Sound bite for Twitter and StockTwits is: Dividend stock cheap. Our Canadian economy is not doing great at the moment and a number of companies are having a hard time. It is not surprise that this company has head winds. However, on a number of measures, it is cheap. See my spreadsheet on Calian Technologies Ltd.
I own this stock of Calian Technologies Ltd. (TSX-CTY, OTC-CLNFF). This is an interesting company with a very nice dividend. This stock came up on a Globe Investor site. The Globe Investor Number Cruncher is an investment column about screening for stocks and funds. They did one on companies with little to no debt. I also noted that the Financial Blogger has this stock on his Top Ten Canadian Dividend Stocks list.
The dividends on this stock are good and the increases are moderate. The current dividend yield is 7.03%. The 5 year median dividend yield is 5.48%. The growth in dividends over the past 5 and 10 years is at 7.23% and 13.35% per year.
The last dividend increase occurred in 2013 and it was for 12%. There has been no dividend increase since and that is why the 5 year growth in dividends is much lower than the 10 year growth in dividends.
The thing is that this company hit a high in 2012 in terms of revenue, earnings and cash flow, so I can see why they have stopped increasing their dividends. In 2015, this company Dividend Payout Ratio for EPS was 84% and for CFPS was 60.5%. Over past 5 years revenue per share is up by 3.2%, EPS is down by 5.3% and CFPS is flat.
Analysts expect moderate growth in revenue and earnings over the next couple of years. The thing is also that there are few analysts following this stock.
This company does have a strong balance sheet. The Liquidity Ratio for 2015 is 2.41 and the Debt Ratio is 3.04. I like these ratios to be at 1.50 or better. The Leverage and Debt/Equity Ratios are also good with these ratios in 2015 being 1.49 and 0.49. I like these ratios to be less than 2.00 and less than 1.00, respectively.
The 5 year low, median and high median Price/Earnings per Share Ratios are 10.03, 11.57 and 11.93. The 10 year corresponding P/E Ratios are similar at 10.45, 11.17 and 12.69. The current P/E Ratio is 11.63. This stock price testing suggests that the stock price is reasonable.
However, on other basis the stock is cheap. The current dividend yield is high at 7.03%. Compare this to the historical median dividend yield of 4.43% which is some 59% lower. However, the dividend yield was even higher in 2009. Since the low of 2009, this stock price is up some 94%.
Also the Graham Price is $16.94. The current stock price is lower at 15.93. According to the Graham Price theory, you should buy companies when the Price/Graham Price Ratio is below 1.00 and for this stock the P/GP Ratio is 0.94.
Just one analyst has a recommendation on this stock and it is a buy. The 12 month stock price given is $20.00 and this implies a total return of 32.58% with 7.03% from dividends and 25.55% from capital gains.
Mark Watkins in a recent article in Dakota Financial News talks about some insider buying. A press release on Market Wired talks about the company getting two new contracts.
I will have only one entry for this stock this year. However, I did a more complete report on this company in 2015 and you can see those reports here and here.
Calian sells technology services to industry and government in Canada and around the world. Calian provides customers with ready access to an exceptional team of engineers, telecommunications and technology professionals, health care professionals and other highly qualified staff. Its web site is here Calian Technologies Ltd.
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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