Wednesday, November 22, 2017

IBI Group Inc.

Sound bite for Twitter and StockTwits is: Infrastructure stock. What this stock has going for it at the moment is momentum and lots of insider buying. These two probably count more at the current time that any stock price testing. Because of recent 3 years of earnings losses, none of my tests are going to show the current price as good. The time to buy good companies is when they are down. This might just apply here. See my spreadsheet on IBI Group Inc.

I do not own this stock of IBI Group Inc. (TSX-IBG, OTC-IBIBF). I have had this stock on my list to investigate for some time before I finally did in 2011. What finally prompted me set up a spreadsheet on this stock was an investment report I read in March of 2011.

What I noticed is a lot of insider buying. The last 3 years has seen net insider buying at 0.11%, 0.01% and 0.6%. Generally you see net insider selling at around 0.01%, so in comparison, the net insider buying is strong for this company. It would seem that insiders feel that the company has a great future.

This stock hit a high around 2012 and has not really done well since then. Revenue recovered a bit in 2016 and EPS is expected to recover this year. For the years 2012 to 2014 inclusive, there were earning losses. The company suspended its dividend in 2014 and has not yet said when this might be reinstated. No analyst seems to see it being reinstated in the near future.

The 5 year low, median and high Price/Earnings per Share Ratios are -0.07, -0.09 and -10.21. These are, of course, not of much use. The corresponding 10 year values are 6.20, 10.04 and 13.88. The corresponding historical or 13 year values are 6.53, 9.98 and 13.43. P/E Ratios tend to be low when a company has had a number of years of earning losses. The current P/E Ratio is 18.51 based on based on a stock price of $7.96 and EPS 2017 estimate of $0.43. This stock price testing shows that the stock price is relatively expensive.

Since we are near the end year, it is probably a good idea to look at the P/E Ratio for 2018. Based on a stock price of $7.96 and 2018 EPS estimate, the P/E Ratio moves down a bit to 15.02. This stock price testing shows that the stock price is relatively expensive.

I get a Graham Price of $2.67. The 10 year low, median and high median Price/Graham Price Ratios are 0.69, 0.99 and 1.27. The current P/GP Ratio is 2.98 based on a stock price of $7.96. When EPS is depressed you would expect that this test could not be past. This stock price testing shows that the stock price is relatively expensive.

The 10 year median Price/Book Value per Share Ratio is 1.38. The current P/B Ratio is 10.77 based on Book Value of $23.04M, BVPS of $0.74 and a stock price of $7.96. The current P/B Ratio is some 678% higher than the 10 year median P/B Ratio. This stock price testing shows that the stock price is relatively expensive.

There are a couple of things to mention here. When a company is having earning losses, the Book Value generally goes down. This has happened here. The other thing is that the book value was negative for the years of 2013 to 2015 inclusive. The book value only turned positive again in 2016. The Book Value has declined by 43% and 26% per year over the past 5 and 10 years. So it is not surprising that the P/B Ratio today is quite high.

The 10 year median Price/Sales (Revenue) Ratio is 0.53. The current P/S Ratio is 0.69 a value some 30% higher. The current P/S Ratio is based on 2017 Revenue estimate of $362M, Revenue per Share of $13.85 and a stock price of $7.96. This stock price testing shows that the stock price is relatively expensive.

When I look at analysts' recommendations, I find Buy (3) and Hold (1) recommendations. The 12 month stock price is $9.13. The 12 month stock price is $9.13. This implies a total return of 14.70 based on a stock price of $7.96. All the return would be from capital gains.

Mmahotstuff on Money Making Articles talk about recent ratings for this company. On Buckeye Business Review we get some technical analysts on this stock.. See what analysts are saying about this company on Stock Chase. They mostly like it.

IBI Group Inc. is an international, multi-disciplinary provider of a range of professional services focused on the physical development of cities. The Company through IBI Group provides professional services, including planning, design, implementation, analysis of operations and other consulting services in relation to four main areas of development. Its web site is here IBI Group Inc.

The last stock I wrote about was about was Johnson and Johnson (NYSE-JNJ)... learn more. The next stock I will write about will PFB Corp. (TSX-PFB, OTC-PFBOF)... learn more on Friday, November 24, 2017 around 5 pm. Tomorrow on my other blog I will write about Being an Investor... learn more on Thursday, November 23, 2017 around 5 pm.

Also, on my book blog I have put a review of the book Reflections on the Revolution in Europe by Christopher Caldwell learn more...

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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