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.
When I was updating my spreadsheet, I noticed for people investing in this company, they have done very well for their shareholders. This a very good dividend growth stock. You can see that reflected in the chart below. However, they are slowing down now and taking on debt.
The current dividend yield is in the moderate range (2% to 4%) with current dividend yield at 3.59%. The 5, 10 and historical dividend yields are 2.49%, 3.62% and 3.62%. The dividend growth is in the good range of over 15% per year with the dividend growth at 36% per year over the past 5 years. The last dividend increase was lower at 16.7% with the last increase in 2018. Analysts do not expect the dividend to be increased this year.
The Dividend Payout Ratios are a little too high currently. The Dividend Payout Ratio for EPS for 2018 is 94% with 5 year coverage at 75%. The DPR for EPS is expected to be lower in 2019 at 82% if the company does not increase its dividend in 2019. The DPR for CFPS for 2018 was 45% with 5 year coverage at 48%. It would be better if EPS DPR was 60% or lower and the CFPS DPR was 40% or lower.
Debt Ratios are worse that they have been, but are currently still fine. The Long Term Debt/Market Cap Ratio for 2018 was 0.17. This is low, but they have been big increases to the Long Term Debt over the past two years. The Liquidity Ratio for 2018 is 1.99 with 5 year median at 2.49. This ratio is lower than it has ever been. The Debt Ratio is 1.99 with 5 year median at 2.06. The Leverage and Debt/Equity Ratios for 2018 at 2.01 and 1.01 with 5 year medians at 1.98 and 0.98.
The Total Return per year is shown below for years of 5 to 17 to the end of 2018. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
|From||Years||Div. Gth||Tot Ret||Cap Gain||Div.|
The 5 year low, median, and high median Price/Earnings per Share Ratios are 14.64, 25.40 and 36.53. The corresponding 10 year ratios are 14.35, 17.79 and 21.03. The corresponding historical ratios are 13.98, 17.69 and 20.99. The current P/E Ratio is 22.96 based on a stock price of $11.71 and 2019 EPS estimate of $0.51. This stock price testing suggests that the stock price is relatively expensive.
I get a Graham Price of $7.08. The 10 year low, median, and high median Price/Graham Price Ratios are 1.06, 1.32 and 1.58. The current P/GP Ratio is 1.65 based on a stock price of $11.71. This stock price testing suggests that the stock price is relatively expensive.
I get a 10 year median Price/Book Value per Share Ratio of 2.74. The current P/B Ratio is 2.68 based on Book Value of $1978M, Book Value per Share of $4.37 and a stock price of $11.71. The current ratio s 2% below the 10 year ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get an historical median dividend yield of 3.62%. The current dividend yield is 3.59% based on a stock price of $11.71 and Dividends of $0.42. The current yield is 1% below the historical dividend yield. This stock price testing suggests that the stock price is relatively reasonable and at the median.
The 10 year median Price/Sales (Revenue) Ratio is 0.99. The current P/S Ratio is 1.34 based on 2019 Revenue estimate of $395M, Revenue per Share of $8.72 and a stock price $11.71. The current ratio is some 36% above the 10 year median. This stock price testing suggests that the stock price is relatively expensive.
Results of stock price testing is that the stock price is probably on the expensive side. You cannot ignore the P/S Ratio and this is showing the stock as expensive. This is a good test because it is about the future. The dividend yield is showing that the price is a bit above the median. This is a good test as it is using current values. The P/B testing is showing the stock price a bit below the median. However, P/B is using past figures.
Is it a good company at a reasonable price? This is certainly a good company with probably a great future. The problem is that the stock price is growing faster than the Revenue. It would seem to be on the expensive side at the moment. So it is not at a relatively reasonable price at present.
When I look at analysts’ recommendations, I find Strong Buy (2) and Buy (5) recommendations. The consensus would be a Strong Buy. The 12 month stock price is $17.11. This implies a total return of 49.70% with 46.11% from capital gains and 3.59% from dividends.
See what analysts are saying on Stock Chase. Jon Vialoux says it has lost momentum. Victoria Hetherington on Motley Fool still thinks buying this stock is a smart idea. A writer on Simply Wall Street talks about insider ownership. A writer on Simply Wall Street says the company’s ROCE is currently mediocre and there may be more attractive investments around. A writer on Simply Wall Street expresses concerns about the dividends are the company is paying too much from earnings and cash flow currently. Standard Staff on Florence Standard says there is downward pressure on the company’s shares.
Savaria Corp designs, engineers, and manufactures products for personal mobility. Its products include home elevators, wheelchair lifts, commercial elevators, ceiling lifts, stair lifts, and van conversions. Its web site is here Savaria Corporation.
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-BLDP, NASDAQ-BLDP) ... learn more on Tuesday, August 6, 2019 around 5 pm.
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