Wednesday, August 2, 2017


Sound bite for Twitter and StockTwits is: Dividend growth Industrial. This is rather a small cap. It also seems to be overpriced. It is a good stock though. There is a lot of insider selling over the past year at 0.80% of Market Cap according to INK. Generally insider selling would be at 0.02% of Market Cap. See my spreadsheet on TECSYS Inc .

I own this stock of TECSYS Inc. (TSX-TCS, OTC-TCYSF). I came across this stock when I was looking for a dividend paying small cap stock as a filler stock. I consider a filler stock to be one to soak up small amounts of investment money that I have left over in my account, especially in the TFSA after I have made my main purchase for the year.

Well, instead of buying a small amount of this stock, I should have bought lots more. I paid some $965 for 500 shares in 2017. Today those shares are worth $8,115. This stock has a total return of 42.87% per year. Also dividends have paid for some 30% of the cost of my stock. Unfortunately, it has been rather overpriced for a while.

Dividends are currently low, but they have been moderate in the past. The current dividend yield is 1.30% with a 10 year median yield of 2.43%. Dividend growth is good. The dividends have grown at 14% and 16.7% per year over the past 5 and 9 years.

This is another company when the spreadsheet shows a lot of green. They have good growth and generally good debt ratios. I prefer the Liquidity Ratio to be at 1.50 or above for safety's sake especially on industries that can be volatile. Return on Equity is not what I would like to see.

The Revenue has grown at 11.6% and 8.2% per year over the past 5 and 10 years. The Revenue per Share has grown at 10.3% and 9.4% per year. These are both good. Outstanding shares have not changed that much over the past 5 and 10 years.

The current Liquidity Ratio is 1.62 and it has a 5 year median of 1.60. However, the Liquidity Ratio has varied a lot and has been below 1.50. This happened last in 2012 when it was 1.45. The Debt Ratio has always been good. The one for 2017 is 2.41 and it has a 5 year median of 2.06. Leverage and Debt/Equity Ratios are good with the current ones at 1.71 and 0.71 respectively. The 5 year median values are 1.95 and 0.95 respectively. It has very little long term debt.

The Return on Equity has been below 10% twice in the past 5 years and 5 times over the past 10 years. It is currently good with a current ROE of $19.5% and a 5 year median of 10.8%. The Return on Comprehensive Income is a little lower with the current one at 16.6% and a 5 year median of 10.8%.

The 5 year low, median and high median Price/Earnings per Share Ratios are 21.69, 29.91 and 38.13. The 10 year corresponding ratios are 15.99, 20.16 and 24.33. The historical ratios are 9.47, 11.88 and 15.83. It would that the rise in price is also being pushed by a rising P/E Ratio. The current P/E Ratio is 32.09 based on a stock price of $13.80 and 2018 EPS estimate of $0.43. This stock price testing suggests that the stock price is relatively expensive. (Note that this stock has a year end at April 30 each year.)

Tech companies tend to have rather high P/E Ratios relative to other stock. This is sort of a tech company even though it is classified in the Industrial Services sector. However, to make money on tech companies you buy them when they have upward momentum. Currently this stock does not have this and it has been falling since reach a high in May of 2017.

I get a Graham Price of $4.91. The 10 year low, median and high median Price/Graham Price Ratios are 1.22, 1.58 and 1.89. The current P/GP Ratio is 2.81 based on a stock price of $13.80. This stock price testing suggests that the stock price is relatively expensive.

The 10 year median Price/Book Value per Share Ratio is 1.90. The current P/B Ratio is 5.53 a value some 190% higher. The current P/B Ratio is based on Book Value of $30.7M, BVPS of $2.49 and a stock price of $13.80. This stock price testing suggests that the stock price is relatively expensive.

This historical median dividend yield is 2.43. The current dividend yield is 1.30% based on dividends of $0.18 and a stock price of $13.80. The 5 year and 10 year median dividend yields are 1.35% and 2.43% respectively. The current yield is some 46% below the historical one but just 3% below the 5 year yield. This stock price testing suggests that the stock price is relatively expensive.

The 10 year median Price/Sales (or Revenue) Ratio is 0.70. The current P/S Ratio is 2.25 based on 2018 Revenues of $75.7M, Revenue per Share of $6.15 and a stock price of $13.80. The current ratio is some 220% higher than the 10 year median. This stock price testing suggests that the stock price is relatively expensive.

When I look at analysts' recommendations, I find only Buy recommendations for the 5 analysts that follow this stock. The 12 month stock price consensus is $17.60. This implies a total return of 25.04% with 23.77% from capital gains and 1.27% from dividends.

There is a Press Release on Cision talking about this company has signed a commercial agreement with Drone Delivery Canada. The Financial News Staff at Staff Talker comment on the high ratios this company has. Staff Writer at Oro Bulletin says that the .Williams Percent Range shows that this stock is oversold (i.e. low). There is not many analysts following this stock on Stock Chase. However, the analysts that do follow this stock like it.

TECSYS Inc. is a supply chain management software provider that delivers powerful enterprise distribution, warehouse and transportation logistics software solutions. The company's customers include about 600 mid-size and Fortune 1000 corporations in healthcare, heavy equipment, third-party logistics, and general wholesale high- volume distribution industries. Its web site is here TECSYS Inc .

On my other blog I wrote yesterday about Pulse Seismic Inc. (TSX-PSD, OTC- PLSDF)... learn more. Tomorrow, I will write about Savaria Corporation (TSX-SIS, OTC-SISXF)... learn more on Friday, August 4, 2017 around 5 pm. Tomorrow on my other blog I will write about Something to Buy August 2017... learn more on Thursday, August 3, 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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