AGF Management Ltd.

Sound bite for Twitter and StockTwits is: Cheap for a reason. I would not believe a turnaround in this company unless it actually happened and seemed sustainable. There is Net Insider Buying of 0.77% of market cap. This is relatively high. See my spreadsheet on AGF Management Ltd.

I do not own this stock of AGF Management Ltd. (TSX-AGF.B, OTC-AGFMF), but I used to. I bought this stock in 2001 and sold half in 2006 and the rest in 2008. It used to be a dividend growth stock, but has not been one for some time now. I sold because I did not see that the stock would improve. It was raising dividends still but at the expense of DPR. In 2008 I was lucky that I sold before it crashed. It has yet to recover.

It is sad to see a once great company do so poorly. For the stock I bought I made a 2.08% total return with 2.09% from dividends and a capital loss of 0.01%. I know I was getting concerned about this stock in 2006 and I made a note that I was, but I did not state what I thought the problem was. The stock certainly hit its high in 2007 and has not recovered. They had certainly raised their dividends at the expense of their Dividend Payout Ratio since 2003.

It was not until they were paying out way more than their earnings in 2012 that they stopped raising their dividends. They were flat for a few years and it was not until 2015 when they finally cut their dividends. In 2006 I was probably concerned about the DPR.

This is no longer a dividend growth stock. For it to be that again, it will need to grow its business again. Analysts seem to expect slight improvements starting in 2017. However, I would want to some sustained improvement if I would ever consider this company a good investment again.

I get 5 year low, median and high median Price/Earnings per Share Ratios of 13.69, 16.32 and 18.96. The 10 year corresponding ratios are similar at 12.42, 15.42 and 19.58. The current P/E Ratio is 9.33 based on a stock price of $4.57 and 2016 EPS estimate of $0.49. This stock price testing suggests that the stock is relatively cheap.

I get a Graham Price of $11.21. The 10 year low, median and high median Price/Graham Price Ratio is 0.73, 0.95 and 1.25. The current P/GP Ratio is 0.41 based on a stock price of $4.57. This stock price testing suggests that the stock is relatively cheap.

When I looked at analysts' recommendations, I saw Hold, Underperform and Sell recommendations. The consensus would be Underperform. The 12 month stock price is $4.86. This implies a total return of 13.35% with 7.00% from dividends and 6.35% from capital gains. It may seem high but most is dividends and you have to wonder if they are assured.

There is an article by Christina Pellegrini in the Financial Post that talks about Assets under Management (AUM) sliding this this company and other Canadian investment firms. This article in EMQ News and Analysis talks about insider buying and recent analysts ratings. See analysts' comments on Stock Chase.

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 that report here

AGF Management Limited is an integrated, global wealth management company, whose principal subsidiaries provide investment management for mutual funds, institutions and corporations, as well as high-net-worth clients; and trust products and services. They sell their products in Canada. Its web site is here AGF Management 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.

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