I own this stock of Stingray Digital Group Inc (TSX-RAY.A, OTC-NONE). I was following Newfoundland Capital Corp and Stingray Bought them out. Also, I read the blub on CEO, Eric Boyko. The site says he is an entrepreneur with nearly two decades of experience with start-ups. Mr. Boyko has extensive expertise in early stage business innovations.
When I was updating my spreadsheet, I noticed that the share price has basically just gone down since it hit a peak in April 2018. The other thing is there is lots of insider buying. Insider have been buying as the stock price has decline and have bought stock for just under $8.50 down to just under $6.50.
The dividend yield is moderate currently at 3.51%. The 4 year median dividend yield is 2.10% The dividend growth is good (15% or higher) over the past 3 years with a growth of 24.3% per year.
The Dividend Payout Ratios should be lower for EPS, and will probably be in the future. The DPR for EPS for 2018 cannot be calculated as there was an earnings loss. The 4 year coverage is 128%. Next year the DPR for EPS is expected to be 32% with a 5 year coverage of 81%. The DPR for CFPS for 2018 is 33% with 5 year coverage at 30%.
Debt Ratios are fine but there is vulnerability in the Liquidity Ratio. The Long Term Debt/Market Cap is fine at 0.56. The Liquidity Ratio is low at 0.84 and it has always been low with 5 year median at just 0.87. If you add in Cash Flow after dividends, it is still low at 1.00 and 5 year median at 1.02. If you add back in current long term debt due, the ratio is still low at 1.27 and 5 year median at 1.30. This is a vulnerability. The Debt Ratio is fine at 1.53 and 5 year median at 1.96. The Leverage and Debt/Equity Ratios are a little high at 2.90 and 1.90.
The Total Return per year is shown below for years of 3 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 4 year low, median, and high median Price/Earnings per Share Ratios are 26.57, 31.06 and 35.56. The current P/E Ratio is 9.02 based on a stock price of $7.40 and 2020 EPS estimate of $0.82. This stock price testing suggests that the stock price is relatively cheap.
I get a Graham Price of $8.34. The 10 year low, median, and high median Price/Graham Price Ratios are 2.76, 3.63 and 4.50. The current P/GP Ratio is 0.89 based on a stock price of $7.40. This stock price testing suggests that the stock price is relatively cheap.
I get a 10 year median Price/Book Value per Share Ratio of 3.92. The current P/B Ratio is 1.96 based on a Book Value of $288M, Book Value per Share of $3.77 and a stock price of $7.40. The current ratio is 50% below the 10 year ratio. This stock price testing suggests that the stock price is relatively cheap.
I get an historical median dividend yield of 2.10%. The current dividend yield is 3.51% based on dividends of $0.26 and a stock price of $7.40. The current yield is 67% above the 4 year median. This stock price testing suggests that the stock price is relatively cheap.
The 4 year median Price/Sales (Revenue) Ratio is 3.95. The current P/S Ratio is 1.76 based on 2020 Revenue estimate of $320M, Revenue per share of $14.20 and a stock price of $7.40. The current ratio is 55% below the 4 year median. This stock price testing suggests that the stock price is relatively cheap.
Results of stock price testing is that the stock price is coming up cheap in all tests. Both the P/E Ratio and P/GP Ratios are showing cheap because EPS is expected in a lot higher than ever earned before. For both the Graham Price and the P/B Ratio tests the Book Value per Share has also jumped. The first quarterly report for 2020 has just come in and the company had a great quarter.
Is it a good company at a reasonable price? I do think that this is a good company, but it is of a higher risk. This is a startup. However, I have bought more shares today.
When I look at analysts’ recommendations, I find Strong Buy (1) and Buy (7) from First Call. Most sites do not have any recommendations. The consensus would be a Buy. TD give a 12 month stock price of $9.50. This implies a total return of 31.89% with 28.58% from capital gains and 3.51% from Dividends.
See what analysts are saying on Stock Chase. They are not much interested in this company. Christopher Liew on Motley Fool thinks it is a cyclical stock. A writer on Simply Wall Street says the ROCE is low and declining. A writer on Simply Wall Street talks about insider buying. Ronald Lewis on Adams Advocate says that the stock is slightly undervalued.
Stingray Group Inc is a music, media, and technology company. The company is a provider of curated direct-to consumer and B2B services, including audio television channels, 101 radio stations, SVOD content, 4K UHD television channels, karaoke products, digital signage, in-store music, and music apps. Its web site is here Stingray Digital Group Inc.
The last stock I wrote about was about was Loblaw Companies Ltd (TSX-L, OTC-LBLCF) ... learn more. The next stock I will write about will be BlackBerry Ltd (TSX-BB, NASDAQ-BBRY) ... learn more on Monday, August 12, 2019 around 5 pm.
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