I do not own this stock of Rogers Sugar Inc (TSX-RSI, OTC-RSGUF). This stock was brought to my attention by Dividend Ninja. This company used to be an Income Trust (TSX-RSI.UN) but it has been converted to a corporation. On its change to a corporation, it lowered its dividend.
When I was updating my spreadsheet, I noticed it has always had a very high dividend yield. The has occurred even after it ceased being a income trust stock. The current dividend yield is 7.50%.
Dividends are good (5% or over). Dividends have been high on this stock. The current dividend yield is 7.50%. The 5, 10, and historical dividend yields are 6.32%, 6.25% and 9.17%. This company used to be an income and the dividend yield peaked just over 15%. The best to be said of dividend growth is that the dividends have stabilized. They have been level since 2012. The company cut its dividend after changing to a corporation from an Income Trust.
The Dividend Payout Ratios are still a problem. The DPR for EPS are still too high, especially after having an income loss in 2019. 2018 was the first year when the DPR for EPS was belong 100% and it is expected to be around 92% in 2020. The DPR for CFPS for 2019 was 40% with 5 year coverage at 43%. The DPR for Free Cash Flow for 2019 is 130% with 5 year coverage at 94%. The Free Cash Flow is getting lower over the past 5 years, so this is going in the wrong direction.
Debt Ratios are fine. The Long Term Debt/Market Cap ratio is 0.28 which is fine. The Liquidity Ratio is 1.90 with 5 year median at 1.75. These both are good. The Debt Ratio is 1.52 with 5 year median of 1.67. Both of these are fine. The Leverage and Debt/Equity Ratios are 2.93 and 1.96 with 5 year ratios at 2.24 and 1.24. These ratios are normal.
The Total Return per year is shown below for years of 5 to 22 to the end of 2019. 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. |
|---|---|---|---|---|---|
| 2014 | 5 | 0.00% | 8.19% | 0.71% | 7.48% |
| 2009 | 10 | -2.42% | 8.43% | 0.10% | 8.33% |
| 2004 | 15 | -2.00% | 9.56% | 0.60% | 8.97% |
| 1999 | 20 | -4.55% | 9.10% | -0.28% | 9.38% |
| 1997 | 22 | -3.11% | 4.27% | -2.76% | 7.02% |
The 5 year low, median, and high median Price/Earnings per Share Ratios are 12.26, 13.72 and 15.19. The corresponding 10 year ratios are 13.08, 13.84 and 14.67. The corresponding historical ratios are 9.02, 9.84 and 11.16. The current P/E Ratio is 12.31 based on a stock price of $4.80 and 0.39. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get a Graham Price of $4.84. The 10 year low, median, and high median Price/Graham Price Ratios are 1.02, 1.16 and 1.27. The current P/GP Ratio is 0.99 based on a stock price of $4.80. 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 1.90. The current P/B Ratio is 1.80 based on a Book Value of $280M, Book Value per Share of $2.67 and a stock price of $4.80. The current ratio is 5.6% 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 9.17. The current dividend yield is 7.50% based on a stock price of $4.80 and dividends of $0.36. The current yield is 18.2% below the historical yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.
The 10 year dividend yield is 6.25%. The current yield of 7.50% is some 20% above this dividend yield. This stock price testing suggests that the stock price is relatively cheap.
The 10 year median Price/Sales (Revenue) Ratio is 0.83. The current P/S Ratio is 0.64 based on 2020 Revenue estimate of $783M, Revenue per Share of $7.47 and a stock price of $4.80. The current ratio is 22.5% 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 relatively cheap to reasonable. Both the P/S Ratio and the Dividend Yield 10 year median tests shows the stock price is relatively cheap. I would suspect this stock is on the cheap side.
Is it a good company at a reasonable price? I prefer dividend growth stock However; this stock has produced a very good yield in dividends and you would probably not lose much in capital over a long term. So. I can see why dividend investors have bought this stock.
When I look at analysts’ recommendations, I find Hold (4) and Underperform (1). The consensus would be hold. The 10 month stock price consensus is $4.75. This implies a total return of 6.46% with a capital loss of 1.04% and dividends of 7.50%.
See what analysts are saying on Stock Chase. They are not keen on this stock, but say that the dividend is safe. Nelson Smith on Motley Fool says stock is cheap and solid. A writer on Simply Wall Street says they are not conformable recommending this stock because of lack of coverage of dividend and lack of EPS growth. A writer on Simply Wall Street says the stock’s fair value is $6.76. A writer on Simply Wall Street says the CEO’s Salary is typical for the size of the company, however some shareholders are not pleased because of declining EPS and Revenue.
Rogers Sugar Inc is a Canada based sugar producing company. The company through its subsidiary is principally engaged in refining, packaging, and marketing of sugar products. The products offered by the company include iced tea mix, stevia, yellow sugar, hot chocolate mix, granulated sugar, brown sugar, organic sugar, icing sugar, coconut sugar, and other related sugar products. It operates in below reportable segments; Sugar and Maple products in Canada and internationally, of which majority of the revenue is generated within Canada. Its web site is here Rogers Sugar Inc .
The last stock I wrote about was about was Royal Bank of Canada (TSX-RY, NYSE-RY) ... learn more. The next stock I will write about will be Calian Group Ltd (TSX-CGY, OTC-CLNFF) ... learn more on January 10, 2020 around 5 pm. Tomorrow on my other blog I will write about Something to Buy January 2020.... learn more on January 9, 2020 around 5 pm.
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