Pulse Seismic Inc.

I do not own this stock of Pulse Seismic Inc. (TSX-PSD, OTC-PLSDF). I wanted to invest some extra money in a dividend paying small cap. I went to the Globe and Mail site of G&M and from Globe Investor section I selected the Stock Filter. I asked for companies that were worth between $1 and $5.50 and had a yield between 4% and 20%. Pulse Seismic Inc. was one of the companies that were returned. This is not a stock I chose to invest in but I found it of interest so I am following it.

The dividends on this stock have jumped around a bit. They were at first increasing them, but when they stopped earning money after 2008, dividends were cancelled for 2009 and 2010. Dividends were restarted in 2011 and they were increased in 2012 and 2013. So far in 2014 they have remained flat. The dividends are up by 5.4% per year over the past 10 years, but down by 16.7% per year over the past 5 years.

I do not think dividends will increase in 2014 as they did not have positive earnings in 2013 and it is not expected that earnings for 2014 will cover the current dividend. As for Dividend Payout Ratio I cannot get a fix on this over the last few years as the DPR for EPS is sometimes negative. The 5 year median DPR for CFPS is just 4.2% because some years no dividends were paid. The DPR for CFPS for 2013 is 19%.

Investors have been making money with 5 and 10 year total return at 22.52% and 10.11% per year. The portion of this return attributable to dividends was at 2.48% and 4.20% per year over these periods. The portion of this return attributable to capital gain was at 20.03% and 5.91% per year over these periods.

Outstanding shares have been increasing somewhat over the past 5 and 10 years at2.1% and 3.9% per year. Shares have increased due to Stock Options and Share Issues and have decreased due to Buy Backs. There has been no growth in revenue, earnings or cash flows and mainly because all these dropped in the 2013 financial year.

Revenue per Share is down by 4.2% and is flat over the past 5 and 10 years using 5 year running averages. EPS is down by 2.6% and by 16.9% per year over the past 5 and 10 years using the 5 year running averages. The CFPS is down by 1.3% and is flat over the past 5 and 10 years using 5 year running averages.

Return on Equity has been all over the place but has only been at or above 10% 2 years in the past 10 years. In 2012 it was 28% and 2014 it was negative 28%. There is no difference in comprehensive income and net income.

The Liquidity Ratio is generally good with a ratio at 3.71 in 2013 and it has a 5 year median of 1.38 a so, so value. The Debt Ratio is good with a value of 3.06 and a 5 year median value of 2.47. The Leverage and Debt/Equity Ratios are quite good at 1.49 and 0.49.

I cannot test the stock price via the Price/EPS Ratios as some P/E Ratios are negative due to negative earnings. The Graham Price is all over the place and so is not a good candidate either.

The 10 year median Price/Book Value per Share is 1.52. The current P/B Ratio is 2.92 a value some 92% higher and this stock price test suggests that the stock price is relatively expensive.

The 3 year median dividend yield is 2.14% and the current dividend yield at 2.59% is some 20% higher and suggests that the stock price is relatively cheap. However, the historical average dividend is higher at 3.83% and the historical median dividend yield is 3.26%, both of which is a lot higher than the current dividend yield and suggests that the stock price is relatively expensive.

The 10 year Price/Sales Ratio is 2.60 and the current P/S Ratio is 5.17 a value some 99% higher and this stock price test suggests that the stock price is relatively expensive.

When I look at analysts' recommendations I find only Hold recommendations, so the consensus recommendation would be a Hold. The 12 month stock price consensus is $3.38. This implies a total return of 11.97% with 9.39% from capital gains and 2.59% from dividends. This stock hit a high of $4.17 in December 2013 and has been tracking lower ever since.

The site of Watch List News talks about Paradigm Capital upgrading this stock from a sell to a hold rating. There is a very interesting review of this company on the Punch Card Blog. This entry is from November 2013, but it discusses the company's business model and what it says applies to today also.

Sound bit for Twitter and StockTwits is: Interesting company, but currently expensive. See my spreadsheet at hse.htm.

I will have only one entry for this stock as I must do on some stock because I cover too many stocks to do double entries on all that I follow.

Pulse Data Inc. is a provider of 2D and 3D seismic library data and is based in Calgary, Alberta. Pulse owns the second-largest licensable seismic data library in western Canada. Pulse's 2D and 3D seismic data library extends over the Western Canada Sedimentary Basin, plus selected areas of the U.S. Rocky Mountains region and northern Canada, with a particular focus on active exploration areas. Its web site is here Pulse Seismic.

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.

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