Friday, June 23, 2017

Parkland Fuel Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Industrial. All my testing is showing that the stock is relatively expensive currently. It has certainly done well for its shareholders being up some 23.54% over the past 5 years with 17.26% from capital gains and 6.28% from dividends. See my spreadsheet on Parkland Fuel Corp.

I do not own this stock of Parkland Fuel Corp (TSX-PKI, OTC-PKIUF). I decided to do a spreadsheet on this stock as it was a stock recommended by Roger Conrad in Money Show 2013.

For this stock, dividends and their growth is all over the place. There have been big increases and decreases in the past. In 2008, dividends were increased by 43%. They did not change in the next two years and then in 2011 they were decreased by 19%. The current dividend is moderate at 3.81%, but it has been much higher in the past with a 10 year median of 6.19%, a historical one of 8.94% and an adjusted historical yield of 7.24%.

The dividend growth over the past 5 and 10 years is at 1.50% and 4.28% per year. The last increase was for 1.8% and it was in 2017. They cannot afford the dividends any longer so increase percentages are going down.

The Dividend Payout Ratio for 2016 was 228% with a 5 year ratio of 130%. The DPR is expected to go to 155% this year and analysts' think that it can cover their dividends again in 2019. Of course, the longer the look out the more inaccurate it tends to be.

This is a stock that was written up in the Money Letter from MPL Communications that puts out the Investment Reporter. This publication company is known for recommending good solid investment stocks. See the item on this here.

The company has not done that well lately, but it is connected to the oil and gas industry. The ROE for 2016 was just 5.5% with a 5 year median of 8.8%. Earnings per Share (EPS) are down by 7.7% and 10.6% per year over the past 5 and 10 years. Analysts expect the earnings to go up by 51% to $0.74 in 2017. However, for the first quarter EPS is down by 8% if you compared the 12 months ending at the end of the first quarter to the EPS of 2016.

The outstanding shares have been increasing over the past 5 and 10 years at 8.4% and 9.6% per year. This means that it is per share growth that one to look at. Revenue per Share is only up by 1% and 7.7% per year over the past 5 and 10 years compared to the growth in Revenue at 9.5% and 18% per year.

The 5 year low, median and high median Price/Earnings per Share Ratios are 26.36, 30.67 and 34.77. The 10 year corresponding ratios are 12.01, 14.42 and 17.80. The historical ratios are 11.48, 15.51 and 20.08. The reason for the most recent P/E Ratios to be high is that as EPS declined, the stock price did not. The current P/E Ratio is 40.96. This is based on a stock price of $30.31 and 2017 EPS estimates of $0.74. This stock price testing suggests that the stock is relatively expensive.

I get a Graham Price of $11.79. The 10 year low, median and high median Price/Graham Price Ratios are 1.14, 1.36 and 1.71. The current P/GP Ratio is 2.57 based on a stock price of $30.31. I must admit I find that the P/GP Ratios rather high for an industrial stock. In any event, this stock price testing also shows that the stock price is relatively expensive.

I get a 10 year median Price/Book Value per Share Ratio of 2.94. The current P/B Ratio is 3.63 based on BVPS of $8.35 ($806.7M BV) and a stock price of $30.31. The current ratio is some 23.6% higher than the 10 year median. This stock price testing suggests that the stock is relatively expensive.

The dividend yield on this stock has been very high in the past. The adjusted historical median dividend yield is 7.25%. The 5 year median dividend yield is 5.21%. The current dividend yield is 3.81% based on dividends of $1.15 and stock price of $30.31. No matter how you look at dividend yield, it shows that the stock is relatively expensive.

When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. Most are a Buy recommendations and the consensus is a Buy recommendations. The 12 month stock price consensus is $35.82. This implies a total return of 21.99% with 18.18% from capital gain and 3.81% from dividends.

EBU staff rider at the Business Union says that this company has a 14-day Commodity Channel Index of -144.20 which implies the stock is oversold and ready for a rally. Renata Jones on Sports Perspectives says a number of companies are rating this stock a Buy. Kay Ng of Motley Fool likes this stock. See what analysts are saying about this stock on Stock Chase. They rather like this company.

Parkland Fuel Corporation is a marketer and distributor of fuels, managing a nationwide network of sales channels for retail, commercial, wholesale and home heating fuel customers. Its web site is here Parkland Fuel Corp.

The last stock I wrote about was about was Computer Modelling Group Ltd. (TSX-CMG, OTC-CMDXF)... learn more. The next stock I will write about will be Saputo Inc. (TSX-SAP, OTC-SAPIF)... learn more on Monday, June 26, 2017 around 5 pm.

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. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

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