather high price. I have sort of broken even because of the dividends paid. It is not a stock that anyone would get excited about. See my spreadsheet at mbt.htm.
This is the second of two parts. The first part was posted on Tuesday, February 18, 2014 and is available here.
This company is a full-service communications company. It serves residential and business customers in Manitoba. Their Allstream division serves national business consumers. Its web site is here Manitoba Telecom.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
When I look at insider trading, I find no insider buying and very minimal insider selling. Insiders have stock options and other options like vehicles like Rights Performance Share Units, Rights Restricted Share Units and Rights Director Compensation Units. The outstanding shares were not increased in 2013 for stock options. There is some insider ownership with the CEO having shares worth around $4.2M and the CFO having shares worth around $0.4M.
The 5 year low, median and high median Price/Earnings per Share Ratios are 11.19, 12.32 and 13.50. The current P/E is 17.17 based on EPS estimates for 2014 of $1.75 and a stock price of $30.04. This stock price tests suggests that the current stock price is relatively expensive.
I get a Graham price of $23.69. The 10 year low, median and high median Price/Graham price Ratios are 0.99, 1.15 and 1.31. The current P/GP Ratio is 1.27. This stock price test suggests that the stock price is on the high side but still relatively reasonable.
The 10 year median Price/Book Value per Share Ratio is 2.09. The current P/B Ratio is 2.11 and this is very close to the 10 year P/B Ratio. This stock price tests suggests that the stock price is relatively reasonable.
The 5 year median Dividend Yield is 5.41% and the current Dividend Yield is 5.66%. Here again the 5 year median and current values are close and this suggests that the current stock price is relatively reasonable.
When I look at the analysts' recommendations, I find Buy, Hold and Underperform recommendations. The consensus recommendations would be a Hold recommendation. The 12 months stock price consensus us $30.20 which is very close to the current stock price of $30.04. This implies a 12 month total return of 6.19% with 0.53% from capital gains and 5.66% from dividends.
At the Stock Chase site there is a number of view of this company by analysts. For 2014 is there are two Buys, one Hold and one Don't Buy recommendations. At the Stockhouse site, Gaalen Engen talks about a recent pension judgment going against this company. The WKRB site talks about TD Securities still having a Buy rating on this stock even though it has lowered its target price to $32 from $33.
The stock price seems to be relatively reasonable. There does not seem to be any other bloggers following this stock as far as I can see. The problem with the stock I own is that I bought it before the dividend was cut and therefore paid a rather high price. I have sort of broken even because of the dividends paid. It is not a stock that anyone would get excited about. See my spreadsheet at mbt.htm.
This is the second of two parts. The first part was posted on Tuesday, February 18, 2014 and is available here.
This company is a full-service communications company. It serves residential and business customers in Manitoba. Their Allstream division serves national business consumers. Its web site is here Manitoba Telecom.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
Tuesday, February 18, 2014
Manitoba Telecom Services Inc.
On my other blog I am today writing about my dividend increases for 2013 continue...
I own this stock of Manitoba Telecom Services Inc. (TSX-MBT, OTC-MOBAF). In 2006, I was look for something to buy and I wanted a good dividend paying Canadian Stock. TD recommended this stock as a current Buy. I checked the stock out and it looked good. I ended up with some of this stock in my trading, RRSP and Pension Accounts. By 2010 I was being to worry about this stock and I want to sell some.
I no longer think that it is a good stock. In the 2009 report, the company said that they cannot guarantee current level of dividends. They have not raised their dividends for years. I like stocks that raise dividends. I sold the stock in my Trading and Pension Accounts and some in the RRSP Account. I had a slight loss in my Trading account and a slight gain in my Pension Account for an overall gain of 0.83% (including dividends). I wished I had never bought this stock.
It is said you should only obtain information form analysts' reports and never take their recommendation. I should have known better. This was a dividend growth company until 2006. It was bad timing on my part. Over past 5 years, dividends are down by 8.2% per year. Dividends are up by 6.1% per year over the past 10 years.
The Dividend Payout Ratios are a problem, especially, the DPR for earnings. For 2013, the DPR for Earnings was at 137%. For 2014 it is expected to be at 97%. The DPR for cash flow is not as bad, with the DPR for cash flow for 2014 at 45% and it is expected to be at 32% for 2014. I doubt if dividends will be increased anytime soon because of the DPR for earnings.
Over the last 5 and 10 years, shareholders would have earned 3.58% and 0.66% per year with capital loss at 2.16% and 4.89% per year and dividend income at 5.74% and 5.55% per year. In my RRSP account which holds the last of this stock I have earned since 2006, 2.85% per year with a capital loss of 3.72% per year and dividends at 6.57% per year.
Outstanding shares have increased by 3.5% and 2.3% per year over the past 5 and 10 years. The shares have increased due to DRIP, stock options and share issues. The shares have decreased due to buy backs. Revenues, earnings and cash flows have been declining. Analysts expect better results in 2014. (However, analysts' had expected better results in 2013 also and this did not occur.)
Revenues per Share have been declining over the past 5 years at 6.5% per year. Revenues per share are up over the past 10 years at 4% per year. Because 2013 had an earnings loss, I cannot determine any positive or negative growth. However, if you look at the 5 year running averages, earnings are down by 15.8% per year over the past 5 years and down by 1% per year over the past 10 years.
Cash Flow per Share has fluctuated, but it is down by 12.5% and 2.5% per year over the past 5 and 10 years. If you look at 5 year running averages, the CFPS is down by 3.8% per year over the past 5 years and up by 2.2% per year over the past 10 years.
Over the past 5 years, Return on Equity has been above 10% for only 2 years. It is interesting that, although ROE on comprehensive income has been over 10% only 2 out of the last 5 years, one of these years was 2013. The ROE on comprehensive income was at 10.8% in 2013. This would imply that earnings were not a bad as first thought of.
The Liquidity Ratio for 2013 is low at just 0.42 and even with cash flow after dividends it is only at 0.68. This means that current assets cannot cover current liabilities. However, if you take off the current portion of the long term loans, the Liquidity Ratio is 0.71, but with cash flow less dividends it reaches over 1.00 at 1.16.
The Debt Ratio has always been good on this company and the current Debt Ratio is 1.69. The Leverage and Debt/Equity Ratios have come down over the past couple of years are not bad at 2.45 and 1.45 for 2013.
This stock is still not doing well. However, I am not in a hurry to sell because I do not think it is going anywhere. See my spreadsheet at mbt.htm.
This is the first of two parts. The second part will be posted on Wednesday, February 19, 2014 and will be available here.
This company is a full-service communications company. It serves residential and business customers in Manitoba. Their Allstream division serves national business consumers. Its web site is here Manitoba Telecom.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
I own this stock of Manitoba Telecom Services Inc. (TSX-MBT, OTC-MOBAF). In 2006, I was look for something to buy and I wanted a good dividend paying Canadian Stock. TD recommended this stock as a current Buy. I checked the stock out and it looked good. I ended up with some of this stock in my trading, RRSP and Pension Accounts. By 2010 I was being to worry about this stock and I want to sell some.
I no longer think that it is a good stock. In the 2009 report, the company said that they cannot guarantee current level of dividends. They have not raised their dividends for years. I like stocks that raise dividends. I sold the stock in my Trading and Pension Accounts and some in the RRSP Account. I had a slight loss in my Trading account and a slight gain in my Pension Account for an overall gain of 0.83% (including dividends). I wished I had never bought this stock.
It is said you should only obtain information form analysts' reports and never take their recommendation. I should have known better. This was a dividend growth company until 2006. It was bad timing on my part. Over past 5 years, dividends are down by 8.2% per year. Dividends are up by 6.1% per year over the past 10 years.
The Dividend Payout Ratios are a problem, especially, the DPR for earnings. For 2013, the DPR for Earnings was at 137%. For 2014 it is expected to be at 97%. The DPR for cash flow is not as bad, with the DPR for cash flow for 2014 at 45% and it is expected to be at 32% for 2014. I doubt if dividends will be increased anytime soon because of the DPR for earnings.
Over the last 5 and 10 years, shareholders would have earned 3.58% and 0.66% per year with capital loss at 2.16% and 4.89% per year and dividend income at 5.74% and 5.55% per year. In my RRSP account which holds the last of this stock I have earned since 2006, 2.85% per year with a capital loss of 3.72% per year and dividends at 6.57% per year.
Outstanding shares have increased by 3.5% and 2.3% per year over the past 5 and 10 years. The shares have increased due to DRIP, stock options and share issues. The shares have decreased due to buy backs. Revenues, earnings and cash flows have been declining. Analysts expect better results in 2014. (However, analysts' had expected better results in 2013 also and this did not occur.)
Revenues per Share have been declining over the past 5 years at 6.5% per year. Revenues per share are up over the past 10 years at 4% per year. Because 2013 had an earnings loss, I cannot determine any positive or negative growth. However, if you look at the 5 year running averages, earnings are down by 15.8% per year over the past 5 years and down by 1% per year over the past 10 years.
Cash Flow per Share has fluctuated, but it is down by 12.5% and 2.5% per year over the past 5 and 10 years. If you look at 5 year running averages, the CFPS is down by 3.8% per year over the past 5 years and up by 2.2% per year over the past 10 years.
Over the past 5 years, Return on Equity has been above 10% for only 2 years. It is interesting that, although ROE on comprehensive income has been over 10% only 2 out of the last 5 years, one of these years was 2013. The ROE on comprehensive income was at 10.8% in 2013. This would imply that earnings were not a bad as first thought of.
The Liquidity Ratio for 2013 is low at just 0.42 and even with cash flow after dividends it is only at 0.68. This means that current assets cannot cover current liabilities. However, if you take off the current portion of the long term loans, the Liquidity Ratio is 0.71, but with cash flow less dividends it reaches over 1.00 at 1.16.
The Debt Ratio has always been good on this company and the current Debt Ratio is 1.69. The Leverage and Debt/Equity Ratios have come down over the past couple of years are not bad at 2.45 and 1.45 for 2013.
This stock is still not doing well. However, I am not in a hurry to sell because I do not think it is going anywhere. See my spreadsheet at mbt.htm.
This is the first of two parts. The second part will be posted on Wednesday, February 19, 2014 and will be available here.
This company is a full-service communications company. It serves residential and business customers in Manitoba. Their Allstream division serves national business consumers. Its web site is here Manitoba Telecom.
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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
Friday, February 14, 2014
Canadian National Railway 2
Canadian National Railway 2
On my other blog I am today writing about our medical establishment's attitude to patient's time continue...
I own this stock of Canadian National Railway (TSX-CNR, NYSE-CNI). In 2005 I was look for good companies to buy at a reasonable price. This stock met by criteria. This is a dividend growth company with a good record of dividend increases. I brought some more in 2009. In my RRSP account, I bought this stock in 2011 and sold in 2013. Reason for sale was to raise money in my RRSP account for future withdrawals. I was looking for something to sell with a low dividend yield.
The insider trading report shows some $18.4M of insider selling with net insider selling at 15.7M and insider buying at $2.7M. In January of this year, the company was buying back shares for cancellation. The company has done a lot of this recently.
Not only do insiders have options, but they have other option like vehicles called Deferred Share Units, Performance Share Units, Restricted Share Units and Directors Restricted Share Units. In 2013, 1.4M shares were added to the outstanding shares due to stock options. The book value of these shares was $40M. These shares added 0.2% to the outstanding shares.
There is some insider ownership with the CEO owning shares worth around $7.8M, a director owning shares worth around $14.4M and the chairman owning shares worth around $12.3M.
The 5 year low, median and high median Price/Earnings per Share Ratios are 12.13, 13.62 and 14.99. The current P/E Ratio is 17.28 based on a share price of $60.66 and 2014 earnings estimates of $3.51. This stock price test suggests that the stock is relatively expensive.
I get a Graham Price of $32.73. The 10 year low, median and high median Price/Graham Price Ratios are 1.05, 1.22 and 1.37. The current P/GP Ratio is 1.85 based on a stock price of $60.66. This stock price tests suggests that the stock is relatively expensive.
I get a 10 year Price/Book Value per Share Ratio of 2.51. The current P/B Ratio is 4.47 based on a stock price of $60.66 and a BVPS of $13.56. The current ratio is 78% higher than the 10 year median ratio and this stock test suggests that the stock is relatively expensive.
I get a 5 year median dividend yield of 1.78% and the current dividend yield is 1.65%. The current year is some 7% lower than the 5 year median dividend yield. Although you would like the current dividend yield to be higher than the 5 year median dividend yield, they are not that far apart and this stock test suggests that the stock price is relatively reasonable.
The historical high dividend yield is 2.05% and the historical average dividend yield is 1.56%. The current dividend yield is 5.5% above the historical average dividend yield and this test suggests that the stock price is relatively reasonable. There is a number of ways to calculate the historical average or median dividend yield, but in all cases the current dividend yield is higher. Again this suggests that the current stock price is relatively reasonable.
It is interesting that the stock tests that do not use any estimates, which are the P/B Ratio test and the dividend yield test, show very converging results. The thing is that the BVPS values have not been growing as quickly as the dividends. Dividends have grown at 13.3% per year over the past 5 years and BVPS has only grown at 6.99%. The dividend yield has grown fast than EPS, which has grown at 9.4% per year over the past 5 years.
The dividends have grown at the expensive of the Dividend Payout Ratio, although, DPRs are still rather good at 28% for earnings and 19% for cash flow. This would suggest some caution as the stock price maybe on the side expensive side.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus recommendations would be a Buy recommendation. The 12 month consensus stock price is $58.5. This implies a loss of the next 12 months of 1.91% with 1.65% from dividends and a capital loss of 3.56%.
This Financial Post article talks about CNR raising its rates for companies using old tank cars. There is a positive report on this company from the Motley Fool. A rather negative report on the under reporting of accidents by CNR is on the Word Press site. This is a blog called Railroaded on Word Press with all sort of negative news on this company. There is a great analysis by The Passive Income Earner on merits of buying CNR stock compared to CP stock.
Although I still like this stock and will continue to hold what I have, I do think that the stock is rather fully valued and now may not be the best time to buy. See my spreadsheet at cnr.htm.
This is the second of two parts. The first part was posted on Thursday, February 13, 2014 and is available here.
Canadian National Railway Company and its operating railway subsidiaries, spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key metropolitan areas of Toronto, Buffalo, Chicago, Detroit, Duluth, Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis, St. Louis, and Jackson, Miss., with connections to all points in North America. Its web site is here CNR.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
On my other blog I am today writing about our medical establishment's attitude to patient's time continue...
I own this stock of Canadian National Railway (TSX-CNR, NYSE-CNI). In 2005 I was look for good companies to buy at a reasonable price. This stock met by criteria. This is a dividend growth company with a good record of dividend increases. I brought some more in 2009. In my RRSP account, I bought this stock in 2011 and sold in 2013. Reason for sale was to raise money in my RRSP account for future withdrawals. I was looking for something to sell with a low dividend yield.
The insider trading report shows some $18.4M of insider selling with net insider selling at 15.7M and insider buying at $2.7M. In January of this year, the company was buying back shares for cancellation. The company has done a lot of this recently.
Not only do insiders have options, but they have other option like vehicles called Deferred Share Units, Performance Share Units, Restricted Share Units and Directors Restricted Share Units. In 2013, 1.4M shares were added to the outstanding shares due to stock options. The book value of these shares was $40M. These shares added 0.2% to the outstanding shares.
There is some insider ownership with the CEO owning shares worth around $7.8M, a director owning shares worth around $14.4M and the chairman owning shares worth around $12.3M.
The 5 year low, median and high median Price/Earnings per Share Ratios are 12.13, 13.62 and 14.99. The current P/E Ratio is 17.28 based on a share price of $60.66 and 2014 earnings estimates of $3.51. This stock price test suggests that the stock is relatively expensive.
I get a Graham Price of $32.73. The 10 year low, median and high median Price/Graham Price Ratios are 1.05, 1.22 and 1.37. The current P/GP Ratio is 1.85 based on a stock price of $60.66. This stock price tests suggests that the stock is relatively expensive.
I get a 10 year Price/Book Value per Share Ratio of 2.51. The current P/B Ratio is 4.47 based on a stock price of $60.66 and a BVPS of $13.56. The current ratio is 78% higher than the 10 year median ratio and this stock test suggests that the stock is relatively expensive.
I get a 5 year median dividend yield of 1.78% and the current dividend yield is 1.65%. The current year is some 7% lower than the 5 year median dividend yield. Although you would like the current dividend yield to be higher than the 5 year median dividend yield, they are not that far apart and this stock test suggests that the stock price is relatively reasonable.
The historical high dividend yield is 2.05% and the historical average dividend yield is 1.56%. The current dividend yield is 5.5% above the historical average dividend yield and this test suggests that the stock price is relatively reasonable. There is a number of ways to calculate the historical average or median dividend yield, but in all cases the current dividend yield is higher. Again this suggests that the current stock price is relatively reasonable.
It is interesting that the stock tests that do not use any estimates, which are the P/B Ratio test and the dividend yield test, show very converging results. The thing is that the BVPS values have not been growing as quickly as the dividends. Dividends have grown at 13.3% per year over the past 5 years and BVPS has only grown at 6.99%. The dividend yield has grown fast than EPS, which has grown at 9.4% per year over the past 5 years.
The dividends have grown at the expensive of the Dividend Payout Ratio, although, DPRs are still rather good at 28% for earnings and 19% for cash flow. This would suggest some caution as the stock price maybe on the side expensive side.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus recommendations would be a Buy recommendation. The 12 month consensus stock price is $58.5. This implies a loss of the next 12 months of 1.91% with 1.65% from dividends and a capital loss of 3.56%.
This Financial Post article talks about CNR raising its rates for companies using old tank cars. There is a positive report on this company from the Motley Fool. A rather negative report on the under reporting of accidents by CNR is on the Word Press site. This is a blog called Railroaded on Word Press with all sort of negative news on this company. There is a great analysis by The Passive Income Earner on merits of buying CNR stock compared to CP stock.
Although I still like this stock and will continue to hold what I have, I do think that the stock is rather fully valued and now may not be the best time to buy. See my spreadsheet at cnr.htm.
This is the second of two parts. The first part was posted on Thursday, February 13, 2014 and is available here.
Canadian National Railway Company and its operating railway subsidiaries, spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key metropolitan areas of Toronto, Buffalo, Chicago, Detroit, Duluth, Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis, St. Louis, and Jackson, Miss., with connections to all points in North America. Its web site is here CNR.
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, February 13, 2014
Canadian National Railway
I own this stock of Canadian National Railway (TSX-CNR, NYSE-CNI). In 2005 I was look for good companies to buy at a reasonable price. This stock met by criteria. This is a dividend growth company with a good record of dividend increases. I brought some more in 2009. In my RRSP account, I bought this stock in 2011 and sold in 2013. Reason for sale was to raise money in my RRSP account for future withdrawals. I was looking for something to sell with a low dividend yield.
My return on this stock to the end of January 2014 has been at 17.71% per year with 1.62% from dividends and 16.09% from capital gains. For the stock I bought in 2005, 8 years ago, I am making a yield of 5.34% on my original purchase money. The current dividend yield is 1.65%. The 5 year median dividend yield is 1.78%.
Dividends have increased by 13.3% and 17.8% per year over the past 5 and 10 years. At the 5 year rate of 13%, if you invested money today, you could be earning 5.6% in 10 years' time on that money. This is the reason you buy dividend growth stocks. Because of the low dividend yield, it would be a great stock to use to build a portfolio that would eventually provide you with income.
Why the 5 year dividend growth is lower than the 10 years dividend growth is because dividend increases were much lower from 2008 to 2010 inclusive. This is generally what happens in bear markets going into recessions.
The Dividend Payout Ratios are good with the 5 year median DPR for earnings at 25% and the 5 year median DPR for cash flow at 19%. The DPR for 2013 were similar at 28% and 19%, respectively.
The 5 and 10 year total return for this stock is 18.09% and 16.71% per year with 14.30% and 16.17% per year from capital gains and 1.92% and 1.69% per year from dividends.
The outstanding shares have decreased by 2.6% and 3% per year over the past 5 and 10 years. Shares have increased due to stock options and decreased due to buy backs. With decreasing outstanding shares it is important to look at other values than "per share" values. That is look at Revenue and Revenue per Share. Just looking at the "per share" values may not give you the whole picture on how well a company is doing.
With this company there has been moderate growth in revenue and good growth in earnings and cash flow. Revenue has growth at 4.5% and 6% per year over the past 5 and 10 years. Revenue per Share has growth at 7.3% and 9.4% per year over the past 5 and 10 years.
Net income has grown at 6.6% and 9.9% per year over the past 5 and 10 years with Earnings per Share growth at 9.4% and 13.5% per year over these same periods. Cash flow has grown at 6.9% and 8% per year over the past 5 and 10 years and Cash Flow per Share has grown at 11% and 10% per year.
For the last 10 years, the Return on Equity has been above 10%. I only have comprehensive income for the last 8 years and this has also been above 10% except for one year when it was 9.4%. The ROE for 2013 was at 20.2% with a 5 year median ROE at 20.2%. The ROE on comprehensive was very high in 2013 at 31%. The difference between net income and comprehensive income has varied a lot over the years.
The Liquidity Ratio is not where I would like it to be. The current one is 0.79. That means that current assets cannot cover current liabilities. However, if you add in cash flow after dividends, the ratio goes to 1.93. If you disregard the current portion of the long term loans, the ratio goes from 0.79 to 1.34, low but acceptable. The Debt Ratio at 1.75 is quite good.
The current Leverage and Debt/Equity Ratios are 2.33 and 1.33 respectively. The 5 year median Leverage and Debt/Equity Ratios are 2.40 and 1.40, respectively. These are rather normal for this sort of stock.
This has been a terrific investment for me. I will retain what I have but will not buy anymore because I have enough of this stock and I do not want any stock to dominate my portfolio.
In my dividend income portfolio, I like to have different sorts of dividend stocks with different payment styles. This stock has a rather low dividend with very good dividend increases. I also have stocks with modest dividend yields and modest dividend growth and ones with rather high dividends and low dividend growth.
Having stocks that have low dividend yield and good dividend growth can give a nice boost to your yearly dividend income growth. See my spreadsheet at cnr.htm.
This is the first of two parts. The second part will be posted on Friday, February 14, 2014 and will be available here.
Canadian National Railway Company and its operating railway subsidiaries, spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key metropolitan areas of Toronto, Buffalo, Chicago, Detroit, Duluth, Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis, St. Louis, and Jackson, Miss., with connections to all points in North America. Its web site is here CNR.
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.
My return on this stock to the end of January 2014 has been at 17.71% per year with 1.62% from dividends and 16.09% from capital gains. For the stock I bought in 2005, 8 years ago, I am making a yield of 5.34% on my original purchase money. The current dividend yield is 1.65%. The 5 year median dividend yield is 1.78%.
Dividends have increased by 13.3% and 17.8% per year over the past 5 and 10 years. At the 5 year rate of 13%, if you invested money today, you could be earning 5.6% in 10 years' time on that money. This is the reason you buy dividend growth stocks. Because of the low dividend yield, it would be a great stock to use to build a portfolio that would eventually provide you with income.
Why the 5 year dividend growth is lower than the 10 years dividend growth is because dividend increases were much lower from 2008 to 2010 inclusive. This is generally what happens in bear markets going into recessions.
The Dividend Payout Ratios are good with the 5 year median DPR for earnings at 25% and the 5 year median DPR for cash flow at 19%. The DPR for 2013 were similar at 28% and 19%, respectively.
The 5 and 10 year total return for this stock is 18.09% and 16.71% per year with 14.30% and 16.17% per year from capital gains and 1.92% and 1.69% per year from dividends.
The outstanding shares have decreased by 2.6% and 3% per year over the past 5 and 10 years. Shares have increased due to stock options and decreased due to buy backs. With decreasing outstanding shares it is important to look at other values than "per share" values. That is look at Revenue and Revenue per Share. Just looking at the "per share" values may not give you the whole picture on how well a company is doing.
With this company there has been moderate growth in revenue and good growth in earnings and cash flow. Revenue has growth at 4.5% and 6% per year over the past 5 and 10 years. Revenue per Share has growth at 7.3% and 9.4% per year over the past 5 and 10 years.
Net income has grown at 6.6% and 9.9% per year over the past 5 and 10 years with Earnings per Share growth at 9.4% and 13.5% per year over these same periods. Cash flow has grown at 6.9% and 8% per year over the past 5 and 10 years and Cash Flow per Share has grown at 11% and 10% per year.
For the last 10 years, the Return on Equity has been above 10%. I only have comprehensive income for the last 8 years and this has also been above 10% except for one year when it was 9.4%. The ROE for 2013 was at 20.2% with a 5 year median ROE at 20.2%. The ROE on comprehensive was very high in 2013 at 31%. The difference between net income and comprehensive income has varied a lot over the years.
The Liquidity Ratio is not where I would like it to be. The current one is 0.79. That means that current assets cannot cover current liabilities. However, if you add in cash flow after dividends, the ratio goes to 1.93. If you disregard the current portion of the long term loans, the ratio goes from 0.79 to 1.34, low but acceptable. The Debt Ratio at 1.75 is quite good.
The current Leverage and Debt/Equity Ratios are 2.33 and 1.33 respectively. The 5 year median Leverage and Debt/Equity Ratios are 2.40 and 1.40, respectively. These are rather normal for this sort of stock.
This has been a terrific investment for me. I will retain what I have but will not buy anymore because I have enough of this stock and I do not want any stock to dominate my portfolio.
In my dividend income portfolio, I like to have different sorts of dividend stocks with different payment styles. This stock has a rather low dividend with very good dividend increases. I also have stocks with modest dividend yields and modest dividend growth and ones with rather high dividends and low dividend growth.
Having stocks that have low dividend yield and good dividend growth can give a nice boost to your yearly dividend income growth. See my spreadsheet at cnr.htm.
This is the first of two parts. The second part will be posted on Friday, February 14, 2014 and will be available here.
Canadian National Railway Company and its operating railway subsidiaries, spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key metropolitan areas of Toronto, Buffalo, Chicago, Detroit, Duluth, Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis, St. Louis, and Jackson, Miss., with connections to all points in North America. Its web site is here CNR.
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, February 12, 2014
Nordion Inc.
On my other blog I am today writing about possible stocks to buy continue...
I do not own this stock of Nordion Inc. (TSX-NDN, NYSE-NDZ), but I used to. I bought this stock in 1996, 1997 and 1998. At that time it was a good dividend stock and it gave me exposure to the Health section. I sold in 2006 as the stock seemed to be going nowhere at that time. The company has also changed its name since I held it. It used to be called MDS Inc. (TSX-MDS).
The stock has not done very well since I sold it in 2006. It has cut its dividend to zero. The dividend was revived in 2011, but then dropped again in 2013.
The share price hit a low in 2012. Over the past 5 years, investors have made some money with the total return at 6.50% per year with 1.36% per year from dividends and 5.13% per year from capital gains. However, over the past 10 years investors would have lost money with total loss at 3.98% per year and capital loss at 4.62% per year and dividends at 0.64% per year.
Shares have been declining over the past 5 and 10 years, with shares down by 12.4% and 7.9% over these periods. This stock reports in US$, but no matter how you look at the figures, the revenues and cash flows have been declining. However, there is some growth in earnings. Because shares are declining, the "per share" figures might look better than they really should.
For example, the revenue is down by 29.3% and 15.6% per year over the past 5 and 10 years in US$. However, Revenue per Share is down by 19.3% and 8.3% per year in US$ over the past 5 and 10 years.
Since the company had earnings losses in 2008 to 2010 inclusive, I do not have 5 year growth figures for earnings. I only have 2 year growth and it looks very good at some 283% per year, but this growth is from a very low level. Over the past 10 years EPS has grown at 31% per year. However, net income is only up 20% per year. There has been reorganization going over the years, so earnings seem to pop up to a higher level in 2008. (By the same token, revenues dropped a lot in 2009.)
Because of the decrease in the number of shares, the Cash Flow per Share looks better than Cash Flow. Cash Flow over the past 4 and 10 years is down by 24.7% and 11% per year. CFPS is down by 11% and 3.4% per year over the past 4 and 10 years. These figures are in US$. I am using 4 years for the second value as 5 years ago, there was negative cash flow.
The one good thing to say about the company is the debt ratios. The Liquidity Ratio for 2013 is 4.96 and the Debt Ratio is 3.92. The current Leverage and Debt/Equity Ratios are also quite good at 1.34 and 0.34, respectively.
The site Ticket Report talks about a recent analyst upgrade on this stock by The Street Ratings and the reasons for this.
It is difficult to get a fix on the P/E Ratios as there were recent earnings losses in 2008 to 2010 inclusive. However, getting rid of the attached P/E Ratios, I get 10 year low, median and high median P/E Ratios of 18.07, 20.52 and 22.97. The current P/E Ratio is 14.86 based on a stock price of $10.52 and EPS of $0.71 CND$ for 2014. This test points to a current cheap stock price.
The 10 year median Price/Book Value per Share Ratio is 1.65. The current P/B Ratio is 1.36 a value that is some 82% of the 10 year median and points to a reasonable stock price. For the stock price to be cheap, the P/B Ratio would need to be 80% of the 10 year median P/B Ratio. It is getting close.
When I look at analysts' recommendations, I find Strong Buy, Hold and Sell recommendations. The consensus would be a Hold recommendation. The 12 month stock price consensus is $10.50 and this is just below where the stock price is today at $10.52.
This is not a stock I would consider buying. First it has no dividend and secondly, it is certainly not a stock you can buy and forget about. See my spreadsheet at ndn.htm.
Nordion Inc. is a global life sciences company that provides products and services for the development of drugs and diagnosis and treatment of disease. The company is a provider of pharmaceutical contract research, medical isotopes for molecular imaging, radiotherapeutics, and analytical instruments. Its web site is here Nordion.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
I do not own this stock of Nordion Inc. (TSX-NDN, NYSE-NDZ), but I used to. I bought this stock in 1996, 1997 and 1998. At that time it was a good dividend stock and it gave me exposure to the Health section. I sold in 2006 as the stock seemed to be going nowhere at that time. The company has also changed its name since I held it. It used to be called MDS Inc. (TSX-MDS).
The stock has not done very well since I sold it in 2006. It has cut its dividend to zero. The dividend was revived in 2011, but then dropped again in 2013.
The share price hit a low in 2012. Over the past 5 years, investors have made some money with the total return at 6.50% per year with 1.36% per year from dividends and 5.13% per year from capital gains. However, over the past 10 years investors would have lost money with total loss at 3.98% per year and capital loss at 4.62% per year and dividends at 0.64% per year.
Shares have been declining over the past 5 and 10 years, with shares down by 12.4% and 7.9% over these periods. This stock reports in US$, but no matter how you look at the figures, the revenues and cash flows have been declining. However, there is some growth in earnings. Because shares are declining, the "per share" figures might look better than they really should.
For example, the revenue is down by 29.3% and 15.6% per year over the past 5 and 10 years in US$. However, Revenue per Share is down by 19.3% and 8.3% per year in US$ over the past 5 and 10 years.
Since the company had earnings losses in 2008 to 2010 inclusive, I do not have 5 year growth figures for earnings. I only have 2 year growth and it looks very good at some 283% per year, but this growth is from a very low level. Over the past 10 years EPS has grown at 31% per year. However, net income is only up 20% per year. There has been reorganization going over the years, so earnings seem to pop up to a higher level in 2008. (By the same token, revenues dropped a lot in 2009.)
Because of the decrease in the number of shares, the Cash Flow per Share looks better than Cash Flow. Cash Flow over the past 4 and 10 years is down by 24.7% and 11% per year. CFPS is down by 11% and 3.4% per year over the past 4 and 10 years. These figures are in US$. I am using 4 years for the second value as 5 years ago, there was negative cash flow.
The one good thing to say about the company is the debt ratios. The Liquidity Ratio for 2013 is 4.96 and the Debt Ratio is 3.92. The current Leverage and Debt/Equity Ratios are also quite good at 1.34 and 0.34, respectively.
The site Ticket Report talks about a recent analyst upgrade on this stock by The Street Ratings and the reasons for this.
It is difficult to get a fix on the P/E Ratios as there were recent earnings losses in 2008 to 2010 inclusive. However, getting rid of the attached P/E Ratios, I get 10 year low, median and high median P/E Ratios of 18.07, 20.52 and 22.97. The current P/E Ratio is 14.86 based on a stock price of $10.52 and EPS of $0.71 CND$ for 2014. This test points to a current cheap stock price.
The 10 year median Price/Book Value per Share Ratio is 1.65. The current P/B Ratio is 1.36 a value that is some 82% of the 10 year median and points to a reasonable stock price. For the stock price to be cheap, the P/B Ratio would need to be 80% of the 10 year median P/B Ratio. It is getting close.
When I look at analysts' recommendations, I find Strong Buy, Hold and Sell recommendations. The consensus would be a Hold recommendation. The 12 month stock price consensus is $10.50 and this is just below where the stock price is today at $10.52.
This is not a stock I would consider buying. First it has no dividend and secondly, it is certainly not a stock you can buy and forget about. See my spreadsheet at ndn.htm.
Nordion Inc. is a global life sciences company that provides products and services for the development of drugs and diagnosis and treatment of disease. The company is a provider of pharmaceutical contract research, medical isotopes for molecular imaging, radiotherapeutics, and analytical instruments. Its web site is here Nordion.
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, February 11, 2014
Exco Technologies Ltd. 2
I do not own this stock of Exco Technologies Ltd. (TSX-XTC, OTC- EXCOF). This is a stock given as a recommendation by Keystone at the Toronto Money Show of 2012. I decided to check into it as it is a small tech company that is paying dividends. Also, I decided to review this stock because Keystone has recommended some very good stocks in the past.
The insider trading report shows $0.9M of insider selling and $0.7M of net insider selling with $0.2M of insider buying. The CEO owns shares worth around $79.7M, an officer owns shares worth around $39M and Edward James Kernaghan, (of Kernaghan Securities Ltd.) owns just over 10% of the shares worth around $39.9M. So there are insiders and others with large stakes in this company.
The 5 year low, median and high median Price/Earnings per Shares ratios are 7.64, 8.58 and 10.30. This is after getting rid of the high negative P/E Ratios due to recent earning loses. If you go back before the troubles of 2006, the median P/E was 16.03, which is probably a more reasonable P/E Ratio. The current P/E Ratio is 12.86 based on 2014 earnings estimate of $0.65 and a current stock price of $8.36. The current P/E is probably a reasonable one.
I get a Graham Price of $7.85. The 10 year low, median and high median Price/Graham Price Ratios are 0.73, 1.01 and 1.33. The current P/GP Ratio is 1.07 and this stock test suggests that the stock price is relatively reasonable.
The 10 year Price/Book Value per Share Ratio is 1.19. The current P/B Ratio is 1.98, a value some 67% higher. This stock test suggests the current stock price of $8.36 is relatively high.
The 5 year median dividend yield is 3.16% and the current dividend yield is 2.39% a value some 24% lower and suggesting that the stock price is relatively high. There are some problems with this test because of the problems this company suffered in 2008 and 2009, where the stock crashed and the yield went high.
There are a number of ways of coming up with an historical average or median dividend yield and these values suggest that the stock price is probably reasonable. There are problems here also as the dividend has been growing faster than Dividend Payout Ratios. Given that the DPRs are still quite reasonable; this is not currently a problem.
There are only a couple of analysts following this stock and the stock is given a Strong Buy and a Hold recommendation. The consensus would be a Buy recommendation. The 12 month consensus stock price is $9.13. This implies and 12 month total return of 11.60% with 2.39% from dividends and 9.21% from capital gains.
Some analysts made comments on this stock and was reported by WKRB, News and Analysis. The site of Bann Ronn gives some technical analysis on this stock.
Given the above stock price testing, I think that the stock price is probably reasonable. It is certainly not cheap. You have to wonder if the risk of owning this stock is worth just a reasonable price. See my spreadsheet at xtc.htm.
This is the second of two parts. The first part was posted on Monday, February 10, 2014 and is available here.
Exco is a global designer, developer and manufacturer of dies, moulds, equipment, components and assemblies to the die-cast, extrusion and automotive industries. The Die Casting and Extrusion Technology groups operations are based in Canada, U.S., Mexico and Colombia and primarily serve automotive and industrial markets throughout the world. The Automotive Solutions Group has facilities are located in Canada, U.S., Mexico and Morocco and supply the North American, European and Asian markets. Its web site is here Exco.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
The insider trading report shows $0.9M of insider selling and $0.7M of net insider selling with $0.2M of insider buying. The CEO owns shares worth around $79.7M, an officer owns shares worth around $39M and Edward James Kernaghan, (of Kernaghan Securities Ltd.) owns just over 10% of the shares worth around $39.9M. So there are insiders and others with large stakes in this company.
The 5 year low, median and high median Price/Earnings per Shares ratios are 7.64, 8.58 and 10.30. This is after getting rid of the high negative P/E Ratios due to recent earning loses. If you go back before the troubles of 2006, the median P/E was 16.03, which is probably a more reasonable P/E Ratio. The current P/E Ratio is 12.86 based on 2014 earnings estimate of $0.65 and a current stock price of $8.36. The current P/E is probably a reasonable one.
I get a Graham Price of $7.85. The 10 year low, median and high median Price/Graham Price Ratios are 0.73, 1.01 and 1.33. The current P/GP Ratio is 1.07 and this stock test suggests that the stock price is relatively reasonable.
The 10 year Price/Book Value per Share Ratio is 1.19. The current P/B Ratio is 1.98, a value some 67% higher. This stock test suggests the current stock price of $8.36 is relatively high.
The 5 year median dividend yield is 3.16% and the current dividend yield is 2.39% a value some 24% lower and suggesting that the stock price is relatively high. There are some problems with this test because of the problems this company suffered in 2008 and 2009, where the stock crashed and the yield went high.
There are a number of ways of coming up with an historical average or median dividend yield and these values suggest that the stock price is probably reasonable. There are problems here also as the dividend has been growing faster than Dividend Payout Ratios. Given that the DPRs are still quite reasonable; this is not currently a problem.
There are only a couple of analysts following this stock and the stock is given a Strong Buy and a Hold recommendation. The consensus would be a Buy recommendation. The 12 month consensus stock price is $9.13. This implies and 12 month total return of 11.60% with 2.39% from dividends and 9.21% from capital gains.
Some analysts made comments on this stock and was reported by WKRB, News and Analysis. The site of Bann Ronn gives some technical analysis on this stock.
Given the above stock price testing, I think that the stock price is probably reasonable. It is certainly not cheap. You have to wonder if the risk of owning this stock is worth just a reasonable price. See my spreadsheet at xtc.htm.
This is the second of two parts. The first part was posted on Monday, February 10, 2014 and is available here.
Exco is a global designer, developer and manufacturer of dies, moulds, equipment, components and assemblies to the die-cast, extrusion and automotive industries. The Die Casting and Extrusion Technology groups operations are based in Canada, U.S., Mexico and Colombia and primarily serve automotive and industrial markets throughout the world. The Automotive Solutions Group has facilities are located in Canada, U.S., Mexico and Morocco and supply the North American, European and Asian markets. Its web site is here Exco.
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, February 10, 2014
Exco Technologies Ltd.
On my other blog I am today writing about possible cheap dividend stocks continue...
I do not own this stock of Exco Technologies Ltd. (TSX-XTC, OTC- EXCOF). This is a stock given as a recommendation by Keystone at the Toronto Money Show of 2012. I decided to check into it as it is a small tech company that is paying dividends. Also, I decided to review this stock because Keystone has recommended some very good stocks in the past.
This company started to pay dividends about 10 years ago in 2003. I would call it a dividend growth company as dividends have grown at 21% and 13% per year over the past 5 and 10 years. They started out with a low dividend (less than 1%) and now the dividend is around 2.4%. The 5 year median dividend yield is 3.2%. This suggests that the dividend growth into the future may not be as good as dividend growth in the past.
The Dividend Payout Ratio is good with the 5 year DPR for earnings at 29% and the 5 year DPR for cash flow at 18%. The DRP rates have fluctuated, but the DPRs for 2013 is similar to the 5 year DPR with the DPR for EPS at 30% and the DPR for cash flow at 22%.
The total return over the past 5 years is very good, but not so much over the past 10 years. The thing is 5 years ago the stock dropped a lot because of the 2000 bear market. The stock has made some capital gains, but not a lot over the years. The 5 and 10 year total return to date is 36.81% and 2.27% per year. The dividend portion of these total returns is 3.69% and 1.21% per year over the past 5 and 10 years. The capital gains portion of these total returns is 33.12% and 1.06% per year over the past 5 and 10 years.
There has been only a very minor change in outstanding shares over the past 5 and 10 years. Shares have increased due to stock options and have decreased due to buy backs. There has not been much in the way of growth in revenue and cash flow over the past 5 and 10 years, especially if you look at 5 year running averages. Earnings have grown fairly well, especially over the past 5 years, because 5 years ago, the company had negative earnings.
Revenue has grown by 4.05% and 0% over the past 5 and 10 years. Revenue has grown over the past 5 years as it was low 5 years ago. If you look at 5 year running averages, revenue is down about 1% per year over the past 5 years and up around 1% per year over the past 10 years.
For EPS, I do not have growth over the past 5 years as 5 years ago earnings were negative. Over the past 3 years EPS has grown at 32% per year. EPS has grown at 3.5% per year over the past 10 years. If you look at 5 year running averages, EPS has grown at 45% over the past 5 years and is down 2% per year over the past 10 years.
Cash Flow per Share has grown at 15% per year over the past 5 years and 0% over the past 10 years. If you look at 5 year running averages, CFPS has grown at 0% per year over the past 5 years and is down 2.8% per year over the past 10 years.
One problem is shown by the Operational Profit Margin (CF/Revenue) Ratio. You want this ratio to be stable or growing. It has been fluctuating, but it is down by 15% over the past 10 years. It is going in the wrong direction.
The Return on Equity has been good over the past 3 years and has been above 10%. The ROE for 2013 is 14.3%. It is expected to be 15.4% in 2014. The ROE on comprehensive income is generally better than the ROE on net income. The ROE on comprehensive income is 16.5%.
The debt ratios are all very good on this stock. The Liquidity Ratio is very high at 4.16. The Debt Ratio is 6.30. Leverage and Debt/Equity Ratios are 1.19 and 0.19. The company has little debt. This gives them the ability to survive a lot of hard times.
Analysts expect that this company will do very well in 2014. The first quarterly report for 2014 (dated December 31, 2013 as the annual reporting date is September 30 each year) seemed to be ok, but not great. Revenue, EPS and CFPS for 2013 were the highest ever reached before for this company. However, cash flow and net income were down slightly from 2012 where the highest level was reached.
This stock has great debt ratios. Analysts expect good growth over next two years. See my spreadsheet at xtc.htm.
This is the first of two parts. The second part will be posted on Tuesday, February 11, 2014 and will be available here.
Exco is a global designer, developer and manufacturer of dies, moulds, equipment, components and assemblies to the die-cast, extrusion and automotive industries. The Die Casting and Extrusion Technology groups operations are based in Canada, U.S., Mexico and Colombia and primarily serve automotive and industrial markets throughout the world. The Automotive Solutions Group has facilities are located in Canada, U.S., Mexico and Morocco and supply the North American, European and Asian markets. Its web site is here Exco.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
I do not own this stock of Exco Technologies Ltd. (TSX-XTC, OTC- EXCOF). This is a stock given as a recommendation by Keystone at the Toronto Money Show of 2012. I decided to check into it as it is a small tech company that is paying dividends. Also, I decided to review this stock because Keystone has recommended some very good stocks in the past.
This company started to pay dividends about 10 years ago in 2003. I would call it a dividend growth company as dividends have grown at 21% and 13% per year over the past 5 and 10 years. They started out with a low dividend (less than 1%) and now the dividend is around 2.4%. The 5 year median dividend yield is 3.2%. This suggests that the dividend growth into the future may not be as good as dividend growth in the past.
The Dividend Payout Ratio is good with the 5 year DPR for earnings at 29% and the 5 year DPR for cash flow at 18%. The DRP rates have fluctuated, but the DPRs for 2013 is similar to the 5 year DPR with the DPR for EPS at 30% and the DPR for cash flow at 22%.
The total return over the past 5 years is very good, but not so much over the past 10 years. The thing is 5 years ago the stock dropped a lot because of the 2000 bear market. The stock has made some capital gains, but not a lot over the years. The 5 and 10 year total return to date is 36.81% and 2.27% per year. The dividend portion of these total returns is 3.69% and 1.21% per year over the past 5 and 10 years. The capital gains portion of these total returns is 33.12% and 1.06% per year over the past 5 and 10 years.
There has been only a very minor change in outstanding shares over the past 5 and 10 years. Shares have increased due to stock options and have decreased due to buy backs. There has not been much in the way of growth in revenue and cash flow over the past 5 and 10 years, especially if you look at 5 year running averages. Earnings have grown fairly well, especially over the past 5 years, because 5 years ago, the company had negative earnings.
Revenue has grown by 4.05% and 0% over the past 5 and 10 years. Revenue has grown over the past 5 years as it was low 5 years ago. If you look at 5 year running averages, revenue is down about 1% per year over the past 5 years and up around 1% per year over the past 10 years.
For EPS, I do not have growth over the past 5 years as 5 years ago earnings were negative. Over the past 3 years EPS has grown at 32% per year. EPS has grown at 3.5% per year over the past 10 years. If you look at 5 year running averages, EPS has grown at 45% over the past 5 years and is down 2% per year over the past 10 years.
Cash Flow per Share has grown at 15% per year over the past 5 years and 0% over the past 10 years. If you look at 5 year running averages, CFPS has grown at 0% per year over the past 5 years and is down 2.8% per year over the past 10 years.
One problem is shown by the Operational Profit Margin (CF/Revenue) Ratio. You want this ratio to be stable or growing. It has been fluctuating, but it is down by 15% over the past 10 years. It is going in the wrong direction.
The Return on Equity has been good over the past 3 years and has been above 10%. The ROE for 2013 is 14.3%. It is expected to be 15.4% in 2014. The ROE on comprehensive income is generally better than the ROE on net income. The ROE on comprehensive income is 16.5%.
The debt ratios are all very good on this stock. The Liquidity Ratio is very high at 4.16. The Debt Ratio is 6.30. Leverage and Debt/Equity Ratios are 1.19 and 0.19. The company has little debt. This gives them the ability to survive a lot of hard times.
Analysts expect that this company will do very well in 2014. The first quarterly report for 2014 (dated December 31, 2013 as the annual reporting date is September 30 each year) seemed to be ok, but not great. Revenue, EPS and CFPS for 2013 were the highest ever reached before for this company. However, cash flow and net income were down slightly from 2012 where the highest level was reached.
This stock has great debt ratios. Analysts expect good growth over next two years. See my spreadsheet at xtc.htm.
This is the first of two parts. The second part will be posted on Tuesday, February 11, 2014 and will be available here.
Exco is a global designer, developer and manufacturer of dies, moulds, equipment, components and assemblies to the die-cast, extrusion and automotive industries. The Die Casting and Extrusion Technology groups operations are based in Canada, U.S., Mexico and Colombia and primarily serve automotive and industrial markets throughout the world. The Automotive Solutions Group has facilities are located in Canada, U.S., Mexico and Morocco and supply the North American, European and Asian markets. Its web site is here Exco.
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, February 7, 2014
AGF Management Ltd. 2
I do not own this stock of AGF Management Ltd. (TSX-AGF.B, OTC- AGFMF), but I used to. I bought it in 2001 and sold half in 2006 and the rest in 2008. It used to be a dividend growth stock, but has not been one for some time now. I sold because I did not see that the stock would improve any time soon. It was raising dividends still but at the expense of DPR. In 2008 I was lucky that I sold before it crashed. It has yet to recover.
When I look at insider trading, I find some $21.4M of insider selling and net insider selling at $21.4M. There is a minor amount of insider buying. Not only do insiders have options, but there are option like vehicles called Performance Share Units, Restricted Share Units and Common Shares Deferred Share Units. In 2013 389,000 shares were issued re stock options with a book value of 3.4M.
The 5 year low, median and high median Price/Earnings per Share Ratios are 11.82, 14.52 and 17.22. The current P/E Ratio is 21.51 based on EPS estimate for 2014 of $.053 and a stock price of $11.40. This stock price test says that the stock price is relatively expensive.
I get a Graham price of $11.50 and the 10 year low, median and high median Price/Graham price Ratios are 0.88, 1.17 and 1.46. The current P/GP Ratio is 0.99 based on a stock price of $11.40. This stock price test says that the stock price is relatively reasonable. However, on an absolute basis, the P/GP Ratio of 0.99 says that the stock is cheap as any P/GP Ratio of 1.00 or lower points to an undervalued stock.
I get a current Price/Book Value per Share Ratio of 1.03. The 10 year median P/B Ratio is 1.35. This stock test says that the stock price is relatively cheap. This is because the current P/B Ratio is just 72% of the 10 year Median P/B Ratio.
The 5 year median dividend yield is 8.31% and the current dividend yield 9.47%. The current dividend yield is based on the dividend of $1.08 and the current stock price of $11.40. The current dividend yield is some 14% higher than the 5 year median yield. This stock price test says that the stock price is cheap to reasonable.
When I look at analysts' recommendations, I find Buy, Hold, Underperform and Sell recommendations. The consensus recommendation would be a Hold. The 12 month stock price consensus is $12.10. This implies a total return of 15.61% with 6.14% from capital gains and 9.47% from dividends.
This stock is still on the S&P/TSX Canadian Dividend Aristocrats Index and the Dividend blogger talks about problem companies on this list, including AGF. The Guru Focus blogger talks about The High Dividend Yield Trap and includes this stock on his list of stocks to avoid.
I feel that buying this stock is bottom feeding, except it is not that cheap and I do not see that it has turned any corner. Sometimes stocks are out of favour for good reason. I started to worry about this company in 2003 and that is over 10 years ago. I sold my shares a number of years ago and I do not regret this. The shares of this company are still way below where I bought and sold this stock. If I had kept it, I would not have made any money. See my spreadsheet at agf.htm.
This is the second of two parts. The first part was posted on Thursday, February 06, 2014 and is available here.
AGF Management Limited is an integrated, global wealth management company, whose principal subsidiaries provide investment management for mutual funds, institutions and corporations, as well as high-net-worth clients; and trust products and services. They sell their products in Canada. Its web site is here AGF.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
When I look at insider trading, I find some $21.4M of insider selling and net insider selling at $21.4M. There is a minor amount of insider buying. Not only do insiders have options, but there are option like vehicles called Performance Share Units, Restricted Share Units and Common Shares Deferred Share Units. In 2013 389,000 shares were issued re stock options with a book value of 3.4M.
The 5 year low, median and high median Price/Earnings per Share Ratios are 11.82, 14.52 and 17.22. The current P/E Ratio is 21.51 based on EPS estimate for 2014 of $.053 and a stock price of $11.40. This stock price test says that the stock price is relatively expensive.
I get a Graham price of $11.50 and the 10 year low, median and high median Price/Graham price Ratios are 0.88, 1.17 and 1.46. The current P/GP Ratio is 0.99 based on a stock price of $11.40. This stock price test says that the stock price is relatively reasonable. However, on an absolute basis, the P/GP Ratio of 0.99 says that the stock is cheap as any P/GP Ratio of 1.00 or lower points to an undervalued stock.
I get a current Price/Book Value per Share Ratio of 1.03. The 10 year median P/B Ratio is 1.35. This stock test says that the stock price is relatively cheap. This is because the current P/B Ratio is just 72% of the 10 year Median P/B Ratio.
The 5 year median dividend yield is 8.31% and the current dividend yield 9.47%. The current dividend yield is based on the dividend of $1.08 and the current stock price of $11.40. The current dividend yield is some 14% higher than the 5 year median yield. This stock price test says that the stock price is cheap to reasonable.
When I look at analysts' recommendations, I find Buy, Hold, Underperform and Sell recommendations. The consensus recommendation would be a Hold. The 12 month stock price consensus is $12.10. This implies a total return of 15.61% with 6.14% from capital gains and 9.47% from dividends.
This stock is still on the S&P/TSX Canadian Dividend Aristocrats Index and the Dividend blogger talks about problem companies on this list, including AGF. The Guru Focus blogger talks about The High Dividend Yield Trap and includes this stock on his list of stocks to avoid.
I feel that buying this stock is bottom feeding, except it is not that cheap and I do not see that it has turned any corner. Sometimes stocks are out of favour for good reason. I started to worry about this company in 2003 and that is over 10 years ago. I sold my shares a number of years ago and I do not regret this. The shares of this company are still way below where I bought and sold this stock. If I had kept it, I would not have made any money. See my spreadsheet at agf.htm.
This is the second of two parts. The first part was posted on Thursday, February 06, 2014 and is available here.
AGF Management Limited is an integrated, global wealth management company, whose principal subsidiaries provide investment management for mutual funds, institutions and corporations, as well as high-net-worth clients; and trust products and services. They sell their products in Canada. Its web site is here AGF.
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, February 6, 2014
AGF Management Ltd.
I do not own this stock of AGF Management Ltd. (TSX-AGF.B, OTC- AGFMF), but I used to. I bought it in 2001 and sold half in 2006 and the rest in 2008. It used to be a dividend growth stock, but has not been one for some time now. I sold because I did not see that the stock would improve. It was raising dividends still but at the expense of DPR. In 2008 I was lucky that I sold before it crashed. It has yet to recover.
What I saw was a continuing problem with the company in that they continued to increase the dividends to the detriment of their Dividend Payout Ratios long after they should have. They have finally stopped doing dividend increases with the DPR for earnings reaching 432% in 2013. The DPR for cash flow was cash flow was also high in 2013 at 82%. However, this was not as bad as last year when the cash flow was negative.
Even though they had continued with dividend increases I must admit that they had really slowed down in the last 5 years with the dividend increase at just 2.6% per year. The 10 year increase was at 13.86% per year. This is a high rate and it takes us back to 2003, the year that I began to get concerned about this stock. I made a total return of 2.08% per year on this stock. My return was all in dividends.
The total return on this stock was fine to the end of December in 2013 for a 5 year return at 16.88% per year. Not much was made over the past 10 years with a return of 2.70% per year. The stock was looking up a bit by the end of December 2013, but has again fallen with the market.
If you look at total return over the past 5 year to day, it is slightly below negative per year. Total return to date over the past 10 years is at 1.78% per year. The 10 years to date total return includes dividends and dividends were at 6.33% per year.
Outstanding shares are down slightly per year over the past 5 and 10 years. Problem is lack of growth in revenue, earnings and cash flow. No matter how you look at the figures, the company has the problem of negative growth.
Revenue per Share is down by 7.5% and 1.6% per year over the past 5 and 10 years. Even looking at 5 year running averages, growth is basically negative with Revenue per Share down 3.7% over the past 5 years and up 0% over the past 10 years.
Looking at Earnings per Share using the 5 year running averages I get declines of 7.5% and 2% per year over the past 5 and 10 years. If you look at Earnings per share over the past 5 and 10 years there is a decline of 29% and 6% per year over the past 5 and 10 years. The fact is that earnings have declined steadily over the past 5 years.
If you look at Cash Flow per Share over the past 5 and 10 years the decrease is at 15.9% and 5.2% per year. Cash flow has been declining over the past 5 years. It was better in 2013 but that is because there was negative cash flow in 2012. If you use 5 year running averages, you do not get much different results.
Over the past 5 years, the Return on Equity was above 10% in one year only and that was in 2010. The ROE for 2013 was 2.3% and the 5 year median ROE was 7%. For the first time in a while, the ROE on comprehensive income was higher than the ROE on net income. For 2013 the ROE on comprehensive income was 3.1%. So that ROE is better, but still very low.
The Liquidity Ratios have been very, very good over the past 2 years with the 2013 ratio at 2.92. However, this is unusual for this company which has a 5 year median ratio of 0.72. The same is true for the Debt Ratio, with the 2013 ratio being at 2.48 and the 5 year median ratio at 1.32.
The Leverage and Debt/Equity Ratios for 2013 were quite good at 1.67 and 0.67. The 5 year ratios for the company are 4.06 and 3.06, respectively. Debt ratios have gone from lousy to very good. My question, of course is, will this last?
The problem with this company is no growth. See my spreadsheet at agf.htm.
This is the first of two parts. The second part will be posted on Friday, February 7, 2014 and will be available here.
AGF Management Limited is an integrated, global wealth management company, whose principal subsidiaries provide investment management for mutual funds, institutions and corporations, as well as high-net-worth clients; and trust products and services. They sell their products in Canada. Its web site is here AGF.
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.
What I saw was a continuing problem with the company in that they continued to increase the dividends to the detriment of their Dividend Payout Ratios long after they should have. They have finally stopped doing dividend increases with the DPR for earnings reaching 432% in 2013. The DPR for cash flow was cash flow was also high in 2013 at 82%. However, this was not as bad as last year when the cash flow was negative.
Even though they had continued with dividend increases I must admit that they had really slowed down in the last 5 years with the dividend increase at just 2.6% per year. The 10 year increase was at 13.86% per year. This is a high rate and it takes us back to 2003, the year that I began to get concerned about this stock. I made a total return of 2.08% per year on this stock. My return was all in dividends.
The total return on this stock was fine to the end of December in 2013 for a 5 year return at 16.88% per year. Not much was made over the past 10 years with a return of 2.70% per year. The stock was looking up a bit by the end of December 2013, but has again fallen with the market.
If you look at total return over the past 5 year to day, it is slightly below negative per year. Total return to date over the past 10 years is at 1.78% per year. The 10 years to date total return includes dividends and dividends were at 6.33% per year.
Outstanding shares are down slightly per year over the past 5 and 10 years. Problem is lack of growth in revenue, earnings and cash flow. No matter how you look at the figures, the company has the problem of negative growth.
Revenue per Share is down by 7.5% and 1.6% per year over the past 5 and 10 years. Even looking at 5 year running averages, growth is basically negative with Revenue per Share down 3.7% over the past 5 years and up 0% over the past 10 years.
Looking at Earnings per Share using the 5 year running averages I get declines of 7.5% and 2% per year over the past 5 and 10 years. If you look at Earnings per share over the past 5 and 10 years there is a decline of 29% and 6% per year over the past 5 and 10 years. The fact is that earnings have declined steadily over the past 5 years.
If you look at Cash Flow per Share over the past 5 and 10 years the decrease is at 15.9% and 5.2% per year. Cash flow has been declining over the past 5 years. It was better in 2013 but that is because there was negative cash flow in 2012. If you use 5 year running averages, you do not get much different results.
Over the past 5 years, the Return on Equity was above 10% in one year only and that was in 2010. The ROE for 2013 was 2.3% and the 5 year median ROE was 7%. For the first time in a while, the ROE on comprehensive income was higher than the ROE on net income. For 2013 the ROE on comprehensive income was 3.1%. So that ROE is better, but still very low.
The Liquidity Ratios have been very, very good over the past 2 years with the 2013 ratio at 2.92. However, this is unusual for this company which has a 5 year median ratio of 0.72. The same is true for the Debt Ratio, with the 2013 ratio being at 2.48 and the 5 year median ratio at 1.32.
The Leverage and Debt/Equity Ratios for 2013 were quite good at 1.67 and 0.67. The 5 year ratios for the company are 4.06 and 3.06, respectively. Debt ratios have gone from lousy to very good. My question, of course is, will this last?
The problem with this company is no growth. See my spreadsheet at agf.htm.
This is the first of two parts. The second part will be posted on Friday, February 7, 2014 and will be available here.
AGF Management Limited is an integrated, global wealth management company, whose principal subsidiaries provide investment management for mutual funds, institutions and corporations, as well as high-net-worth clients; and trust products and services. They sell their products in Canada. Its web site is here AGF.
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, February 5, 2014
Shaw Communications Inc. 2
On my other blog I am today writing about Capital Gains..continue...
I do not own this stock of Shaw Communications Inc. (TSX-SJR.B, NYSE-SJR). It was a stock on Investment Reporter list (MPL Communications Publication).
Looking at the insider trading report, I find $14M of insider selling and net insider selling at $13.8M with a small amount of insider buying at $0.2M. Over the past month, directors seem to be retaining their Directors' Deferred Share Units. Besides options, insiders have Restricted Share Units and Directors' Deferred Share Units, which are option like vehicles.
The 5 year low, median and high median Price/Earnings per Share Ratios are 14.06, 16.52 and 17.90. The current P/E Ratio is 13.92 based on a stock price of $24.36 and 2014 earnings estimates of $1.75. This stock test says that the stock is cheap.
I get a Graham Price of $18.73. The 10 year low, median and high median Price/Graham price Ratios are 1.38, 1.61 and 1.87. On a relative basis this stock test says that the stock price is cheap. On an absolute basis, the P/GP Ratio would have to be 1.00 or lower for the stock price to be cheap.
The 10 year median Price/Book Value per Share Ratio is 3.20. The current P/B Ratio is 2.73 based on a stock price of $24.36 and a Book Value per Share of $8.91. The current P/B Ratio is 86% of the 10 year median P/B Ratio. This stock test says that the stock price is reasonable. For the stock price to be considered to be cheap, the current P/B Ratio would have to be just 80% of the 10 year median P/B Ratio.
The 5 year median Dividend Yield is 4.23% and the current dividend yield is some 6.7% higher at 4.52%. This stock test shows that the stock price is reasonable. For the stock price is to be cheap by this test, the current dividend yield would have to be 20% higher than the 5 year median dividend yield.
On a historical dividend yield basis, the average dividend yield is 2.43% a value some 86% lower than the current dividend yield and this suggests that the stock price is cheap. However, dividend yields were started off in a very low range and they were increased over time to take up a higher percentage of the earnings and cash flow. I would wonder how good this test is in light of this fact.
My stock tests show that the current stock price of $24.36 is relatively cheap to reasonable. Analysts expect that this company will do very well in 2014 as far as revenue, earnings and cash flow go. Certainly the first quarterly report for 2014 of November 2013 has these values going in the right direction, but not as strongly as expected yet.
For example, analysts expect that EPS will climb some 7.4% in 2014. If you look at year over year ending in August 2013 and November 2013, EPS is up but by only 0.8%. Cash Flow per Share is expected to climb by 150% in 2014, but if you look at year over year ending in August 2013 and November 2013 Cash Flow per Share is up by 28%. We can say that revenue, earnings and cash flow are heading in the right direction.
This stock was analyzed by the Dividend Growth Investing & Retirement blogger in May 2013 and he gives an overall positive take on this stock. He also did another review of this stock two days later and it is here. The blogger Canadian Miser named this stock as one of the op 10 Undervalued Dividend Paying Stocks on January 30, 2014. The blogger Insider Monkey says that hedge fund holdings of this stock dropped 17% in the first part of 2013.
When I look at analysts' recommendations, I find Buy, Hold, Underperform and Sell recommendations. The consensus recommendation would be a Hold. The 12 month stock price is $25.10. This implies a total return of 7.55% with 3.04% from capital gains and 4.52% from dividends.
My stock testing shows that the stock price is relatively cheap to reasonable. However, I do wonder about the future of the communications industry and the effects of future technological changes on this sector. To me the risks associated with communications stocks concerning future tech changes is high and I wonder if this stock is cheap enough to make the risk of buying it enough. See my spreadsheet at sjr.htm.
This is the second of two parts. The first part was posted on Tuesday, February 4, 2014 and is available here.
Shaw Communications Inc. is a diversified communications company whose core business is providing broadband cable television, Internet, digital phone and satellite direct-to-home services. Industry: Communications & Media (Cable). SJR.B shares are non-voting and the SJR.A shares are voting shares. Its web site is here Shaw Communications.
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 Shaw Communications Inc. (TSX-SJR.B, NYSE-SJR). It was a stock on Investment Reporter list (MPL Communications Publication).
Looking at the insider trading report, I find $14M of insider selling and net insider selling at $13.8M with a small amount of insider buying at $0.2M. Over the past month, directors seem to be retaining their Directors' Deferred Share Units. Besides options, insiders have Restricted Share Units and Directors' Deferred Share Units, which are option like vehicles.
The 5 year low, median and high median Price/Earnings per Share Ratios are 14.06, 16.52 and 17.90. The current P/E Ratio is 13.92 based on a stock price of $24.36 and 2014 earnings estimates of $1.75. This stock test says that the stock is cheap.
I get a Graham Price of $18.73. The 10 year low, median and high median Price/Graham price Ratios are 1.38, 1.61 and 1.87. On a relative basis this stock test says that the stock price is cheap. On an absolute basis, the P/GP Ratio would have to be 1.00 or lower for the stock price to be cheap.
The 10 year median Price/Book Value per Share Ratio is 3.20. The current P/B Ratio is 2.73 based on a stock price of $24.36 and a Book Value per Share of $8.91. The current P/B Ratio is 86% of the 10 year median P/B Ratio. This stock test says that the stock price is reasonable. For the stock price to be considered to be cheap, the current P/B Ratio would have to be just 80% of the 10 year median P/B Ratio.
The 5 year median Dividend Yield is 4.23% and the current dividend yield is some 6.7% higher at 4.52%. This stock test shows that the stock price is reasonable. For the stock price is to be cheap by this test, the current dividend yield would have to be 20% higher than the 5 year median dividend yield.
On a historical dividend yield basis, the average dividend yield is 2.43% a value some 86% lower than the current dividend yield and this suggests that the stock price is cheap. However, dividend yields were started off in a very low range and they were increased over time to take up a higher percentage of the earnings and cash flow. I would wonder how good this test is in light of this fact.
My stock tests show that the current stock price of $24.36 is relatively cheap to reasonable. Analysts expect that this company will do very well in 2014 as far as revenue, earnings and cash flow go. Certainly the first quarterly report for 2014 of November 2013 has these values going in the right direction, but not as strongly as expected yet.
For example, analysts expect that EPS will climb some 7.4% in 2014. If you look at year over year ending in August 2013 and November 2013, EPS is up but by only 0.8%. Cash Flow per Share is expected to climb by 150% in 2014, but if you look at year over year ending in August 2013 and November 2013 Cash Flow per Share is up by 28%. We can say that revenue, earnings and cash flow are heading in the right direction.
This stock was analyzed by the Dividend Growth Investing & Retirement blogger in May 2013 and he gives an overall positive take on this stock. He also did another review of this stock two days later and it is here. The blogger Canadian Miser named this stock as one of the op 10 Undervalued Dividend Paying Stocks on January 30, 2014. The blogger Insider Monkey says that hedge fund holdings of this stock dropped 17% in the first part of 2013.
When I look at analysts' recommendations, I find Buy, Hold, Underperform and Sell recommendations. The consensus recommendation would be a Hold. The 12 month stock price is $25.10. This implies a total return of 7.55% with 3.04% from capital gains and 4.52% from dividends.
My stock testing shows that the stock price is relatively cheap to reasonable. However, I do wonder about the future of the communications industry and the effects of future technological changes on this sector. To me the risks associated with communications stocks concerning future tech changes is high and I wonder if this stock is cheap enough to make the risk of buying it enough. See my spreadsheet at sjr.htm.
This is the second of two parts. The first part was posted on Tuesday, February 4, 2014 and is available here.
Shaw Communications Inc. is a diversified communications company whose core business is providing broadband cable television, Internet, digital phone and satellite direct-to-home services. Industry: Communications & Media (Cable). SJR.B shares are non-voting and the SJR.A shares are voting shares. Its web site is here Shaw Communications.
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, February 4, 2014
Shaw Communications Inc.
I do not own this stock of Shaw Communications Inc. (TSX-SJR.B, NYSE-SJR). It was a stock on Investment Reporter list (MPL Communications Publication).
The dividends have increased by 7% and 44.5% per year over the past 5 and 10 years. The big increase over the last 10 years was probably deliberate as the company started off paying very low dividends and then did some big increases that increased the portion of profits that they paid out. The last dividend increase was for 7.8% in 2014.
Dividends in the future will probably close to the 5 year growth in dividends. The 5 year Dividend Payout Ratios are 66% for EPS and 27% for CFPS. The DRPs for 2013 was at 61% for EPS and 33% for CFPS. I doubt that they will be doing anymore big dividend increases from now on. They have a very good dividend which has a yield of 4.45%
The Total Return over the past 5 and 10 years has been at 6.56% and 12.44% per year for the past 5 and 10 years. The dividend portion of these returns is at 4.19% and 4.14% per year, respectively. The capital gains portion of these returns is at 2.37% and 8.3% per year, respectively.
Outstanding shares have increased by 1% per year over the past 5 years and are down slightly over the past 10 years. Shares have increased due to Stock Options, DRIPs and Share Issues. Shares have decreased due to Buy Backs. Growth in Revenues and Earnings has been mostly quite good over the past 5 and 10 years. Growth in Cash Flow, not so good.
Revenue per Share has grown at 9.4% and 10.17% per year over the past 5 and 10 years. The EPS has grown by 1% and 35% per year over the past 5 and 9 years. However, if you look at 5 year running averages, the EPS has grown by 11.4% and 41.6% per year over the past 5 and 7 years. The problem with earnings is that 10 years ago the company had an earnings loss, so I cannot calculate growth from 10 years ago.
Cash Flow per Share has grown by 1.3% and 10% per year over the past 5 and 10 years. If you look at 5 year running averages, the CFPS has grown by 8.4% and 16% per year over the past 5 and 10 years. The problem with cash flow is that there is good growth until 5 years ago and there has not been much growth in the last 5 years.
It is only in the last 8 years that the Return on Equity has been above 10%. Before that, ROE was quite low. The 5 year median ROE is 18.9% and the ROE for 2013 is 17.8%. The ROE on comprehensive income is quite close with the ROE for 2013 at 17.9% and the 5 year median ROE at 17.9% also.
One thing that I do not like with this stock is the Liquidity Ratio and it has been low. The Liquidity Ratio for 2013 is at 0.54. This means that the current assets cannot cover the current liabilities. If you add in cash flow after dividends the ratio becomes only 0.96. If you take off the current portion of the long term debt, then the Liquidity Ratio is 0.96 and if you use the cash flow after dividends it is 1.68.
In either case, the company depends on cash flow to cover current liabilities. Maybe not so good when cash flow is flatting. You can see this in the Operational Profit Margin (CF/Revenue) Ratio which has declined by almost 35% over the past 5 years. What you want is for the OPM to be stable or increase. A decrease is not a good sign.
The Debt Ratio is mediocre and has always been. The current Debt Ratio is 1.53 which I fine but the 5 year median Debt Ratio is 1.39. The current Leverage and Debt/Equity Ratios are currently lower than what they have been and are fine at 2.76 and 1.76 currently. The 10 year median ratios are at 3.64 and 2.64, respectively.
Analysts expect the cash flow to increase substantially in 2014 by some 150%. The first quarter shows some sign of a good increase with the Year over Year increase at 28% when looking at the 12 month period to August 2013 and the 12 months period to November 2013.
The debt ratios are rather normal for this sort of company, but generally, when companies are largely owned by an individual or family, the debt ratios are better than normal. This is not true in this case where there two levels of shares of Class B shares which are non-voting and the Class A shares which are voting shares. The Shaw family owns most of the Class A shares.
Communications companies are no longer the widow and orphan stocks that they used to be when I started investing. I still have some BCE (TSX-BCE) that I bought in the 1980's, and I have done quite well with it over the years. I also have Manitoba Telecom (TSX-MBT) which I bought in 2006 and I consider this a big mistake.
With changes in technology, you have to wonder how well these companies are going to hold up in the future. They are not a part of the market that I am currently interested in. See my spreadsheet at sjr.htm.
This is the first of two parts. The second part will be posted on Wednesday, February 5, 2014 and will be available here.
Shaw Communications Inc. is a diversified communications company whose core business is providing broadband cable television, Internet, digital phone and satellite direct-to-home services. Industry: Communications & Media (Cable). SJR.B shares are non-voting and the SJR.A shares are voting shares. Its web site is here Shaw Communications.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
The dividends have increased by 7% and 44.5% per year over the past 5 and 10 years. The big increase over the last 10 years was probably deliberate as the company started off paying very low dividends and then did some big increases that increased the portion of profits that they paid out. The last dividend increase was for 7.8% in 2014.
Dividends in the future will probably close to the 5 year growth in dividends. The 5 year Dividend Payout Ratios are 66% for EPS and 27% for CFPS. The DRPs for 2013 was at 61% for EPS and 33% for CFPS. I doubt that they will be doing anymore big dividend increases from now on. They have a very good dividend which has a yield of 4.45%
The Total Return over the past 5 and 10 years has been at 6.56% and 12.44% per year for the past 5 and 10 years. The dividend portion of these returns is at 4.19% and 4.14% per year, respectively. The capital gains portion of these returns is at 2.37% and 8.3% per year, respectively.
Outstanding shares have increased by 1% per year over the past 5 years and are down slightly over the past 10 years. Shares have increased due to Stock Options, DRIPs and Share Issues. Shares have decreased due to Buy Backs. Growth in Revenues and Earnings has been mostly quite good over the past 5 and 10 years. Growth in Cash Flow, not so good.
Revenue per Share has grown at 9.4% and 10.17% per year over the past 5 and 10 years. The EPS has grown by 1% and 35% per year over the past 5 and 9 years. However, if you look at 5 year running averages, the EPS has grown by 11.4% and 41.6% per year over the past 5 and 7 years. The problem with earnings is that 10 years ago the company had an earnings loss, so I cannot calculate growth from 10 years ago.
Cash Flow per Share has grown by 1.3% and 10% per year over the past 5 and 10 years. If you look at 5 year running averages, the CFPS has grown by 8.4% and 16% per year over the past 5 and 10 years. The problem with cash flow is that there is good growth until 5 years ago and there has not been much growth in the last 5 years.
It is only in the last 8 years that the Return on Equity has been above 10%. Before that, ROE was quite low. The 5 year median ROE is 18.9% and the ROE for 2013 is 17.8%. The ROE on comprehensive income is quite close with the ROE for 2013 at 17.9% and the 5 year median ROE at 17.9% also.
One thing that I do not like with this stock is the Liquidity Ratio and it has been low. The Liquidity Ratio for 2013 is at 0.54. This means that the current assets cannot cover the current liabilities. If you add in cash flow after dividends the ratio becomes only 0.96. If you take off the current portion of the long term debt, then the Liquidity Ratio is 0.96 and if you use the cash flow after dividends it is 1.68.
In either case, the company depends on cash flow to cover current liabilities. Maybe not so good when cash flow is flatting. You can see this in the Operational Profit Margin (CF/Revenue) Ratio which has declined by almost 35% over the past 5 years. What you want is for the OPM to be stable or increase. A decrease is not a good sign.
The Debt Ratio is mediocre and has always been. The current Debt Ratio is 1.53 which I fine but the 5 year median Debt Ratio is 1.39. The current Leverage and Debt/Equity Ratios are currently lower than what they have been and are fine at 2.76 and 1.76 currently. The 10 year median ratios are at 3.64 and 2.64, respectively.
Analysts expect the cash flow to increase substantially in 2014 by some 150%. The first quarter shows some sign of a good increase with the Year over Year increase at 28% when looking at the 12 month period to August 2013 and the 12 months period to November 2013.
The debt ratios are rather normal for this sort of company, but generally, when companies are largely owned by an individual or family, the debt ratios are better than normal. This is not true in this case where there two levels of shares of Class B shares which are non-voting and the Class A shares which are voting shares. The Shaw family owns most of the Class A shares.
Communications companies are no longer the widow and orphan stocks that they used to be when I started investing. I still have some BCE (TSX-BCE) that I bought in the 1980's, and I have done quite well with it over the years. I also have Manitoba Telecom (TSX-MBT) which I bought in 2006 and I consider this a big mistake.
With changes in technology, you have to wonder how well these companies are going to hold up in the future. They are not a part of the market that I am currently interested in. See my spreadsheet at sjr.htm.
This is the first of two parts. The second part will be posted on Wednesday, February 5, 2014 and will be available here.
Shaw Communications Inc. is a diversified communications company whose core business is providing broadband cable television, Internet, digital phone and satellite direct-to-home services. Industry: Communications & Media (Cable). SJR.B shares are non-voting and the SJR.A shares are voting shares. Its web site is here Shaw Communications.
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, February 3, 2014
Valener Inc.
On my other blog I am today writing about Monkeys Vs Fund Managers in index investing..continue...
I do not own this stock of Valener Inc. (TSX-VNR, OTC-VNRCF). I was looking for another utility to invest in, in 2009 and I was looking possibly at another pipeline stock. This company has natural gas pipelines in Quebec. I also recognized the name of this company because at that time it was Gaz Metro.
This company was not so bad when I first looked in 2009, but in 2010 it reorganized and made a public utility stock out of 29% of what was Gas Metro. This makes the valuation of this stock very complex. Not only do you have to look at Valener Inc. financial statements, but you have to also consider Gaz Metro's financial statements. Otherwise you might not get the whole story.
An example is debt ratios. The Liquidity Ratio for Valener is 1.16 for the 2013 financial year. This is low, but acceptable. However, the Liquidity Ratio for Gaz Metro is at 0.84. This means that the current assets cannot cover the current liabilities and this is unacceptable. The same problem is with the Debt Ratio where by the one for Valener is extremely high (and good) at 7.65 and the one for Gaz Metro is very low at 1.35.
The other complication is when Valener was spun off for private investors. It was 29% of the original company investors had invested in. This was done in 2010. It makes it very difficult to see how well this company has done over time. I generally do not invest in companies that are difficult to analyze. It is too easy to miss something important.
Dividends are not growing on this company. In fact the dividends are down by 4.2% and 2.9% per year over the past 5 and 10 years. I have dividend information going back to 1993 and dividends have fluctuated over this time. Currently they have been level since their last decline in 2011. I do not see them changing anytime soon as the Dividend Payout Ratio for earnings is just over 100%.
Return on Equity for Valener is at 5.9% a low number. However, the ROE for Gaz Metro is at much better number of 12.4%. In both cases the ROE on comprehensive income is better with the ROE on Valener at 8.7% and the ROE on Gaz Metro at 15.5%.
When I look at analysts' recommendations, I find Hold and Underperform recommendations. The consensus recommendation would be a Hold. The consensus 12 month target stock price is $16.50. This implies a total return of 8.28% with 6.52% from dividends and 1.76% from capital gain.
The 5 year median dividend yield is 6.56% and the current dividend yield at 6.52% is just below it. This stock test says that the stock price is reasonable. If you look at an historical median dividend yield, the current yield at 6.52% is some 11.5% lower than an historical yield at 7.37%. On this basis the stock price is getting expensive.
The 10 year Price/Book Value per Share Ratio is 2.01 and the current P/B Ratio is just 0.96. The current ratio is only48% of the 10 year P/B Ratio and this test says the stock is cheap. However, if you look at the share of the book value that Valener owns in Gaz Metro, the BVPS is much lower at $10.78 rather than the $15.89 value given for Valener shares in Valener's statements. However, even with the lower BVPS, the current P/B Ratio would be 1.42 and only 70% of the 10 year P/B Ratio and therefor still shows a cheap price.
I would not invest as the stock is too complex to evaluate. Also, I like dividend growth stocks and this is not one. The stock price seems to be cheap to reasonable on some basis and expensive on a more historical another basis. See my spreadsheet at vnr.htm.
Valener owns 29% of Gaz Metro and also has investments (i.e. Vermont Gas Systems & Green Mountain Power). Gaz Metro is Quebec's leading natural gas distributor. Its web site is here Valener.
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 Valener Inc. (TSX-VNR, OTC-VNRCF). I was looking for another utility to invest in, in 2009 and I was looking possibly at another pipeline stock. This company has natural gas pipelines in Quebec. I also recognized the name of this company because at that time it was Gaz Metro.
This company was not so bad when I first looked in 2009, but in 2010 it reorganized and made a public utility stock out of 29% of what was Gas Metro. This makes the valuation of this stock very complex. Not only do you have to look at Valener Inc. financial statements, but you have to also consider Gaz Metro's financial statements. Otherwise you might not get the whole story.
An example is debt ratios. The Liquidity Ratio for Valener is 1.16 for the 2013 financial year. This is low, but acceptable. However, the Liquidity Ratio for Gaz Metro is at 0.84. This means that the current assets cannot cover the current liabilities and this is unacceptable. The same problem is with the Debt Ratio where by the one for Valener is extremely high (and good) at 7.65 and the one for Gaz Metro is very low at 1.35.
The other complication is when Valener was spun off for private investors. It was 29% of the original company investors had invested in. This was done in 2010. It makes it very difficult to see how well this company has done over time. I generally do not invest in companies that are difficult to analyze. It is too easy to miss something important.
Dividends are not growing on this company. In fact the dividends are down by 4.2% and 2.9% per year over the past 5 and 10 years. I have dividend information going back to 1993 and dividends have fluctuated over this time. Currently they have been level since their last decline in 2011. I do not see them changing anytime soon as the Dividend Payout Ratio for earnings is just over 100%.
Return on Equity for Valener is at 5.9% a low number. However, the ROE for Gaz Metro is at much better number of 12.4%. In both cases the ROE on comprehensive income is better with the ROE on Valener at 8.7% and the ROE on Gaz Metro at 15.5%.
When I look at analysts' recommendations, I find Hold and Underperform recommendations. The consensus recommendation would be a Hold. The consensus 12 month target stock price is $16.50. This implies a total return of 8.28% with 6.52% from dividends and 1.76% from capital gain.
The 5 year median dividend yield is 6.56% and the current dividend yield at 6.52% is just below it. This stock test says that the stock price is reasonable. If you look at an historical median dividend yield, the current yield at 6.52% is some 11.5% lower than an historical yield at 7.37%. On this basis the stock price is getting expensive.
The 10 year Price/Book Value per Share Ratio is 2.01 and the current P/B Ratio is just 0.96. The current ratio is only48% of the 10 year P/B Ratio and this test says the stock is cheap. However, if you look at the share of the book value that Valener owns in Gaz Metro, the BVPS is much lower at $10.78 rather than the $15.89 value given for Valener shares in Valener's statements. However, even with the lower BVPS, the current P/B Ratio would be 1.42 and only 70% of the 10 year P/B Ratio and therefor still shows a cheap price.
I would not invest as the stock is too complex to evaluate. Also, I like dividend growth stocks and this is not one. The stock price seems to be cheap to reasonable on some basis and expensive on a more historical another basis. See my spreadsheet at vnr.htm.
Valener owns 29% of Gaz Metro and also has investments (i.e. Vermont Gas Systems & Green Mountain Power). Gaz Metro is Quebec's leading natural gas distributor. Its web site is here Valener.
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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