K-Bro Linen Inc

Sound bite for Twitter and StockTwits is: Dividend Paying Consumer stock. Stock price is probably reasonable. It will probably become an dividend growth stock once is gets the Dividend Payout Ratios under control. See my spreadsheet on K-Bro Linen Inc.

I do not own this stock of K-Bro Linen Inc (TSX-KBL, OTC-KBRLF). People were talking about this stock at the 2009 Toronto Money Show. This was one income trust being touted as currently a good buy with very good yield. It was also recommended by Aaron Dunn who is the Senior Equity Analyst for Keystone Publishing Corp, a publisher of Canadian investment newsletters.

When I was updating my spreadsheet, I noticed the stock price has caught up with the declining EPS and shareholders capital gain was negative in 2018. The stock declined almost 20% last year, but is up by almost 8% this year. EPS is expected to rise this year. The EPS for the past 12 months is higher than to the end of last year.

Dividend yields are moderate (2 to 4% ranges) to good (5% or over). The current dividend yield is moderate at 3.53%. The 5, 10 and historical median dividend yields are 2.83%, 3.36% and 5.02%. If you look at median dividend yield since the company became a corporation, the yield is 3.09%. Dividends have been flat since 2014. Since this is an old income trust, current yields are likely to continue and the company will not get back to the yields it had as an income trust. See dividend growth in the chart below.

The Dividend Payout Ratios are still too high, but analysts expect them to improve. The DPR for 2018 for EPS for 2018 was 204% with 5 year coverage at 170%. The DPR for EPS is expected to be this year at 98% with 5 year coverage at 111%. The DPR for CFPS for 2018 was 44% with 5 year coverage at 42%.

Debt Ratios are fine and mostly quite good. The Long Term Debt/Market Cap Ratio for 2018 is good and low at 0.20. The Liquidity Ratio good at 1.97. The Debt Ratio is good and high at 2.61. I like the last two ratios to be at 1.50 or higher. The Leverage and Debt/Equity Ratios are good and low at 1.62 and 0.62 respectively.

The Total Return per year is shown below for years of 5 to 14 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.
2013	5	0.35%	-0.09%	-3.32%	3.24%
2008	10	0.87%	20.81%	13.15%	7.66%
2004	14	1.17%	14.37%	7.80%	6.57%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 29.73, 33.61 and 37.49. The 10 year corresponding ratios are 20.57, 23.99 and 27.42. The corresponding historical ratio are 18.04, 18.71 and 20.62. The current P/E Ratio is 29.27 based on a stock price of $36.00 and 2019 EPS estimate of $1.23. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $22.46. The 10 year low, median, and high median Price/Graham Price Ratios are 1.59, 1.86 and 2.13. The current P/GP Ratio is 1.60 based on a stock price of $36.00. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10 year median Price/Book Value per Share Ratio of 2.46. The current P/B Ratio is 1.97 based on a stock price of $36.00, Book Value of $193M, and a Book Value per Share of $18.23. The current ratio is 19.7% below the 10 year median 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 5.02%. The median dividend yield since becoming a corporation is 3.09%. The current dividend yield is 3.33% based on dividends of $1.20 and a stock price of $36.00. The current dividend yield is 33.6% below the historical median yield but it is 7.9% above the yield since becoming a corporation. This stock price testing suggests that the stock price is relatively reasonable and below the median going by the yield since the company has become a corporation.

The 10 year median Price/Sales (Revenue) Ratio is 1.73. The current P/S Ratio is 1.51 based on 2019 Revenue estimate of $252M, Revenue per Share of $23.86 and a stock price of $36.00. The current ratio is 13% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

Results of stock price testing is that the stock price is probably reasonable. In this case the best test is the P/S Ratio test. This test shows the stock price is relatively reasonable and below the median. The rest of the testing shows these same results except for the P/E Ratio testing. The P/E Ratios are all relatively high for this sort of company. The dividend yield test is suspect because the company used to be an income trust.

Is it a good company at a reasonable price? I think that this company has a lot of potential. It would appear, on a number of tests, to be reasonable priced.

When I look at analysts’ recommendations, I find Strong Buy (2), Buy (4) and Hold (1). The consensus would be a Buy. The 12 month stock price consensus is $45.43. This implies a total return of 29.53% with 3.33% from dividends and 26.19% from capital gains.

See what analysts are saying on Stock Chase. It is not well covered but analysts like the company. Kris Knutson on Motley Fool likes this company, but report is from last year. A writer on Simply Wall Street points out a lot of negatives for this company, but does not understand that this used to be an income trust company that had to switch to a corporation because changes to the CDN Tax Laws. A writer on Simply Wall Street talks about who owns shares in this company. A writer on Simply Wall Street says that the company’s intrinsic value says the stock is undervalued. Stock Muse Staff on Stock Muse say the Piotroski F-Score is 4 showing the company of middling strength .

K-Bro Linen Inc is a healthcare and hospitality laundry and linen processor in Canada. K-Bro operates nine facilities in eight major cities across Canada, and two distribution centres, providing management services and laundry processing of hospitality, healthcare, and specialty linens. Its web site is here K-Bro Linen Inc.

The last stock I wrote about was about was Le Chateau Inc (TSX-CTU, OTC-LCUAF) ... learn more. The next stock I will write about will be Linamar Corporation (TSX-LNR, OTC-LIMAF) ... learn more on Wednesday, October 2, 2019 around 5 pm. Tomorrow on my other blog I will write about Dividend Stocks October 2019.... learn more on Tuesday, October 2, 2019 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.

Le Chateau Inc

Sound bite for Twitter and StockTwits is: Consumer Stock. This stock is probably cheap. This is showing up the P/S Ratio testing. However, revenue is declining, they cannot make a profit and the Book Value is negative. It is surprising it is still hanging in there. See my spreadsheet on Le Chateau Inc.

I do not own this stock of Le Chateau Inc (TSX-CTU, OTC-LCUAF). In June 10, 2012 I started spreadsheet because of a request from Blog reader. It was also on my list of dividend and special dividend paying stocks. Jennifer Dowty wrote a column on Dividend Paying stocks in 2010. Jennifer is now a Portfolio Manager for Manulife Asset Management Limited. The title of the article in Investor’s Digest was Dividend Stocks: Buy, Hold and Collect. The Investor’s Digest is a publication of MPL Communications.

When I was updating my spreadsheet, I noticed the investors who have been in this company for more than 15 years have still made money. All their return is in dividends. This is the advantage of dividend stocks. You often do not lose money in the long term. It seems like all analysts have given up on this company because it has not been able to make a profit since 2011. It is interesting that it is still hanging in there.

For the second quarter of 2019, the accounting rules they have introduced take account of lease liabilities and right to use assets. This is part of the reason the Liquidity Ratio is below 1.00 (which means current assets cannot cover current liabilities. The other reasons are the current portion of the credit facility and the current portion of the long term debt.

Dividends were suspended in 2012 because the company could no longer afford them. They started with earnings losses for the 2011 calendar year.

Debt Ratios are not good. The 2018 Long Term Debt/Market Cap is 19.72. However, it moved down to 5.91 for the second quarter of 2019. The Liquidity Ratio was high and good 2018 at 2.11 but it moved to 0.77 currently. Even with cash flow added, it is 0.81. The current assets cannot cover the current liability. The Debt Ratio for 2018 is 1.05. It has moved to 0.94 currently. That means that assets cannot cover liabilities and they have a negative book value.

The Total Return per year is shown below for years of 5 to 26 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.
2013	5	n/a	-52.65%	-52.65%	0.00%
2008	10	n/a	-30.76%	-36.45%	5.70%
2003	15	n/a	9.15%	-21.52%	30.67%
1998	20	n/a	9.39%	-15.46%	24.84%
1993	25	n/a	4.15%	-13.77%	17.92%
1992	26	n/a	8.13%	-11.43%	19.56%

The 5 year low, median, and high median Price/Earnings per Share Ratios are all negative. The corresponding 10 year ratios are all negative. The corresponding historical ratios are 4.56, 6.57 and 8.76. The current P/E Ratio is negative 0.11 based on a stock price of $0.09 and an earnings loss for the past 12 months of $0.79. We cannot do any testing with the P/E Ratio.

I cannot do any testing with Price/Graham Price Ratios because we have a negative book value. I cannot do any testing re Price/Book Value per Share Ratio because of the negative book Value. I cannot do any testing with the dividend yield because there is no dividend.

The 10 year median Price/Sales (Revenue) Ratio is 0.29. The current P/S Ratio is 0.01 based on last 12 months of Revenue of $182.2M, Revenue per Share of $6.03 and a stock price of $0.09. The current ratio is some 95% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

Results of stock price testing is that the stock price is probably relatively cheap. As noted above, most of what I like to test with cannot be done. The only that there can be any testing is P/S Ratio and this is generally a good test.

Is it a good company at a reasonable price? This company has not made a profit since 2011, it has not dividend, Revenue is declining and the Book Value is negative. It is not the sort of stock I would invest in. It is cheap.

When I look at analysts’ recommendations, I find that no analysts are following this stock.

See what analysts are saying on Stock Chase. Last entries were for 2011 when analyst feared the company was heading into trouble. Susan Portelance on Motley Fool compared this company negatively to Reitmans in 2017. A writer on Simply Wall Street in 2018 said that a high level of debt like this company holds can be dangerous as liquidity can dry up in unexpected downturns. The company reported on Globe Newswire the results for the second quarter of 2019. This article on Globe Newswire talks about the Chairman providing a loan to Le Chateau Inc.

Le Chateau Inc is a Canadian brand in specialty retailing, offering a broad array of contemporary fashion apparel, accessories, and footwear for style-conscious women and men. Its web site is here Le Chateau Inc.

The last stock I wrote about was about was Granite REIT (TSX-GRT.UN, NYSE-GRP.U) ... learn more. The next stock I will write about will be K-Bro Linen Inc (TSX-KBL, OTC-KBRLF) ... learn more on September 30, 2019 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.

Granite REIT

Sound bite for Twitter and StockTwits is: Dividend Growth REIT. The stock price is probably expensive. The changes in 2012 seem to be have quite good for the company. See my spreadsheet on Granite REIT.

I do not own this stock of Granite REIT (TSX-GRT.UN, NYSE-GRP.U). I first bought some of this stock in 2003 when it was called MI Developments (TSX-MIM.A). It was a company connected with Frank Stronach and Magna. TD bank also had an Action Buy Call (Strong Buy) on this stock. The year of 2006 was the last time I did well on this stock. It kept going down and I sold it in 2009; being discourage it would ever do well again.

When I was updating my spreadsheet, I noticed that they gave out more units to the shareholders but then did a consolidation so this did not increase the number of units outstanding. I think that the effect on the number of units of this distribution for shareholders is nil, which is what I am assuming. I wish that they would not do such weird things as it can be hard to tell the exact implications.

The dividend yields are moderate (2 to4% range) to good (5% or over). The current yield is 4.34%, with 5, 10 and historical median dividend yields at 5.50%, 5.55% and 4.47%. There were some big dividend increases when this company became a REIT, but since then, they have slowed down. This last increase was in this year and it was for just 2.6%.

The Dividend Payout Ratios seems to be fine. The DPR for EPS for 2018 was 27% with 5 year coverage of 44% for the calculated EPS. For REITs, generally speaking, the Funds from Operations (FFO) and Adjusted Funds from Operations (AFFO) are used to look at DPR. For 2018 the DPR for FFO is 74% with 5 year coverage at 73%. The DPR for AFFO for 2018 is 91% with 5 year coverage at 79%.

Debt Ratios are all fine. The Long Term Debt/Market Cap ratio is 0.49 for 2018 and this is low and fine. The Liquidity Ratio has varied greatly and is quite high and fine for 2018 at 8.39. The Debt Ratio for 2018 is also high and fine at 2.48. The Leverage and Debt/Equity Ratios are low and fine at 1.68 and 0.68.

The Total Return per year is shown below for years of 5 to 16 to the end of 2018 in CDN$. 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.
2013	5	5.34%	12.58%	6.60%	5.99%
2008	10	14.01%	27.66%	19.33%	8.33%
2003	15	12.50%	5.68%	2.63%	3.05%
2002	16		7.64%	4.38%	3.26%

The Total Return per year is shown below for years of 5 to 16 to the end of 2018 in US$.

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2013	5	0.23%	6.71%	1.28%	5.43%
2008	10	12.78%	27.41%	17.95%	9.45%
2003	15	13.02%	5.69%	2.26%	3.43%
2002	16		9.32%	5.32%	3.99%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 5.74, 6.73 and 7.71. The corresponding 10 year ratios are 6.53, 7.67 and 7.38. The corresponding historical ratios are 6.53, 7.67 and 8.82. The current P/E Ratio is 7.23 based on a stock price of $64.42 and 12 months ending at the second quarter EPS of 8.91. This stock price testing suggests that the stock price is relatively reasonable and below the median.

Because this is a REIT, the Price/FFO Ratio is often used. The 5 year low, median, and high median P/FFO ratios are 11.34, 12.75 and 14.17. This corresponding 10 year ratios are 11.23, 12.93, and 14.63. The current P/FFO Ratio is 18.25 based on current stock price of $64.42 and 2019 FFO estimate of $3.53. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $66.54. The 10 year low, median, and high median Price/Graham Price Ratios are 0.71, 0.77 and 0.84. The current P/GP Ratio is 0.97 based on a stock price of $64.42. 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 1.05. The current P/B Ratio is 1.16 based on a stock price of $64.42, Book Value of $2756M and Book Value per Share of $55.75. The current ratio is 11% higher than the 10 year ratio. This stock price testing suggests that the stock price is relatively reasonable but above median.

I get an historical median dividend yield of 4.47%. The current yield is 4.34% based on dividends of $2.80 and a stock price of $64.42. The current yield is 3% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above median.

The 10 year median Price/Sales (Revenue) Ratio is 8.76. The current P/S Ratio is 11.71 based on 2019 Revenue estimate of $272M, Revenue per Share of $5.00 and a stock price of $64.42. The current P/S Ratio is 34% above the 10 year ratio. This stock price testing suggests that the stock price is relatively expensive.

Results of stock price testing is that the stock price is probably expensive. The P/S Ratio testing is interesting because it is both an increase in the stock price and an increase in the number of outstanding shares that contributed to this ratio’s testing showing that the stock price is relatively expensive. You have to wonder if the dividend yield test is any good because of the change of this company from a corporation to a REIT. The P/B would seem to point to a reasonable if not cheap stock price. However, P/B Ratios for REIT tend to be low (that is under 1.5) which is considered low for other companies.

Is it a good company at a reasonable price? The changes in 2012 including to a REIT seems to have been very good for this company. It now seems to be a good REIT to own. However, at present, it does seem to be on the expensive side. Interestingly, the Chairman of this company has yet to show up on an INK report and he has been reported to be the chairman for the last 3 years. The INK report shows officers and board members of a company and what they own in shares.

When I look at analysts’ recommendations, I find Strong Buy (4), Buy (2) and Hold (3). The consensus would be a Buy. The 12 months consensus stock price is $67.78. This would imply a total return of 11.12% based on a stock price of $64.42 with 4.35% from dividends and 6.77% from capital gains.

See what analysts are saying on Stock Chase. They think that management is doing an excellent job. Karen Thomas on Motley Fool thinks this is good REIT at an attractive price. A writer on Simply Wall Street says the company has a good interest coverage ratio. Liza Goodheart on The Enterprise Leader says CIBC raised the target price on this stock. Charles Blunt on Mayfield Recorder says the company has an average recommendation of Buy.

Granite Real Estate Investment Trust, or Granite, is a real estate investment trust engaged in the acquisition, development, and management of primarily industrial properties in North America and Europe. Granite's portfolio comprises various manufacturing, corporate office, warehouse and logistics, and product engineering facilities. Its web site is here Granite REIT.

The last stock I wrote about was about was Alcanna Inc (TSX-CLIQ, OTC-LQSIF) ... learn more. The next stock I will write about will be Le Chateau Inc (TSX-CTU, OTC-LCUAF) ... learn more on September 27, 2019 around 5 pm. Tomorrow on my other blog I will write about Money Show 2019 – Nick Bontis.... learn more on Thursday, September 26, 2019 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.

Alcanna Inc

Sound bite for Twitter and StockTwits is: Consumer Stock Cheap. This stock is probably cheap. It has cancelled the dividends, so there is no telling what and if any dividends will be in their future plans. Expenses seem to be growing faster than revenue. Analysts do not expect to see any positive earnings this year. The 12 month EPS to the end of the second quarter is a loss of $4.79. See my spreadsheet on Alcanna Inc .

I do not own this stock of Alcanna Inc (TSX-CLIQ, OTC-LQSIF). The idea of following this stock came from a reader of my blog.

When I was updating my spreadsheet, I noticed that Selling and Admin expenses increased much more than Sales. Selling and Admin increased by 14.4% compared to Sales which increased by 5%. They had a big write off for goodwill. There is a lot of insider buying below $6.00. This company has some good debt ratio for 2018, but this changed in the second quarter of 2019.

They have cancelled their dividends for this year. They could not afford their dividends as they have not been making a profit in the last two years. They used to be an income trust and income trusts could pay out based on FFO and AFFO, but corporation should be paying out based on earnings. They have never been close to paying out their dividends paid on earnings.

Debt Ratios are fine for 2018 but have vulnerabilities currently because of accounting changes. We will have to see how these new accounting changes play out in the longer term. Their Long Term Debt/Market Cap ratio is low and good at 0.47 for 2018 and currently at 0.51. Their Liquidity Ratio is high and good at 3.17 for 2018 and 2.57 currently. Their Debt Ratio is good in 2018 at 2.24. However, it becomes low currently at 1.20 because of following different account rules for its leases. The Leverage and Debt/Equity Ratios are fine in 2018 at 1.81 and 0.81 but become very high currently at 5.98 and 4.98 because of the same accounting changes noted above.

The Total Return per year is shown below for years of 5 to 14 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.

The shareholders with longer term holdings have made a profit because of dividends, but shareholders have not profited over the last few years because dividends have been cut and capital gains losses are bigger.

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2013	5	-19.73%	-14.36%	-21.44%	7.08%
2008	10	-13.96%	5.38%	-8.69%	14.07%
2004	14	-7.86%	3.81%	-8.47%	12.28%

The 5 year low, median, and high median Price/Earnings per Share Ratios are all negative at 0.91, 1.83 and 2.83. The 10 year corresponding ratios are 13.44, 14.91 and 16.38. The corresponding historical ratios are 13.91, 16.41 and 18.95. The current P/E Ratio is a negative 13.23 based on a stock price of $5.30 and 2019 EPS estimate of earnings losses of $0.40. The P/E Ratio for next year is 26.50 based on a stock price of $5.30 and 2020 EPS of $0.20. This all suggests that the P/E Ratio test for this stock is probably undesirable.

I get a Graham Price of $3.28. The 10 year low, median, and high median Price/Graham Price Ratios are 0.88, 1.11 and 1.39. The current P/GP Ratio is 1.62 based on a stock price of $5.30. This stock price testing suggests that the stock price is relatively expensive. But this is probably not a good test either because of all the earning losses.

I get a 10 year median Price/Book Value per Share Ratio of 1.20. The current P/B Ratio is 2.22 based on a stock price of $5.30, Book Value of $88.7M and Book Value per Share of $2.39. The current ratio is 84% higher than the 10 year ratio. This stock price testing suggests that the stock price is relatively expensive.

A dividend yield test cannot be done because the dividend has been cancelled.

The 10 year median Price/Sales (Revenue) Ratio is 0.48. The current P/S Ratio 0.25 based 2019 Revenue estimate of $797M, Revenue per Share of $21.47 and a stock price of $5.30. The current ratio is 49% below the 10 year ratio. This stock price testing suggests that the stock price is relatively expensive

Results of stock price testing is that the stock price is probably cheap by the only real valid test that I can do, which is the P/S Ratio Test. There are problems with the other tests due to the number and amount of the earning losses and lack of a dividend.

Is it a good company at a reasonable price? Personally, I would not buy this company at the present time, so I cannot say it is a good company to buy. It is probably cheap.

When I look at analysts’ recommendations, I find Strong Buy (1), Buy (1), and Hold (3). The consensus would be a Buy. The 12 month stock price is $7.60. This implies a total return of 43.40% all from capital gains.

See what analysts are saying on Stock Chase. They are now into cannabis. (Everyone is now into cannabis.) Christopher Liew on Motley Fool says to avoid this stock at all costs. A writer on Simply Wall Street says it is running a high debt while not making money and this can be a risky business. A writer on Simply Wall Street says that a company losing money with revenues going in the wrong direction is not what investors like to see. A contributor on Goodwell Gazette says that the Piotroski F-Score of 2 for this company is a low one. David Arnold on Invest Tribune says there has been an increase in short sellers of this stock.

Alcanna Inc is the private-sector retailer of alcoholic beverages in Canada and in the top 5 in North America. The company operates approximately 235 stores under the brand names Wine & Beyond, Liquor Deport and Brown Jug in Alberta, B.C., and Alaska. The company owned 25 per cent by Aurora Cannabis Inc and also owns the Nova Cannabis brand with 5 stores in Alberta and 1 in Toronto. Its web site is here Alcanna Inc.

The last stock I wrote about was about was Great-West Lifeco Inc (TSX-GWO, OTC-GWLIF) ... learn more. The next stock I will write about will be Granite REIT (TSX-GRT.UN, NYSE-GRP.U) ... learn more on September 25, 2019 around 5 pm. Tomorrow on my other blog I will write Money Show 2019 Gold.... learn more on Tuesday, September 24, 2019 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.

Great-West Lifeco Inc

Sound bite for Twitter and StockTwits is: Dividend Growth Insurance. The stock price seems relatively cheap to reasonable and below the median. They have some vulnerability in high Dividend Payout Ratios and coverage of debt. However, they do have a long term good record for dividends. See my spreadsheet on Great-West Lifeco Inc.

I do not own this stock of Great-West Lifeco Inc (TSX-GWO, OTC-GWLIF). This stock seems to be a favorite with investors who like solid, stable, dividend paying stock. It was on Mike Higgs' list and it used to be on the dividend lists. I have been following this stock for some time. However, I will not buy it because I have Power Financial Corp. (TSX-PWF). Great West Lifeco Inc. is one of the companies under the Power Financial Corp. and Power Corp. (TSX-POW).

When I was updating my spreadsheet, I noticed as with all Life Insurance companies, this company has had a hard time because of ultra-low interest rates, but these companies are learning to deal with this. I noticed that the last two dividend increases are higher than the 5 year average of 4.8% with the increase in 2017 at 8.4% and the 2019 at 6.2%. Of course, the problem with the average for the past 5 years was the years with no dividend increases.

The current yield is good (5% or over) at 5.29%. The 5, 10 and historical yields are moderate (2 to 4% ranges) at 4.06%, 4.46% and 3.55%. Growth has been picking up as you can see from the chart below. This is because there was no growth from 2010 to 2014 inclusive. The last increase was in 2019 and it was for 6.2%.

The Dividend Payout Ratios are a bit high so there is some vulnerability here. The DPR for EPS for 2018 is 52% with 5 year coverage at 53%. The DPR for CFPS for 2018 is 44% with 5 year coverage at 42%. The DPR for EPS is expected to go a bit higher before dropping again.

Debt Ratios are fine, but there is some vulnerability here. Since this is a financial, you want to look at the assets covering the long term debt which for 2018 is at 0.94. The ratio for the second quarter of 2019 is 1.04 and this coverage ratio is not good as it should not be above 1.00. Over 1.00 means that they do not have enough cash and investments assets to covering their long term debt.

The Liquidity Ratio I calculate is 1.28. If you add in cash flow after dividends it is 1.93. This ratio is not an important one for financials. The Debt Ratio is 1.06 and this is fine for financials. Leverage and Debt/Equity Ratios at 15.61 ad 14.61 are probably a bit too high.

The Total Return per year is shown below for years of 5 to 30 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.
2013	5	4.81%	1.52%	-2.96%	4.49%
2008	10	2.63%	8.64%	3.13%	5.51%
2003	15	7.02%	6.06%	1.48%	4.58%
1998	20	10.28%	8.61%	3.94%	4.67%
1993	25	13.72%	16.57%	9.55%	7.02%
1988	30	11.31%	16.75%	10.27%	6.48%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 11.37, 12.43 and 13.55. The corresponding 10 year ratios are 10.92, 12.39 and 13.73. The corresponding historical ratios are 11.31, 12.53 and 14.12. The current P/E Ratio is 11.78 based on a $31.23 and 2019 EPS estimate of $2.65. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a Graham Price of $35.25. The 10 year low, median, and high median Price/Graham Price Ratios are0.87, 0.98 and 1.11. The current P/GP ratio is 0.89 based on a stock price of $31.23. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10 year median Price/Book Value per Share Ratio of 1.75. The current P/B Ratio of 1.50 based on a stock price of $31.23, Book Value of $19,360M and Book Value per Share if $20.84. The current ratio is 14% below the 10 year median 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 3.55%. The current dividend yield is 5.29% based on dividends of $1.652 and a stock price of $31.23. The current yield is 49% above the historical dividend yield. This stock price testing suggests that the stock price is cheap.

The 10 year median Price/Sales (Revenue) Ratio is 0.75. The current P/S Ratio is 0.50 based on 2019 Revenue estimate of $57,746M, Revenue per Share of $62.17 and a stock price of $31.23. The current P/S Ratio is 33% below the 10 year median ratio. This stock price testing suggests that the stock price is cheap.

Results of stock price testing is that the stock price is that the stock is probably relatively cheap. The P/S Ratio confirms the Dividend Yield test that the stock is relatively cheap. All the other tests point the stock as being relatively reasonable and below the median. The P/E Ratios for this stock is surprisingly consistent.

Is it a good company at a reasonable price? The stock price is cheap to reasonable. The company has a solid dividend payment record. I have records going back 30 years and they have paid dividends each year and have not decreased the dividends. This makes it a good dividend growth company. They kept the dividends flat for the years 2010 to 2014 inclusive. This is understandable because of the low interest rates.

When I look at analysts’ recommendations, I find Hold (10) and Underperform (1) recommendations. The consensus would be a Hold. The 12 month stock price consensus is $31.68. This implies a total return of 6.73% with 1.44% from capital gains and 5.29% from dividends based on a current price of $31.23.

Note that last year in September 2018 when I look at analysts’ recommendations, I found Strong Buy (1), Buy (1) and Hold (8). The consensus was a Hold. The 12 month stock price consensus was $36.40. This implies a total return of 20.08% with 15.15% from capital gains and 4.92% from dividends based on a current price of $31.61. It would appear that last year they were way off the 12 month consensus price. The price last year is almost the same as it is this year. Current Price is $31.23 and last year’s price was $31.61.

See what analysts are saying on Stock Chase. They mention that low interest rates are bad for insurance companies. Christopher Liew on Motley Fool likes the good dividends of this company for retirement income. A writer on Simply Wall Street thinks this stock is underpriced. A writer on Simply Wall Street talks about how badly the stock price has done over the past year. Mark Albertson on Silicon Angle talks about how the company is protecting itself against Malware. The CEO is interviewed on BNN Bloomberg.

Great-West Lifeco, majority-owned by Power Financial, is one of Canada's big three life insurance firms. Great-West primarily operates in its home market of Canada but has been expanding its operations in the U.S. and Europe through Irish Life, Putnam Investments, and now Empower Retirement. Its web site is here Great-West Lifeco Inc.

The last stock I wrote about was about was Trican Well Service Ltd (TSX-TCW, OTC-TOLWF) ... learn more. The next stock I will write about will be Alcanna Inc (TSX-CLIQ, OTC-LQSIF) ... learn more on Monday, September 23, 2019 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.

Trican Well Service Ltd

Today, I sold TransAlta Corp (TSX-TA, NYSE-TAC). I have had this stock since 1987. I have not lost on it because it is a dividend paying stock. This is a utility stock and why you hold utility stocks is good yield. Lately, dividends have been decreasing and the stock price has been increasing. The current yield is 1.87%. This is low for a utility. There does not seem any current hope for a dividend increases anytime soon.

Sound bite for Twitter and StockTwits is: Industrial Service Stock. The stock is relatively cheap. It has great debt ratios. However, it does service the oil patch and therefore is risky. See my spreadsheet on Trican Well Service Ltd.

I do not own this stock of Trican Well Service Ltd (TSX-TCW, OTC-TOLWF). I was following Canyon Services Group Inc. and Trican Well Services Ltd. had a plan of arrangement with Canyon Shareholders.

When I was updating my spreadsheet, I noticed in 2018 and 2019 they reducing their Long Term Debt and Goodwill and Intangible assets. They also have very good debt ratios. Both these are very good things for the company to do.

The company used to have dividends. They were started in 2011 and cancelled in 2017. Analysts do to expect any future dividend payments in the near term. The 5 year coverage DPR for EPS for 2015 was 102%. The DPR for CFPS for 2015 was 98%. Clearly, they could not afford the dividends. At different times the company had earning losses and negative cash flow.

Debt Ratios are good. The long Term Debt/Market Cap Ratio for 2018 is low and therefore good at 0.13. It fell to 0.03 in the second quarter of 2019. Both the Liquidity Ratio and Debt Ratios are high and therefore good at 2.35 and 5.36 respectively. These high ratios will see a company through bad times. The Leverage and Debt/Equity Ratios are low and therefore good at 1.23 and 0.23 respectively for 2018.

The Total Return per year is shown below for years of 5 to 12 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.

Dividend Growth is zero because dividends have been suspended since 2016.

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2013	5	0.00%	-27.94%	-30.10%	2.15%
2008	10	0.00%	27.89%	9.63%	18.26%
2005	12	0.00%	-1.57%	-7.25%	5.68%

The 5 year low, median, and high median Price/Earnings per Share Ratios are all negative 1.41, 3.64 and 5.88. The corresponding 10 year ratios are 0.58, 3.10 and 1.92. The corresponding historical ratios are also negative at 1.41, 3.64 and 5.88. The current P/E Ratio is also negative at 5.43 based on a stock price of $1.25 and 2019 EPS estimate of earnings losses of $0.23. What do I say? You cannot do this test when you got negative P/E Ratios.

I get a Graham Price of $1.09. This is not a good test when earnings are negative for a number of years as the Graham Price may not reflect the true Graham Price. The 10 year low, median, and high median Price/Graham Price Ratios are .61, 1.03 and 1.31. The current P/GP Ratio is 1.15 based on a stock price of $1.25. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a 10 year median Price/Book Value per Share Ratio of 1.59. The current P/B Ratio is 0.47 based on a stock price of $1.25, Book Value of $794M and Book Value per Share of $2.64. The current ratio is some 70% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I cannot do a dividend yield test because dividends have been suspended.

The 10 year median Price/Sales (Revenue) Ratio is 1.78. The current P/S Ratio is 0.51 based on a stock price of $1.25, Revenue estimate for 2019 of $741 and Revenue per Share of 2.46. The current ratio is 71% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

Results of stock price testing is that the stock price is probably cheap. It is never a good sign when there are test you cannot do. In this case the P/E Ratio testing cannot be done when you have a lot of earnings losses and the dividend yield test cannot be done due to dividends being suspended. With the P/GP Ratio test, the Graham Price can be suspect because of earning losses. The important one is the P/S Ratio test and it is showing that the stock is cheap. Another good one is the P/B Ratio test and this is showing the same thing.

Is it a good company at a reasonable price? An oil patch services stock is risky because the oil patch is all boom and bust. The think that company has going for it is good debt ratios and this can see a company through some very rough times. Personally, I do not buy stocks that do not pay dividends, so currently, I would not buy this stock.

When I look at analysts’ recommendations, I find Strong Buy (2), Buy (2) and Hold (10). The consensus would be a Buy. The 12 month stock price is $1.51. This implies a total return of 20.80% all from capital gains.

See what analysts are saying on Stock Chase. Some think this is turn-around stock and others that there is too much capacity in the Canadian Oil Patch for oil field services. Nelson Smith on Motley Fool says that the smart money is buying. A writer on Simply Wall Street says that the intrinsic value of this stock is $1.84 and above the current price.. A writer onSimply Wall Street said they would be happier if insiders owned more shares. Chelsea Overton on Sundance Herald said that National Bank lowered their target price for this stock recently.

Trican Well Service Ltd is a Canada-based oilfield services company. It provides products, equipment, services, and technology for use in the drilling, completion, stimulation, and reworking of oil and gas wells primarily through its continuing pressure pumping operations in Canada. Its web site is here Trican Well Service Ltd.

The last stock I wrote about was about was Wajax Corp (TSX-WJX, OTC-WJXFF) ... learn more. The next stock I will write about will be Great-West Lifeco Inc (TSX-GWO, OTC-GWLIF) ... learn more on Friday, September 20, 2019 around 5 pm. Tomorrow on my other blog I will write about Barrick Gold.... learn more on Thursday, September 19, 2019 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.

Wajax Corp

Sound bite for Twitter and StockTwits is: Dividend Paying Industrial. The stock price is cheap. It remains to be seen if this stock will be a dividend growth stock in the future. There is some risk in the rising long term debt. On the plus side, insiders are buying. See my spreadsheet on Wajax Corp.

I do not own this stock of Wajax Corp (TSX-WJX, OTC-WJXFF). TD Waterhouse put out a report on good dividend paying stocks to own in November 2011. This was a stock they named. I had not heard of it before, so I decided to investigate it.

When I was updating my spreadsheet, I noticed that is had a very mixed record with dividends. After a couple of year of no insider trading, insiders are buying this stock. Over the past year insiders have been buying, especially when it went below $17.00. The percentage of insider buying of the market cap is 0.24%. This is high. You would expect insider buying around 0.01% to 0.02%. There has been buying by CFO, CEO and Chairman.

The current dividend yield is good (5% and above). It has been in this range in the past also. The 5, 10 and historical dividend yield is from moderate (2 to 4% ranges) to good (above 5%). These yields are, respectively, 4.99%, 5.87% and 4.31%.

The company has a mixed history for dividends. I have dividend information going back to 1986 (some 32 years). The dividends were suspended in 1992 and restarted in 2004. There were dividend increases until 2013 when they then started dividend cuts. Dividends have been flat since 2016. Analysts do not expect any dividend growth in the near term. This accounts for the Dividend Growth record in the chart below.

The Dividend Payout Ratios are improving. The DPR for EPS for 2018 is 56% with 5 year coverage at 116% DPR coverage has recently been declining. The DPR for CFPS for 2018 is 22% with 5 year coverage at 32%.

Debt Ratios are fine, but long term debt is moving higher and this is not good. The Long Term Debt/Market Cap is fine at 0.66 in 2018 but moved up higher in the second quarter of 2019 to 0.82. Debt is increasing. The Liquidity Ratio is very good at 2.15 in 2018 with 5 year median also at 2.15. The Debt Ratio is fine in 2018 at 1.56 with 5 year median at 1.69. The Leverage and Debt/Equity Ratios are fine in 2018 at 2.80 and 1.80 with 5 year medians at 2.58 and 1.58.

The Total Return per year is shown below for years of 5 to 32 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.

Years of 15 to 25 have zero increases because dividends were suspended at the end of the periods.

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2013	5	-18.32%	-9.83%	-14.59%	4.76%
2008	10	-13.16%	9.17%	-2.38%	11.55%
2003	15	0.00%	29.97%	4.98%	24.99%
1998	20	0.00%	15.37%	3.78%	11.59%
1993	25	0.00%	9.84%	2.47%	7.36%
1988	30	1.95%	6.26%	0.75%	5.51%
1985	32	1.83%	5.64%	0.42%	5.22%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 12.22, 14.23 and 16.23. The corresponding 10 year ratios are 9.38, 11.99 and 14.61. The corresponding historical ratios are 8.76, 11.76 and 14.21. The current ratio is 7.77 based on a stock price of $16.78 and 2019 EPS estimate of $2.16. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $27.54. The 10 year low, median, and high median Price/Graham Price Ratios are 0.92, 1.14 and 1.34. The current P/GP is 0.61 based on a stock price of $16.78. 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 1.98. The current P/B Ratio is 1.07 based on a stock price of $16.78, Book Value of $305.12 and Book Value per Share of $15.61. The current ratio is 46% below the 10 year ratio. This stock price testing suggests that the stock price is relatively cheap. The recovery form 2008 has been long and slow for the economy and this has been tough on a lot of companies. This company is making headway but there is risk involved.

I get an historical median dividend yield of 4.31. The current yield is 5.96% based on dividend of $1.00 and a stock price of $16.78. The current yield is 38% above the historical yield. This stock price testing suggests that the stock price is relatively cheap.

The 10 year median Price/Sales (Revenue) Ratio is 0.37. The current P/S Ratio is 0.20 based on 2019 Revenue estimate of $1,600M, Revenue per Share of $81.86 and a stock price of $16.78. The current ratio is 45% below the 10 year ratio. This stock price testing suggests that the stock price is relatively cheap.

Results of stock price testing is that the stock price is currently relatively cheap. All the testing shows this. It is also nice that the dividend yield test and the P/S Ratio test confirm each other.

Is it a good company at a reasonable price? The company had just turned itself into and income trust in 2005 when Canadian Law on Income Trust was changed in November 2006. Their dividends were too high to be sustainable when they were to change back to a corporation. Their dividend is probably still too high, but analysts do not expect any more cuts to the dividends and expect it will be better covered in the future. This is an industrial stock and therefore will have volitivity in their business. It is uncertain if it will become a dividend growth stock in the future and mainly, I do like dividend growth stocks.

When I look at analysts’ recommendations, I find Buy (2) and Hold (3). The consensus would be a Buy. The 12 month stock price is $20.60. This implies a total return of 28.72% with 22.77% from capital gains and 5.96% from dividends based on a stock price of $16.78.

See what analysts are saying on Stock Chase. They like to company but think it is illiquid, but with a safe dividend. James Watkins-Strand on Motley Fool was positive about this company because of the high dividend yield. A writer on Simply Wall Street thinks the low P/E of this company shows pessimistic market expectations. A writer on Simply Wall Street thinks that the estimated future revenue growth does not seem like a key driver for buying this stock. A writer on Simply Wall Street thinks this stock is worth further investigation. Derek Livingston on Mak Daily says that short selling as decreased by 38% recently.

Wajax Corp is a Canadian distributor of industrial components. Its core business is the sale of parts and service support of equipment, power systems, and industrial components through a network of branches in Canada. Its web site is here Wajax Corp.

The last stock I wrote about was about was Telus Corp (TSX-T, NYSE-TU)... learn more. The next stock I will write about will be Trican Well Service Ltd (TSX-TCW, OTC-TOLWF) ... learn more on Wednesday, September 18, 2019 around 5 pm. Tomorrow on my other blog I will write about SNC Lavalin.... learn more on Tuesday, September 17, 2019 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.

Telus Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Telecom. Price is probably reasonable. The company is slowing down in terms of dividend growth. See my spreadsheet on Telus Corp.

I do not own this stock of Telus Corp (TSX-T, NYSE-TU). I started to follow this stock because of a list of stock John Sartz talked about in 2008. At the Toronto Money Shows in 2009 and 2010 Aaron Dunn from Keystone Financial Publishing Corp talked about having recommended this stock. Aaron Dunn says he likes companies with resilient business models, which are profitable and are growing their earnings. He also like companies with strong management teams, health balance sheets and compelling valuations. Telus Corp (TSX-T) was one of three stocks he recommended in 2009.

When I was updating my spreadsheet, I noticed that the dividend increases are slowing down. See the chart below. The last 5 year is lower per year than the last 10 years. Also, the last increase, which was in this year was for 7.1% and this is lower than the average per year for the last 5 years which is at 9.3%.

The thing is that both Revenue and EPS has only been increasing for the past 5 and 10 years at rates in the 4 and 5% ranges. Dividends cannot increase faster than Revenue and EPS over the long term.

The dividend yield is in moderate range (2 to 4% ranges). The current dividend yield is 4.60%. The 5, 10 and historical median dividend yields are 4.27%, 4.22% and 3.92%. Dividend growth is in the moderate range (8 to 14% ranges) with the growth for the past 5 years at 9.31% per year.

The Dividend Payout Ratios are fine. The DPR for EPS for 2018 is 77% with 5 year coverage at 76%. I wish it was lower but it is probably fine. The DRR for CFPS for 2018 is 32% and with 5 year coverage at 30%. This is fine.

Debt Ratios are fine but there is vulnerability here. The Long Term Debt/Market Cap Ratio for 2018 is 0.49. The Liquidity Ratio for 2018 at 0.79 is low. It means that the current assets cannot cover the current liabilities. Adding in cash flow after dividends only rises this to 1.39. I would like to see this at 1.50 or above. The Debt Ratio is also a bit low at 1.46. I would also like to see this at 1.50 or above. The Leverage and Debt/Equity Ratios are 3.20 and 2.20. It would be nice if these were lower.

The Total Return per year is shown below for years of 5 to 24 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.
2013	5	9.31%	8.80%	4.36%	4.44%
2008	10	18.13%	14.32%	9.31%	5.01%
2003	15	13.71%	13.03%	8.68%	4.35%
1998	20	5.98%	6.85%	3.94%	2.91%
1994	24	5.24%	9.44%	5.69%	3.76%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 17.20, 18.51 and 19.64. The corresponding 10 year ratios are 15.27, 17.05 and 18.51. The corresponding historical ratio are 15.27, 17.42 and 19.74. The current P/E Ratio is 16.65 based on a stock price of $48.94 and 2019 EPS estimate of $2.94. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a Graham Price of $34.00. The 10 year low, median, and high median Price/Graham Price Ratios are 1.31, 1.43 and 1.54. The current P/GP Ratio is 1.44 based on a stock price of $48.94. This stock price testing suggests that the stock price is relatively reasonable but above the median

I get a 10 year median Price/Book Value per Share Ratio of 2.67. The current P/B Ratio is 2.80 based on a stock price of $48.94, Book Value of $10,504M and Book Value per Share of $17.48. The current ratio is some 4.7% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median

I get an historical median dividend yield of 3.92%. The current dividend yield is $4.60% based on a stock price of $48.94 and dividends of $2.25. The current ratio is 17% above the historical dividend yield. This stock price testing suggests that the stock price is relatively reasonable and below the median

The 10 year median Price/Sales (Revenue) Ratio is 1.85. The current P/S Ratio is 1.99 based on 2019 Revenue estimate of $14,784M, Revenue per Share of $24.60 and a stock price of $48.94. The current ratio is some 7.7% above the 10 year ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median

Results of stock price testing is that the stock price is probably reasonable. The P/S Ratio testing is show as reasonable but above the median when the dividend yield is showing the price as reasonable and below the median. The rest of the testing show similar things.

Is it a good company at a reasonable price? I think that this is a good dividend growth stock that could be held for the long term. Currently the price seems reasonable. On the other hand, it does seem to be slowing down currently in regards to dividend growth.

When I look at analysts’ recommendations, I find Strong Buy (3), Buy (5) and Hold (10). The consensus would be a Buy. The 12 month stock price is $51.58. This implies a total return of 9.99% with 5.39% from capital gains and 4.60% from dividends.

See what analysts are saying on Stock Chase. They like this company but say the stock is expensive. Andrew Button on Motley Fool likes the company’s dividend growth. A writer on Simply Wall Street talks about why income investors should have this stock. A writer on Simply Wall Street says that the stock is trading below his calculated Intrinsic Value. Dennis Silva on Altcoin Mercury talks about TD Asset Management being bullish on this stock.

Telus is one of the big three wireless service providers in Canada, with its 9 million subscribers nationwide constituting almost 30% of the total market. It is also the ILEC (incumbent local exchange carrier; the legacy telephone provider) in the western Canadian provinces of British Columbia and Alberta, where it provides Internet, television, and landline phone services. It also has a small wireline presence in eastern Quebec. Its web site is here Telus Corp.

The last stock I wrote about was about was Accord Financial Corp (TSX-ACD, OTC-ACCFF) ... learn more. The next stock I will write about will be Wajax Corp (TSX-WJX, OTC-WJXFF) ... learn more on Monday, September 16, 2019 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.

Accord Financial Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Financial. The shares are probably cheap. There is significate insider ownership and recent insider buying. However, the company has slowed down in recent years. It would be nice to see them increase the dividend as this would show management’s confidence in the future. See my spreadsheet on Accord Financial Corp.

I do not own this stock of Accord Financial Corp (TSX-ACD, OTC-ACCFF). If I was looking for a small cap financial stock, I would consider this stock. The dividend is good and it does raise the dividend in the past. It has had some problems recently, but a lot of companies are with this long drawn out recover. As with all small cap stocks there is low trading volume.

When I was updating my spreadsheet, I noticed that they used to give quite good dividend increases, then the increases stopped in 2015 and there have been none since. There has always been good insider buying on this stock, including in 2019, but at 0.06% it is the lowest. Past years were in 2018 at 0.25% and 2017 at 0.36%. You would expect Net Insider Buy to be around 0.01% to 0.2%. However, this is a rather small company with around $72M.

Talk about dividends yields and growth. Dividend yields are moderate (2% to 4% range). The current dividend is 4.22%. The 5, 10 and 15 year median dividend yields are 3.86%, 4.00% and 2.62%. The last dividend increase was in 2015 and it was for 5.9%. Dividend have been flat since.

The Dividend Payout Ratios are fine. The DPR for EPS for 2018 is 29% with 5 year coverage at 38%. The DPR for CFPS for 2018 is 23% with 5 year coverage at 7%.

Debt Ratios are good. The Long Term Debt/Market Cap Ratio is 2.95. However, this is a financial services company so I looked at Long Term Debt/Cash Ratio and it is 0.63. So, Cash (and near cash) adequately covers the debt. The Liquidity Ratio for 2018 is 12.18 and very high. The Debt Ratio is 1.47 which is good for a financial services stock. The Leverage and Debt/Equity Ratios are fine at 3.28 and 2.24 for 2018.

The Total Return per year is shown below for years of 5 to 26 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.

For Dividend Growth, I have up to 31 years. According to their annual reports, the company started to pay dividends in 1988 but did not go public on the TSX until 1992.

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2013	5	2.38%	7.18%	2.95%	4.23%
2008	10	4.14%	9.11%	4.58%	4.53%
2003	15	5.56%	7.09%	1.71%	5.38%
1998	20	2.98%	9.23%	3.81%	5.42%
1993	25	2.38%	9.85%	4.85%	5.00%
1992	26	10.11%	12.31%	6.43%	5.88%
1987		12.25%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 9.46, 11.20 and 12.34. The corresponding 10 year ratios are 8.56, 10.04 and 11.52. The corresponding historical ratios are 8.55. 10.25 and 11.56. The current P/E Ratio is 6.72 based on a stock price of $8.53 and last 12 months EPS of $1.27. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $17.49. The 10 year low, median, and high median Price/Graham Price Ratios are 0.64, 0.73 and 0.82. The current P/GP Ratio is 0.49 based on a stock price of $8.53. 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 1.22. The current P/B Ratio is 0.80 based on Book Value of $90.4M, Book Value per Share of $10.70 and a stock price of $8.53. The current P/B Ratio is some 35% below the 10 year median. This stock price testing suggests that the stock price is relatively cheap.

I get an historical median dividend yield of 2.62%. The current dividend yield is 4.22% based on dividends of $0.36 and a stock price of $8.53. The current yield is 61% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

The 10 year median Price/Sales (Revenue) Ratio is 2.35. The current P/S Ratio is 1.65 based on the last 12 months Revenue of $45.6M, Revenue per Share of $5.16 and a stock price of $8.53. The current ratio is 30% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

Results of stock price testing is that the stock price is probably relatively cheap. All the tests are showing this. Of note is that the stock price is below Book Value per Share. This strongly points to a cheap stock price.

Is it a good company at a reasonable price? I think that this is a good company. However, it is a small cap financial services company with little to no analysts following this stock. The thing that stands out is that the company seems to be slowing down. What would be nice to see is a dividend increases. This would signal that the company has confidence in the future. There is significant insider ownership with the chairman holding shares worth $17M and almost 24% of the outstanding shares.

When I look at analysts’ recommendations, I find one Buy recommendation on Market Watch. No other site gives any ratings that I could find.

See what analysts are saying on Stock Chase. A number of analysts talk about this being a well-run company. A writer on Simply Wall Street thinks this company deserves further attention. Blogger called Safety in Value on Seeking Alpha talks about this stock. Mark Bunting interviews CEO Simon Hitzig Small Cap Power.

Accord Financial Corp is a provider of asset-based financial services to businesses. Its asset-based financial services include asset-based lending, including factoring, lease financing, working capital financing, credit protection and receivables management, and supply chain financing for importers. Its web site is here Accord Financial Corp.

The last stock I wrote about was about was Just Energy Group Inc. (TSX-JE, NYSE-JE) ... learn more. The next stock I will write about will be Telus Corp (TSX-T, NYSE-TU)... learn more on Friday, September 13, 2019 around 5 pm. Tomorrow on my other blog I will write about Best Canadian Stocks.... learn more on Thursday, September 12, 2019 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.

Just Energy Group Inc

Sound bite for Twitter and StockTwits is: Power Utility Stock. The stock is probably cheap. It has a negative book value and it has suspended dividends. See my spreadsheet on Just Energy Group Inc.

I do not own this stock of Just Energy Group Inc (TSX-JE, NYSE-JE). I started to follow this is July 2010. It was one of the high yield income trusts that people were talking about, so I decided to check it out.

When I was updating my spreadsheet, I noticed none of the sites I looked at for estimates were agreeing on what the EPS was in 2019. They do agree on EPS for 2018. For example, Market Screener says for 2019 the EPS was -$0.88 and the Thomson Reuters Report says -$0.62. The Financial Statements says -$1.68. According to the annual statement notes the EPS for 2019 was adjusted and restated from -$0.88 to -$1.68. Sometimes also, when FFO is involved, as in this stock, sites confuse FFO and EPS.

The company announced in August 2019 that the dividend was being suspended. The other thing is that there was lots of insider buying within the last year, but all prior to the latest decline in the stock that started at the end of July 2019. Note that this stock has a financial year ending at March 31 each year.

This is an old income trust company and it stopped increasing the dividends when it became a corporation. In 2014 it started to reduce the dividends, they became flat in 2017 and now in 2019 they have suspended them. Income Trust always had high dividends and this company was no exception reaching over 20% at one point. Just below the recent suspension the yield reached almost 30% because of falling stock price. The historical median was 8.17%.

The Dividend Payout Ratios are too high. Cutting the dividend is an appropriate move until they can start again to have some earnings. The DPR for EPS for 2019 is not calculable because of negative returns. Even the 5 year coverage is non calculable because of EPS losses. Prior to the dividend cut the DPR for 2020 was expected at 119%. It is now 30% for 2020. The DPR for CFPS for 2019 was 47% with 5 year coverage at 44%.

Debt Ratios are a vulnerability. The Long Term Debt/Market Cap ratio for 2019 is 1.02. Far too high. It is high because long term debt went up 63% between 2018 and 2019. Also, the stock price did fall. The current ratio is 2.95. The debt has gone up 7% and the stock price fell 63% since the end of the 2019 financial year. The Liquidity Ratio is low at 1.14. If you add back in the current portion of the long term debt you get 1.32. There is no sense in adding in cash flow after dividends as the cash flow is negative.

The Debt Ratio is 0.95. This means that the assets cannot cover the liabilities and we have a negative book value. The Leverage (A/BK) and Debt/Equity Ratios cannot be calculated because of the negative book value.

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.

As you can see from the chart below, any money made was in the dividends. Now that dividends are suspended, will shareholders make any money at all?

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2013	5	-9.86%	-1.60%	-9.91%	8.31%
2008	10	-8.63%	17.69%	-2.00%	19.69%
2003	15	-2.40%	3.62%	-7.25%	10.86%
2001	17	3.05%	20.01%	-0.13%	20.14%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 2.01, 10.34 and 3.27. The corresponding 10 year ratios are 2.34, -3.64 and 3.56. The corresponding historical ratio or 5.64, 6.85 and 8.06. The current P/E Ratio is 3.98 based on a stock price of $1.67 and 2020 EPS estimate of $0.42. Most of this makes no sense because of all the years at earning losses.

I get a Graham Price of $2.27. The 10 year low, median, and high median Price/Graham Price Ratios are 0.92, 1.11 and 1.33. The current P/GP Ratio is 0.74 based on a stock price of $1.67. This stock price testing suggests that the stock price is relatively cheap.

I cannot do a Price/Book Value per Share Ratio test as the Book Value is negative. I also cannot do an historical median dividend yield test because the dividends have been suspended.

The 10 year median Price/Sales (Revenue) Ratio is 0.33. The current P/S Ratio is 0.08 based on 2020 Revenue estimate of $3,153M, Revenue per Share of $21.08 and a stock price of $1.67. The current ratio is 76% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

Results of stock price testing is that the stock price is that the stock price is probably cheap. Really, the only good test is the P/S Ratio test. It is hard to know how good the Graham Price is because of all the EPS losses and the negative book value.

Is it a good company at a reasonable price? I personally would not buy a stock with a negative Book Value. I like dividend growth stocks, but this stock does not have a good dividend paying history.

When I look at analysts’ recommendations, I find Strong Buy (2) and Hold (3). The consensus would be a Buy. The 12 month stock price consensus is $3.25. This implies a total return of 94.6% all from capital gains.

See what analysts are saying on Stock Chase. It is not well covered and not liked. David Jagielski on Motley Fool talks about this company’s recent problems. A writer on Simply Wall Street talks about insider buying over the past year. A writer on Simply Wall Street talks about the past and future EPS. The company put out a press release on Glove Newswire commenting on a recent Globe and Mail article station that the founder of the company is looking to bail out of the struggling company.

Just Energy Group Inc is a Canadian-based electricity and natural gas company that operates in various Canadian provinces, the United States, and the United Kingdom. The company mainly sells its products to residential and small community customers through its Consumer segment and to mid-sized commercial customers through its Commercial segment. Its web site is here Just Energy Group Inc.

The last stock I wrote about was about was SmartCentres REIT (TSX-SRU.UN, OTC-CWYUF) ... learn more. The next stock I will write about will be Accord Financial Corp (TSX-ACD, OTC-ACCFF) ... learn more on Wednesday, September 11, 2019 around 5 pm. Tomorrow on my other blog I will write about Brookfield Renewable Energy Partners.... learn more on Tuesday, September 10, 2019 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.