I do not own this stock of Johnson and Johnson (NYSE-JNJ). As Canadians, we are told we should be buying US stocks for our portfolio. It is often recommended that we have at least 25% of our portfolio in US stocks. I have never followed this, although I have tried dipping into the US market, but I have never made any money there.
When I look at insider trading, I find some $5.9M of insider selling and no insider buying over the past 12 months. This many seem like a lot, but in relation to the market cap of this stock, it is extremely small. There is some insider ownership with the CEO owing stock worth around $7.2M and the CFO owing stock around $5.7M. Although here again in relationship to market cap, these are very small amounts.
The 5 year low, median and high median Price/Earnings per Share Ratios are 14.73, 17.27 and 18.79. The 10 year corresponding P/E Ratios are similar at 15.79, 17.36 and 18.82. The current P/E Ratio is 18.49 based on a stock price of $107.21 and 2014 earnings estimate of $5.80. This P/E is still within a reasonable range, but at the very top end.
This company also puts out an Adjusted EPS value. Analysts seem to pick up this Adj. EPS as a valid number. The 5 year low, median and high median P/E Ratios for this EPS value are lower at 12.52, 14.50 and 16.12. The 10 year values are similar at11.98, 12.93 and 14.03. The current P/E Ratio for Adj. EPS is 18.30 based on a stock price of $107.21 and 2014 earnings of $5.86. This stock price test suggests that the stock is expensive. Even if you look at 2015 earnings estimate, which is $6.12, the P/E is still too high at 17.52.
I get a Graham price of $56.59. The 10 year low, median and high median Price/Graham Price ratios are 1.44, 1.62 and 1.84. The current P/GP Ratio is 1.89 based on a stock price of $107.21. This stock price tests suggests that the stock price is expensive.
The 10 year Price/Book Value per Share Ratio is 3.88. The current P/B Ratio is 4.37 a value some 12.5% higher. The current P/B Ratio is based on a stock price of $107.21 and BVPS of $24.55. This stock price test suggests that the stock price is still within a reasonable range.
The 5 year dividend yield is 3.46%. The current dividend yield is 2.61%, a value some 25% lower. This is based on a dividend of $2.80 and a stock price of $107.21. This stock price tests suggests that the stock price is expensive. However, if you look at the historical average and median dividend yields, which are at 2.36% and 2.05%, you get a different story. These yields are 11% and 27% lower than the current dividend yield and suggest that the stock price is relatively lower than the historical average or median levels.
When I look at the analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. Most of the recommendations are a Hold, but the consensus would be a Buy recommendation. The 12 month stock price consensus is $108.00. This implies a total return of 3.35% with 2.61% from dividends and 0.74% from capital gains. (See my blog for information on analyst ratings .)
There is an interesting article in Business Insider about JNJ suing Boston Scientific for $5B. An recent article on Nasdaq talked about JNJ being the stock of the week. The Legacy site says that Jacks is giving JNJ a neutral rating and target price of $113.00. (Neutral rating is same as market perform or hold rating.)
Sound bit for Twitter and StockTwits is: Historical dividend yield says price is reasonable. On a lot of levels the stock price seems slightly expensive. However, on an historical dividend yield basis is coming out as reasonable. It is interesting that the consensus recommendation is a Buy, but the consensus stock price is not much above the current stock price. See my spreadsheet at jnj.htm.
This is the second of two parts. The first part was posted on Thursday, November 27, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
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.
Johnson & Johnson is engaged in the manufacture and sale of a broad range of products in the health care field in many countries of the world. The company's worldwide business is divided into three segments: Consumer; Pharmaceutical; and Professional. Its web site is here Johnson and Johnson.
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, November 28, 2014
Thursday, November 27, 2014
Johnson and Johnson
I do not own this stock of Johnson and Johnson (NYSE-JNJ). As Canadians, we are told we should be buying US stocks for our portfolio. It is often recommended that we have at least 25% of our portfolio in US stocks. I have never followed this, although I have tried dipping into the US market, but I have never made any money there.
For 5 year periods ending December 2002 to December 2013 a Canadian investor would have made money 9 year out 12 years. However, the median 5 year total return is just 1.16% per year, including dividends. The total return would be above 4% in only 4 of these 5 year periods. The best 5 year total return years were 2002 with a 14.26% per year total return and 2013 with an 8.66% per year total return. Over the past 10 years the total return for Canadian investors would be 6.54% per year.
The stock has done better in the US$ as the 5 and 10 years total return is 12.04% and 8.81%. The portion of this total return from dividends is at 3.17% and 2.70%. The portion of this total return from capital gains is at 8.88% and 6.11% per year.
The company certainly has a long history of dividend growth and a decent dividend. In US$ the 5 and 10 year dividend growth is at 7.6% and 10.8% per year over the past 5 and 10 years. The current dividend yield is 2.61% and it has a 5 year median yield of 3.46%.
For Canadian investors, the dividend increases over the past 5 and 10 years is at 4.6% and 8.7% per year. The current dividend yield is 2.61% with a 5 year median dividend yield at 3.46%. The problem for Canadian investors is that the dividends paid will fluctuate with the fluctuations in the currency exchange rate.
Over the past 5 and 10 years the CDN$ is down by 2.8% and 1.9% per year. The relative decline in the CDN$ compared to the US$ accounts for the differences in total return between Canadian and US investors.
The outstanding shares have increased by 2.4% and 0.5% per year over the past 5 and 10 years. Growth in Revenue, Earnings and Cash Flow has all done better over the past 10 years than over the past 5 years. Growth over the past 5 years is from slightly negative to slightly positive. Growth over the past 10 years is from mediocre to good. All my growth figures are in US$.
Revenue has grown at 2.3% and 5.5% per year over the past 5 and 10 years. Revenue per share has declined by 0.1% and increase by 5% per year over the past 5 and 10 years. The growth using 5 year running averages is better with 5 and 10 year growth at 3.6% and 7% per year.
EPS is up by 1% and 7.2% per year over the past 5 and 10 years. If you look at 5 year running averages over the past 5 and 10 years, EPS does better with growth of 3.2% and 8.5% per year. This is a retail stock, so EPS do tend to fluctuate and this is why 5 year running averages can sometimes give a better view of what is happening. They also give an adjusted EPS and this has grown at 3.9% and 7.4% per year over the past 5 and 10 years.
Cash flow is down by 0.1% and up by 6.5% per year over the past 5 and 10 years. Here again, if you look at 5 year running averages, growth is better with growth at 4.1% and 8.1% per year over the past 5 and 10 years. The comment on EPS growth concerning 5 year running averages applies to cash flow as well.
I have statistics on this stock going back to 1998 and the Return on Equity has been above 10% in each year. The ROE for 2013 was at 18.7% and the 5 year median ROE is 18.7%. The ROE for comprehensive income for 2013 is 22.7% and the 5 year median ROE for comprehensive income is 22.7%. When the ROE on comprehensive income is the same or higher than the ROE on net income, it suggests that the earnings are of good quality.
The debt ratios are all quite good. The Liquidity Ratio for 2013 is at 2.20. This ratio has a 5 year median of 2.51. The Debt Ratio for 2013 is at 2.26. This ratio has a 5 year median of 2.15. Leverage and Debt/Equity Ratios for 2013 are at 1.79 and 0.79. The 5 year median ratios are 1.82 and 0.82. You can see from the 5 year median ratios that these ratios tend to be consistently good.
Sound bit for Twitter and StockTwits is: US Health Care Dividend Growth Stock. See my spreadsheet at jnj.htm.
This is the first of two parts. The second part will be posted on Friday, November 28, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
Johnson & Johnson is engaged in the manufacture and sale of a broad range of products in the health care field in many countries of the world. The company's worldwide business is divided into three segments: Consumer; Pharmaceutical; and Professional. Its web site is here Johnson and Johnson.
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.
For 5 year periods ending December 2002 to December 2013 a Canadian investor would have made money 9 year out 12 years. However, the median 5 year total return is just 1.16% per year, including dividends. The total return would be above 4% in only 4 of these 5 year periods. The best 5 year total return years were 2002 with a 14.26% per year total return and 2013 with an 8.66% per year total return. Over the past 10 years the total return for Canadian investors would be 6.54% per year.
The stock has done better in the US$ as the 5 and 10 years total return is 12.04% and 8.81%. The portion of this total return from dividends is at 3.17% and 2.70%. The portion of this total return from capital gains is at 8.88% and 6.11% per year.
The company certainly has a long history of dividend growth and a decent dividend. In US$ the 5 and 10 year dividend growth is at 7.6% and 10.8% per year over the past 5 and 10 years. The current dividend yield is 2.61% and it has a 5 year median yield of 3.46%.
For Canadian investors, the dividend increases over the past 5 and 10 years is at 4.6% and 8.7% per year. The current dividend yield is 2.61% with a 5 year median dividend yield at 3.46%. The problem for Canadian investors is that the dividends paid will fluctuate with the fluctuations in the currency exchange rate.
Over the past 5 and 10 years the CDN$ is down by 2.8% and 1.9% per year. The relative decline in the CDN$ compared to the US$ accounts for the differences in total return between Canadian and US investors.
The outstanding shares have increased by 2.4% and 0.5% per year over the past 5 and 10 years. Growth in Revenue, Earnings and Cash Flow has all done better over the past 10 years than over the past 5 years. Growth over the past 5 years is from slightly negative to slightly positive. Growth over the past 10 years is from mediocre to good. All my growth figures are in US$.
Revenue has grown at 2.3% and 5.5% per year over the past 5 and 10 years. Revenue per share has declined by 0.1% and increase by 5% per year over the past 5 and 10 years. The growth using 5 year running averages is better with 5 and 10 year growth at 3.6% and 7% per year.
EPS is up by 1% and 7.2% per year over the past 5 and 10 years. If you look at 5 year running averages over the past 5 and 10 years, EPS does better with growth of 3.2% and 8.5% per year. This is a retail stock, so EPS do tend to fluctuate and this is why 5 year running averages can sometimes give a better view of what is happening. They also give an adjusted EPS and this has grown at 3.9% and 7.4% per year over the past 5 and 10 years.
Cash flow is down by 0.1% and up by 6.5% per year over the past 5 and 10 years. Here again, if you look at 5 year running averages, growth is better with growth at 4.1% and 8.1% per year over the past 5 and 10 years. The comment on EPS growth concerning 5 year running averages applies to cash flow as well.
I have statistics on this stock going back to 1998 and the Return on Equity has been above 10% in each year. The ROE for 2013 was at 18.7% and the 5 year median ROE is 18.7%. The ROE for comprehensive income for 2013 is 22.7% and the 5 year median ROE for comprehensive income is 22.7%. When the ROE on comprehensive income is the same or higher than the ROE on net income, it suggests that the earnings are of good quality.
The debt ratios are all quite good. The Liquidity Ratio for 2013 is at 2.20. This ratio has a 5 year median of 2.51. The Debt Ratio for 2013 is at 2.26. This ratio has a 5 year median of 2.15. Leverage and Debt/Equity Ratios for 2013 are at 1.79 and 0.79. The 5 year median ratios are 1.82 and 0.82. You can see from the 5 year median ratios that these ratios tend to be consistently good.
Sound bit for Twitter and StockTwits is: US Health Care Dividend Growth Stock. See my spreadsheet at jnj.htm.
This is the first of two parts. The second part will be posted on Friday, November 28, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
Johnson & Johnson is engaged in the manufacture and sale of a broad range of products in the health care field in many countries of the world. The company's worldwide business is divided into three segments: Consumer; Pharmaceutical; and Professional. Its web site is here Johnson and Johnson.
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, November 26, 2014
Northland Power Inc.
On my other blog I am today writing about handling my registered accounts.
I do not own this stock of Northland Power Inc. (TSX-NPI, OTC-NPIFF). This company is into generating electric power. I have a lot invested in pipelines and I would like to have more invested in electric power as my utilities investment. I read a report on this stock that said it was a good defensive stock to buy. That is, it is a good stock to hold in a stock market correction. I can certainly see the logic of using utility stocks as defensive stocks.
This is another company that used to be an income trust. It had a spotty record of dividend increases before 2008 and the dividend has been flat since then. They are still paying dividends monthly. No analyst seems to expect any dividend increase any time soon.
Part of the problem is that the company is having a hard time making a profit. It had two years of earnings losses in the last 5 years and 2014 it is also expected to have an earnings loss. The third quarterly report points this way as well. As well no analyst seems to expect the dividends to be covered by earnings in 2015 and 2016. On the other hand no one seems to think that dividends will be cut either.
The story is happier if looking at cash flow. The Dividend Payout Ratio for CFPS has a 5 year median of 91%. However, the DPR for CFPS for 2013 was 54% and the corresponding ones for 2014 to 2016 are 70%, 62% and 58%, respectively.
Shareholders have done well over the past 5 and 10 years with total returns at 15.65% and 9.09% per year over the past 5 and 10 years. The portion of this total return attributable to dividends is at 7.92% and 7.03% per year. The portion of this total return attributable to capital gain is at 7.74% and 2.06% per year. Dividends are currently at a slightly lower level at 6.23%.
Outstanding shares have increased by 16.2% and 13.6% per year over the past 5 and 10 years because of Debenture Conversions, Share Issues, DRIP, Stock Options and Exchange Shares. The company has revenue and cash flow growth, but EPS growth only over the past 10 years.
Revenue has grown at 22.7% and 19.4% per year over the past 5 and 10 years. Revenue per Share has only grown at 5.6% and 5.1% per year over the past 5 and 10 years. EPS is flat over the past 5 years and is up by 7.3% per year over the past 10 years. Cash Flow per Share is up by 6.5% and 7.5% per year over the past 5 and 10 years. If I were a shareholder, I would be more interested in per share values.
With earnings losses, it is hard to get a fix on historical Price/Earnings per Share ratios. The P/E for 2015 would be 43.33 based on a current stock price of $17.33 and 2015 EPS estimate of $0.40. This is, of course a very high P/E for a utility stock.
If you look at Price/Book Value per Share, the 10 year P/B Ratio is 1.80 and the current one is some 99% higher at 3.80 based on a BVPS of $4.86 and current stock price of $17.33. The problem here is that the BVPS is declining at around 7% per year. This stock price test suggests that the stock is expensive.
If you look at P/CF or P/S Ratios, they suggest that the stock price could be reasonable. The 10 year median P/CF is 10.83 with a current P/CF only slightly higher at 11.18. The 10 year median P/S Ratio is 4.97 and the current one at 3.09 is some 38% lower. The problem I see here is that a P/CF Ratio of 11.18 or a P/S Ratio of 3.09 is not particularly good ratios for a utility.
When I look at analysts’ recommendations, I find Strong Buy, Buy, Hold and Underperform recommendations. Most of the recommendations are a Buy and the consensus recommendation would be a buy. The 12 month consensus stock price is $19.00. This would imply a total return of 15.87% with 6.23% from dividends and 9.64% from capital gains.
Sound bit for Twitter and StockTwits is: I prefer companies that have positive EPS. See my spreadsheet at npi.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.
Northland Power Inc. indirectly owns interests in power projects. Northland's assets comprise facilities that produce electricity from "clean" natural gas and "green" renewable sources such as wind and biomass. Electricity generation is sold under long-term PPAs with creditworthy customers, and any fuel for natural-gas-fired projects, where required, is purchased under long-term contracts to assure stability of operating margins. This company operates in Canada, US and Germany. Its web site is here Northland Power.
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 Northland Power Inc. (TSX-NPI, OTC-NPIFF). This company is into generating electric power. I have a lot invested in pipelines and I would like to have more invested in electric power as my utilities investment. I read a report on this stock that said it was a good defensive stock to buy. That is, it is a good stock to hold in a stock market correction. I can certainly see the logic of using utility stocks as defensive stocks.
This is another company that used to be an income trust. It had a spotty record of dividend increases before 2008 and the dividend has been flat since then. They are still paying dividends monthly. No analyst seems to expect any dividend increase any time soon.
Part of the problem is that the company is having a hard time making a profit. It had two years of earnings losses in the last 5 years and 2014 it is also expected to have an earnings loss. The third quarterly report points this way as well. As well no analyst seems to expect the dividends to be covered by earnings in 2015 and 2016. On the other hand no one seems to think that dividends will be cut either.
The story is happier if looking at cash flow. The Dividend Payout Ratio for CFPS has a 5 year median of 91%. However, the DPR for CFPS for 2013 was 54% and the corresponding ones for 2014 to 2016 are 70%, 62% and 58%, respectively.
Shareholders have done well over the past 5 and 10 years with total returns at 15.65% and 9.09% per year over the past 5 and 10 years. The portion of this total return attributable to dividends is at 7.92% and 7.03% per year. The portion of this total return attributable to capital gain is at 7.74% and 2.06% per year. Dividends are currently at a slightly lower level at 6.23%.
Outstanding shares have increased by 16.2% and 13.6% per year over the past 5 and 10 years because of Debenture Conversions, Share Issues, DRIP, Stock Options and Exchange Shares. The company has revenue and cash flow growth, but EPS growth only over the past 10 years.
Revenue has grown at 22.7% and 19.4% per year over the past 5 and 10 years. Revenue per Share has only grown at 5.6% and 5.1% per year over the past 5 and 10 years. EPS is flat over the past 5 years and is up by 7.3% per year over the past 10 years. Cash Flow per Share is up by 6.5% and 7.5% per year over the past 5 and 10 years. If I were a shareholder, I would be more interested in per share values.
With earnings losses, it is hard to get a fix on historical Price/Earnings per Share ratios. The P/E for 2015 would be 43.33 based on a current stock price of $17.33 and 2015 EPS estimate of $0.40. This is, of course a very high P/E for a utility stock.
If you look at Price/Book Value per Share, the 10 year P/B Ratio is 1.80 and the current one is some 99% higher at 3.80 based on a BVPS of $4.86 and current stock price of $17.33. The problem here is that the BVPS is declining at around 7% per year. This stock price test suggests that the stock is expensive.
If you look at P/CF or P/S Ratios, they suggest that the stock price could be reasonable. The 10 year median P/CF is 10.83 with a current P/CF only slightly higher at 11.18. The 10 year median P/S Ratio is 4.97 and the current one at 3.09 is some 38% lower. The problem I see here is that a P/CF Ratio of 11.18 or a P/S Ratio of 3.09 is not particularly good ratios for a utility.
When I look at analysts’ recommendations, I find Strong Buy, Buy, Hold and Underperform recommendations. Most of the recommendations are a Buy and the consensus recommendation would be a buy. The 12 month consensus stock price is $19.00. This would imply a total return of 15.87% with 6.23% from dividends and 9.64% from capital gains.
Sound bit for Twitter and StockTwits is: I prefer companies that have positive EPS. See my spreadsheet at npi.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.
Northland Power Inc. indirectly owns interests in power projects. Northland's assets comprise facilities that produce electricity from "clean" natural gas and "green" renewable sources such as wind and biomass. Electricity generation is sold under long-term PPAs with creditworthy customers, and any fuel for natural-gas-fired projects, where required, is purchased under long-term contracts to assure stability of operating margins. This company operates in Canada, US and Germany. Its web site is here Northland Power.
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, November 25, 2014
Keyera Corp. 2
I do not own this stock of Keyera Corp. (TSX-KEY, OTC-KEYUF). I started to review some of the stock recommended by Jennifer Dowty from a column she wrote and I reviewed in February 2010 on Dividends and Special Dividends. The title of the article in Investor's Digest was Dividend Stocks: Buy, Hold and Collect. Jennifer is now a Portfolio Manager for Manulife Asset Management Limited.
When I look at insider trading, I find $0.34M of insider buying and $0.38M of insider selling. So there is a bit of net insider selling but very little. This is not much action in insider trading at all. There is some insider ownership with the CEO owing shares worth around $23.9M and an officer having share worth around $14.4M.
Shares are not increased due to stock option, but the Long Term Incentive Plan for employees seems rather high. It affects both the company's earnings and cash flow. Over the past 7 years, the median percentage of earnings is at 13.5%. In 2013, the LTIP was at 19.3% of earnings. However, this is equal to 0.56% of market cap and when shares are issued for stock options, that percentage of market cap is rather normal.
The 5 year low, median and high median Price/Earnings per Share ratios are 18.04, 22.18 and 26.32. The corresponding 10 year values are 16.63, 20.96 and 25.29. The current P/E Ratio is 29.42 based on a stock price of $91.80 and 2014 EPS estimate of $3.12. The 2015 P/E Ratio is 25.36 based on a stock price of $91.80 and 2015 EPS estimate of $3.62. All this suggests is that the current stock price is just above or at the very top end of a reasonable stock price range.
I get a current Graham price of $34.28 and the 10 year low, median and high median Price/Graham Price Ratios are 1.07, 1.34 and 1.62. The current P/GP ratio is 2.68 based on a stock price of $91.80. This stock price test suggests that the stock price is expensive.
The 10 year Price/Book Value per Share ratio is 1.98. The current P/B Ratio is 4.88 based on a stock price of $91.80 and PBPS of $16.74. Book Values on this stock have been increasing at less than 3% per year. This lack of growth in book value or shareholder value affects both this test and the one above. The current P/B Ratio is some 176% of the 10 year ratio. This stock price test suggests that the stock price is expensive.
It was expected that old income trust company's dividend yields would end up in the 4 to 5% range. This stock currently has a rather low yield of 2.8%. This is quite outside this range and the yield is lower than the previous low of 3.9%. This stock price test suggests that the stock price is expensive.
Even looking cash flow, which has had good growth you get the same sort of answer. The 10 year Price/Cash Flow per Share ratio is at 11.20 (and the 5 year median P/CF is not far at 11.83). The current P/CF Ratio at 15.99 is some 43% above the 10 year value. This stock price test suggests that the stock price is expensive.
When I look at analysts' recommendations, I find Buy and Hold recommendations. Most of the recommendations are a Buy and the consensus recommendation would be a Buy. The 12 month consensus stock price is $98.50. This implies a total return of 10.11%, with 7.30% from capital gains and 2.81% from dividends.
In early November, Keyera Corp put out the highlights of its third quarterly results over Newswire. A recent article on WKRB talks about CIBC raising their target stock price for Keyera to $103.00. The blogger Dividend Growth Investing and Retirement has this company on his All-Star List.
Sound bit for Twitter and StockTwits is: Getting a bit expensive. Everything I look at suggests that the stock price is too high. Paying too much for a stock you want to hold for the longer term really affects your overall returns on the stock. If you are doing a momentum buy, current price does not matter as much as market sentiment. The stock price trend is certainly going up and this could continue for a while.
In the end dividend growth stocks tend to have capital gains equal to the growth of the dividends. So this stock's total return should equal dividend growth plus dividends. This stock is currently growing faster than that when the increase for 2014 year to date is at 44%. See my spreadsheet at key.htm.
This is the second of two parts. The first part was posted on Monday, November 24, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
Keyera provides essential services and products to oil and gas producers in western Canada, and markets related natural gas liquids (NGLs) throughout North America. Its web site is here Keyera.
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 $0.34M of insider buying and $0.38M of insider selling. So there is a bit of net insider selling but very little. This is not much action in insider trading at all. There is some insider ownership with the CEO owing shares worth around $23.9M and an officer having share worth around $14.4M.
Shares are not increased due to stock option, but the Long Term Incentive Plan for employees seems rather high. It affects both the company's earnings and cash flow. Over the past 7 years, the median percentage of earnings is at 13.5%. In 2013, the LTIP was at 19.3% of earnings. However, this is equal to 0.56% of market cap and when shares are issued for stock options, that percentage of market cap is rather normal.
The 5 year low, median and high median Price/Earnings per Share ratios are 18.04, 22.18 and 26.32. The corresponding 10 year values are 16.63, 20.96 and 25.29. The current P/E Ratio is 29.42 based on a stock price of $91.80 and 2014 EPS estimate of $3.12. The 2015 P/E Ratio is 25.36 based on a stock price of $91.80 and 2015 EPS estimate of $3.62. All this suggests is that the current stock price is just above or at the very top end of a reasonable stock price range.
I get a current Graham price of $34.28 and the 10 year low, median and high median Price/Graham Price Ratios are 1.07, 1.34 and 1.62. The current P/GP ratio is 2.68 based on a stock price of $91.80. This stock price test suggests that the stock price is expensive.
The 10 year Price/Book Value per Share ratio is 1.98. The current P/B Ratio is 4.88 based on a stock price of $91.80 and PBPS of $16.74. Book Values on this stock have been increasing at less than 3% per year. This lack of growth in book value or shareholder value affects both this test and the one above. The current P/B Ratio is some 176% of the 10 year ratio. This stock price test suggests that the stock price is expensive.
It was expected that old income trust company's dividend yields would end up in the 4 to 5% range. This stock currently has a rather low yield of 2.8%. This is quite outside this range and the yield is lower than the previous low of 3.9%. This stock price test suggests that the stock price is expensive.
Even looking cash flow, which has had good growth you get the same sort of answer. The 10 year Price/Cash Flow per Share ratio is at 11.20 (and the 5 year median P/CF is not far at 11.83). The current P/CF Ratio at 15.99 is some 43% above the 10 year value. This stock price test suggests that the stock price is expensive.
When I look at analysts' recommendations, I find Buy and Hold recommendations. Most of the recommendations are a Buy and the consensus recommendation would be a Buy. The 12 month consensus stock price is $98.50. This implies a total return of 10.11%, with 7.30% from capital gains and 2.81% from dividends.
In early November, Keyera Corp put out the highlights of its third quarterly results over Newswire. A recent article on WKRB talks about CIBC raising their target stock price for Keyera to $103.00. The blogger Dividend Growth Investing and Retirement has this company on his All-Star List.
Sound bit for Twitter and StockTwits is: Getting a bit expensive. Everything I look at suggests that the stock price is too high. Paying too much for a stock you want to hold for the longer term really affects your overall returns on the stock. If you are doing a momentum buy, current price does not matter as much as market sentiment. The stock price trend is certainly going up and this could continue for a while.
In the end dividend growth stocks tend to have capital gains equal to the growth of the dividends. So this stock's total return should equal dividend growth plus dividends. This stock is currently growing faster than that when the increase for 2014 year to date is at 44%. See my spreadsheet at key.htm.
This is the second of two parts. The first part was posted on Monday, November 24, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
Keyera provides essential services and products to oil and gas producers in western Canada, and markets related natural gas liquids (NGLs) throughout North America. Its web site is here Keyera.
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, November 24, 2014
Keyera Corp.
On my other blog I am today writing about how I did in the October 2014 market correction.
I do not own this stock of Keyera Corp. (TSX-KEY, OTC-KEYUF). I started to review some of the stock recommended by Jennifer Dowty from a column she wrote and I reviewed in February 2010 on Dividends and Special Dividends. The title of the article in Investor's Digest was Dividend Stocks: Buy, Hold and Collect. Jennifer is now a Portfolio Manager for Manulife Asset Management Limited.
This company only paid one special dividend so far and that was in 2009. However, they are a dividend growth company. Dividends are moderate as are the dividend increases. The current dividend yield is 2.81%. The 5 year median dividend yield is much higher at 6%, but this is because this company was an income trust company until 2010.
Their 5 and 10 year dividend growth is at 6.2% and 7.5% per year over the past 5 and 10 years. The most recent increase was for 2014 and it was for 7.5%. The company stopped increasing the dividends in one year, 2010, when they were transiting from an income trust to a corporation. Analysts do expect dividend increases to continue.
The Dividend Payout Ratios have been a little too high for a corporation, but they are coming down. The 5 year median DPR for EPS is 99.5% and for CPFS is 53.5%. The corresponding ones for 2013 was 120% for EPS and 50% for CFPS. They are expected to move lower and the corresponding ones for 2014 is expected to be 80% for EPS and 44% for CFPS. DPRs for corporations are lower than those of income trusts.
Shareholders have done well with this stock. The 5 and 10 year total return is at 35.53% and 26.47% per year with 30.27% and 20.36% per year of this total return from capital gains and 5.26% and 6.11% per year of this total return from dividends. I would expect future total return to be lower.
It was expected that the dividend yield on income trusts companies would be lowered caused by dividend cuts and/or stock price increases. This stock used to have dividend yields north of 10% and the current one is 2.8%. The change happened wholly due to stock price increases. This reason for stock price increases is not likely to happen again. Also, the dividend portion of the total return was at 5.26% and 6.11% per year but again dividend is now 2.81%, but the dividend portion of the total return will also be lower in the future.
Outstanding shares have increased by 4.7% and 16.6% per year over the past 5 and 10 years. This makes the per share values more important to shareholders. The growth in revenue is from ok to good, the growth in cash flow is quite good but the growth in earnings is down over the past 5 years, but up quite well over the past 10 years.
Revenue is up by 8.5% and 17.9% per year over the past 5 and 9 years. The growth in Revenue per Share is up by 3.7% and 13.1% per year over the past 5 and 9 years. Earnings per share is down by 6.5% and up by 9.4% per year over the past 5 and 9 years. Net income is down by 2.4% and up by 33% per year over the past 5 and 10 years.
Analysts do expect a good increase in EPS for 2014 and the third quarterly report supports this. Analysts expect EPS to increase around 67% for 2014. If you compare the 12 month period ending in September 2014 to the 12 month period ending in December 2013, EPS is up 55%.
Cash flow has had the best growth with the cash flow up by 20.5% and 21.9% per year over the past 5 and 9 years and CFPS up by 15% and 17% per year over the past 5 and 9 years.
The Return on Equity has been over the 10% each of the past 5 years. The ROE for 2013 was at 15.9% and the 5 year median is also at 15.9%. The comprehensive income and net income has been the same since they start to report comprehensive income in 2006. Comprehensive income ROE basically suggests that ROE on net income is of good quality.
All the debt ratios have varied but have generally been good over the past 3 years with the Liquidity Ratio sometimes a bit low and the Leverage and Debt/Equity Ratios a bit high. The Liquidity Ratio for 2013 was at 1.64 and it has a 5 year median value of 1.36. The Debt Ratio for 2013 was at 1.43 and it has a 5 year median value of 1.50. The Leverage and Debt/Equity Ratios for 2013 were at 3.30 and 2.30 and these ratios have a 5 year median of 2.46 and 1.46, respectively.
Sound bit for Twitter and StockTwits is: Dividend Growth Stock. Analysts expect that 2014 will be a good year for this company and certainly the third quarter results are pointing in that direction. See my spreadsheet at key.htm.
This is the first of two parts. The second part will be posted on Tuesday, November 24, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
Keyera provides essential services and products to oil and gas producers in western Canada, and markets related natural gas liquids (NGLs) throughout North America. Its web site is here Keyera.
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 Keyera Corp. (TSX-KEY, OTC-KEYUF). I started to review some of the stock recommended by Jennifer Dowty from a column she wrote and I reviewed in February 2010 on Dividends and Special Dividends. The title of the article in Investor's Digest was Dividend Stocks: Buy, Hold and Collect. Jennifer is now a Portfolio Manager for Manulife Asset Management Limited.
This company only paid one special dividend so far and that was in 2009. However, they are a dividend growth company. Dividends are moderate as are the dividend increases. The current dividend yield is 2.81%. The 5 year median dividend yield is much higher at 6%, but this is because this company was an income trust company until 2010.
Their 5 and 10 year dividend growth is at 6.2% and 7.5% per year over the past 5 and 10 years. The most recent increase was for 2014 and it was for 7.5%. The company stopped increasing the dividends in one year, 2010, when they were transiting from an income trust to a corporation. Analysts do expect dividend increases to continue.
The Dividend Payout Ratios have been a little too high for a corporation, but they are coming down. The 5 year median DPR for EPS is 99.5% and for CPFS is 53.5%. The corresponding ones for 2013 was 120% for EPS and 50% for CFPS. They are expected to move lower and the corresponding ones for 2014 is expected to be 80% for EPS and 44% for CFPS. DPRs for corporations are lower than those of income trusts.
Shareholders have done well with this stock. The 5 and 10 year total return is at 35.53% and 26.47% per year with 30.27% and 20.36% per year of this total return from capital gains and 5.26% and 6.11% per year of this total return from dividends. I would expect future total return to be lower.
It was expected that the dividend yield on income trusts companies would be lowered caused by dividend cuts and/or stock price increases. This stock used to have dividend yields north of 10% and the current one is 2.8%. The change happened wholly due to stock price increases. This reason for stock price increases is not likely to happen again. Also, the dividend portion of the total return was at 5.26% and 6.11% per year but again dividend is now 2.81%, but the dividend portion of the total return will also be lower in the future.
Outstanding shares have increased by 4.7% and 16.6% per year over the past 5 and 10 years. This makes the per share values more important to shareholders. The growth in revenue is from ok to good, the growth in cash flow is quite good but the growth in earnings is down over the past 5 years, but up quite well over the past 10 years.
Revenue is up by 8.5% and 17.9% per year over the past 5 and 9 years. The growth in Revenue per Share is up by 3.7% and 13.1% per year over the past 5 and 9 years. Earnings per share is down by 6.5% and up by 9.4% per year over the past 5 and 9 years. Net income is down by 2.4% and up by 33% per year over the past 5 and 10 years.
Analysts do expect a good increase in EPS for 2014 and the third quarterly report supports this. Analysts expect EPS to increase around 67% for 2014. If you compare the 12 month period ending in September 2014 to the 12 month period ending in December 2013, EPS is up 55%.
Cash flow has had the best growth with the cash flow up by 20.5% and 21.9% per year over the past 5 and 9 years and CFPS up by 15% and 17% per year over the past 5 and 9 years.
The Return on Equity has been over the 10% each of the past 5 years. The ROE for 2013 was at 15.9% and the 5 year median is also at 15.9%. The comprehensive income and net income has been the same since they start to report comprehensive income in 2006. Comprehensive income ROE basically suggests that ROE on net income is of good quality.
All the debt ratios have varied but have generally been good over the past 3 years with the Liquidity Ratio sometimes a bit low and the Leverage and Debt/Equity Ratios a bit high. The Liquidity Ratio for 2013 was at 1.64 and it has a 5 year median value of 1.36. The Debt Ratio for 2013 was at 1.43 and it has a 5 year median value of 1.50. The Leverage and Debt/Equity Ratios for 2013 were at 3.30 and 2.30 and these ratios have a 5 year median of 2.46 and 1.46, respectively.
Sound bit for Twitter and StockTwits is: Dividend Growth Stock. Analysts expect that 2014 will be a good year for this company and certainly the third quarter results are pointing in that direction. See my spreadsheet at key.htm.
This is the first of two parts. The second part will be posted on Tuesday, November 24, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
Keyera provides essential services and products to oil and gas producers in western Canada, and markets related natural gas liquids (NGLs) throughout North America. Its web site is here Keyera.
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, November 21, 2014
Innergex Renewable Energy 2
I do not own this stock of Innergex Renewable Energy (TSX-INE, OTC-INGXF). In 2006 I bought Innergex Power on a buy rating and favorable report from TD although it has only been going from 2003. In 2008 I sold Innergex as I did not think that it is a stock I want to hold as dividend increased less than the rate of inflation. I was just trying out this stock. For the period that I held it I lost 4.8% per year. My capital loss was 17%.
When I look at insider trading, I find no insider selling and very minor insider buying. The outstanding shares were not increased by stock options in 2013. There is some insider ownership with the CEO having shares worth around $6.5M, the CFO having shares worth around $1.3M and an officer with shares worth around $2.1M.
Since there have been a number of years with negative EPS, I can get no fix on median Price/Earnings Ratios for this stock. Since 2014 is also supposed to produce a negative EPS and the EPS for the last 12 months is also negative, there will be no current P/E Ratio for comparison.
The EPS for 2015 is expected to be positive with a value of $0.18. The current stock price is $10.72. An EPS of $0.18 and a stock price of $10.72 give a P/E of 59.56. This is a rather high P/E, especially considering the stock is a utility stock. This suggests that the stock price is expensive.
The Graham Price is $4.20. The 10 year low, median and high Price/Graham Price Ratios are 1.21, 1.35 and 1.52. The current P/GP Ratio is 2.55 based on a stock price of $10.72. This stock price test suggests that the stock price is relatively expensive.
The 10 year Price/Book Value per Share is 1.68. The current P/B Ratio at 2.46 is based on a stock price of $10.72 and BVPS of $4.36. The current P/B Ratio is some 47% higher than the 10 year ratio. This stock price test suggests that the stock price is relatively expensive.
The only tests that would suggest that the price might be relatively reasonable are P/S Ratio and P/CF Ratio tests. The current P/CF Ratio at 11.91 is some 2% below the 10 years median of 12.18. However, I think that a P/CF on a utility is any P/CF over 10.00 is rather high. The current P/S Ratio is 4.46 and this some 18% lower than the 10 year median P/S Ratio of 5.45. However, I think that any P/S over 2.00 on a utility stock is rather high.
When I look at analysts' recommendations, I find Buy and Hold recommendations. The consensus recommendation would be a Hold. Most of the recommendations are a Hold. The 12 month stock price consensus is $11.30. This implies a total return of 11.01% with 5.41% from capital gains and 5.60% from dividends.
This article on Re News talks about wind turbines being supplied to a wind farm run in a partnership between Mi'gmaq First Nations of Quebec and Innergex Renewable Energy. This article in Pique Magazine talks about a new hydro-electric facility this company is building in B. C.
Sound bit for Twitter and StockTwits is: Stock expensive and has problems. See my spreadsheet at ine.htm.
This is the second of two parts. The first part was posted on Thursday, November 20, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
Innergex is involved in Canada's renewable energy industry. The Company develops, owns and operates facilities located in North America, leveraging run-of-river hydroelectric power generating facilities, wind farms and photovoltaic solar parks. Its web site is here Innergex.
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 selling and very minor insider buying. The outstanding shares were not increased by stock options in 2013. There is some insider ownership with the CEO having shares worth around $6.5M, the CFO having shares worth around $1.3M and an officer with shares worth around $2.1M.
Since there have been a number of years with negative EPS, I can get no fix on median Price/Earnings Ratios for this stock. Since 2014 is also supposed to produce a negative EPS and the EPS for the last 12 months is also negative, there will be no current P/E Ratio for comparison.
The EPS for 2015 is expected to be positive with a value of $0.18. The current stock price is $10.72. An EPS of $0.18 and a stock price of $10.72 give a P/E of 59.56. This is a rather high P/E, especially considering the stock is a utility stock. This suggests that the stock price is expensive.
The Graham Price is $4.20. The 10 year low, median and high Price/Graham Price Ratios are 1.21, 1.35 and 1.52. The current P/GP Ratio is 2.55 based on a stock price of $10.72. This stock price test suggests that the stock price is relatively expensive.
The 10 year Price/Book Value per Share is 1.68. The current P/B Ratio at 2.46 is based on a stock price of $10.72 and BVPS of $4.36. The current P/B Ratio is some 47% higher than the 10 year ratio. This stock price test suggests that the stock price is relatively expensive.
The only tests that would suggest that the price might be relatively reasonable are P/S Ratio and P/CF Ratio tests. The current P/CF Ratio at 11.91 is some 2% below the 10 years median of 12.18. However, I think that a P/CF on a utility is any P/CF over 10.00 is rather high. The current P/S Ratio is 4.46 and this some 18% lower than the 10 year median P/S Ratio of 5.45. However, I think that any P/S over 2.00 on a utility stock is rather high.
When I look at analysts' recommendations, I find Buy and Hold recommendations. The consensus recommendation would be a Hold. Most of the recommendations are a Hold. The 12 month stock price consensus is $11.30. This implies a total return of 11.01% with 5.41% from capital gains and 5.60% from dividends.
This article on Re News talks about wind turbines being supplied to a wind farm run in a partnership between Mi'gmaq First Nations of Quebec and Innergex Renewable Energy. This article in Pique Magazine talks about a new hydro-electric facility this company is building in B. C.
Sound bit for Twitter and StockTwits is: Stock expensive and has problems. See my spreadsheet at ine.htm.
This is the second of two parts. The first part was posted on Thursday, November 20, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
Innergex is involved in Canada's renewable energy industry. The Company develops, owns and operates facilities located in North America, leveraging run-of-river hydroelectric power generating facilities, wind farms and photovoltaic solar parks. Its web site is here Innergex.
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, November 20, 2014
Innergex Renewable Energy
I do not own this stock of Innergex Renewable Energy (TSX-INE, OTC-INGXF). In 2006 I bought Innergex Power on a buy rating and favorable report from TD although it has only been going from 2003. In 2008 I sold Innergex as I did not think that it is a stock I want to hold as dividend increased less than the rate of inflation. I was just trying out this stock. For the period that I held it I lost 4.8% per year. My capital loss was 17%.
This company is another income trust that has changed to a corporation. What I did not like was the low dividend growth although the dividend yield was good. Now the dividend yield is down, currently at 5.6%. The dividend growth is not any better. They had been keeping the dividend flat until this year as Dividend Payout Ratio for EPS is too high.
The Dividend Payout Ratio for 2013 was 880% for EPS and 60.3% for Cash Flow per Share. The payout ratio for CFPS is not bad; the real problem is with this company making money. The DPR for EPS for 2014 will be worse as the company is not expected to make a profit in 2014. Analysts seem to feel that DPR for CFPS will be around 66% for 2014.
They raised the dividend in 2014 by 3.4%. This is not a bad hike considering on how high the dividend yield. But I am not sure that they can keep this up as no one seems to expect the EPS to cover the dividend in the next few years.
The total return for shareholders over the past few years has been good. The 5 and 10 total return is at 15.83% and 8.50% per year. The portion of this total return from dividends is at 7% and 6.61% per year. The portion of this total return from capital is at 8.83 and 1.90% per year. The return from dividends will be lower in the future as the dividend yield decreases. This is common for old income trust companies.
The outstanding shares have been increasing by 17.4% and 13.6% per year over the past 5 and 10 years. They have increased due to Share Issues, DRIP and Stock Options. Because of the increasing number of shares, the "per share" values become important. Revenue growth is quite good, cash flow is good. The problem is the lack to earnings growth.
Revenue has grown at 27% and 25% per year over the past 5 and 10 years. Revenue per Share has grown at 8.4% and 9.8% per year over the past 5 and 10 years. Cash Flow has grown at 23% and 22% per year over the past 5 and 10 years. Cash Flow per Share has grown at 4.8% and 7.4% per year over the past 5 and 10 years.
Over the past 10 years, there has been 4 years of negative earnings. Analysts expect that 2014 will be another year of negative earnings. The third quarterly report for 2014 supports what the analysts are saying. Since exactly 5 years ago was a negative earnings year, I can only look at growth for the last 4 years and net income has grown at 14.7%. Net income has grown at 17.5% over the past 10 years.
However, EPS is down by 8.4% per year over the past 4 years and only up by 2.2% over the past 10 years. As a shareholder, I would be more interested in the EPS growth than the net income growth, because that is what is going to affect any shares I hold.
Return on Equity has been at or over 10% only 2 times in the past 5 years, and no times before 5 years ago. The ROE for 2013 was 10%. The 5 year median is just 0.3%. The comprehensive income has been equal to the net income, so there is no difference in its ROE.
The Liquidity Ratio was rather low in 2013 at 1.18. This ratio has often been low with a 5 year median of 1.31. If you add in cash flow after dividends, you get a ratio for 2013 of 1.81. This ratio has a 5 year median of 1.56.
Sound bit for Twitter and StockTwits is: Renewable Energy company with a hopeful future. At least I hope it will do well in the future. I would like to invest more in renewal energy because I think it is the wave of the future. However, this company has to first prove it can make a profit. See my spreadsheet at ine.htm.
This is the first of two parts. The second part will be posted on Friday, November 21, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
Innergex is involved in Canada's renewable energy industry. The Company develops, owns and operates facilities located in North America, leveraging run-of-river hydroelectric power generating facilities, wind farms and photovoltaic solar parks. Its web site is here Innergex.
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.
This company is another income trust that has changed to a corporation. What I did not like was the low dividend growth although the dividend yield was good. Now the dividend yield is down, currently at 5.6%. The dividend growth is not any better. They had been keeping the dividend flat until this year as Dividend Payout Ratio for EPS is too high.
The Dividend Payout Ratio for 2013 was 880% for EPS and 60.3% for Cash Flow per Share. The payout ratio for CFPS is not bad; the real problem is with this company making money. The DPR for EPS for 2014 will be worse as the company is not expected to make a profit in 2014. Analysts seem to feel that DPR for CFPS will be around 66% for 2014.
They raised the dividend in 2014 by 3.4%. This is not a bad hike considering on how high the dividend yield. But I am not sure that they can keep this up as no one seems to expect the EPS to cover the dividend in the next few years.
The total return for shareholders over the past few years has been good. The 5 and 10 total return is at 15.83% and 8.50% per year. The portion of this total return from dividends is at 7% and 6.61% per year. The portion of this total return from capital is at 8.83 and 1.90% per year. The return from dividends will be lower in the future as the dividend yield decreases. This is common for old income trust companies.
The outstanding shares have been increasing by 17.4% and 13.6% per year over the past 5 and 10 years. They have increased due to Share Issues, DRIP and Stock Options. Because of the increasing number of shares, the "per share" values become important. Revenue growth is quite good, cash flow is good. The problem is the lack to earnings growth.
Revenue has grown at 27% and 25% per year over the past 5 and 10 years. Revenue per Share has grown at 8.4% and 9.8% per year over the past 5 and 10 years. Cash Flow has grown at 23% and 22% per year over the past 5 and 10 years. Cash Flow per Share has grown at 4.8% and 7.4% per year over the past 5 and 10 years.
Over the past 10 years, there has been 4 years of negative earnings. Analysts expect that 2014 will be another year of negative earnings. The third quarterly report for 2014 supports what the analysts are saying. Since exactly 5 years ago was a negative earnings year, I can only look at growth for the last 4 years and net income has grown at 14.7%. Net income has grown at 17.5% over the past 10 years.
However, EPS is down by 8.4% per year over the past 4 years and only up by 2.2% over the past 10 years. As a shareholder, I would be more interested in the EPS growth than the net income growth, because that is what is going to affect any shares I hold.
Return on Equity has been at or over 10% only 2 times in the past 5 years, and no times before 5 years ago. The ROE for 2013 was 10%. The 5 year median is just 0.3%. The comprehensive income has been equal to the net income, so there is no difference in its ROE.
The Liquidity Ratio was rather low in 2013 at 1.18. This ratio has often been low with a 5 year median of 1.31. If you add in cash flow after dividends, you get a ratio for 2013 of 1.81. This ratio has a 5 year median of 1.56.
Sound bit for Twitter and StockTwits is: Renewable Energy company with a hopeful future. At least I hope it will do well in the future. I would like to invest more in renewal energy because I think it is the wave of the future. However, this company has to first prove it can make a profit. See my spreadsheet at ine.htm.
This is the first of two parts. The second part will be posted on Friday, November 21, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
Innergex is involved in Canada's renewable energy industry. The Company develops, owns and operates facilities located in North America, leveraging run-of-river hydroelectric power generating facilities, wind farms and photovoltaic solar parks. Its web site is here Innergex.
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, November 19, 2014
IBI Group Inc.
On my other blog I am today writing about the presentation at the World Money Show in Toronto by David Wyss.
I do not own this stock of IBI Group Inc. (TSX-IBG, OTC-IBIBF). I have had this stock on my list to investigate for some time. What finally prompted me set up a spreadsheet on this stock was an investment report I read in March of 2011. I will continue to follow this stock to see how it all turns out.
This first thing to discuss is dividends. This firm was started in 1974 and it had its IPO in 2004, when they also started to declare dividends. At that time it was an income trust so the initial dividend yield was high with the yield being in the 9% to 11% range. They changed to a corporation in 2011 and decreased the dividend by some 31%. Unfortunately, they had negatives earnings in 2012 and 2013 and cut their dividends to zero in 2013.
Of course dividends are not the main problem. In 2013, the liabilities were higher than the assets and so this company has a negative book value. In 2014 the company renegotiated their credit facilities and revised the terms of their outstanding debentures.
On the other hand, analysts seem to feel that the company is moving forward. It is felt it will again have positive earnings. They also feel that the company will have a positive book value again in 2016. Most seem to feel by the estimates given that 2013 was the bottom for this company.
The third quarter results seem to bear this out, with rising revenue, positive earnings and cash flow. The stock price has also begun to rise with it up by some 177% this year.
This company has been beaten up. The P/E Ratio is 12.84 based on a stock price of $2.44 and 2014 earnings of $0.19. They have a good chance of getting to this EPS as the EPS so far this year , at the end of the third quarter is $0.17.The P/E Ratio for 2015 is very low at 6.10 based on a stock price of $2.44 and EPS estimate of $0.40.
At the end of their third quarter, the company has cash that equals 24% of the stock price with $0.53 cash per share and share price at $2.44. This would effectively make the stock price $1.91 with a P/E of 4.78.
The structure of this company is rather complex, but basically there is an Management Partnership that effectively holds some 40% of voting shares of the company on a partially diluted basis, assuming the exchange of the Class B partnership units for common shares of the company.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus recommendation would be a Buy. The 12 month consensus stock price is $3.42. This implies a 40% total return, all from capital gains.
On the Digital Journal site there is an announcement of IBI Group's third quarter results for 2014. According to Market Watch investors of IBI Group are organizing for the purpose of determining whether IBG's management exercised its fiduciary duty. According to Sleek Money BNS lowered their price objective on this stock.
Sound bit for Twitter and StockTwits is: Beaten up company. Anyone buying shares in this company are, of course, taking a risk. However, if all works out, there could be nice profits to have. See my spreadsheet at ibg.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.
IBI Group Inc. is an international, multi-disciplinary provider of a range of professional services focused on the physical development of cities. The Company through IBI Group provides professional services, including planning, design, implementation, analysis of operations and other consulting services in relation to four main areas of development (urban land, building facilities, transportation networks and systems technology.) Its web site is here IBI Group.
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 IBI Group Inc. (TSX-IBG, OTC-IBIBF). I have had this stock on my list to investigate for some time. What finally prompted me set up a spreadsheet on this stock was an investment report I read in March of 2011. I will continue to follow this stock to see how it all turns out.
This first thing to discuss is dividends. This firm was started in 1974 and it had its IPO in 2004, when they also started to declare dividends. At that time it was an income trust so the initial dividend yield was high with the yield being in the 9% to 11% range. They changed to a corporation in 2011 and decreased the dividend by some 31%. Unfortunately, they had negatives earnings in 2012 and 2013 and cut their dividends to zero in 2013.
Of course dividends are not the main problem. In 2013, the liabilities were higher than the assets and so this company has a negative book value. In 2014 the company renegotiated their credit facilities and revised the terms of their outstanding debentures.
On the other hand, analysts seem to feel that the company is moving forward. It is felt it will again have positive earnings. They also feel that the company will have a positive book value again in 2016. Most seem to feel by the estimates given that 2013 was the bottom for this company.
The third quarter results seem to bear this out, with rising revenue, positive earnings and cash flow. The stock price has also begun to rise with it up by some 177% this year.
This company has been beaten up. The P/E Ratio is 12.84 based on a stock price of $2.44 and 2014 earnings of $0.19. They have a good chance of getting to this EPS as the EPS so far this year , at the end of the third quarter is $0.17.The P/E Ratio for 2015 is very low at 6.10 based on a stock price of $2.44 and EPS estimate of $0.40.
At the end of their third quarter, the company has cash that equals 24% of the stock price with $0.53 cash per share and share price at $2.44. This would effectively make the stock price $1.91 with a P/E of 4.78.
The structure of this company is rather complex, but basically there is an Management Partnership that effectively holds some 40% of voting shares of the company on a partially diluted basis, assuming the exchange of the Class B partnership units for common shares of the company.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus recommendation would be a Buy. The 12 month consensus stock price is $3.42. This implies a 40% total return, all from capital gains.
On the Digital Journal site there is an announcement of IBI Group's third quarter results for 2014. According to Market Watch investors of IBI Group are organizing for the purpose of determining whether IBG's management exercised its fiduciary duty. According to Sleek Money BNS lowered their price objective on this stock.
Sound bit for Twitter and StockTwits is: Beaten up company. Anyone buying shares in this company are, of course, taking a risk. However, if all works out, there could be nice profits to have. See my spreadsheet at ibg.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.
IBI Group Inc. is an international, multi-disciplinary provider of a range of professional services focused on the physical development of cities. The Company through IBI Group provides professional services, including planning, design, implementation, analysis of operations and other consulting services in relation to four main areas of development (urban land, building facilities, transportation networks and systems technology.) Its web site is here IBI Group.
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, November 18, 2014
Encana Corp. 2
On my other blog I am today writing about the presentation at the World Money Show in Toronto by Iain Butler.
I do not own this stock of Encana Corp. (TSX-ECA, NYSE-ECA) but I used to. Please note that my spreadsheet following this company starts with Alberta Energy Company and follows this company into the formation of EnCana in 2002. It was in 2002 EnCana was formed with the merger of AEC and PanCanadian Energy Corporation. Company split into EnCana Corp and Cenovus Energy Inc. in 2009, Oil with Cenovus and gas with EnCana.
When I look at insider trading, there is not much happening. There is no insider selling and insider buying is at $0.6M. This is at $0.004% of market cap and so relatively very little. There seems to be little insider ownership. The CEO owns shares worth around $1.2M and the Chairman owns shares worth around $2M. Otherwise insider ownership is little.
The 5 year low, median and high median Price/Earnings per Share Ratios are 13.96, 15.91 and 17.86. The current P/E at 8.42 is based on a stock price of $20.21 and 2014 EPS estimate of $2.40. This stock price test suggests that the stock price is cheap.
I get a Graham Price of $28.08. The 10 year low, median and high median Price/Graham Price Ratios are 0.78, 1.03 and 1.19. The current P/GP Ratio is 0.72 based on a stock price of $20.21. This stock price test suggests that the stock price is cheap.
The 10 year Price/Book Value per Share Ratio is 1.96. The current one is 30% lower at 1.38 based on a stock price of $20.21 and BVPS of $14.60. This stock price test suggests that the stock price is cheap.
If you do a dividend yield stock price test you get different results. The current dividend yield 1.57% is much lower than the 5 year median dividend yield of 3.12% and the historical average of 2.99%. Interestingly it is not lower than the historical median yield of 1.45%. The yield on this stock has been quite high recently until the dividend was cut recently by some 65%.
However, they have cut the dividend to get a better Payout Ratio for EPS. Last year the DPR for EPS was 209%. In 2012 they had an earnings loss. The DPR for EPS for 2014 is expected to be around 13%.
The Motley Fool likes EnCana because they expect gas prices to heat up. On the Seeking Alpha Site Carl Surran thinks the EnCana's bullish thesis is still intact. Also on Seeking Alpha IAE Research say the company should grow after reshuffling its assets.
When I look at analysts' recommendations, I find Strong Buy, Buy, Hold and Underperform recommendations. There are a lot of analysts following this stock and most of the recommendations are a Buy or a Hold. The consensus recommendation would be a Buy. The 12 month consensus stock price is $24.30. This implies a total return of 21.81% with 20.24% from capital gains and 1.57% from dividends.
Sound bit for Twitter and StockTwits is: price is cheap. The price is rather low. However, they just also cut their dividend to a 1.6% yield. Most analysts do not see much in the way of dividend increases over the next little while. So, dividends are not likely to be very good in the near future. See my spreadsheet at eca.htm.
This is the second of two parts. The first part was posted on Monday, November 17, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
EnCana is among the largest natural gas companies in North America. They are focused on natural gas exploration and the development of resource plays. They have a diversified portfolio of assets and hold a highly competitive land and resource position in a number of North America's most promising shale and tight gas resource plays. Its web site is here EnCana.
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 Encana Corp. (TSX-ECA, NYSE-ECA) but I used to. Please note that my spreadsheet following this company starts with Alberta Energy Company and follows this company into the formation of EnCana in 2002. It was in 2002 EnCana was formed with the merger of AEC and PanCanadian Energy Corporation. Company split into EnCana Corp and Cenovus Energy Inc. in 2009, Oil with Cenovus and gas with EnCana.
When I look at insider trading, there is not much happening. There is no insider selling and insider buying is at $0.6M. This is at $0.004% of market cap and so relatively very little. There seems to be little insider ownership. The CEO owns shares worth around $1.2M and the Chairman owns shares worth around $2M. Otherwise insider ownership is little.
The 5 year low, median and high median Price/Earnings per Share Ratios are 13.96, 15.91 and 17.86. The current P/E at 8.42 is based on a stock price of $20.21 and 2014 EPS estimate of $2.40. This stock price test suggests that the stock price is cheap.
I get a Graham Price of $28.08. The 10 year low, median and high median Price/Graham Price Ratios are 0.78, 1.03 and 1.19. The current P/GP Ratio is 0.72 based on a stock price of $20.21. This stock price test suggests that the stock price is cheap.
The 10 year Price/Book Value per Share Ratio is 1.96. The current one is 30% lower at 1.38 based on a stock price of $20.21 and BVPS of $14.60. This stock price test suggests that the stock price is cheap.
If you do a dividend yield stock price test you get different results. The current dividend yield 1.57% is much lower than the 5 year median dividend yield of 3.12% and the historical average of 2.99%. Interestingly it is not lower than the historical median yield of 1.45%. The yield on this stock has been quite high recently until the dividend was cut recently by some 65%.
However, they have cut the dividend to get a better Payout Ratio for EPS. Last year the DPR for EPS was 209%. In 2012 they had an earnings loss. The DPR for EPS for 2014 is expected to be around 13%.
The Motley Fool likes EnCana because they expect gas prices to heat up. On the Seeking Alpha Site Carl Surran thinks the EnCana's bullish thesis is still intact. Also on Seeking Alpha IAE Research say the company should grow after reshuffling its assets.
When I look at analysts' recommendations, I find Strong Buy, Buy, Hold and Underperform recommendations. There are a lot of analysts following this stock and most of the recommendations are a Buy or a Hold. The consensus recommendation would be a Buy. The 12 month consensus stock price is $24.30. This implies a total return of 21.81% with 20.24% from capital gains and 1.57% from dividends.
Sound bit for Twitter and StockTwits is: price is cheap. The price is rather low. However, they just also cut their dividend to a 1.6% yield. Most analysts do not see much in the way of dividend increases over the next little while. So, dividends are not likely to be very good in the near future. See my spreadsheet at eca.htm.
This is the second of two parts. The first part was posted on Monday, November 17, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
EnCana is among the largest natural gas companies in North America. They are focused on natural gas exploration and the development of resource plays. They have a diversified portfolio of assets and hold a highly competitive land and resource position in a number of North America's most promising shale and tight gas resource plays. Its web site is here EnCana.
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, November 17, 2014
Encana Corp.
On my other blog I am today writing about the presentation at the World Money Show in Toronto by Jimmy Mengel.
I do not own this stock of Encana Corp. (TSX-ECA, NYSE-ECA) but I used to. I had held this stock previously as Alberta Energy Company from April 2000 until August 2002 and made some 18% total returns per year. I had EnCana Corp from February 2006 to November 2009 and made a 9.54% per year total return. I sold this stock in 2009 because I only had 100 shares and the stock was going to split into two companies. I would have ended up with small investment in two companies.
As you can see I do not look on oil companies as a long term buy. Also, please note that my spreadsheet following this company starts with Alberta Energy Company and follows this company into the formation of EnCana in 2002. It was in 2002 EnCana was formed with the merger of AEC and PanCanadian Energy Corporation. Company split into EnCana Corp and Cenovus Energy Inc. in 2009, Oil with Cenovus and gas with EnCana.
Dividends on this company is paid in US$, so dividends paid will fluctuate depending on the exchange rate between US$ and CDN$. There has been another big cut in dividends for 2014 and this cut is a 65% cut. Over the past 10 years in CDN$ terms dividends are up by 9.8% and over the same period in US$ they are up by 10.5%. This includes the latest dividend cut.
Over the past 5 years, dividends are down by 17.7% in CDN$ terms and by 18.9% in US$ terms. This also includes the most recent dividend cut. Dividends on resource stocks do tend to fluctuate.
Over the past 5 and 10 years, the total return for this stock is at a negative 7.50% per year and a positive 4.57% per year. The 5 year capital loss is at 9.94% per year and the 5 year dividend is at 2.44% per year. For the past 10 years, the capital gain is at 1.38% per year and the dividend is at 3.20% per year. It has been 5 years since EnCana was split into two companies, so the 5 year values are from this split.
The outstanding shares are down by 0 and 2.2% per year over the past 5 and 10 years. Shares have increased sue to Share Issues, Stock Options and DRIP. Shares have decreased due to Buy Backs.
This stock reports in US$. The Revenue is down by 17.7% and up by 6.1% per year over the past 5 and 10 years. The Revenue per Share is down by 17.4% and up by 8.4% per year over the past 5 and 10 years. The Revenue per Share looks better because of share buy backs. Revenues hit bottom in 2012 and have been improving since. Analysts expect growth in Revenue over the next few years. If you compare the 12 month period to the end of September 2014 to the 12 month period to the end of December 2013, Revenues are up by 23%.
Net Income is down by 40% and 15% per year over the past 5 and 10 years. Net income hit bottom in 2012 and has been improving since. Analysts expect good growth in Net Income over the next few years. Net Income growth is certainly very good to the end of the third quarter of 2014. Net Income over the past 12 months to the end of the third quarter is up over a 1,000% compared to 12 month period to December 2013.
EPS is down by 41.5% and 14.5% per year over the past 5 and 10 years. These values are in US$ terms. EPS hit bottom in 2012 and has been improving since. Analysts expect good growth in EPS, especially in 2014. If you compare the 12 month period to the end of September 2014 to the 12 month period to the end of December 2013, EPS are up by 1,141%.
Cash flow is down by 12.1% and up by 0.9% per year over the past 5 and 10 years. Cash Flow per Share is down by 11.9% and up by 3.1% per year over the past 5 and 10 years. These are also in US$ terms. Cash Flow bottomed in 2011. Analysts expect good growth for 2014 at some 38%. If you compare the 12 month period to the end of September 2014 to the 12 month period to the end of December 2013, Cash Flows are up by 18.3%.
Revenue, Earnings and dividends hit peaks in 2008. The Cash Flow hit a peak in 2009. Looking at the 5 year running averages, they are bit better than just past 5 and 10 years, except in cash flow. If you look at CFPS using 5 year running averages, the growth is at 7% and 13.3% per year over the past 5 and 10 years.
In the last 4 out of 5 years, the Return on Equity has been below 10%. For the year ending in December 2013, the ROE was at 4.6%. The ROE is expected to be around 11% for 2014. If you calculate ROE for Net Income for the 12 month period ending in September 2014, it is at 31.3%. Generally the ROE on comprehensive income tends to be slightly higher than the ROE for Net Income.
The Liquidity Ratio and Debt Ratios are slightly low and the Leverage and Debt/Equity Ratios slightly high. The Liquidity Ratio has fluctuated and the one for 2013 was at 1.45, but the current ratio is 4.12 and this is higher than it has been before. The Debt Ratio for 2013 was at 1.41 and the current one is 1.80 is also rather high, but since the 5 year median is 1.93 so it is not higher than it has been in the past. It has also fluctuated.
The Leverage and Debt/Equity Ratios are generally a bit high with values of 3.43 and 2.43 for 2013 and current values of 2.25 and 1.25. The 5 year median values are 2.11 and 1.11. I prefer them to be below 2.00 and 1.00 respectively, but they are currently ok.
Sound bit for Twitter and StockTwits is: Good growth since 2012. See my spreadsheet at eca.htm.
This is the first of two parts. The second part will be posted on Tuesday, November 18, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
EnCana is among the largest natural gas companies in North America. They are focused on natural gas exploration and the development of resource plays. They have a diversified portfolio of assets and hold a highly competitive land and resource position in a number of North America's most promising shale and tight gas resource plays. Its web site is here EnCana.
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 Encana Corp. (TSX-ECA, NYSE-ECA) but I used to. I had held this stock previously as Alberta Energy Company from April 2000 until August 2002 and made some 18% total returns per year. I had EnCana Corp from February 2006 to November 2009 and made a 9.54% per year total return. I sold this stock in 2009 because I only had 100 shares and the stock was going to split into two companies. I would have ended up with small investment in two companies.
As you can see I do not look on oil companies as a long term buy. Also, please note that my spreadsheet following this company starts with Alberta Energy Company and follows this company into the formation of EnCana in 2002. It was in 2002 EnCana was formed with the merger of AEC and PanCanadian Energy Corporation. Company split into EnCana Corp and Cenovus Energy Inc. in 2009, Oil with Cenovus and gas with EnCana.
Dividends on this company is paid in US$, so dividends paid will fluctuate depending on the exchange rate between US$ and CDN$. There has been another big cut in dividends for 2014 and this cut is a 65% cut. Over the past 10 years in CDN$ terms dividends are up by 9.8% and over the same period in US$ they are up by 10.5%. This includes the latest dividend cut.
Over the past 5 years, dividends are down by 17.7% in CDN$ terms and by 18.9% in US$ terms. This also includes the most recent dividend cut. Dividends on resource stocks do tend to fluctuate.
Over the past 5 and 10 years, the total return for this stock is at a negative 7.50% per year and a positive 4.57% per year. The 5 year capital loss is at 9.94% per year and the 5 year dividend is at 2.44% per year. For the past 10 years, the capital gain is at 1.38% per year and the dividend is at 3.20% per year. It has been 5 years since EnCana was split into two companies, so the 5 year values are from this split.
The outstanding shares are down by 0 and 2.2% per year over the past 5 and 10 years. Shares have increased sue to Share Issues, Stock Options and DRIP. Shares have decreased due to Buy Backs.
This stock reports in US$. The Revenue is down by 17.7% and up by 6.1% per year over the past 5 and 10 years. The Revenue per Share is down by 17.4% and up by 8.4% per year over the past 5 and 10 years. The Revenue per Share looks better because of share buy backs. Revenues hit bottom in 2012 and have been improving since. Analysts expect growth in Revenue over the next few years. If you compare the 12 month period to the end of September 2014 to the 12 month period to the end of December 2013, Revenues are up by 23%.
Net Income is down by 40% and 15% per year over the past 5 and 10 years. Net income hit bottom in 2012 and has been improving since. Analysts expect good growth in Net Income over the next few years. Net Income growth is certainly very good to the end of the third quarter of 2014. Net Income over the past 12 months to the end of the third quarter is up over a 1,000% compared to 12 month period to December 2013.
EPS is down by 41.5% and 14.5% per year over the past 5 and 10 years. These values are in US$ terms. EPS hit bottom in 2012 and has been improving since. Analysts expect good growth in EPS, especially in 2014. If you compare the 12 month period to the end of September 2014 to the 12 month period to the end of December 2013, EPS are up by 1,141%.
Cash flow is down by 12.1% and up by 0.9% per year over the past 5 and 10 years. Cash Flow per Share is down by 11.9% and up by 3.1% per year over the past 5 and 10 years. These are also in US$ terms. Cash Flow bottomed in 2011. Analysts expect good growth for 2014 at some 38%. If you compare the 12 month period to the end of September 2014 to the 12 month period to the end of December 2013, Cash Flows are up by 18.3%.
Revenue, Earnings and dividends hit peaks in 2008. The Cash Flow hit a peak in 2009. Looking at the 5 year running averages, they are bit better than just past 5 and 10 years, except in cash flow. If you look at CFPS using 5 year running averages, the growth is at 7% and 13.3% per year over the past 5 and 10 years.
In the last 4 out of 5 years, the Return on Equity has been below 10%. For the year ending in December 2013, the ROE was at 4.6%. The ROE is expected to be around 11% for 2014. If you calculate ROE for Net Income for the 12 month period ending in September 2014, it is at 31.3%. Generally the ROE on comprehensive income tends to be slightly higher than the ROE for Net Income.
The Liquidity Ratio and Debt Ratios are slightly low and the Leverage and Debt/Equity Ratios slightly high. The Liquidity Ratio has fluctuated and the one for 2013 was at 1.45, but the current ratio is 4.12 and this is higher than it has been before. The Debt Ratio for 2013 was at 1.41 and the current one is 1.80 is also rather high, but since the 5 year median is 1.93 so it is not higher than it has been in the past. It has also fluctuated.
The Leverage and Debt/Equity Ratios are generally a bit high with values of 3.43 and 2.43 for 2013 and current values of 2.25 and 1.25. The 5 year median values are 2.11 and 1.11. I prefer them to be below 2.00 and 1.00 respectively, but they are currently ok.
Sound bit for Twitter and StockTwits is: Good growth since 2012. See my spreadsheet at eca.htm.
This is the first of two parts. The second part will be posted on Tuesday, November 18, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
EnCana is among the largest natural gas companies in North America. They are focused on natural gas exploration and the development of resource plays. They have a diversified portfolio of assets and hold a highly competitive land and resource position in a number of North America's most promising shale and tight gas resource plays. Its web site is here EnCana.
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, November 14, 2014
Chesswood Group Ltd.
On my other blog I am today writing about the presentation at the World Money Show in Toronto by Money Saver Magazine with David Stanley.
I do not own this stock of Chesswood Group Ltd. (TSX-CHW, OTC-CHWWF). A reader wrote me in 2012 that he was researching and found a company that he hoped I could give me a brief outlook on. He said that the company is Chesswood Group and they are basically a financial leasing company. From 2009 to 2012 they increased their dividends from 2.5 cents to 5.5 cents per month. This is a 120% increase.
Dividends are now at 65 cents, an increase of 8.3% for 2014. The dividend growth over the past 5 years is at 5.2% per year. The dividends are down by 2.3% per year over the past 7 years. The low growth and lower dividends can be explained because this stock used to be an income trust company. When it became a corporation it decreased the dividends by some 74%.
If you look at dividend increases since they start to increase them again in 2009, dividends are up by 21.8% per year. I wonder about this dividend growth being sustainable. Earnings are growing, but revenue and cash flow are not. The current dividend yield is very good at 5.42%.
The Dividend Payout Ratio is for 2013 is at 80% and 24.1% for EPS and CFPS. The DPR for EPS is expected to be about 72% for 2014. There is not many analysts following this stock and there are noestimates for CF.
The outstanding shares have increased by 6.9% and 4.9% per year over the past 5 and 7 years. Revenue is not growing much and Revenue per Share is down. Earnings have growing very well, but cash flow has not. Without future revenue growth, EPS cannot grow. Revenue is expected to go down by 11% for 2014, but then go up 15% in 2014. This means it is expected to growth 2.7% from 2013 to 2014.
The Revenue has grown at 2.5% and 6.7% per year over the past 5 and 10 years. Revenue per Share is down by 4.2% and up by 2.5% per year over the past 5 and 7 years. Earnings per Share have grown well and EPS is up by 25% and 5% per year over the past 4 and 7 years. I use the last 4 years EPS growth because 5 years ago the EPS was negative.
Cash flow is down by 3.8% and up by 1.9% per year over the past 5 and 7 years. CFPS is down by 10% and 2.8% per year over the past 5 and 7 years.
The Liquidity Ratio is high, but the Debt Ratio is a bit low and the Leverage and Debt/Equity Ratios are a bit high. The Liquidity Ratio for 2013 is 13.15. They have very little current debt. The Debt Ratio is 1.46. The Leverage and Debt/Equity Ratios are 3.18 and 2.18. Generally speaking, Leverage and Debt/Equity Ratios are usually high for financial companies.
The 5 year low, median and high median Price/Earnings per Share are at 8.05, 10.03 and 12.01. The corresponding 7 year values are a bit lower. The current P/E Ratio is 14.54 based on a stock price of $14.43 and 2014 EPS estimate of $1.08. This stock price test suggests that the stock price is relatively expensive. However, a P/E Ratio of 14.54 is not a high one.
The 10 year Price/Book Value per Share Ratio is 0.99. The current P/B Ratio of 2.28 is some 130% higher. This stock price test suggests that the stock price is relatively expensive.
One thing I should mention that I did not like was in 2011 this company did a 1 to 100 consolidation and then a 100 to 1 split. The sole purpose of this seemed to be to get rid of small shareholders. This is not a positive sign for small investors.
Sound bit for Twitter and StockTwits is: Dividend Growth Stock, with problems. See my spreadsheet at chw.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.
Chesswood Group Limited is a financial services company operating primarily in the specialty finance industry. Chesswood's approach is to acquire financial services businesses. It owns Pawnee Leasing Corporation, located in Fort Collins, Colorado, is Chesswood's largest operating company. Pawnee's assets comprise approximately 75% of Chesswood's consolidated assets. Chesswood owns of one of the larger Acura dealers in Canada, Acura Sherway, in addition to Canada's only eDealer, cars4U.com. Its web site is here Chesswood Group.
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 Chesswood Group Ltd. (TSX-CHW, OTC-CHWWF). A reader wrote me in 2012 that he was researching and found a company that he hoped I could give me a brief outlook on. He said that the company is Chesswood Group and they are basically a financial leasing company. From 2009 to 2012 they increased their dividends from 2.5 cents to 5.5 cents per month. This is a 120% increase.
Dividends are now at 65 cents, an increase of 8.3% for 2014. The dividend growth over the past 5 years is at 5.2% per year. The dividends are down by 2.3% per year over the past 7 years. The low growth and lower dividends can be explained because this stock used to be an income trust company. When it became a corporation it decreased the dividends by some 74%.
If you look at dividend increases since they start to increase them again in 2009, dividends are up by 21.8% per year. I wonder about this dividend growth being sustainable. Earnings are growing, but revenue and cash flow are not. The current dividend yield is very good at 5.42%.
The Dividend Payout Ratio is for 2013 is at 80% and 24.1% for EPS and CFPS. The DPR for EPS is expected to be about 72% for 2014. There is not many analysts following this stock and there are noestimates for CF.
The outstanding shares have increased by 6.9% and 4.9% per year over the past 5 and 7 years. Revenue is not growing much and Revenue per Share is down. Earnings have growing very well, but cash flow has not. Without future revenue growth, EPS cannot grow. Revenue is expected to go down by 11% for 2014, but then go up 15% in 2014. This means it is expected to growth 2.7% from 2013 to 2014.
The Revenue has grown at 2.5% and 6.7% per year over the past 5 and 10 years. Revenue per Share is down by 4.2% and up by 2.5% per year over the past 5 and 7 years. Earnings per Share have grown well and EPS is up by 25% and 5% per year over the past 4 and 7 years. I use the last 4 years EPS growth because 5 years ago the EPS was negative.
Cash flow is down by 3.8% and up by 1.9% per year over the past 5 and 7 years. CFPS is down by 10% and 2.8% per year over the past 5 and 7 years.
The Liquidity Ratio is high, but the Debt Ratio is a bit low and the Leverage and Debt/Equity Ratios are a bit high. The Liquidity Ratio for 2013 is 13.15. They have very little current debt. The Debt Ratio is 1.46. The Leverage and Debt/Equity Ratios are 3.18 and 2.18. Generally speaking, Leverage and Debt/Equity Ratios are usually high for financial companies.
The 5 year low, median and high median Price/Earnings per Share are at 8.05, 10.03 and 12.01. The corresponding 7 year values are a bit lower. The current P/E Ratio is 14.54 based on a stock price of $14.43 and 2014 EPS estimate of $1.08. This stock price test suggests that the stock price is relatively expensive. However, a P/E Ratio of 14.54 is not a high one.
The 10 year Price/Book Value per Share Ratio is 0.99. The current P/B Ratio of 2.28 is some 130% higher. This stock price test suggests that the stock price is relatively expensive.
One thing I should mention that I did not like was in 2011 this company did a 1 to 100 consolidation and then a 100 to 1 split. The sole purpose of this seemed to be to get rid of small shareholders. This is not a positive sign for small investors.
Sound bit for Twitter and StockTwits is: Dividend Growth Stock, with problems. See my spreadsheet at chw.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.
Chesswood Group Limited is a financial services company operating primarily in the specialty finance industry. Chesswood's approach is to acquire financial services businesses. It owns Pawnee Leasing Corporation, located in Fort Collins, Colorado, is Chesswood's largest operating company. Pawnee's assets comprise approximately 75% of Chesswood's consolidated assets. Chesswood owns of one of the larger Acura dealers in Canada, Acura Sherway, in addition to Canada's only eDealer, cars4U.com. Its web site is here Chesswood Group.
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, November 13, 2014
Cenovus Energy Inc. 2
On my other blog I am today writing about the presentation at the World Money Show in Toronto by Money Saver Magazine with Bruce Cappon.
I do not own this stock of Cenovus Energy Inc. (TSX-CVE, NYSE-CVE). This is another stock that was talked about at the 2010 Money Show in Toronto. There were those who liked oil companies and they mentioned both Suncor Energy Inc. (TSX-SU) and Cenovus Energy Inc. (TSX-CVE).
This company was split off from EnCana (TSX-ECA) in 2009. This was the oil part of EnCana and EnCana now is just a gas play. My spreadsheet reflects this split. I was also following Alberta Energy Co. (TSX-AEC) into EnCana. Also, between 2002 and 2008, the company was reporting in US$.
When I look at insider trading, I find $1M of insider buying and $3.3M of insider selling. Net insider selling is at $2.3M and only 0.01% of market cap and therefore a low amount. There is insider ownership with the CEO owing shares worth around $3.7M, the CFO owing shares worth around $1.1M, and officer owing shares worth around $3.4M and the Chairman owning shares worth around $3.7.
Outstanding shares were increased by 970,000 in 2013 for stock options. This is 0.13% of the outstanding shares and therefore a low amount. This book value of these shares was at $31M and this number of shares was worth some $29.5M at the end of 2013. (You can compare and contrast this with the same sort of information on CCL Industries where values were relatively much higher.)
The 5 year low, median and high median Price/Earnings per Share Ratios are 19.94, 24.54 and 29.14. The 10 year corresponding values were much lower at 12.47, 14.85 and 18.07. The current P/E Ratio is 15.06 based on a stock price of $28.62 and 2014 EPS estimate of $1.90. This stock price test suggests that the stock price is reasonable.
I get a Graham Price of $24.84. The 10 year low, median and high median Price/Graham Price Ratios are 1.08, 1.28 and 1.57. The current P/GP Ratio 1.15 based on a stock price of $28.62. This stock price test suggests that the stock price is reasonable.
The 10 year Price/Book Value per Share Ratio is 1.22. The current P/B Ratio is 2.01 based on a BVPS of $14.21 and a stock price of $28.62. The current P/B Ratio is some 9% lower than the 10 year P/B Ratio. This stock price test suggests that the stock price is reasonable.
The 5 year dividend yield is 2.76% and the current dividend yield at 3.72% is some 35% higher. I do not think that looking a historical dividend yields are appropriate because they cover EnCana not Cenovus. This stock price test suggests that the stock price is cheap.
Sound bit for Twitter and StockTwits is: Stock price is reasonable to cheap. See my spreadsheet at cve.htm. Note that there is a lot hidden in my spreadsheet, like US$ values and pre-2009 original values. Prior to 2009, reporting was in US$ and company was part of EnCana Otherwise the spreadsheet would look too confusing. However, I am willing to share my whole spreadsheet with anyone interested.
This is the second of two parts. The first part was posted on Wednesday, November 12, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
Cenovus Energy Inc. is an integrated oil company. The Company's operations include enhanced oil recovery (EOR) properties and established crude oil and natural gas production in Alberta and Saskatchewan. It also has ownership interests in two refineries in Illinois and Texas, United States. Its web site is here Cenovus.
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 Cenovus Energy Inc. (TSX-CVE, NYSE-CVE). This is another stock that was talked about at the 2010 Money Show in Toronto. There were those who liked oil companies and they mentioned both Suncor Energy Inc. (TSX-SU) and Cenovus Energy Inc. (TSX-CVE).
This company was split off from EnCana (TSX-ECA) in 2009. This was the oil part of EnCana and EnCana now is just a gas play. My spreadsheet reflects this split. I was also following Alberta Energy Co. (TSX-AEC) into EnCana. Also, between 2002 and 2008, the company was reporting in US$.
When I look at insider trading, I find $1M of insider buying and $3.3M of insider selling. Net insider selling is at $2.3M and only 0.01% of market cap and therefore a low amount. There is insider ownership with the CEO owing shares worth around $3.7M, the CFO owing shares worth around $1.1M, and officer owing shares worth around $3.4M and the Chairman owning shares worth around $3.7.
Outstanding shares were increased by 970,000 in 2013 for stock options. This is 0.13% of the outstanding shares and therefore a low amount. This book value of these shares was at $31M and this number of shares was worth some $29.5M at the end of 2013. (You can compare and contrast this with the same sort of information on CCL Industries where values were relatively much higher.)
The 5 year low, median and high median Price/Earnings per Share Ratios are 19.94, 24.54 and 29.14. The 10 year corresponding values were much lower at 12.47, 14.85 and 18.07. The current P/E Ratio is 15.06 based on a stock price of $28.62 and 2014 EPS estimate of $1.90. This stock price test suggests that the stock price is reasonable.
I get a Graham Price of $24.84. The 10 year low, median and high median Price/Graham Price Ratios are 1.08, 1.28 and 1.57. The current P/GP Ratio 1.15 based on a stock price of $28.62. This stock price test suggests that the stock price is reasonable.
The 10 year Price/Book Value per Share Ratio is 1.22. The current P/B Ratio is 2.01 based on a BVPS of $14.21 and a stock price of $28.62. The current P/B Ratio is some 9% lower than the 10 year P/B Ratio. This stock price test suggests that the stock price is reasonable.
The 5 year dividend yield is 2.76% and the current dividend yield at 3.72% is some 35% higher. I do not think that looking a historical dividend yields are appropriate because they cover EnCana not Cenovus. This stock price test suggests that the stock price is cheap.
Sound bit for Twitter and StockTwits is: Stock price is reasonable to cheap. See my spreadsheet at cve.htm. Note that there is a lot hidden in my spreadsheet, like US$ values and pre-2009 original values. Prior to 2009, reporting was in US$ and company was part of EnCana Otherwise the spreadsheet would look too confusing. However, I am willing to share my whole spreadsheet with anyone interested.
This is the second of two parts. The first part was posted on Wednesday, November 12, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
Cenovus Energy Inc. is an integrated oil company. The Company's operations include enhanced oil recovery (EOR) properties and established crude oil and natural gas production in Alberta and Saskatchewan. It also has ownership interests in two refineries in Illinois and Texas, United States. Its web site is here Cenovus.
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, November 12, 2014
Cenovus Energy Inc.
On my other blog I am today writing about the presentation at the World Money Show in Toronto by Money Saver Magazine with Alan MacDonald.
I do not own this stock of Cenovus Energy Inc. (TSX-CVE, NYSE-CVE). This is another stock that was talked about at the 2010 Money Show in Toronto. There were those who liked oil companies and they mentioned both Suncor Energy Inc. (TSX-SU) and Cenovus Energy Inc. (TSX-CVE).
This company was split off from EnCana (TSX-ECA) in 2009. This was the oil part of EnCana and EnCana now is just a gas play. My spreadsheet reflects this split. I was also following Alberta Energy Co. (TSX-AEC) into EnCana. Also, between 2002 and 2008, the company was reporting in US$.
First I will talk about dividends. Dividend yields were a lot lower before company was split from EnCana. Perhaps I should say the dividends attached to this stock were lower prior to the split. The dividend yields of EnCana had a median value of 1.3%. The dividend yield median for Cenovus is at 2.9%.
This company was split from EnCana in 2009. Since then dividends are up by 4.9% per year. The dividends were flat for two years of 2009 and 2010. The years of 2011, 2013 and 2014 have seen 10% rises in dividends.
The 5 year median Dividend Payout Ratio for the EPS is at 67.2% and for CFPS is at 21%. The DPRs for EPS for 2013 was at 111.3% and for CFPS was at 21%. The DPRs for 2014 are expected to be better at $56% for EPS and 23% for CFPS.
Shareholders have a positive total return, but it is rather low. The 5 and 10 year total return is at 6.02% and 8.72% per year. The capital gain portion of this return is 2.58% and 5.60% per year. The dividend portion of this return is 3.45% and 3.12% per year. Note that it is now 5 years since this company was split off from EnCana.
Over the past 5 years, the Return on Equity was below 10% 3 times. The ROE for 2013 was 6.7% and the 5 year median ROE was 9.9%. The ROE on comprehensive income for 2013 was 8.1% and its 5 year median is 9.8%.
The debt ratios are fine, but the Liquidity Ratio is a bit low and the Leverage and Debt/Equity Ratios are a bit high. The Liquidity Ratio for 2013 was 1.48. The 5 year median is 1.24. I think it is better when this ratio is 1.50 or above. If you add in cash flow after dividends the ratio is 2.23. The Debt Ratio is good at 1.65 and its 5 year median is 1.74. The Leverage and Debt/Equity Ratios are 2.54 and 1.54. I think it is better when these ratios are 1.99 and 0.99 respectively and below.
Sound bit for Twitter and StockTwits is: Energy Dividend Growth Stock. See my spreadsheet at cve.htm. Note that there is a lot hidden in my spreadsheet, like US$ values and pre-2009 original values. Prior to 2009, reporting was in US$ and company was part of EnCana. Otherwise the spreadsheet would look too confusing. However, I am willing to share my whole spreadsheet with anyone interested.
This is the first of two parts. The second part will be posted on Thursday, November 13, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
Cenovus Energy Inc. is an integrated oil company. The Company's operations include enhanced oil recovery (EOR) properties and established crude oil and natural gas production in Alberta and Saskatchewan. It also has ownership interests in two refineries in Illinois and Texas, United States. Its web site is here Cenovus.
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 Cenovus Energy Inc. (TSX-CVE, NYSE-CVE). This is another stock that was talked about at the 2010 Money Show in Toronto. There were those who liked oil companies and they mentioned both Suncor Energy Inc. (TSX-SU) and Cenovus Energy Inc. (TSX-CVE).
This company was split off from EnCana (TSX-ECA) in 2009. This was the oil part of EnCana and EnCana now is just a gas play. My spreadsheet reflects this split. I was also following Alberta Energy Co. (TSX-AEC) into EnCana. Also, between 2002 and 2008, the company was reporting in US$.
First I will talk about dividends. Dividend yields were a lot lower before company was split from EnCana. Perhaps I should say the dividends attached to this stock were lower prior to the split. The dividend yields of EnCana had a median value of 1.3%. The dividend yield median for Cenovus is at 2.9%.
This company was split from EnCana in 2009. Since then dividends are up by 4.9% per year. The dividends were flat for two years of 2009 and 2010. The years of 2011, 2013 and 2014 have seen 10% rises in dividends.
The 5 year median Dividend Payout Ratio for the EPS is at 67.2% and for CFPS is at 21%. The DPRs for EPS for 2013 was at 111.3% and for CFPS was at 21%. The DPRs for 2014 are expected to be better at $56% for EPS and 23% for CFPS.
Shareholders have a positive total return, but it is rather low. The 5 and 10 year total return is at 6.02% and 8.72% per year. The capital gain portion of this return is 2.58% and 5.60% per year. The dividend portion of this return is 3.45% and 3.12% per year. Note that it is now 5 years since this company was split off from EnCana.
Over the past 5 years, the Return on Equity was below 10% 3 times. The ROE for 2013 was 6.7% and the 5 year median ROE was 9.9%. The ROE on comprehensive income for 2013 was 8.1% and its 5 year median is 9.8%.
The debt ratios are fine, but the Liquidity Ratio is a bit low and the Leverage and Debt/Equity Ratios are a bit high. The Liquidity Ratio for 2013 was 1.48. The 5 year median is 1.24. I think it is better when this ratio is 1.50 or above. If you add in cash flow after dividends the ratio is 2.23. The Debt Ratio is good at 1.65 and its 5 year median is 1.74. The Leverage and Debt/Equity Ratios are 2.54 and 1.54. I think it is better when these ratios are 1.99 and 0.99 respectively and below.
Sound bit for Twitter and StockTwits is: Energy Dividend Growth Stock. See my spreadsheet at cve.htm. Note that there is a lot hidden in my spreadsheet, like US$ values and pre-2009 original values. Prior to 2009, reporting was in US$ and company was part of EnCana. Otherwise the spreadsheet would look too confusing. However, I am willing to share my whole spreadsheet with anyone interested.
This is the first of two parts. The second part will be posted on Thursday, November 13, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
Cenovus Energy Inc. is an integrated oil company. The Company's operations include enhanced oil recovery (EOR) properties and established crude oil and natural gas production in Alberta and Saskatchewan. It also has ownership interests in two refineries in Illinois and Texas, United States. Its web site is here Cenovus.
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, November 11, 2014
CCL Industries Inc. 2
On my other blog I am today writing about the presentation at the World Money Show in Toronto by Money Saver Magazine with John DeGoey.
I do not own this stock of CCL Industries Inc. (TSX-CCL.B, OTC-CCDBF). In 2009 I read a favorable report on this stock of which I had also heard of before. This is also a dividend paying stock and in 2009 it was on Dividend Achievers list.
When I look at insider trading I find net insider selling at $49.6M. There is a very minor amount of insider buying. Net insider selling equals some 1.8% of the market cap of this stock and on a relative basis this is quite high.
Also, in 2013 outstanding shares were increased by 916,000 for stock options. This amount is some 2.66% of outstanding shares and again is quite high. You would expect the percentage to be under 1% and ideally under 0.5%. These stock options have a book value of $20M. This number of shares was worth $72.6M at the end of 2013.
The 5 year low, median and high median Price/Earnings per Share Ratios are 11.69, 13.22 and 15.03. The corresponding 10 years values were a bit lower at 11.34, 13.14 and 14.81. The current P/E Ratio is 18.77 based on a stock price of $122.20 and 2014 EPS estimate of $6.51. This stock price test suggests that the stock is relatively expensive. A P/E of 18.77 is not a particularly high one on an absolute basis. But this is an industrial stock, so I would expect that P/E would be more in line with the stock's history.
A 2014 EPS estimate of $6.51 may see high considering that the EPS for 2013 was at 2.99. However, if you look at EPS for the last 12 months ending in the third quarter of September 30, 2014, the EPS is $5.45.
I get a Graham Price of $69.96. The 10 year low, median and high Price/Graham Price Ratios are 0.75, 0.89 and 1.01. The current P/GP Ratio is 1.77. This stock price test suggests that the stock price is relatively expensive.
I get a 10 year Price/Book Value per Share Ratio of 1.39. The current P/B Ratio is 3.76 a value some 170% higher. The P/B Ratio of 3.76 is based on a BVPS of $32.46 and a stock price of $122.20. This stock price test suggests that the stock price is relatively very expensive. A P/B Ratio of 1.39 is on an absolute basis a low ratio. On an absolute basis a P/B Ratio of 3.76 is not that high.
I get a 5 year median dividend yield of 2.20%. The current dividend yield of 0.98 is some 55% higher. Using the historical average and historical median dividend yields of 2.35% and 2.13%, the current dividend yield is some 58% and 54% higher. This stock price test suggests that the stock price is relatively very expensive. Personally, I do not buy dividend stock with a dividend yield under 1%.
When I look at analysts' recommendations I find Strong Buy and Buy. The consensus recommendation would be a Buy and most analysts' recommendations are a Buy. The 12 month stock price consensus target is $139.00. This implies a total return of 14.73% with 13.75% from capital gains and 0.98% from dividends.
A recent Forbes article says this stock is oversold based on RSI reading. They were using a price of $104.44. By my methods $104.44 is still in overbought range. (Oversold means the price is low or cheap.) The Mideast Times reports that some analysts have raised their target price to $140.00.
Sound bit for Twitter and StockTwits is: Stock price expensive to very expensive. Also insiders are selling off their shares. This could be a momentum buy, but I do not see this as a good entry point for a long term buy. See my spreadsheet at ccl.htm.
This is the second of two parts. The first part was posted on Monday, November 10, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
CCL Industries Inc. provides state-of-the-art specialty packaging solutions to some of the world's largest producers of consumer brands in personal care, cosmetic, healthcare, household and specialty food and beverage products. CCL is the world's largest supplier of innovative and secure labeling solutions to leading global companies in the consumer product and healthcare sectors and supplies aluminum containers and plastic tubes for major consumer brands of personal care, household products and specialty food and beverages. With headquarters in Toronto, Ontario, Canada, CCL Industries operates production facilities in North America, Europe, Latin America, Asia and Australia. Its web site is here CCL Industries.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. 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 CCL Industries Inc. (TSX-CCL.B, OTC-CCDBF). In 2009 I read a favorable report on this stock of which I had also heard of before. This is also a dividend paying stock and in 2009 it was on Dividend Achievers list.
When I look at insider trading I find net insider selling at $49.6M. There is a very minor amount of insider buying. Net insider selling equals some 1.8% of the market cap of this stock and on a relative basis this is quite high.
Also, in 2013 outstanding shares were increased by 916,000 for stock options. This amount is some 2.66% of outstanding shares and again is quite high. You would expect the percentage to be under 1% and ideally under 0.5%. These stock options have a book value of $20M. This number of shares was worth $72.6M at the end of 2013.
The 5 year low, median and high median Price/Earnings per Share Ratios are 11.69, 13.22 and 15.03. The corresponding 10 years values were a bit lower at 11.34, 13.14 and 14.81. The current P/E Ratio is 18.77 based on a stock price of $122.20 and 2014 EPS estimate of $6.51. This stock price test suggests that the stock is relatively expensive. A P/E of 18.77 is not a particularly high one on an absolute basis. But this is an industrial stock, so I would expect that P/E would be more in line with the stock's history.
A 2014 EPS estimate of $6.51 may see high considering that the EPS for 2013 was at 2.99. However, if you look at EPS for the last 12 months ending in the third quarter of September 30, 2014, the EPS is $5.45.
I get a Graham Price of $69.96. The 10 year low, median and high Price/Graham Price Ratios are 0.75, 0.89 and 1.01. The current P/GP Ratio is 1.77. This stock price test suggests that the stock price is relatively expensive.
I get a 10 year Price/Book Value per Share Ratio of 1.39. The current P/B Ratio is 3.76 a value some 170% higher. The P/B Ratio of 3.76 is based on a BVPS of $32.46 and a stock price of $122.20. This stock price test suggests that the stock price is relatively very expensive. A P/B Ratio of 1.39 is on an absolute basis a low ratio. On an absolute basis a P/B Ratio of 3.76 is not that high.
I get a 5 year median dividend yield of 2.20%. The current dividend yield of 0.98 is some 55% higher. Using the historical average and historical median dividend yields of 2.35% and 2.13%, the current dividend yield is some 58% and 54% higher. This stock price test suggests that the stock price is relatively very expensive. Personally, I do not buy dividend stock with a dividend yield under 1%.
When I look at analysts' recommendations I find Strong Buy and Buy. The consensus recommendation would be a Buy and most analysts' recommendations are a Buy. The 12 month stock price consensus target is $139.00. This implies a total return of 14.73% with 13.75% from capital gains and 0.98% from dividends.
A recent Forbes article says this stock is oversold based on RSI reading. They were using a price of $104.44. By my methods $104.44 is still in overbought range. (Oversold means the price is low or cheap.) The Mideast Times reports that some analysts have raised their target price to $140.00.
Sound bit for Twitter and StockTwits is: Stock price expensive to very expensive. Also insiders are selling off their shares. This could be a momentum buy, but I do not see this as a good entry point for a long term buy. See my spreadsheet at ccl.htm.
This is the second of two parts. The first part was posted on Monday, November 10, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
CCL Industries Inc. provides state-of-the-art specialty packaging solutions to some of the world's largest producers of consumer brands in personal care, cosmetic, healthcare, household and specialty food and beverage products. CCL is the world's largest supplier of innovative and secure labeling solutions to leading global companies in the consumer product and healthcare sectors and supplies aluminum containers and plastic tubes for major consumer brands of personal care, household products and specialty food and beverages. With headquarters in Toronto, Ontario, Canada, CCL Industries operates production facilities in North America, Europe, Latin America, Asia and Australia. Its web site is here CCL Industries.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. 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, November 10, 2014
CCL Industries Inc.
On my other blog I am today writing about the presentation at the World Money Show in Toronto by Money Saver Magazine with Burns and Johnston.
I do not own this stock of CCL Industries Inc. (TSX-CCL.B, OTC-CCDBF). In 2009 I read a favorable report on this stock of which I had also heard of before. This is also a dividend paying stock and in 2009 it was on Dividend Achievers list.
As far as dividends go, this stock has had a moderate dividend and has increased it moderately. The 5 year median dividend yield is 2.2% and the 10 year median dividend is 2%. The 5 and 10 year dividend growth is at 9% and 9.1% per year. Recently however, the stock price has moved up sharply and the 2014 dividend yield is only 0.9%. The current dividend yield is 1%. These are both low dividend yields.
With a 2% to 2.2% dividend and 9% dividend growth you would probably have a dividend yield on your original purchase price of 5%, 7.7% and 11.8% after 10, 15 and 20 years. With the current 1% yield and 9% dividend growth, you would have a dividend yield of 2.3%, 3.6% and 5.5% yield on your original purchase price in 10, 15 and 20 years.
Dividend Payout Ratios are good. The 5 year median DPR for EPS is at 28.8% and for CFPS is at 12.8%. The corresponding DPRs for 2013 are at 28.8% for EPS and 13.3% for CFPS. The company is expected to have strong earnings for 2014. The dividends were raised some 20% in 2014, but the DPRs for 2014 are expected to be 16.9% for EPS and just 9% for CFPS.
As I mentioned above, the stock price on this company has moved up sharply lately with an 84% increase in 2013 and another 54% increase so far this year. Shareholders have done very well recently with 5 and 10 year total return at 35.66% and 22.07% per year. The capital gains portion of this total return is at 34.03% and 20.58% per year. The dividends portion of this total return is at 1.63% and 1.49% per year.
Outstanding shares have not increased much over the past 5 and 10 years with increases of 1.1% and 0.6% per year. Shares have increased due to Stock Options and Share Issues and have decreased due to Buy Backs. There are also two classes of shares. Class B shares are on the TSX and are non-voting. Class A shares are voting shares and mostly owned by the Lang family (i.e. like 95%).
Growth in Revenues, Earnings and Cash Flow has been moderate to good over the past 5 and 10 years. If you look at just Revenue, it has grown at 9.7% and 2.2% per year over the past 5 and 10 years. However, in 2005 they sold a division of the company, and if you strip out this division, growth over the past 5 and 8 years are at 9.7% and 8.4% per year. The Revenue per Share has grown at 8.5% and 1.6% per year over the past 5 and 10 years.
The EPS is up by 15.4% and 6.4% per year over the past 5 and 10 years. The 5 year earnings are up sharply because exactly 5 years ago the EPS was at a low. If you use the 5 year running averages over the past 5 years, EPS are down by 4.7% per year.
The Cash Flow is up by 5% and 5.3% per year over the past 5 and 10 years. The Cash Flow per Share is up by 3.9% and 4.6% per year over the past 5 and 10 years.
The Return on Equity has been below 10% 3 times in the last 10 years and 2 times in the last 5 years. The ROE for 2013 is 10.2% and the 5 year median ROE is also at 10.2%. The ROE on comprehensive income is strong for 2013 with a value of 14.7%. However, the 5 year median ROE is low at just 7.2%. It would seem that 2013 is a strong earnings year.
The debt ratios are fine with the Liquidity Ratio a bit low sometimes and the Leverage and Debt/Equity Ratios a bit high sometimes. The Liquidity Ratio is for 2013 is 1.41. If you add in cash flow after dividends his ratio is 1.97. The Debt Ratios have always been good with the 2013 ratio at 1.74 and the 5 year median at 1.95. The current Leverage and Debt/Equity Ratios are 2.36 and 1.36 respectively.
Sound bit for Twitter and StockTwits is: Dividend Growth Stock. Analysts seem to feel that 2014 will be a very good year for this company. The company seems to have confidence in the future as they have raised the dividend by 20% in 2014. This is the highest dividend increase ever for this company. The stock price has also shot up. See my spreadsheet at ccl.htm.
This is the first of two parts. The second part will be posted on Tuesday, November 11, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
CCL Industries Inc. provides state-of-the-art specialty packaging solutions to some of the world's largest producers of consumer brands in personal care, cosmetic, healthcare, household and specialty food and beverage products. CCL is the world's largest supplier of innovative and secure labeling solutions to leading global companies in the consumer product and healthcare sectors and supplies aluminum containers and plastic tubes for major consumer brands of personal care, household products and specialty food and beverages. With headquarters in Toronto, Ontario, Canada, CCL Industries operates production facilities in North America, Europe, Latin America, Asia and Australia. Its web site is here CCL Industries.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. 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 CCL Industries Inc. (TSX-CCL.B, OTC-CCDBF). In 2009 I read a favorable report on this stock of which I had also heard of before. This is also a dividend paying stock and in 2009 it was on Dividend Achievers list.
As far as dividends go, this stock has had a moderate dividend and has increased it moderately. The 5 year median dividend yield is 2.2% and the 10 year median dividend is 2%. The 5 and 10 year dividend growth is at 9% and 9.1% per year. Recently however, the stock price has moved up sharply and the 2014 dividend yield is only 0.9%. The current dividend yield is 1%. These are both low dividend yields.
With a 2% to 2.2% dividend and 9% dividend growth you would probably have a dividend yield on your original purchase price of 5%, 7.7% and 11.8% after 10, 15 and 20 years. With the current 1% yield and 9% dividend growth, you would have a dividend yield of 2.3%, 3.6% and 5.5% yield on your original purchase price in 10, 15 and 20 years.
Dividend Payout Ratios are good. The 5 year median DPR for EPS is at 28.8% and for CFPS is at 12.8%. The corresponding DPRs for 2013 are at 28.8% for EPS and 13.3% for CFPS. The company is expected to have strong earnings for 2014. The dividends were raised some 20% in 2014, but the DPRs for 2014 are expected to be 16.9% for EPS and just 9% for CFPS.
As I mentioned above, the stock price on this company has moved up sharply lately with an 84% increase in 2013 and another 54% increase so far this year. Shareholders have done very well recently with 5 and 10 year total return at 35.66% and 22.07% per year. The capital gains portion of this total return is at 34.03% and 20.58% per year. The dividends portion of this total return is at 1.63% and 1.49% per year.
Outstanding shares have not increased much over the past 5 and 10 years with increases of 1.1% and 0.6% per year. Shares have increased due to Stock Options and Share Issues and have decreased due to Buy Backs. There are also two classes of shares. Class B shares are on the TSX and are non-voting. Class A shares are voting shares and mostly owned by the Lang family (i.e. like 95%).
Growth in Revenues, Earnings and Cash Flow has been moderate to good over the past 5 and 10 years. If you look at just Revenue, it has grown at 9.7% and 2.2% per year over the past 5 and 10 years. However, in 2005 they sold a division of the company, and if you strip out this division, growth over the past 5 and 8 years are at 9.7% and 8.4% per year. The Revenue per Share has grown at 8.5% and 1.6% per year over the past 5 and 10 years.
The EPS is up by 15.4% and 6.4% per year over the past 5 and 10 years. The 5 year earnings are up sharply because exactly 5 years ago the EPS was at a low. If you use the 5 year running averages over the past 5 years, EPS are down by 4.7% per year.
The Cash Flow is up by 5% and 5.3% per year over the past 5 and 10 years. The Cash Flow per Share is up by 3.9% and 4.6% per year over the past 5 and 10 years.
The Return on Equity has been below 10% 3 times in the last 10 years and 2 times in the last 5 years. The ROE for 2013 is 10.2% and the 5 year median ROE is also at 10.2%. The ROE on comprehensive income is strong for 2013 with a value of 14.7%. However, the 5 year median ROE is low at just 7.2%. It would seem that 2013 is a strong earnings year.
The debt ratios are fine with the Liquidity Ratio a bit low sometimes and the Leverage and Debt/Equity Ratios a bit high sometimes. The Liquidity Ratio is for 2013 is 1.41. If you add in cash flow after dividends his ratio is 1.97. The Debt Ratios have always been good with the 2013 ratio at 1.74 and the 5 year median at 1.95. The current Leverage and Debt/Equity Ratios are 2.36 and 1.36 respectively.
Sound bit for Twitter and StockTwits is: Dividend Growth Stock. Analysts seem to feel that 2014 will be a very good year for this company. The company seems to have confidence in the future as they have raised the dividend by 20% in 2014. This is the highest dividend increase ever for this company. The stock price has also shot up. See my spreadsheet at ccl.htm.
This is the first of two parts. The second part will be posted on Tuesday, November 11, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
CCL Industries Inc. provides state-of-the-art specialty packaging solutions to some of the world's largest producers of consumer brands in personal care, cosmetic, healthcare, household and specialty food and beverage products. CCL is the world's largest supplier of innovative and secure labeling solutions to leading global companies in the consumer product and healthcare sectors and supplies aluminum containers and plastic tubes for major consumer brands of personal care, household products and specialty food and beverages. With headquarters in Toronto, Ontario, Canada, CCL Industries operates production facilities in North America, Europe, Latin America, Asia and Australia. Its web site is here CCL Industries.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. 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, November 7, 2014
Brookfield Asset Management 2
On my other blog I am today writing about the presentation at the World Money Show in Toronto by Donald Dony.
I do not own this stock of Brookfield Asset Management (TSX-BAM, NYSE-BAM). I used to own an earlier version of this stock as Hees International, then Edper Group and then EdperBrascan back in 1987 to 1999.
When I look at insider trading, I find just insider selling. Over the past year insider selling totaled $36.7M. This may sound like a lot, but is it just 0.14% of market cap. There is insider ownership with the CEO having shares worth around $712.7M, the CFO having shares worth around $232.1M and a 10% holder with shares worth around $367.2M. The above insiders only hold some 4.4% of the outstanding shares in this company that is worth some $33.9B.
The 5 year low, median and high median Price/Earnings per Share Ratios are 10.80, 11.78 and 14.29. The corresponding 10 year P/E Ratios are higher at 11.14, 14.38 and 17.75. The current P/E Ratio is 22.32 based on a stock price of $55.07 and 2014 EPS estimate of $2.18 US$ or $2.47 CDN$. This stock price test suggests that the stock is expensive.
Another problem is that analysts seem to feel that EPS will drop substantially in 2015 to around $1.59 US$ or $1.80 CDN$. This would raise the P/E Ratio even further to 30.60. By P/E testing, this stock is expensive.
I get a Graham Price of $43.53. The 10 year low, median and high median P/GP Ratios are 0.83, 1.06 and 1.31. The current P/GP Ratio is 1.27. This puts the stock price in the reasonable range. However, I get a P/GP Ratio of 1.48 for 2015 and this puts the stock in the expensive range.
I get a 10 year Price/Book Value per Share Ratio of 2.02 and the current P/B Ratio is 1.61 based on a stock price of $55.07 and BVPS of $34.13. The current P/B Ratio is 20% lower than the 10 year median P/B Ratio. The value in this test is that no estimate values are used. This stock price test suggests that the current stock price is reasonable.
The 5 year median dividend yield is 1.77%, the historical average dividend yield is 3.90% and the historical median dividend yield is 2.88%. These are all substantially higher than the current dividend yield from 25% to 66% higher. This stock price testing suggests that the stock price is expensive.
Over the longer term, capital gains tend to equal dividend increases. Over the past 10 years, in US$, dividends are up by 10.56% per year but capital gains are up by 15.64% per year. This does suggest that the stock price is current expensive.
The Motley Fool says this company is a buy and is bullet proof. The Motley Fool seems to like to stock a lot with another buy on it giving two reasons why Brookfield Asset Management is recession proof.
I had always thought that Motley Fool offered sound advice. I have read some of their reports and they seemed very reasonable. However, when I was at the Money Show I talked to a lady who subscribes to their newsletter. She said that she was currently disappointed with their advice because all the stocks she bought on their advice have lost money. That was certainly interesting.
When I look at analysts' recommendations, I find Buy and Holder recommendations. The 12 month consensus stock price is $44.60. This implies a capital loss of 19%. You can anomalies like this when a stock is climbing fast and analysts' reports do not keep up. Also, there are not that many analysts following this stock as there are only 5.
However, I do wonder about the analysts' estimates. If you look at EPS over the past 12 months to the end of June 2014 compared to the 12 months to the end of 2013, EPS is up some 37%. Analysts expect earnings year over year to the end of 2014 to be down by 30%. Estimates expect Revenues to be down by 6.65, but they are only down by 4.4%. Cash Flow is expected to be down by 50%, but it is up by 5.5%.
If you use EPS over the past 12 months to the end of June 2014, the P/E Ratio is just 11.37. This would put the stock price testing of E/P Ratio into the reasonable range. When stock price testing is uncertain, I like the P/B Ratio and the dividend yield tests. This is because these tests use no estimates. However, the P/B Ratio test says the stock is cheap and the dividend yield tests say the stock is expensive. If I have to choose one test, I tend to go with the dividend yield tests.
Also, as I mentioned yesterday, this company has a lot of cash on hand. It is equal to $7.19 per share or some 13% of the current stock price.
Sound bit for Twitter and StockTwits is: Maybe expensive, maybe not. This stock has been rising since 2009 so the stock price has probably gotten ahead of the stocks fundamentals. However, as I have said above, I do wonder about the analysts' estimates. See my spreadsheet at bam.htm.
This is the second of two parts. The first part was posted on Thursday, November 06, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
This Canadian Asset Managing company invests in and operates a variety of assets on its own behalf as well as co-investors. It is focused on property, power and infrastructure assets. It operates in Canada, US and internationally. Its web site is here Brookfield Asset Management.
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 Brookfield Asset Management (TSX-BAM, NYSE-BAM). I used to own an earlier version of this stock as Hees International, then Edper Group and then EdperBrascan back in 1987 to 1999.
When I look at insider trading, I find just insider selling. Over the past year insider selling totaled $36.7M. This may sound like a lot, but is it just 0.14% of market cap. There is insider ownership with the CEO having shares worth around $712.7M, the CFO having shares worth around $232.1M and a 10% holder with shares worth around $367.2M. The above insiders only hold some 4.4% of the outstanding shares in this company that is worth some $33.9B.
The 5 year low, median and high median Price/Earnings per Share Ratios are 10.80, 11.78 and 14.29. The corresponding 10 year P/E Ratios are higher at 11.14, 14.38 and 17.75. The current P/E Ratio is 22.32 based on a stock price of $55.07 and 2014 EPS estimate of $2.18 US$ or $2.47 CDN$. This stock price test suggests that the stock is expensive.
Another problem is that analysts seem to feel that EPS will drop substantially in 2015 to around $1.59 US$ or $1.80 CDN$. This would raise the P/E Ratio even further to 30.60. By P/E testing, this stock is expensive.
I get a Graham Price of $43.53. The 10 year low, median and high median P/GP Ratios are 0.83, 1.06 and 1.31. The current P/GP Ratio is 1.27. This puts the stock price in the reasonable range. However, I get a P/GP Ratio of 1.48 for 2015 and this puts the stock in the expensive range.
I get a 10 year Price/Book Value per Share Ratio of 2.02 and the current P/B Ratio is 1.61 based on a stock price of $55.07 and BVPS of $34.13. The current P/B Ratio is 20% lower than the 10 year median P/B Ratio. The value in this test is that no estimate values are used. This stock price test suggests that the current stock price is reasonable.
The 5 year median dividend yield is 1.77%, the historical average dividend yield is 3.90% and the historical median dividend yield is 2.88%. These are all substantially higher than the current dividend yield from 25% to 66% higher. This stock price testing suggests that the stock price is expensive.
Over the longer term, capital gains tend to equal dividend increases. Over the past 10 years, in US$, dividends are up by 10.56% per year but capital gains are up by 15.64% per year. This does suggest that the stock price is current expensive.
The Motley Fool says this company is a buy and is bullet proof. The Motley Fool seems to like to stock a lot with another buy on it giving two reasons why Brookfield Asset Management is recession proof.
I had always thought that Motley Fool offered sound advice. I have read some of their reports and they seemed very reasonable. However, when I was at the Money Show I talked to a lady who subscribes to their newsletter. She said that she was currently disappointed with their advice because all the stocks she bought on their advice have lost money. That was certainly interesting.
When I look at analysts' recommendations, I find Buy and Holder recommendations. The 12 month consensus stock price is $44.60. This implies a capital loss of 19%. You can anomalies like this when a stock is climbing fast and analysts' reports do not keep up. Also, there are not that many analysts following this stock as there are only 5.
However, I do wonder about the analysts' estimates. If you look at EPS over the past 12 months to the end of June 2014 compared to the 12 months to the end of 2013, EPS is up some 37%. Analysts expect earnings year over year to the end of 2014 to be down by 30%. Estimates expect Revenues to be down by 6.65, but they are only down by 4.4%. Cash Flow is expected to be down by 50%, but it is up by 5.5%.
If you use EPS over the past 12 months to the end of June 2014, the P/E Ratio is just 11.37. This would put the stock price testing of E/P Ratio into the reasonable range. When stock price testing is uncertain, I like the P/B Ratio and the dividend yield tests. This is because these tests use no estimates. However, the P/B Ratio test says the stock is cheap and the dividend yield tests say the stock is expensive. If I have to choose one test, I tend to go with the dividend yield tests.
Also, as I mentioned yesterday, this company has a lot of cash on hand. It is equal to $7.19 per share or some 13% of the current stock price.
Sound bit for Twitter and StockTwits is: Maybe expensive, maybe not. This stock has been rising since 2009 so the stock price has probably gotten ahead of the stocks fundamentals. However, as I have said above, I do wonder about the analysts' estimates. See my spreadsheet at bam.htm.
This is the second of two parts. The first part was posted on Thursday, November 06, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
This Canadian Asset Managing company invests in and operates a variety of assets on its own behalf as well as co-investors. It is focused on property, power and infrastructure assets. It operates in Canada, US and internationally. Its web site is here Brookfield Asset Management.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
See my website for stocks followed and investment notes. Follow me on Twitter or StockTwits.
Thursday, November 6, 2014
Brookfield Asset Management
On my other blog I am today writing about the presentation at the World Money Show in Toronto that was also a Natural Resources Panel.
I do not own this stock of Brookfield Asset Management (TSX-BAM, NYSE-BAM). I used to own an earlier version of this stock as Hees International, then Edper Group and then EdperBrascan back in 1987 to 1999.
Dividends are paid in US$, so they will fluctuate with the fluctuation of our currency. After 2008 growth in dividends has been quite slow. Dividends have also grown faster in US$ terms that in CDN$ terms. The dividend yield is rather low and over the longer term dividend growth is good.
The current dividend has a dividend yield of 1.32%. The 5 year median dividend yield is at 1.77% in CDN$ and 1.74% in US$. The last dividend increase was for 6.7% in US$, but only 4.1% in CDN$. The 5 and 10 year dividend growth is 0.10% and 8.42% per year in CDN$ and 2.96% and 10.56% per year in US$.
Canadian shareholders have done well in this stock recently. The 5 and 10 year total return has been at 21.63% and 13.80% per year with 2.95% and 2.67% per year from dividends and 18.68% and 11.12% per year from capital gains. The total return for US shareholders is similar.
The outstanding shares have increase by 1.5% and 0.7% per year over the past 5 and 10 years. Revenue and earnings growth has been good and cash flow growth has been moderate to good. Revenue is up by 10.1% and 20% per year over the past 5 and 10 years. Revenue per Share is up by 8.5% and 19.2% per year over the past 5 and 10 years in US$ terms. The growth is slightly less in CDN$.
EPS growth is at 25.1% and 18.32% per year over the past 5 and 10 years. Cash Flow per Share is up by 7.3% and 16.5% per year over the past 5 and 10 years. These are in US$. The growth is slightly less in CDN$.
Return on Equity has been below 10% over the past 10 years twice and over the past 5 years twice. The ROE for 2013 was at 11.9% with the 5 year median at 11.4%. The ROE on comprehensive Income is quite a bit lower in 2013 at 7.5%. The 5 year median ROE on comprehensive income is better at 10.4%. When the ROE on comprehensive income is significantly lower than the ROE on net income, it suggests that perhaps earnings are not of good quality.
The debt ratios are generally good with the Leverage and Debt/Equity Ratios are little high. The Liquidity Ratio is 2.09. The Debt Ratio is 1.73 and the Leverage and Debt/Equity Ratios are 2.37 and 1.37.
The last thing to mention is the company seems to have lots of cash on hand. At the end of 2013 cash equal 5.8% of the stock price and currently cash is at 13.1% of the stock price. Over the past 5 years cash has a median value of 10.4% of the stock price.
Sound bit for Twitter and StockTwits is: Dividend Growth stock. See my spreadsheet at bam.htm.
This is the first of two parts. The second part will be posted on Friday, November 7, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
This Canadian Asset Managing company invests in and operates a variety of assets on its own behalf as well as co-investors. It is focused on property, power and infrastructure assets. It operates in Canada, US and internationally. Its web site is here Brookfield Asset Management.
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 Brookfield Asset Management (TSX-BAM, NYSE-BAM). I used to own an earlier version of this stock as Hees International, then Edper Group and then EdperBrascan back in 1987 to 1999.
Dividends are paid in US$, so they will fluctuate with the fluctuation of our currency. After 2008 growth in dividends has been quite slow. Dividends have also grown faster in US$ terms that in CDN$ terms. The dividend yield is rather low and over the longer term dividend growth is good.
The current dividend has a dividend yield of 1.32%. The 5 year median dividend yield is at 1.77% in CDN$ and 1.74% in US$. The last dividend increase was for 6.7% in US$, but only 4.1% in CDN$. The 5 and 10 year dividend growth is 0.10% and 8.42% per year in CDN$ and 2.96% and 10.56% per year in US$.
Canadian shareholders have done well in this stock recently. The 5 and 10 year total return has been at 21.63% and 13.80% per year with 2.95% and 2.67% per year from dividends and 18.68% and 11.12% per year from capital gains. The total return for US shareholders is similar.
The outstanding shares have increase by 1.5% and 0.7% per year over the past 5 and 10 years. Revenue and earnings growth has been good and cash flow growth has been moderate to good. Revenue is up by 10.1% and 20% per year over the past 5 and 10 years. Revenue per Share is up by 8.5% and 19.2% per year over the past 5 and 10 years in US$ terms. The growth is slightly less in CDN$.
EPS growth is at 25.1% and 18.32% per year over the past 5 and 10 years. Cash Flow per Share is up by 7.3% and 16.5% per year over the past 5 and 10 years. These are in US$. The growth is slightly less in CDN$.
Return on Equity has been below 10% over the past 10 years twice and over the past 5 years twice. The ROE for 2013 was at 11.9% with the 5 year median at 11.4%. The ROE on comprehensive Income is quite a bit lower in 2013 at 7.5%. The 5 year median ROE on comprehensive income is better at 10.4%. When the ROE on comprehensive income is significantly lower than the ROE on net income, it suggests that perhaps earnings are not of good quality.
The debt ratios are generally good with the Leverage and Debt/Equity Ratios are little high. The Liquidity Ratio is 2.09. The Debt Ratio is 1.73 and the Leverage and Debt/Equity Ratios are 2.37 and 1.37.
The last thing to mention is the company seems to have lots of cash on hand. At the end of 2013 cash equal 5.8% of the stock price and currently cash is at 13.1% of the stock price. Over the past 5 years cash has a median value of 10.4% of the stock price.
Sound bit for Twitter and StockTwits is: Dividend Growth stock. See my spreadsheet at bam.htm.
This is the first of two parts. The second part will be posted on Friday, November 7, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.
This Canadian Asset Managing company invests in and operates a variety of assets on its own behalf as well as co-investors. It is focused on property, power and infrastructure assets. It operates in Canada, US and internationally. Its web site is here Brookfield Asset Management.
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, November 5, 2014
Canadian Oil Sands 2
On my other blog I am today writing about the presentation at the World Money Show in Toronto called Natural Resources Panel.
I do not own this stock of Canadian Oil Sands (TSX-COS, OTC-COSWF). I am reviewing this stock because when anyone talks about investing in Canadian Oil Sands, this is the stock that seems to be mentioned first. As with some other investment in oil companies, if the dividend is good, then it will vary according to the price of oil.
When I look at insider trading I find $4M of insider selling, $0.7M of insider buying and net insider selling at $3.3M. Net insider selling is at just 0.03% of market cap and so very low. Outstanding shares were increased by only 10,000 shares for stock options in 2013. This is not high enough to provide a percentage of outstanding stock taking a percentage to two decimal points (that is it is less than 0.00%). I also do not see any significant insider ownership.
The 5 year low, median and high median Price/Earnings Ratios are 10.92, 11.13 and 14.29. The 10 year corresponding P/E Ratios are similar at 10.08, 11.69 and 16.19. The current P/E Ratio is 11.25 based on a stock price of $17.66 and 2014 EPS estimate of $1.57. This stock price test suggests that the stock price is reasonable.
I get a Graham Price of $18.45. The 10 year low, median and high median Price/Graham Price Ratios are 0.94, 1.37 and 1.66. The current P/GP Ratio is 0.96 is based on a stock price of $17.66. This stock price test suggests that the stock price is reasonable.
The 10 year Price/Book Value per Share Ratio is 2.96. The current P/B Ratio is 1.83 based on a stock price of $17.66 and BVPS of $9.63. The current P/B Ratio is some 38% lower than the 10 year ratio. This stock price test suggests that the stock price is cheap.
The historical average dividend yield is 5.02 and this historical median dividend yield is 5.22. These are some 34% and 52% below historical yields. These tests do not show that the stock is cheap, but it does show that it is quite low.
When I look at analysts' recommendations, I find Strong Buy, Hold and Underperform recommendations. There is a lot of Hold and Underperform recommendations and the consensus recommendation would be a Hold. The 12 month stock price consensus is $20.50. This implies a total return of 24.01% with 7.93% from dividends and 16.08% from capital gains. (Note with the falling oil prices, the dividend may not be safe.)
In this financial post article, Albert's Premier says that oil sands crude will reach Gulf Coast with or without Keystone. At the Motley Fool, Matt Smith says the company's dividend maybe under threat because of falling oil prices. There is an interest, but long article in the Globe and Mail on why Alberta's oils sands matter to Canadians.
Sound bit for Twitter and StockTwits is: Price cheap to reasonable. Is div safe? In most tests the stock price has not crossed into cheap territory, but it is getting close. However, oil prices are dropping so this will be a problem in the near term. See my spreadsheet at cos.htm.
This is the second of two parts. The first part was posted on Tuesday, October 4, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
Canadian Oil Sands Trust provides a pure investment opportunity in the oil sands through its 36.74% interest in the Syncrude Project. Syncrude is an experienced oil sands operator, producing a high-quality crude oil for the past 30 years. With large, bitumen-rich leases located in the sweet spot of the Athabasca oil sands deposit and a fully integrated upgrading facility that produces 100% light, sweet crude oil, the quality of their Syncrude asset is very good. Its web site is here CDN Oil Sands.
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 Canadian Oil Sands (TSX-COS, OTC-COSWF). I am reviewing this stock because when anyone talks about investing in Canadian Oil Sands, this is the stock that seems to be mentioned first. As with some other investment in oil companies, if the dividend is good, then it will vary according to the price of oil.
When I look at insider trading I find $4M of insider selling, $0.7M of insider buying and net insider selling at $3.3M. Net insider selling is at just 0.03% of market cap and so very low. Outstanding shares were increased by only 10,000 shares for stock options in 2013. This is not high enough to provide a percentage of outstanding stock taking a percentage to two decimal points (that is it is less than 0.00%). I also do not see any significant insider ownership.
The 5 year low, median and high median Price/Earnings Ratios are 10.92, 11.13 and 14.29. The 10 year corresponding P/E Ratios are similar at 10.08, 11.69 and 16.19. The current P/E Ratio is 11.25 based on a stock price of $17.66 and 2014 EPS estimate of $1.57. This stock price test suggests that the stock price is reasonable.
I get a Graham Price of $18.45. The 10 year low, median and high median Price/Graham Price Ratios are 0.94, 1.37 and 1.66. The current P/GP Ratio is 0.96 is based on a stock price of $17.66. This stock price test suggests that the stock price is reasonable.
The 10 year Price/Book Value per Share Ratio is 2.96. The current P/B Ratio is 1.83 based on a stock price of $17.66 and BVPS of $9.63. The current P/B Ratio is some 38% lower than the 10 year ratio. This stock price test suggests that the stock price is cheap.
The historical average dividend yield is 5.02 and this historical median dividend yield is 5.22. These are some 34% and 52% below historical yields. These tests do not show that the stock is cheap, but it does show that it is quite low.
When I look at analysts' recommendations, I find Strong Buy, Hold and Underperform recommendations. There is a lot of Hold and Underperform recommendations and the consensus recommendation would be a Hold. The 12 month stock price consensus is $20.50. This implies a total return of 24.01% with 7.93% from dividends and 16.08% from capital gains. (Note with the falling oil prices, the dividend may not be safe.)
In this financial post article, Albert's Premier says that oil sands crude will reach Gulf Coast with or without Keystone. At the Motley Fool, Matt Smith says the company's dividend maybe under threat because of falling oil prices. There is an interest, but long article in the Globe and Mail on why Alberta's oils sands matter to Canadians.
Sound bit for Twitter and StockTwits is: Price cheap to reasonable. Is div safe? In most tests the stock price has not crossed into cheap territory, but it is getting close. However, oil prices are dropping so this will be a problem in the near term. See my spreadsheet at cos.htm.
This is the second of two parts. The first part was posted on Tuesday, October 4, 2014 and is available here. The first part talks about the stock and the second part talks about the stock price.
Canadian Oil Sands Trust provides a pure investment opportunity in the oil sands through its 36.74% interest in the Syncrude Project. Syncrude is an experienced oil sands operator, producing a high-quality crude oil for the past 30 years. With large, bitumen-rich leases located in the sweet spot of the Athabasca oil sands deposit and a fully integrated upgrading facility that produces 100% light, sweet crude oil, the quality of their Syncrude asset is very good. Its web site is here CDN Oil Sands.
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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