Canadian Tire Corp.

Sound bite for Twitter and StockTwits is: Price Reasonable to Expensive. Insiders are buying shares with Net Insider Buying at 0.03% of market cap. This is, relatively speaking, a lot. Based on dividend yield, the price is good. Based on P/E Ratios or P/GP Ratios, the stock price is just over the line as expensive. See my spreadsheet on Canadian Tire Corp.

I own this stock of Canadian Tire Corp. (TSX-CTC.A, OTC-CDNAF). In 2000 when I first bought this stock, it was on the Investment Reporter's list of conservative Canadian stocks. I bought stock for my trading account in 2009 because I have done well with it in my Pension Account and it was a consumer stock.

In my Trading Account since 2009 I have earned 16.02% per year with 1.67% per year attributed to dividends and 14.35% per year attributed to capital gains. I have sold off most in my pension account because when I have had to sell stocks in my Pension Account because of necessary withdrawals, I have sold off the stocks with the lowest dividend yields.

However, this is a better stock for when you are accumulating stocks or for a Trading Account. The dividend yield is low but the dividend increases are good. High dividend increases on some stock in a trading account will help to push up your overall dividend growth.

The current dividend yield is 1.70% based on dividends of $2.30 and a stock price of $135.45. The 5 year median dividend yield is 1.71%. The dividends have grown 20.1% and 13.7% per year over the past 5 and 10 years. The last dividend increase was in 2016 and it was for 9.5%.

When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. Most of the recommendations are a Buy and the consensus recommendation is a Buy. The 12 month stock price consensus is $146.69. This implies a total return of 10% with 1.70% from dividends and 8.30% from capital gains.

There is a great article in Canadian Business by John Lorinc on how this company is adapting to digital marketing. Benjamin Sinclair of Motley Fool likes this stock. A number of analysts seem to feel the stock is overpriced at Stock Chase.

The 5 year low, median and high median Price/Earnings per Share Ratios are 10.07, 12.15 and 14.56. The 10 years corresponding ratios are similar at 10.00, 12.07 and 15.11. The current P/E Ratio is 15.55 based on a stock price of $135.45 and 2016 EPS estimate of $8.71. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $114.96. The 10 years low, median and high median Price/Graham Price Ratios are 0.68, 0.83 and 1.04. The current P/GP Ratio is 1.18 based on a stock price of $135.45. This stock price testing suggests that the stock price is relatively expensive.

The current dividend yield is 1.70% based on dividends of $2.30 and a stock price of $135.45. The historical median dividend yield is 1.68%. This stock price testing suggests that the stock price is relatively reasonable and below the median.

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.

The last stock I wrote about was H & R Real Estate Trust (TSX-HR.UN, OTC-HRUFF) learn more. The next stock I will write about will be Richelieu Hardware Ltd (TSX-RCH, OTC-RHUHF)... learn more on Wednesday, March 16, 2016 around 5 pm.

Also, on my book blog I have put a review of the book Political Order and Political Decay by Francis Fukuyama learn more...

Canadian Tire operates several retail businesses that offer everyday products and services through a network of over 1,700 locations across the country. The key banners that the company operates under include Canadian Tire Retail, FGL Sports, Mark's, Petroleum, Part Source, and Financial Services. Its web site is here Canadian Tire Corp.

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.