Sound bite for Twitter and StockTwits is: Dividend stock cheap. Since I had both Power Financial and this stock, I decided to go with Power Financial. So basically I am still invested in IGM. I think that Power Corp's companies are good companies. It all depends on what you want to have in your portfolio if you invest in Power Corp or its companies. Certainly it is a good time to invest in a company is when it is relatively cheap. See my spreadsheet on IGM Financial Inc.
I do not own this stock of IGM Financial Inc. (TSX-IGM, OTC-IGIFF), but I used to. I originally bought this stock to replace AGF Management (TSX-AGF.B). IGM was known as a dividend growth stock and it was on a lot of lists of good stocks, including Mike Higgs' and Dividend Aristocrats. I sold this 2011 because I had Power Financial, of which this company is partially owned by and I wanted to rationalize my portfolio. So I sold this stock and bought more of Power Financial. I purposely sold at a low point to reduce taxes and do a buy at a low also.
This is still a dividend growth company. It does have a long history of rising dividends. But a lot of financial companies were hit badly in the last recession. However, currently they are reviving and this company is no different. They have been doing better lately and they did raise their dividend in 2015.
The most recent increase was for 4.65%. This is the second dividend increase since 2008. They did a dividend increase in 2011 which was for 4.88%. The 5 and 10 year dividend growth is at 1.9% and 5.4% per year. These increases are a lot less than occurred prior to 2008 when the 5 and 10 year dividend growth to that year was 15.1% and 18.1% per year. Of course the Dividend Payout Ratios for EPS prior to 2008 was 54% or less. Since 2008 the DPR for EPS is running around 72%. No wonder dividend increases are low and far between. On the other hand, Dividend Yields have been higher than they have ever been recently reaching almost 7%.
For Assets under Management, Revenues and Cash Flow, the old highs made in and around 2007 have been breached. For example for AUM the high for 2007 was $123.0B. In 2012 AUM was $120.7B and in 2013 was $131.8B. For EPS this is not true. In 2007 EPS was $3.32 and for 2015 is $3.11.
The 5 year low, median and high median Price/Earnings per Share Ratios are 12.40, 14.23 and 16.06. The 10 year corresponding values are similar at 12.85, 15.30 and 17.20. The corresponding Historical values are a little higher at 13.70, 17.80 and 24.13. The current P/E Ratio is 12.53 based on a stock price based on a stock price of $37.73 and 2016 EPS estimate of $3.01. This stock price testing probably suggests that the stock price is relatively cheap.
I get a Graham Price of $36.05. The 10 year low, median and high median Price/Graham Price Ratios are 1.14, 1.27 and 1.57. The current P/GP Ratio is 1.05 based on a stock price of $37.73. This stock price testing is suggesting that the stock price is relatively cheap.
I get a 10 year Price/Book Value per Share Ratio of 2.57. The current P/B Ratio is 1.97 based on a stock price of $37.73 and BVPS of $19.19. The current ratio is some 24% lower than the 10 year ratio. This stock price testing is suggesting that the stock price is relatively cheap.
The current Dividend Yield is 5.96% based on dividends of $2.25 and a stock price of $37.73. The historical median dividend yield is 3.33% a values some 79% lower. This stock price testing probably suggests that the stock price is relatively cheap.
When I look at analysts' recommendations, I find Buy, Hold and Underperform. There is only 1 Buy recommendation and 1 Underperform recommendation; all the others are a Hold. The consensus is a Hold. The 12 month stock price is $38.43. This implies a total return of 7.82% with 1.86% from capital gains and 5.96% from dividends. I think if you are building a portfolio and/or have a long term horizon, then buy good companies when they are cheap. Recovery maybe a while, but it will be worth it in the long term. All my stock price testing is hitting cheap.
In this Market Wire Release IFM talks about investing in a leading US Digital Wealth Advisor called Personal Capital. Sylvia Delisle of Risers and Fallers talk about recent analysts' recommendations for IGM. See what some analysts are saying 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 and here.
Yesterday on my other blog I wrote about Keeping an Eye on Things... learn more . The next stock I will write about will be Intertape Polymer Group Inc. (TSX-ITP, OTC-ITPOF)... learn more on Monday, June 6, 2016 around 5 pm.
The company serves its customers through two industry-leading service platforms: FirstService Residential, North America's largest manager of residential communities; and FirstService Brands, one of North America's largest providers of essential property services delivered through individually branded franchise systems and company-owned operations. Its web site is here IGM Financial Inc.
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.
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