Savaria Corporation

Sound bite for Twitter and StockTwits is: Relatively expensive. There is nothing wrong with this stock, but I think that the stock price is too high to consider buying at this time. I would rate it a Hold. I do not sell good companies just because the price is expensive. The price would have to get into a stupid range for me to sell. See my spreadsheet on Savaria Corporation.

I do not own this stock of Savaria Corporation (TSX-SIS, OTC-SISXF). I got this stock off the Dividend Blogger site that no longer exists. I am always interested in dividend growth small cap stock. The first few years of accounting were rather confusing, but I think I figured them out in the end. They also do not publish financial statements on their site.

Dividends are moderate to good with moderate to good dividend increases. The current dividend is 2.33%. They started dividend in 2005 and the median dividend yield since then is 4.08% and the 5 year median is at 3.07%. The 5 and 10 year dividend increase is at 15.1% and 21.1% per year.

The current Dividend Payout Ratios are a little high for this sort of company at 60.7% for EPS in 2015. They have gotten too high in the past with DPRs over 100% in 2011, 2012 and 2014. They are expected to be around 60% again on 2016 before falling to around 47% in 2017 and 42% in 2018. The DPR for CFPS is better with a ratio of 39% in 2015 and a 5 year median of 49%.

Outstanding shares have increased a lot in the past 5 year with 8.2% increase per year over this time period. The 10 year increase is a lot lower at just 1%, but this is because the company did a big buy back in 2009. Shares have increased due to Share Issues, Stock Options and Share Conversion. The shares have decreased due to buy backs. So for me, per share growth is more important especially over the past 5 years.

They are nicely growing their earnings and cash flow, but not so much their revenue. EPS is up by 21% and 10% per year over the past 5 and 10 years. CFPS is up by 13% and 14.3% per year over the past 5 and 10 years. However Revenue per Share is up by only 0.3% over the past 5 years. The 10 year increase is better at 8.3% per year growth.

This stock has recently had a good run up in price. The total return over the past 5 year is 49.26% per year with 43.36% from capital gain and dividend of 5.90%. The 10 year total return is still good, but a lot less at 18.59% per year with 15.70% per year from capital gains and 2.88% per year from dividends.

The 5 year low, median and high median Price/Earnings per Share Ratios are 14.44, 17.17 and 19.89. The 10 year corresponding values are 10.91, 15.40 and 19.40. The15 year values are 13.04, 17.17 and 20.38. It is interesting that the 5 year run up in stock prices seems to be the results of higher P/E Ratios. The current P/E Ratio is 26.06 based on a stock price of $8.60 and 2016 EPS of $0.33. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham price of 3.51. The 10 year low, median and high median Price/Graham Price Ratios are 0.93, 1.17 and 1.42. The current P/GP Ratio is 2.45 based on a stock price of $8.60. This stock price testing suggests that the stock price is relatively expensive.

The 10 year median Price/Book Value per Share Ratio is 1.85. The current P/B ratio is 5.19 a value some 180% higher. The current P/B Ratio is based on BVPS of $1.66 and a stock price of $8.60. This stock price testing suggests that the stock price is relatively expensive.

The historical median dividend yield is 4.08% a value some 43% higher than the current dividend yield of 2.33% based on a stock price of $8.60 and dividends $0.20. The current dividend yield is even some 37% higher than the 5 year median dividend yield of 3.70%. This stock price testing suggests that the stock price is relatively expensive.

When I look at analysts' recommendations, I find Strong Buy and Buy recommendations. The consensus would be a Strong Buy. The 12 month stock price consensus would be $8.88. This implies a total return of 5.58% with 3.26% from capital gains and 2.33% from dividends based on a stock price $8.60.

Harley Jackson write in Consumer Eagle that analysts expect EPS to be $0.09 for the second quarter. In this press release via Market Wired Savaria says it has completed its Acquisition of the Automotive Division of Shoppers Home Health Care. Dan Stringer on Seeking Alpha in April 2016 wrote a good report on this stock.

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 about was TECSYS Inc. (TSX-TCS, OTC-TCYSF) ... learn more. The next stock I will write about will be Ballard Power Systems Inc. (TSX-BLD, NASDAQ-BLDP)... learn more on Monday, August 8, 2016 around 5 pm.

Savaria Corporation is North America's leader in the accessibility industry focused on meeting the needs of people with mobility challenges. Savaria designs, manufactures, installs and distributes primarily elevators for home and commercial use, as well as stairlifts and vertical and inclined platform lifts. In addition, it converts and adapts minivans to be wheelchair accessible. Its web site is here Savaria Corporation.

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.