I own this stock of TFI International (TSX-TFII, OTC-TFIFF). I read a report called "6 Canadian Dividend Stocks That Fly Under the Radar" by John Heinzl in April of 2013. This is one of the stocks mentioned. There was also a good review of this stock by Advice Hotline by MPL Communications. I bought this stock in 2017 because I liked the spreadsheet. It is a stock recommended my MPL Communications.
When I was updating my spreadsheet, I noticed that they were decreasing their shares since 2015 (by some 20%), but this year they issued shares and increased them by almost 7%. Even though it is down this year, year to date, I have done well to the end of April with a Total Return of 13.28%, with 10.58% from capital gains and 2.70% from dividends.
The dividend yields are moderate with dividend growth moderate. This stock used to be an income trust, so interest rates were higher in the past. They cut the dividends went they changed to a corporation and since then yields are been lower. The current dividend yield is moderate (2% to 4% ranges) at 2.76%. The 5, 10 and historical yields are also moderate at 2.35%, 2.45% and 3.33%. The dividend growth, since they started to grow them again has been in the moderate range (8% to 14% ranges). See chart below.
The Dividend Payout Ratios (DPR) are good. The DPR for EPS for 2019 is 25% with 5 year coverage at 23%. The DPR for CFPS for 2019 is 11% with 5 year coverage at 12%. The DPR for Free Cash Flow for 2019 is 27% with 5 year coverage at 33%. Dividend Coverage Ratio for 2019 is 3.69.
Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2019 is 0.47. The Liquidity Ratio for 2019 is low at 1.08, but if you add in Cash Flow before dividends, it is 1.81. The Debt Ratio is 1.49 for 2019. With a 5 year median at 1.56. The Leverage and Debt/Equity Ratios are current a bit too high at 3.03 and 2.03 respectively.
The Total Return per year is shown below for years of 5 to 29 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 | 10.60% | 10.56% | 8.32% | 2.24% |
| 2009 | 10 | 9.15% | 21.62% | 18.04% | 3.58% |
| 2004 | 15 | -1.27% | 11.83% | 7.35% | 4.48% |
| 1999 | 20 | -1.01% | 30.09% | 15.30% | 14.79% |
| 1994 | 25 | 24.37% | 15.47% | 8.90% | |
| 1990 | 29 | 17.91% | 12.81% | 5.10% |
The 5 year low, median, and high median Price/Earnings per Share Ratios are 9.24, 12.14 and 15.04. The corresponding 10 year ratios are 9.38, 12.16 and 14.94. The corresponding historical ratios are 8.87, 11.23 and 13.45. The current P/E Ratio is 13.55 based on a stock price of $37.66 and 2020 EPS estimate of $2.78. This stock price testing suggests that the stock price is relatively reasonable but above the median.
I get a Graham Price of $32.64. The 10 year low, median, and high median Price/Graham Price Ratios are 0.84, 1.04 and 1.27. The current P/GP Ratio is 1.15 based on a stock price of $37.66. 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 2.14. The current P/B Ratio is 2.21 based on a stock price of $37.66, Book Value of $1,484M, and a Book Value per Share of $17.03. The current ratio is 3.4% 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 3.33%. The current dividend yield is 2.76% based on a stock price of $37.66 and dividends of $1.04. The current yield is 17% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.
I get a 10 year median dividend yield of 2.45%. The current dividend yield is 2.76% based on a stock price of $37.66 and dividends of $1.04. The current yield is 12.6% above the 10 year median 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 0.62. The current P/S Ratio is 0.69 based on 2020 Revenue Estimate of $4,770M, Revenue per Share of $54.75 and a stock price of $37.66. The current ratio is 10% 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, but above the median. For the dividend yield tests, the 10 year one is probably the best for this stock as the company used to be an income trust, and income trusts had quite high dividend yields which would influence the historical median dividend yield. However, the 10 year dividend yield test of reasonable and below the median is not confirmed by the P/S Ratio test which says the stock is reasonable but above the median. All the other tests agree with the P/S Ratio test. There are no problems with any of these tests.
Is it a good company at a reasonable price? I started to buy shares in this company in 2017 and bought more in 2018 and 2020. It is a good dividend growth company for me. Although the price is still in the reasonable range, considering that we are in a bear market, it would be nice if it was cheap and it is not.
When I look at analysts’ recommendations, I find Strong Buy (7), Buy (6), Hold (1), and Sell (1). The consensus would be a Buy. The 12 month stock price consensus is $44.69. This implies a total return of 21.43% with 18.67% from capital gains and 2.76% from dividends.
Among all the positive views on this company was a negative one on Stock Chase. Chris Blumas says that the company will have disruptions by technology and the valuation is too high for this stage in the economic cycle. This might explain the sell recommendation.
See what analysts are saying on Stock Chase . There were mixed views in the past, but last entries were positive. Nelson Smith on Motley Fool thinks this stock is still cheap. See the executive over view on Simply Wall Street. A writer on Simply Wall Street says that the P/E of this stock is lower than the industry average and the Canadian market average. So, current market expectation for this stock is muted. The company announces first quarterly results on Globe Newswire. Brian Anderson on Smarter Analyst talks about a recent rating on this stock
TFI International is a recognized North American transportation and logistics leader, partnering with a diverse group of customers in the US, Canada, and Mexico. Their vast e-commerce network spans more than 80 North American cities. Its web site is here TFI International.
The last stock I wrote about was about was McCoy Global Inc (TSX-MCB, OTC-MCCRF) ... learn more. The next stock I will write about will be Power Corp of Canada (TSX-POW, OTC-PWCDF) ... learn more on Wednesday, May 6, 2020 around 5 pm. Tomorrow on my other blog I will write about Dividend Stocks May 2020.... learn more on Tuesday, May 05, 2020 around 5 pm.
Also, on my book blog I have put a review of the book Boom and Bust by William Quinn and John D. Turner 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.
No comments:
Post a Comment