High Liner Foods

Sound bite for Twitter and StockTwits is: Dividend growth Consumer stock. This stock has grown quite well and has provided dividend growth since 2008. See my spreadsheet on High Liner Foods.

I do not own this stock of High Liner Foods (TSX-HLF, OTC-HLNFF). This is a stock liked by the Investment Reporter and is considered to be of average risk. The MPL Communication’s site is here. Ryan Irvine of Keystone also likes this company.

The dividend yield is moderate with generally good growth, especially in the last 5 years. Dividends were started in 2004 and have grown since 2008. The current dividend is 2.70% based on a Dividend of $0.48 and a stock price of $17.75. The 5 year median dividend yield is lower at 1.88%. Dividends have grown by 24.9% and 15.2% per year over the past 5 and 10 years. The most recent dividend increase was in 2015 and the increase was for 14.3%.

The Dividend Payout Ratios are good. The DPR for 2014 was 36.4% for EPS and 14.2% for CFPS. The 5 year median DPR was 32.8% for EPS and 12.91% for CFPS. The DPR the last 12 months to the end of the second quarter is around 36.9% for DPR and 19.7% for CFPS

If you had bought this stock 5, 10 or 15 years ago, your current dividend yield on your original purchase price would be 7.3%, 9.6% or 22.6%. If you had bought this stock 5, 10 or 15 years ago you would have had dividends that paid 25.7%, 46.2% or 119.5% of the cost of your stock.

Shareholders have done well on the past 5 and 10 years with total return at 19.70% and 16.88% per year. The portion of this total return from dividends is at 2.79% and 2.3% per year. The portion of this total return from capital gain is at 16.92% and 14.58% per year.

Outstanding shares have decreased by 3.5% and grown by 3.7% per year over the past 5 and 10 years. Shares have increased due to Stock Options, Share Issues and Debenture Conversion. Shares have decreased due to Buy Backs. There has been good growth in Revenue, Earnings and Cash Flow over the past 5 and 10 years. Also note that 3 years ago in 2012 this company changed the reporting currency to US$ from CDN$. My calculations are in CDN$.

Revenue has grown by 14.2% and 16.3% per year over the past 5 and 10 years. Revenue per Share has grown at 18.4% and 12.2% per year over the past 5 and 10 years. Revenue is expected to grow very modestly in US$ in 2015. The Revenue will grow well in CDN$ terms (because of changing exchange rates). Growth in US$ is at 0.2% and in CDN$ is 14.6%.

EPS growth is at 16% and 13.2% per year over the past 5 and 10 years. However, this company also puts out an Adjusted EPS which has grown at 20.3% and 11.4% per year over the past 5 and 10 years. Analysts are giving estimates in Adjusted EPS. In US$ Adjusted EPS is expected to increase by 7.3% in US$ and 22.7% in CDN$. If you compare the 12 month period to the end of the second quarter and to the end of 2014, Adjusted EPS has declined by 2.4% in US$ and increased by 11.7% in CDN$.

Cash Flow has grown by 25.05% and 21.9% per year over the past 5 and 10 years. CFPS has grown at 29.6% and 17.6% per year over the past 5 and 10 years. Analysts expect growth of 146% in US$ and 181% in CDN$ in 2015. If you compare the 12 month period to the end of the second quarter and to the end of 2014, Cash Flow has increased by 24.2% in US$ and increased by 42.1% in CDN$.

I will need a few more years of this stock reporting in US$ to get a fix on how well this stock has done in US$ terms as regards to growth.

The Return on Equity has been above 10% four out of the last 5 years. The ROE for 2014 is 15.4% and the 5 year median is 13.8%. The ROE on comprehensive income has been lower with an ROE for 2014 at 10.8% and the 5 year median at 12%. The difference seems to be mostly in currency exchange and hedges against currency exchange.

Most of the debt ratios are good, but the Leverage and Debt/Equity Ratios are a bit high. The Liquidity Ratio is 2.27 in 2014 and the Debt Ratio is 1.39. The Leverage and Debt/Equity Ratios are 3.58 and 2.58.

This is the first of two parts. The second part will be posted on Monday, September 21, 2015 and will be available here. The first part talks about the stock and the second part talks about the stock price.

High Liner Foods is the leading North American processor and marketer of value-added frozen seafood. Their retail branded products are sold throughout the United States, Canada and Mexico and are available in most grocery and club stores. They also sell their branded products to restaurants and institutions and they are the major supplier of private label value-added frozen seafood products to North American food retailers and food service distributors. Its web site is here High Liner Foods.

This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

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