CI Financial Corp

Sound bite for Twitter and StockTwits is: Price relative cheap to reasonable. This company seems to be currently doing a good job. I know that many people are against Mutual Fund companies, but I cannot see that they going out of business anytime soon. It is probably given Hold ratings as EPS is expected to be a bit lower in 2016 before picking up again. See my spreadsheet on CI Financial Corp.

I do not own this stock of CI Financial Corp (TSX-CIX, OTC- CIFAF). I started to follow this stock originally because it was a Mutual Fund company. People talked about it being easier to make money from buying a Mutual Fund company than buying Mutual Funds. When they became a Unit Trust in 2006, dividends were significantly increased, but these dividends proved to be unsustainable, so dividends where decreased in 2010. They changed back to a corporation in 2009.

Currently the dividend yield is good as is the dividend growth. The current dividend yield is 5.12% and the dividend growth is 11.5% and 16.1% per year over the past 5 and 10 years. The growth figures hide some growth problems. This stock's dividend hit a high in 2009 ($2.76) that is still some 50% higher than the current dividends ($1.38).

Even though the 5 year growth is quite good at 11.5%, the most recent dividend increase was for just 4.5%. However, for some years in the past dividends were raised more than once in a year. If dividend increases continue at 4.5% in 5, 10 and 15 years for stock purchased today, a shareholder would be earning 6.4%, 8% and 9.9% on the original investment. If increases are at 11%, after 5, 10 and 15 years a shareholder could be earning 8.6%, 15.54 and 24.5% yield on today's purchase price of $26.95.

For a while they could not afford their dividends, but this does not appear to have been a problem since the dividend decrease in 2010. In 2015 the Dividend Payout Ratio for EPS is 65.4%. The DPR for CFPS for 2015 was at 52%. Dividends payments seem to be currently in good shape. It would appear that this is currently a dividend growth company.

One thing to point out is that the Liquidity Ratio is low. The Liquidity Ratio for 2015 is 0.98 and the 5 year median is 0.90. The problem with low Liquidity Ratios is that it makes a company vulnerable in bad times. If you add in cash flow after dividends, the Liquidity Ratio becomes a more acceptable 1.67 ratio. (I just do not like to have to muck around with a ratio to get it better.)

The growth figures on this stock are moderate to good. For example, the Assets under Management (AUM) grow by 8.8% and 8.5% per year over the past 5 and 10 years. These are good growth figures. The EPS grow by 11.9% and 7.4% per year over the past 5 and 10 years. Growth at 8% or above is good. Moderate growth is from 3% to under 8%.

The 5 year low, median and high median Price/Earnings per Share Ratios are 15.57, 18.32 and 19.89. The corresponding 10 year values are 15.28, 17.18 and 19.90. The historical values are 15.94, 18.34 and 20.94. The current P/E Ratio is 13.48 based on a stock price of $26.95 and 2016 EPS estimate of $2.00. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $17.41. The 10 year low, median and high median Price/Graham Price Ratios are 1.50, 1.74 and 1.98. The current P/GP Ratio is 1.55 based on a stock price of $26.95. This stock price testing suggests that the stock price is relatively cheap. Note that the P/GP Ratios are rather high.

The 10 year median Price/Book Value per Share Ratio is 4.23. The current P/B Ratio is 4.00 a value some 5% lower. This stock price testing suggests that the stock price is relatively reasonable and below the median. Note that a good P/B Ratio is around 1.50, so these ratios are rather high.

The historical median dividend yield is 3.20%. The current dividend yield at 5.125 is some 60% higher. The current dividend yield is based on dividends of $1.38 and a stock price of $26.95. This stock price suggests that the stock price is below the median and probably cheap.

When I look at analysts' recommendations I find Buy and Hold recommendations. Most of the recommendations are a Hold and the consensus is a Hold. The 12 month stock price consensus is $30.30. This implies total return of 17.55% per year with 5.12% from dividends and 12.43% from capital gains. This is based on current stock price of $26.95.

Mark Robinson on LMKAT talks about recent analysts ratings on this stock. Robin Reyes on Sonoran Weekly Review talks about the recent announcement from CI Financial to Buy Back shares. Joseph Solitro of Motley Fool talks about 5 Dividend Growth Stocks, including this stock. See what analysts on Stock Chase say about this company.

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.

Yesterday on my other blog I wrote about Buy Backs... learn more . The next stock I will write about will be Computer Modelling Group Ltd (TSX-CMG, OTC-CMDXF)... learn more on Monday, June 20, 2016 around 5 pm.

CI Financial Corp. is a diversified wealth management firm and one of Canada's largest investment fund companies. CI is an Independent and Canadian-owned company. This company promotes and manages mutual funds and other investment products through its wholly-owned subsidiaries of CI Investments Inc., and Assante Wealth Management. Its web site is here CI Financial 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. I have three blogs. The first talks only about specific stocks and is called Investment Talk . The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits.