I do not own this stock of Alimentation Couche-Tard Inc. (TSX-ATD.B, OTC-ANCUF), but I used to. In 2004 I bought this stock as it has a good reputation and my spreadsheet showed I should do well with it. I bought more of this stock in 2006 as it had started to pay a dividend. I sold the stock in my trading account in 2007 as I was raising mortgage money and this stock had gone down so was cheap, tax wise, to sell. In 2013, I sold the stock in my Pension account as it had the lowest dividend yield and I had to raise money in this account because of yearly withdrawals.
This stock started to pay a dividend 2006. The dividend yield is very low, with current dividend at 0.49% and the 5 year median dividend at 0.80%. The dividend growth is quite good at 21% and 18.6% per year over the past 5 and 7 years.
Because of the low dividend yield it would take quite a while to reach a decent yield on an original investment. With the current dividend yield and dividends increasing at 20% per year, after 10 years the yield on an investment today would only be 3%. After 20 years, the yield on an investment today would be paying a yield of 18.7%. I generally do not buy stock which has a dividend yield below 1%.
The dividend payout ratios are very low. The 5 year median DPR for EPS is at 9.6% and for CFPS is at 5.1%. The DPR for the financial year ending in April 2014 was 7.7% for EPS and 4.7% for CFPS.
Over all this company produced a total return of 15.28% per year for me. The portion of this total return attributable to dividends was 0.52% per year and the portion attributable to capital gain was 14.76% per year. Over the past 5 and 10 years the total return for shareholders has been 37.24% and 19.20% per year. The portion of this total return attributable to dividends was 0.79% and .48% per year over these periods. The portion of this total return attributable to capital gain was 36.45% and 18.72% per year over these periods.
The number of outstanding shares has not changed over the past 5 and 10 years. Shares have increased due to Stock Options and Share Issues and they have decreased due to Buy Backs. There have also been some conversions of Class A shares into Class B shares. There has been great growth in Revenue, Earnings and Cash Flow. Since 2006, this company has been reporting in US$ and growth has been better in US$ terms than in CDN$ terms.
Revenue per Share is up by 17.3% and 22.3% per year over the past 5 and 10 years in CDN$ terms. Revenue per Share is up by 19.1% and 24.9% per year over the past 5 and 10 years in US$ terms.
Earnings are up by 25.3% and 27.3% per year over the past 5 and 10 years in CDN$ terms. Cash Flow per Share is up by 20.8% and 25.6% per year over the past 5 and 10 years in CDN$ terms.
The Return on Equity has been over 10% each year over the past 10 years. The ROE for the financial year ending in April 2014 was at 20.4% and the 5 year median ROE is at 19.1%. The ROE on comprehensive income for the financial year ending in April 214 was 20.4% and the 5 year median ROE is 21.2%.
The debt ratios are fine. The current Liquidity Ratio is 1.21. However, if you add in cash flow after dividends it is 1.72. The current Debt Ratio is 1.61. The current Leverage and Debt/Equity Ratios are 2.65 and 1.65.
Sound bit for Twitter and StockTwits is: Dividend Growth Stock, Low Yield. Currently I have no plans to buy any of this stock, but I will continue to track it as it is a Dividend Growth Stock and I might be interested in it in the future. See my spreadsheet at atd.htm.
This is the first of two parts. The second part will be posted on Friday, August 29, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
Couche-Tard is the largest convenience store operator in North America with over 4,600 company-operated stores. In Europe, with over 1,600 company-operated sites, Couche-Tard is a leader in c-store and road transportation fuel in Scandinavian and the Baltic States, with a growing presence in Poland. Its web site is here Alimentation Couche-Tard.
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.
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