Northland Power Inc

Sound bite for Twitter and StockTwits is: Dividend Paying Utility. The stock price appears to be on the expensive side. It is not a dividend growth stock. The Debt level is worrisome. However, the market seems to like this stock and it is current doing well as far as a rising stock price is concerned. See my spreadsheet on Northland Power Inc.

I do not own this stock of Northland Power Inc (TSX-NPI, OTC-NPIFF). This company is into generating electric power. I have a lot invested in pipelines and I would like to have more invested in electric power as part of my utility’s investments. I read a report on this stock that said it was a good defensive stock to buy. That is, it is a good stock to hold in a stock market correction. I can certainly see the logic of using utility stocks as defensive stocks.

When I was updating my spreadsheet, I noticed debt ratios that I do not like. The Long Term Debt/Market Cap is high at 1.29. This needs to be under 1.00. This is occurring with a rapidly rising stock price. The Debt Ratio is just 1.17 and I prefer this to be 1.50 or higher. The Leverage and Debt/Equity Ratios are too high at 6.94 and 5.94. I prefer these to be under 3.00 and 2.00. Too much debt can spell trouble in hard times.

On the other hand, I noticed that the market keeps pushing the stock price higher. This stock is already up almost 70% so far this year. If you look at total return below, this stock has done very well. It will not do so well in the future on total return as the dividend yields are considerably lower. Total return considers both capital gains and dividend in calculating the return.

The dividend yields are currently moderate with dividend growth low almost non-existent. The current dividend yield is moderate (2% to 4%) at 2.59%. This company used to be an income trust and income trust have high yields. The 5 and 10 year median dividend yields are good (5% to 6%) at 5.13% and 6.18%. The historical median dividend yield is high (7% or higher) at 7.69%. The dividend growth over the past 5 years is at 2.13% per year. However, in the past 5 years (in fact past 11) years, there has been only one dividend increase and it was for 11.1%.

The Dividend Payout Ratios (DPR) need improving. The DPR for 2019 for EPS is 71% with 5 year coverage at 124%. This is too high, of course. The DPR for CFPS is 18% with 5 year coverage at 23% and this is fine. I looked at 3 sites for Free Cash Flow and all had a different answer. So, the DPR for FCF for 2019 could or could not be fine. The 5 year coverage is not because of years of negative FCF, which all sites say.

Debt Ratios need improving. The Long Term Debt/Market Cap is too high at 1.29. It needs to be under 1.00 and some analysts like it under 0.50. It has been too high for the past 5 years that I have looked at. The Liquidity Ratio is low at 0.91. However, if you add in cash flow after dividends, which you need to do for most utilities, it is good at 1.64. the Debt Ratio is much too low at 1.17. The Leverage and Debt/Equity Ratios are too high at 6.94 and 5.94.

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	2.13%	18.16%	12.21%	5.95%
2009	10	1.06%	15.34%	8.58%	6.76%
2004	15	0.99%	10.47%	4.46%	6.01%
1999	20	1.28%	15.19%	6.24%	8.94%
1997	22	3.20%	12.05%	4.65%	7.40%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 13.68, 15.65 and 17.62. The corresponding 10 year ratios are 13.38, 15.26 and 17.14. The corresponding historical ratios are 13.41, 15.49 and 17.86. The current P/E Ratio is 23.04 based on a stock price of $46.31 and EPS estimate for 2020 of 2.01. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $16.85. The 10 year low, median, and high median Price/Graham Price Ratios are 2.13, 2.50 and 2.69. The current P/GP Ratio is 2.75 based on a stock price of $46.31. 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 4.66. The current P/B Ratio is 7.38 based on a Book Value of $1,267M, Book Value per Share of $6.28 and a stock price of $46.31. The current ratio is 58% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median Price/Cash Flow per Share Ratio of 7.08. The current P/CF Ratio is 7.82 based on Cash Flow per Share estimate for 2020 of $5.92, Cash Flow of $1,194M, and a stock price of 46.31. The current ratio is 10% 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 7.69%. The current dividend yield is 2.59% based on dividends of $1.20 and a stock price of $46.31. The current dividend yield is 66% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median dividend yield of 6.18%. The current dividend yield is 2.59% based on dividends of $1.20 and a stock price of $46.31. The current dividend yield is 58% below the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively expensive.

I get a 5 year median dividend yield of 5.13%. The current dividend yield is 2.59% based on dividends of $1.20 and a stock price of $46.31. The current dividend yield is 49% below the 5 year median dividend yield. This stock price testing suggests that the stock price is relatively expensive. The problem is the stock price has taken off but dividends are flat.

The 10 year median Price/Sales (Revenue) Ratio is 3.64. The current P/S Ratio is 4.49 based on Revenue estimate for 2020 of $2082M, Revenue per Share of $10.32. The current ratio is 23% above the 10 year median 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 dividend yield testing does not work because dividends are flat and the stock price has taken off. This used to be an income trust and as such had high dividend yields. They have good cash flow, but all other testing is showing the stock price as expensive.

Is it a good company at a reasonable price? I do not think that this stock is selling at a reasonable price. It would appear to be on the expensive side. It is not a dividend growth stock, which are the sort I like. Perhaps they should have cut their dividend when becoming a corporation, they may have been better off. The other thing I do not like is the debt level. Personally, I would look for another utility stock to buy rather than this one.

When I look at analysts’ recommendations, I find Strong Buy (2), Buy (4), Hold (5), Sell (1), No Opinion (1). The consensus would be a Hold. The 12 month stock price consensus is $45.00. This implies a total loss of 0.24% with a capital loss of 2.83% and dividends of 2.59%.

Analysts like this stock on Stock Chase and one mentions the good cash flow. Sneha Nahata on Motley Fool likes this company because of the steady dividend. The Executive Summary on Simply Wall Street gives the company two stars out of 5 and list 4 risks. A writer on Simply Wall Street likes the high ROC of the company, but feels it has too much debt. A writer on Simply Wall Street likes the TSR and the fact that the company went from EPS losses to positive EPS, but is worried about some of the risk warnings. Chris MacDonald on Bay Street thinks this is a company to watch.

Northland Power Inc is an operator of power producing facilities. These facilities generate electricity from natural gas or use renewable sources, such as wind and solar power. Most of the electricity produced by Northland Power comes from its thermal facilities. Additionally, almost all of Northland Power's power generation takes place in Canada. The company also owns assets in Mexico, the Netherlands, and Germany. Its web site is here Northland Power Inc.

The last stock I wrote about was about was Chesswood Group Ltd (TSX-CHW, OTC-CHWWF) ... learn more. The next stock I will write about will be Wild Brain Ltd (TSX-WILD, OTC- WLDBF) ... learn more on Wednesday, December 02, 2020 around 5 pm. Tomorrow on my other blog I will write about Dividend Stocks December 2020.... learn more on December 01, 2020 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.

Chesswood Group Ltd

Sound bite for Twitter and StockTwits is: Dividend Paying Financial. The price seems reasonable if not cheap. Analysts do not expect much in the near term. It may again become a dividend growth stock. It is currently hard times for some stocks. However, they have restarted the dividend, all be it at a lower level, but this is a positive development. See my spreadsheet on Chesswood Group Ltd.

I do not own this stock of Chesswood Group Ltd (TSX-CHW, OTC-CHWWF). A reader wrote me in 2012 that he was researching and found a company that he hoped I could give him a brief outlook on. He said that the company is Chesswood Group and they are basically a financial leasing company. From 2009 to 2012 they increased their dividends from 2.5 cents to 5.5 cents per month. This is a 120% increase.

When I was updating my spreadsheet, I noticed that they suspended their dividend this year. Usually, when I company does that is because they expect bad times coming or at least uncertain times. Analysts certainly do not expect them to do well this year, but do expect better times starting in 2021. However, the company has restarted dividends this year, but at a lower level. Management obviously feels they can handle the dividends at the new lower level. This is a positive development.

The dividend yields are moderate with dividend growth currently non-existent, but dividend restarted. This company cancelled the dividends partway through this year then restarted it at a lower level. The current dividend yield is moderate (2% to 4% ranges) at 2.82%. The dividend yields have been high (7% to 8/%) with the 5, 10 and historical dividend yields at 7.52%, 7.58% and 8.12%. This company used to be an income trust and changed to a corporation in 2011. This is why dividend yields were high, especially in the past.

The Dividend Payout Ratios (DPR) were fine in the past and perhaps they will still be fine in the future. The DPR for EPS for 2019 was 118% with 5 year coverage at 69%. The company is not expected to have positive earnings this year, but 5 year coverage is expected at 83%. Analysts do not expect the company to cover the dividend with EPS in the near future. The DPR for CFPS for 2019 was 14% with 5 year coverage at 16%. The DPR for CFPS for this year is just 4% with 5 year coverage at 13%.

Debt Ratios are fine for a financial. Because this company is in finance, I look at Debt/Covering Assets Ratio which is 0.87 and fine. The Liquidity Ratio is good at 2.56 for 2019. The Debt Ratio for 2019 is 1.20. The Leverage and Debt/Equity Ratios are 5.92 and 4.92 respectively for 2019.

The Total Return per year is shown below for years of 5 to 13 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	1.49%	4.53%	-3.54%	8.07%
2009	10	9.96%	21.53%	9.24%	12.29%
2006	13	0.00%	11.30%	2.60%	8.70%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 7.43, 9.36 and 10.55. The corresponding 10 year ratios are 8.15, 9.72 and 11.65. The historical ratios are 7.74, 9.38 and 11.60. The current P/E Ratio is negative based on a stock price of $8.50 and EPS loss of $0.44.

The P/E Ratio for 2021 is not much help either. That P/E Ratio is 50.00. This is because the expected EPS for 2021 is just $0.17 which is 76% below the EPS for 2019.

My best guess for a current Graham Price is $5.59 The 10 year low, median, and high median Price/Graham Price Ratios are 0.67, 0.79 and 0.92. The current P/GP Ratio is 1.52 based on a stock price of $8.50. This stock price testing suggests that the stock price is relatively expensive

If we use last year’s Graham Price of $11.86, the current P/GP Ratio would be 0.72 based on a stock price of $8.50. 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 1.32. The current P/B Ratio is ratio is 1.04 based on a Book Value of $133M, Book Value per Share of $8.18 and a stock price of $8.50. The current ratio is 21% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I get a 10 year median Price/Cash Flow per Share Ratio of 2.91. The current P/CF Ratio is 3.50 based on last 12 month Cash Flow of $39.6M, Cash Flow per Share of $2.43 and a stock price of $8.50. The current ratio is 20% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. The problem is that there are lots of P/CF Ratio that are negative, so the 10 year median ratio is very low.

If we look at Price/Cash Flow per Share Ratio for Cash Flow less Working Capital, I get a 10 year 2.63. The current P/CF (less WC) Ratio is 1.23 based on a Cash Flow of $112M, Cash Flow per Share of $6.90 and a stock price of $8.50. The current ratio is 53% 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 8.12%. The current dividend yield is 2.82% based on dividends of $0.24 and a stock price of $8.50. The current dividend yield is 65% below the 10 historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive. The problem is that dividends have been cut by over 70% recently.

I get a 10 year median dividend yield of 7.68%. The current dividend yield is 2.82% based on dividends of $0.24 and a stock price of $8.50. The current dividend yield is 63% below the 10 historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive. The problem is that dividends have been cut by over 70% recently.

The 10 year median Price/Sales (Revenue) Ratio is 1.44. The current P/S Ratio is 1.19 based on Revenue estimate for 2020 of $116M, Revenue per Share 7.12 and a stock price of $8.50. The current ratio is 17% 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 if not cheap. I cannot use the dividend yield tests because of recent dividend tests. The P/S Ratio testing says that the stock is reasonable and below the median. A problem being is that Revenue is expected to decline this year and next. The P/B Ratio testing says that the stock is cheap and there is no problem with this testing. The P/CF Ratio (less WC) may be more valid and this shows the stock price as relatively cheap.

Is it a good company at a reasonable price? The stock price seems reasonable. Until recently, this company was making money for its shareholders. It is a small cap. It is also rather risky at present. The stock price is down just 17% this year. This is not bad considering how other companies have fared.

When I look at analysts’ recommendations, I find a Buy (1) recommendation. The consensus would be a Buy. The 12 month stock price is $8.25. This implies a total loss of 0.12% with a capital loss of 2.94% and dividends of 2.82%.

The last entries were in 2019 on Stock Chase so analysts have lost interest in this stock. Jason Hoang on Motley Fool says this company is cheap and a good long term bet. The Executive Summary on Simply Wall Street has some red flags and two stars out of 5. A writer on Simply Wall Street has concerns about this stock. The company announces third quarter results on Seeking Alpha and restarts dividends.

Chesswood Group Ltd is a Canada based company focused on commercial equipment finance for small and medium-sized businesses. The company's operations consist of segments of Equipment Financing-US; and Equipment Financing-Canada. Its web site is here Chesswood Group Ltd.

The last stock I wrote about was about was Quarterhill Inc (TSX-QTRH, NASDAQ-QTRH) ... learn more. The next stock I will write about will be Northland Power Inc (TSX-NPI, OTC-NPIFF) ... learn more on Monday, November 30, 2020 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.

Quarterhill Inc

Sound bite for Twitter and StockTwits is: Dividend Paying Tech. The stock price is probably reasonable. It would be risky. They seem to be reinventing themselves again. Their debt ratios are good, but the DPR could improve and they are not expected to make a profit in 2021. So far shareholders have not done well with this stock. See my spreadsheet on Quarterhill Inc.

I do not own this stock of Quarterhill Inc (TSX-QTRH, OTC-QTRHF). I bought this company in 2000 as WiLan Inc. (TSX-WIN, OTC-WILN. It was an up and coming company in communications. I sold it in 2006 after losing most of my investment. This stock has never recovered from the bubble that occurred in 2000. I lost all hope of ever making any money on this stock. The other thing is that they completely refocused their company to earn money on their patents and became a patent troll which was not the sort of company I like.

When I was updating my spreadsheet, I noticed it has been reinventing itself again. They had a good year in 2019. Their revenue is increasing and they made a profit. They may again become an interesting company to invest in. A negative might be that EPS is expected to drop, especially by 2021 when they are expected to have an earnings loss. They have dropped their NASDAQ listing and have switched their currency back to CDN$.

The dividend yields are currently low with dividend growth currently non-existent. The current dividend yield is low (under 2%) at 1.85%. The 5, 10 and historical median dividend yields are moderate (2% to 4%) at 3.23%, 3.00% and 2.78%. The company had some good dividend increases until 2015. In 2017 the dividends were decrease by 76% and have been flat ever since. Analysts do not expect any change in the near future.

The Dividend Payout Ratios (DPR) could be improved. The DPR for EPS for 2019 is 43%. The 5 year coverage cannot be calculated due to earning losses. The DPR for CFPS for 2019 is 14% with 5 year coverage at 27%. The DPR for Free Cash Flow for 2019 is 70% with 5 year coverage at 39%. However, sites I looked at did not agree on FCF, but FCF DPR quoted is representative.

Debt Ratios are very good. The Long Term Debt/Market Cap Ratio is 0.00 (even though there is some long term debt). The Liquidity Ratio is very good at 3.84 as is the Debt Ratio at 6.72. The Leverage and Debt/Equity Ratios are also very good at 1.17 and 0.17.

The Total Return per year is shown below for years of 5 to 21 to the end of 2019 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.
2014	5	-21.71%	-9.63%	-13.66%	4.03%
2009	10	7.18%	3.26%	-2.63%	5.89%
2004	15		4.67%	0.37%	4.30%
1999	20		-8.04%	-9.82%	1.78%
1998	21		3.44%	0.51%	2.92%

The Total Return per year is shown below for years of 5 to 18 to the end of 2019 in US$. 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	-23.46%	-12.14%	-15.74%	3.60%
2009	10	4.92%	-1.20%	-6.40%	5.20%
2004	15		4.82%	0.11%	4.71%
2001	18		-0.84%	-3.86%	3.03%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 11.74, 19.93 and 25.77. The corresponding 10 year ratios are 10.96, 16.59 and 21.06. The Corresponding historical ratios are all negative and are of not help. The current P/E Ratio is 18.78 based on a stock price of $2.70 and EPS estimate for 2020 of $0.14. This stock price testing suggests that the stock price is relatively reasonable but above the median. This is in CDN$.

I get a Graham Price of $2.84. The 10 year low, median, and high median Price/Graham Price Ratios are 0.68, 1.06 and 1.45. The current P/GP Ratio is 0.95 based on a stock price of $2.70. This stock price testing suggests that the stock price is relatively reasonable and below the median. This is in CDN$.

I get a 10 year median Price/Book Value per Share Ratio of 1.34. The current P/B Ratio is 1.08 based on a Book Value of $297M, Book Value per Share of $2.50 and a stock price of $2.70. The current ratio is 14% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median. This is in CDN$.

I get a 10 year median Price/Cash Flow per Share Ratio of 10.99. The current P/CF Ratio is 9.08 based on CFPS for last 12 months of $0.30, Cash Flow of $35M and a stock price of $2.70. The current ratio is 17% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median. This is in CDN$.

I get an historical median dividend yield of 2.78%. The current dividend yield is 1.85% based on dividends of $0.05 and a stock price of $2.70. The current dividend yield is 33% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive. This is in CDN$.

I get a 10 year median dividend yield of 30%. The current dividend yield is 1.85% based on dividends of $0.05 and a stock price of $2.70. The current dividend yield is 38% below the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively expensive. This is in CDN$.

The 10 year median Price/Sales (Revenue) Ratio is 3.21. The current P/S Ratio is 1.83 based on a stock price of $2.70, Revenue estimate of $175M ($134M US$) and Revenue per Share of $1.29. The current ratio is 43% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This is in CDN$.

Results of stock price testing is that the stock price is probably reasonable. The dividend yield tests are showing the stock price as expensive. However, dividends were cut by over 75% in 2017 and have been flat ever since. Also, the stock price has been rising is up by 62% this year. The P/S Ratio is a good test and it show that the stock price is relatively cheap. Most of the other tests are showing the stock price as reasonable.

Is it a good company at a reasonable price? This company has reinvented itself a number of times. Analysts expect that this company will not do as well over the next couple of years as it did in 2019. That is hard to say. Certainly, the dividend has been cut and the stock price is down over the past 5 years and 10 years. So, this would be a risky investment.

When I look at analysts’ recommendations, I find Strong Buy (3), Buy (1) and Hold (1). The consensus would be a Buy. The 12 months stock price is $3.02 ($2.35 US$). This implies a total return of 15.62% with 13.77% from capital gains and 1.85% from dividends based on a stock price of $2.70.

The most recent analyst’s reports are positive on Stock Chase. Stephanie Bedard-Chateauneuf on Motley Fool talk about this being a good tech stock for your TFSA. A writer on Simply Wall Street talk about institutional ownership in this company. A writer on Simply Wall Street talks last year about this company’s stock rising in 2019. It has also risen in 2020, but not enough to give it positive TSR over the past 5 years.. A recent article on Yahoo Finance talk about this company acquiring IBM Patents .

Quarterhill Inc is a growth-oriented company in the Intellectual Property and Intelligent Transportation System (ITS) industries. Its goal is to pursue an investment strategy that capitalizes on attractive market trends in both ITS and its adjacent markets. Its web site is here Quarterhill Inc.

The last stock I wrote about was about was Finning International Inc (TSX-FTT, OTC-FINGF) ... learn more. The next stock I will write about will be Chesswood Group Ltd (TSX-CHW, OTC-CHWWF) ... learn more on Friday, November 27, 2020 around 5 pm. Tomorrow on my other blog I will write about Best Canadian Stocks.... learn more on Thursday, November 21, 2020 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.

Finning International Inc

Sound bite for Twitter and StockTwits is: Dividend Growth Industrial. The stock price seems reasonable at this time. This year of 2020 is not expected to be a good year for this company, but analysts think things will improve starting in 2021. See my spreadsheet on Finning International Inc.

I do not own this stock of Finning International Inc (TSX-FTT, OTC-FINGF). When I was in the market to buy an industrial stock in this area in 2007, I look at this stock was well as Toromont Industries (TSX-TIH). At the time I liked Toromont better, so that is what I bought.

When I was updating my spreadsheet, I noticed that this company did well at first coming out of the 2008 recession, but they hit a peak in 2013/14 and they have really slowed down from there. They have gradually doing better, but Covid has hit their progress. This year of 2020 is not expected to be a good year.

The dividend yields are currently moderate with dividend growth currently low. The current yield is moderate (2% to 4% range) at 3.52%. The 5 and 10 years median dividend yields are also moderate at 2.82% and 2.57%. The historical dividend yield is low (below 2%) at 1.69%. The dividend growth over the past 5 years is low (below8%) at 3.5% per year. The most recent dividend increase was in 2019 and it was for 2.5%. There has been no increase in 2020, but analysts expect one in 2021.

The Dividend Payout Ratios (DPR) are fine. The DPR for EPS for 2019 was 55% with 5 year coverage at 105.4%. The problem was a earnings loss in 2015. The DPR for CFPS for 2019 was 18% with 5 year coverage at 20.6%. The DPR for Free Cash Flow is 360% with 5 year coverage at 70%. However, all three sites that I looked at did not agree on what the FCF was and one said DPR for 2019 was 29%.

Debt Ratios are fine. The Long Term Debt Market Cap Ratio for 2019 is 0.32 and this is a good ratio. The Liquidity Ratio is also good at 1.81 and is the Debt/Ratio at 1.55. The Leverage and Debt/Equity Ratios are fine at 2.83 and 1.83.

The Total Return per year is shown below for years of 5 to 31 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	3.54%	3.06%	0.06%	3.01%
2009	10	6.36%	7.48%	4.25%	3.23%
2004	15	9.82%	5.02%	2.49%	2.53%
1999	20	11.06%	9.82%	6.83%	2.99%
1994	25	10.64%	9.40%	6.73%	2.67%
1989	30	7.24%	9.42%	6.91%	2.51%
1988	31	8.49%	10.78%	7.86%	2.93%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 18.22, 20.79 and 24.66. The corresponding 10 year ratios are 12.47, 15.85 and 18.12. The corresponding historical ratios are 12.58, 16.44 and 19.76. The current P/E Ratio is 18.55 based on a stock price of $24.67 and EPS estimate for 2020 of $1.33. This stock price testing suggests that the stock price is relatively expensive.

The above EPS for 2020 is a decrease of over 10% in EPS. EPS is expected to improve in 2021. The P/E Ratio for 2021 is 16.02 based a stock price of $24.67 and EPS for 2021 of $1.54. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a Graham Price of $20.08. The 10 year low, median, and high median Price/Graham Price Ratios are 1.19, 1.47 and 1.74. The current P/GP Ratio is 1.23 based on a stock price of $24.67. 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 2.28. The current P/B Ratio is 1.83 based on a stock price of $24.67, Book Value of $2,184M and a Book Value per Share of $13.47. The current ratio is 19.5% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median and almost cheap.

I get a 10 year median Price/Cash Flow per Share Ratio of 10.71. The current P/CF Ratio is 6.08 based on a stock price of $24.67, Cash Flow per Share estimate for 2020 of $4.06 and Cash Flow of $658M. The current ratio is 43% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. My problem with this is that this is an increase in CFPS of 247% and CFPS has never before been this high. So, I do wonder.

I get an historical median dividend yield of 1.83%. The current dividend yield is 3.32% based on dividends of $0.78 and a stock price of $24.67. The current dividend yield is 82% higher than the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

I get a 10 year median dividend yield of 2.57%. The current dividend yield is 3.32% based on dividends of $0.78 and a stock price of $24.67. The current dividend yield is 29% higher than 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 0.67. The current P/S Ratio is 0.69 based on Revenue estimate for 2020 of $5,824M and a stock price of $24.67. The current ratio is 2% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.

The problem is that analysts think that the Revenue for 2020 will decrease by 25%. If we look at the Revenue estimate for 2021, we get a P/S Ratio of 0.62. This is based on a stock price of $24.67 and Revenue estimate for 2021 of $6,400M. 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 and around the median and maybe below the median. The dividend yield tests are showing the stock price as relatively cheap. This is not confirmed by the P/S Ratio testing, which is showing the stock price as reasonable. However, we do have ongoing problems with the recovery from 2008 recession and the Covid situation. The stock price testing does vary, but most say the stock price is in the reasonable range.

Is it a good company at a reasonable price? This is a dividend growth stock company, which is the sort that I like. The reason I do not buy this is because I have Toromont Industries Ltd which is in basically the same industry. I do think it is a good company.

When I look at analysts’ recommendations, I find Strong Buy (3), Buy (3) and Hold (3). The consensus would be a buy. The 12 month stock price consensus is $25.25. This implies a total return of 5.67% with 2.35% from capital gains and 3.32% from dividends.

Analysts have varying views on this stock on Stock Chase. Ambrose O'Callaghan on Motley Fool thinks this is a great stock for your TFSA. A writer on Simply Wall Street thinks shareholders should keep an eye on this company’s debt. A writer on Simply Wall Street says this company has an intrinsic stock price of $29.57. The blogger Freedom Thirty Five likes this stock.

Finning International Inc is a dealer and distributor of heavy-duty machinery and parts of the Caterpillar brand. The company sells and rents Caterpillar machinery. The company operates in Canada, South America, UK and Ireland, and others. Its web site is here Finning International Inc.

The last stock I wrote about was about was Crescent Point Energy Corp (TSX-CPG, NYSE-CPG) ... learn more. The next stock I will write about will be Quarterhill Inc (TSX-QTRH, NASDAQ-QTRH) ... learn more on Wednesday, November 25, 2020 around 5 pm. Tomorrow on my other blog I will write about TFSA Successor Holder.... learn more on Tuesday, November 24, 2020 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.

Crescent Point Energy Corp

Sound bite for Twitter and StockTwits is: Dividend Paying Resource. The stock is probably cheap and very risky. They have been energetically cutting their dividends. Debt Ratios are fine. There is some insider buying. Although you have to wonder if the expected total return for the next year at just 24% is worth the risk. See my spreadsheet on Crescent Point Energy Corp.

I do not own this stock of Crescent Point Energy Corp (TSX-CPG, NYSE-CPG). I got this idea to look into this stock from another blogger, My Own Advisor and his November 2012 blog entry on great Canadian dividend paying stocks. I also noticed that several people at the Toronto Money Show of 2013 mentioned this stock. I do not invest much in energy stocks, but I do follow them because they are such a large part of the TSX.

When I was updating my spreadsheet, I noticed that this is an oil company and it has not made a profit since 2014. Analysts expect it to make a profit in 2022, but who knows. They have kept their dividend, for now, but have reduced it to $0.005 a year. The stock is also down some 65% this year so far. They do have cash flow.

The dividend yields are low with current dividend growth non-existent. The current dividend yield is low (under 1%) at just 0.23%. The 5 year median dividend yield is moderate (2% to 4% ranges) at 3.19%. The 10 year median dividend yield is good (5% to 6% ranges) at 6.34%. The 5 year median dividend yield is high (7% and above) at 7.40%. The stock used to be an income trust and this accounts for the high past dividend yields. They started to decrease the dividends in 2015 and this has continued in most years since.

The Dividend Payout Ratios (DPR) could be improved, but is covered by cash flow. The DPR for 2019 and the 5 year coverage cannot be calculated because of EPS losses. The DPR for CFPS for 2019 is 1% with 5 year coverage at 22%. They have good cash flow. The DPR for Free Cash Flow for 2019 is 5% with 5 year coverage at 153%. (This is due to some years of negative FCF.)

Debt Ratios are fine. The Long Term Debt/Market Cap for 2019 is fine at 0.88, but it drops to a current 2.06 because of the drop in the stock price this year. The Liquidity Ratio for 2019 is 0.81, but if you add in cash flow after dividend it is good at 3.04. The Debt Ratio for 2019 is 2.12. The Leverage and Debt/Equity Ratios are also quite good at 1.89 and 0.89, but do rise to 2.36 and 1.36 currently.

The Total Return per year is shown below for years of 5 to 18 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	-57.12%	-22.80%	-26.46%	3.66%
2009	10	-34.52%	-8.78%	-17.47%	8.69%
2004	15	-23.06%	11.45%	-6.87%	18.32%
2001	18	-16.23%	37.60%	2.72%	34.88%

The Total Return per year is shown below for years of 5 to 18 to date. 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	-57.12%	-31.18%	-34.12%	2.94%
2009	10	-34.52%	-17.80%	-26.62%	8.82%
2004	15	-23.06%	6.05%	-14.42%	20.47%
2001	18	-16.23%	11.99%	-10.22%	22.21%

The 5 year low, median, and high median Price/Earnings per Share Ratios are all negative. The corresponding 10 year ratios are 8.66, 6.67 and 4.69. The corresponding historical ratios are 5.07, 8.11 and 11.16. The current P/E Ratio is negative, as is the one for 2021. The P/E Ratio for 2022 is 214.00. Because of the years of earning losses, it really is not valid to do any P/E Ratio testing for stock price.

My best guess for a Graham Price is $1.11. The 10 year low, median, and high median Price/Graham Price Ratios are 2.09, 2.39 and 2.70. The current P/GP Ratio is 1.92 based on a stock price of $2.14. 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 1.08. The current P/B Ratio is 0.39 based on a Book Value of $2,912M, Book Value per Share of $5.50 and a stock price of $2.14. The current ratio is 64% below the 10 year ratio. This stock price testing suggests that the stock price is relatively cheap. A problem is that the book value has been falling and is down by 15% per year over the past 5 years. It almost fell 50% so far this year.

I get a 10 year median Price/Cash Flow per Share Ratio of 6.13. The current P/CF Ratio is 1.35 based on Cash Flow per Share estimate for 2020 of $1.59, Cash Flow of $842M and a stock price of $2.14. The current ratio is 78% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I get an historical median dividend yield of 7.40%. The current dividend yield is 0.23% based on dividends of $0.005 and a stock price of $2.14. The current dividend yield is 97% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median dividend yield of 6.54%. The current dividend yield is 0.23% based on dividends of $0.005 and a stock price of $2.14. The current dividend yield is 96% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive.

The 10 year median Price/Sales (Revenue) Ratio is 3.96. The current P/S Ratio is 0.65 based on Revenue estimate for 2020 of $1,739, Revenue per Share of $3.28 and a stock price of $2.14. The current P/S Ratio is 84% below the 10 year median ratio. This stock price testing suggests that the stock price is cheap expensive.

Results of stock price testing is that the stock price is probably cheap. The dividend yield test does not show this but dividends have been reduced around 99.9% over the last couple of years. This means that the dividend yield tests do not show us anything. The P/S Ratio test shows that the stock price is cheap. This is confirmed by the P/CF Ratio test and the P/B Ratio test. However, the Revenue is expected to fall 48% this year, the cash flow is expected to fall some 53% and the Book Value fell almost 50% so far this year. So, all the tests have problems.

Is it a good company at a reasonable price? The stock price is probably cheap. It would be a high risk. With the expected return over the next year of 24%, you have to wonder if it is worth the risk. They have cash flow still.

When I look at analysts’ recommendations, I find Strong Buy (1), Buy (3), Hold (3) and Sell (1). The consensus would be a Hold. The 12 month stock price is $2.64. This implies a total return of 23.60% with 23.36% from capital gains and 0.23% from dividends based on a stock price of $2.14.

Analysts on Stock Chase have varying views, but one mentions that this industry has been decimated. Jitendra Parashar Motley Fool thinks you should buy and hold this stock and become rich. The executive summary on Simply Wall Street say that this company is not forecast to become profitable over the next 3 years. Josef Schachter on BNN Bloomberg talks about this stock. A Simply Wall Street article on Yahoo Finance says that 5 analysts expect the company to break even by 2021..

Crescent Point Energy is an independent exploration and production company. Its web site is here Crescent Point Energy Corp.

The last stock I wrote about was about was Innergex Renewable Energy (TSX-INE, OTC-INGXF) ... learn more. The next stock I will write about will be Finning International Inc (TSX-FTT, OTC-FINGF) ... learn more on Monday, November 23, 2020 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.

Innergex Renewable Energy

Sound bite for Twitter and StockTwits is: Dividend Growth Utility. Stock price is reasonable to expensive. I would like this company to generate earnings and cash flow for me to like it. I also think the debt ratios need to be improved. See my spreadsheet on Innergex Renewable Energy.

I do not own this stock of Innergex Renewable Energy (TSX-INE, OTC-INGXF). In 2006 I bought Innergex Power on a buy rating and favorable report from TD although it has only been going from 2003. In 2008 I sold Innergex as I did not think that it is a stock I want to hold as dividend increased less than the rate of inflation.

When I was updating my spreadsheet, I noticed that this renewal energy company cannot seem to make money. The EPS is only up over the past 5 years, because 5 years ago, the EPS loss was greater at $0.63 than the loss for 2019 which is $0.25.

I do not like their debt ratios. None are good. They are using convertible debentures for some debt, but these will dilute shareholders value when converted to shares. For example, the Long Term Debt/Market Cap is 1.82. This means just the long term debt is much higher than the market cap for the company. This ratio should be under 1.00 and lots of analysts like to see it at 0.50 or lower. Personally, I like companies that can make a profit and have good debt ratios.

The dividend yields are moderate with dividend growth low. The current dividend yield is moderate (2% to 4% range) at 3.10%. The 5 year historical dividend yield is good (2% and 4% ranges) at 4.95%. The 10 and historical dividend yields are good (5% and 6% ranges) at 5.51% and 6.01%. This stock used to be an income trust, and income trusts always rather high dividend yields. When these companies had to change to corporations, they needed to reduce their dividends. The dividend increases are low (under 8% per year) with the dividend increase for the past 5 years at 3.16% per year. The last dividend increase was for 2.9% and it was made in this year.

The Dividend Payout Ratios (DPR) need improving. The DPR for EPS for 2019 cannot be calculated because of the earnings loss in 2019. The 5 year coverage is 3638% and, of course, far too high. The DPR for CFPS for 2019 is 49% with 5 year coverage at 33%. I like both the current and 5 year coverage to be 40% or less. The DPR for Free Cash Flow for 2019 is negative and cannot be calculated. The 5 year coverage is also negative an cannot be calculated.

Debt Ratios are awful. The Long Term Debt/Market Cap is 1.82 and far too high. The Liquidity Ratio for 2019 is 0.48. If you add in cash flow after dividends it is 0.70. This means that current assets cannot cover current liabilities. If you add back in the current portion of the long term debt the ratio is 1.34 and with cash flow is 1.68. You have to be careful in added back in the current portion of the long term debt as there could come a time when the company cannot roll over debt.

The Debt Ratio is 1.11 and this is quite low. I prefer one at 1.50 or high. The Leverage and Debt/Equity Ratios at 10.36 and 9.36 are extremely high and bad. I like them to be less than 3.00 and 2.00, respectively.

The Total Return per year is shown below for years of 5 to 16 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	3.16%	13.17%	8.22%	2.88%
2009	10	0.15%	15.31%	9.16%	2.15%
2004	15	0.57%	9.99%	4.36%	2.53%
2003	16	0.67%	10.46%	4.54%	2.21%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 36.32, 46.20 and 56.07. The corresponding 10 year ratios are negative. The corresponding historical ratios are 9.78, 10.73 and 11.69. The current P/E Ratio is negative because analysts expect an earning loss of $0.24 in 2020.

The analysts expect a profit in 2021 with EPS of $0.34. With a stock price at $23.24, the P/E Ratio would be 68.35. Analysts also expect a profit in 2022 of $0.40. With a stock price of $23.24, the P/E Ratio would be 58.10. These ratios are even higher than the 5 year ones. None of this is helpful in telling how reasonable the stock price is currently.

I get a Graham Price of $5.42. The 10 year low, median, and high median Price/Graham Price Ratios are 2.13, 2.35 and 2.56. The current P/GP Ratio is 4.29 based on a stock price of $23.24. 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 3.14. The current P/B Ratio is 3.74 based on a Book Value of $916M, Book Value per Share of $6.22 and a stock price of $23.24. The current ratio is 19% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a 10 year median Price/Cash Flow per Share Ratio of 14.12. The current P/CF Ratio is 17.21 based on Cash Flow per Share estimate for 2020 of $1.35, Cash Flow of $198.8M and a stock price of $23.24. The current ratio is 22% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

I get an historical median dividend yield of 6.01%. The current dividend yield is 3.10% based on dividends of $0.72 and a stock price of $23.24. The current dividend yield is 48% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median dividend yield of 5.51%. The current dividend yield is 3.10% based on dividends of $0.72 and a stock price of $23.24. The current dividend yield is 44% below the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively expensive.

I get a 5 year median dividend yield of 4.91%. The current dividend yield is 3.10% based on dividends of $0.72 and a stock price of $23.24. The current dividend yield is 37% below the 5 year median dividend yield. This stock price testing suggests that the stock price is relatively expensive.

The 10 year median Price/Sales (Revenue) Ratio is 4.63. The current P/S Ratio is 5.42 based on Revenue estimate for 2020 of $632M, Revenue per Share of $4.29 and a stock price of $24.23. The current ratio is 3% 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 reasonable to expensive. No matter how you do the dividend test, the results is that the stock price is relatively expensive. The problem is that this used to be an income trust and income trust had higher dividend yields than other stocks. But this stock cannot even gain traction with a 5 year test. The stock price is rising a lot more than the dividend. Although a dividend yield of 3.10% is not bad for a utility company. The P/S Ratio test shows the stock price as reasonable, but on the high side of reasonable. The company is not producing EPS or a good Cash Flow.

Is it a good company at a reasonable price? This stock seems to becoming a dividend growth stock, but it is having problems with generating earnings and cash flow. Analysts and the market expect great things probably because it is into green energy, but personally, I like companies that can produce earnings and cash flow.

When I look at analysts’ recommendations, I find Buy (4) and Hold (5). The consensus would be a Buy. The 12 month stock price is $25.86. This implies a total return of 14.37% with 11.27% from capital gains and 3.10% from dividends.

One analyst says on Stock Chase that the run up this year is due to Hydro Quebec buying 10% of its stock. David Jagielski on Motley Fool offers this stock as part of a 3 stock portfolio for dividends. On the executive overview on Simply Wall Street the stock is given 2 stars out of 5 and a risk analysis. A writer on Simply Wall Street says there is positive sentiment around this stock. A writer on Simply Wall Street is uncomfortable with the company’s debt. See recent analysts ratings on Modern Readers.

Innergex Renewable Energy Inc is an independent Canadian renewable power producer. It develops, acquires, owns, and operates hydroelectric, wind, and solar facilities in Canada, the United States, France, and Chile. Its web site is here Innergex Renewable Energy.

The last stock I wrote about was about was PFB Corp (TSX-PFB, OTC-PFBOF) ... learn more. The next stock I will write about will be Crescent Point Energy Corp (TSX-CPG, NYSE-CPG) ... learn more on Friday, November 20, 2020 around 5 pm. Tomorrow on my other blog I will write about Canadian Portfolio.... learn more on November 19, 2020 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.

PFB Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Industrial. The current stock price testing is showing the stock as relatively expensive. It is a small company so is risky. It is a dividend growth company and it has good debt ratios. See my spreadsheet on PFB Corp.

I do not own this stock of PFB Corp (TSX-PFB, OTC-PFBOF). I am following this stock as I read a positive article on this stock in November 2009 and thought I would do a spreadsheet on it. This stock is a dividend paying small cap stock. The article said that this stock would be good for long-term gains and rising dividends. This is the thing with small cap stock; you can get a blend of capital gains and rising dividends in the long term only if the company is successful.

When I was updating my spreadsheet, I noticed there was a lot insider selling in June 2020 at $10 before the stock took off raising to $20.00. Of the 22 years of data on dividends I have, there were only 6 dividend increases and 4 of these happened between 2016 and 2019. Until 2016, the dividends were flat most years.

The dividend yield is currently low with dividend growth currently moderate. The current dividend yield is low (under 2%) at 1.76%. The 5, 10 and historical dividend yields are is moderate (2% to 4% range) at 3.25%, 3.77% and 3.23%. The current dividend growth is low (below 8% per year) at 7.84% per year over the past 5 years. They just started to increase the dividends in 2016 from a flat dividend. The increases have been really in the moderate range (8% to 14% ranges). The last dividend increase was for 12.5% and it was in 2019. There has been no increase this year. However, the company paid big special dividend in 2019 and in 2020.

The Dividend Payout Ratios (DPR) are good. The DPR for 2019 is 103% with 5 year coverage at 61%. Without the special dividend, the DPR would be 27% for 2019. The DPR for CFPS for 2019 is 48% with 5 year coverage at 27%. The DPR for 62% with 5 year coverage at 69%. I am not concerned about the rather high DPRs because the company has cash. The positive cash flow is from operating activities. I would be more worried if positive cash flow was from investing or financing activities.

Debt Ratios are good. The Long Term Debt/market Cap for 2019 is 0.09 and is currently at 0.06. This is very good and low. The Liquidity Ratio is good and high at 2.30. The Debt Ratio is also good and high at 2.50. The Leverage and Debt/Equity Ratios are good and low at 1.67 and 0.67.

The Total Return per year is shown below for years of 5 to 26 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	7.84%	31.13%	24.75%	6.38%
2009	10	3.85%	14.41%	8.79%	5.62%
2004	15	5.81%	11.39%	6.53%	4.86%
1999	20	6.46%	12.53%	5.02%	7.50%
1994	25	5.86%	14.16%	6.99%	7.18%
1993	26		13.50%	6.93%	6.57%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 8.59, 9.61 and 13.82. The corresponding 10 year ratios are 10.68, 12.79 and 14.89. The corresponding historical ratios are 8.59, 10.36 and 14.79. The current P/E Ratio is 8.76 based on a stock price of $20.40 and EPS estimate for 2020 of $2.33. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $22.75. The 10 year low, median, and high median Price/Graham Price Ratios are 0.65, 0.77 and 0.95. The current P/GP Ratio is 0.90 based on a stock price of $20.40. 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 0.98. The current P/B Ratio is 2.07 based on a stock price of $20.40, Book Value of $66.04 and Book Value per Share of $9.87. The current ratio is 111% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median Price/Cash Flow per Share Ratio of 6.89. The current P/CF Ratio is 5.76 based on Cash Flow per Share estimate for 2020 of $3.54, Cash Flow of $23.69 and a stock price of $20.40. The current ratio is 16% 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 3.23%. The current dividend yield is 1.76% based on dividends of $0.36 and a stock price of $20.40. The current dividend yield is 45% below the historical dividend yield. This stock price testing suggests that the stock price is relatively expensive.

I get an historical median dividend yield of 3.77%. The current dividend yield is 1.76% based on dividends of $0.36 and a stock price of $20.40. The current dividend yield is 53% below the historical dividend yield. This stock price testing suggests that the stock price is relatively expensive.

The 10 year median Price/Sales (Revenue) Ratio is 0.50. The current P/S Ratio is 1.01 based on Revenue estimate for 2020 of $135M, Revenue per Share of $20.18 and a stock price of $20.40. The current P/S Ratio is 102% above the 10 year median 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 relatively expensive. Both the dividend yield tests show that the stock price is relatively expensive and this is confirmed by the P/S Ratio test. The P/B Ratio test says the same thing and this test does not use any estimates. However, the P/E Ratio, the P/GP Ratio and P/CF tests show that the stock price is reasonable.

Is it a good company at a reasonable price? I do think that it is a good company although it is risky because it is relatively small. It has turned itself into a dividend growth company recently. It has also given out special dividends in 2019 and 2020. The stock price seems to be on the expensive side.

When I look at analysts’ recommendations, I find Strong Buy (2). The consensus would be a Strong buy. There are no many analysts following this stock. The 12 month stock price consensus is $26.75. This implies a total return of a total return of 32.89% with 31.15% from capital gains and 1.76% from dividends.

There is only one entry for this stock on Stock Chase and it is positive. Debra Ray on Motley Fool talks about the fact that building industry firms are doing well and have growing dividends with PFB Corp being mentioned.. A writer on Simply Wall Street thinks the intrinsic value of this stock is $27.87. A write on Simply Wall Street say the CEO is getting a higher proportion of total compensation in salary that other companies of the same size but total compensation is close to the median. James Li on Gurufocus talks about 4 stocks with special dividends including PFB Corp.

PFB Corp is Canadian based firm which is in the business of delivering products and solutions in the areas of manufacturing insulating building products made from expanded polystyrene materials. Most of its revenue is earned through Canadian market, while it has a presence in the USA, and other countries. Its web site is here PFB Corp.

The last stock I wrote about was about IBI Group Inc (TSX-IBG, OTC-IBIBF) ... learn more. The next stock I will write about will be Innergex Renewable Energy (TSX-INE, OTC-INGXF) ... learn more on Wednesday, November 18, 2020 around 5 pm. Tomorrow on my other blog I will write about TD Goal Assist.... learn more on Tuesday, November 17, 2020 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.

IBI Group Inc

Sound bite for Twitter and StockTwits is: Industrial Sector Stock. The stock price is reasonable but above the median. Debt Ratios need improving See my spreadsheet on IBI Group Inc.

I do not own this stock of IBI Group Inc (TSX-IBG, OTC-IBIBF). I have had this stock on my list to investigate for some time before I finally did in 2011. What finally prompted me set up a spreadsheet on this stock was an investment report I read in March of 2011.

When I was updating my spreadsheet, I noticed that this stock has recovered well from March 2020 lows and it is up some over 16% this year. Estimates have increased for this company this year. For example, last year the Revenue given for 2020 was $386M and this year the Revenue for 2020 is expected to be $426M. Also last year the EPS for 2020 was expected at $0.39, and now the expected EPS for 2020 is $0.58. Also, analysts are more interested in this stock. For last year I only got estimates for the current year and one more year. This year, estimates were for the current year and two more years.

This company stopped paying dividends in 2014. The company started off as an income trust (partnership) and became a corporation in 2011. It has good dividends as an income trust, but after becoming a corporation they could not afford to pay dividends at the rate they were paying.

Debt Ratios need improving. The Long Term Debt/Market Cap Ratio for 2019 is 0.50 and is good. The Liquidity Ratio is 2.03 is very good. The Debt Ratio is low at 1.19 and I prefer this to be 1.50 or higher. The Leverage and Debt/Equity Ratios are too high at 6.18 and 5.18. I prefer these ratios to be less than 3.00 and 2.00.

The Total Return per year is shown below for years of 5 to 15 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%	25.27%	25.27%	0.00%
2009	10	0.00%	-7.29%	-10.19%	2.90%
2004	15	0.00%	5.37%	-4.32%	9.69%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 8.67, 11.79 and 16.65. The corresponding 10 year ratios are 7.80, 11.34 and 14.53. The corresponding historical ratios are 6.93, 10.50 and 13.88. The current P/E Ratio is 12.74 based on a stock price of $7.39 and EPS estimate for 2020 of $0.58. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a Graham Price of $4.81. The 10 year low, median, and high median Price/Graham Price Ratios are 0.85, 1.22 and 1.75. The current P/GP Ratio is 1.54 based on a stock price of $7.39. 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 1.53. The current P/B Ratio is 4.16 based on a stock price of $7.39, Book Value of $55.46, and Book Value per Share of $1.77. The current ratio is 173% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. One problem is that the company had a negative book Value in years 2013 to 2015 inclusive. This would lower the 10 year median P/B Ratio.

I get a 10 year median Price/Cash Flow per Share Ratio of 5.94. The current P/CF Ratio is 86.94 based on a stock price of $7.39, Cash Flow per Share estimate for 2020 of $0.09 and a Cash Flow of $2.7M. The current ratio is 1365% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

However, the analysts expect that the Cash Flow per Share for 2020 will drop in 2020 by 76%, but be much better in 2021. If we use the Cash Flow per Share estimate for 2021 of $1.34, the Cash Flow would be $41.9M and the P/CF Ratio would be 5.51. This ratio is 7% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I cannot do any dividend yield tests because this stock has suspended its dividend.

The 10 year median Price/Sales (Revenue) Ratio is 0.46. The current P/S Ratio is 0.34 based on Revenue estimate for 2020 of $426M, Revenue per Share of $13.63 and a stock price of $7.39. The current ratio is 18% above the 10 year median 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. This shown by the P/S Ratio test, the P/E Ratio test, and the P/GP Ratio test. There are problems with the P/B Ratio test and P/CF Ratio test as noted above.

Is it a good company at a reasonable price? The stock price seems relatively reasonable, but on the high side as it is above the 10 year median by a number of measures. The company was having problems in 2012 and 2013 and seems to have recovered but the recovery is quite uneven. Earnings growth was down by 17% in 2019 and Revenue growth by only 2%. This stock would be risky.

When I look at analysts’ recommendations, I find Strong Buy (2) and Buy (5). The consensus would be a Buy. The 12 month stock price is $9.04. This implies a total return of 22.33% all from capital gains.

The last analysts’ reports were in 2019 on Stock Chase. Last year they found it interesting. Adam Othman on Motley Fool thinks this stock will be a buy in the next market dip coming soon. A writer on Simply Wall Street thinks the CEO is paid under the market median for this size of a company. A writer on Simply Wall Street says that the company’s solid accrual ratio indicates strong Free Cash Flow. The company on Global Newswire talks about a strong second quarter in 2020.

IBI Group Inc is a Canada based engineering services provider. The company plans, designs, implements, as well as offer other consulting services and software development for its intelligence, buildings, and infrastructure business streams. Its web site is here IBI Group Inc.

The last stock I wrote about was about was Johnson and Johnson (NYSE-JNJ) ... learn more. The next stock I will write about will be PFB Corp (TSX-PFB, OTC-PFBOF) ... learn more on Monday, November 16, 2020 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.

Johnson and Johnson

Sound bite for Twitter and StockTwits is: Dividend Growth Consumer. My stock price testing showed the stock to be on the expensive side. But it showed the same last year, and in spite of Covid, the stock did just fine. Dividend Payout Ratio are a bit too high. See my spreadsheet on Johnson and Johnson.

I do not own this stock of Johnson and Johnson (NYSE-JNJ). As Canadians, we are told we should be buying US stocks for our portfolio. It is often recommended that we have at least 25% of our portfolio in US stocks. I have never followed this, although I have tried dipping into the US market, but I have never made any money there. I bought some of this stock in June 2005 and realized a year later, in June of 2006 that it was going nowhere for me and sold. I lost almost 17% of my investment. When I bought in 2005, all the analysts were saying that it was a good buy at that time. I bought at the wrong time.

When I was updating my spreadsheet, I noticed the stock price has made a good recovery from March lows and is only down 2.5% this year. However, estimates are down for 2020 from last year. For example, Revenue is now expected to be $81,814M for 2020, last the Revenue for 2020 was expected to come in at $85,294M. Note that revenue given last year for 2019 was $82,218M, but it came in only slightly lower at $82,059.

One of the things I look at for foreign investing is the 5 year total return per year for years ending over a period of time. I have the 5 year total return on this stock from 1998 and 2019. For example, for 1998 I have the 5 year total return between 1993 and 1998. Most 5 year periods, Canadian investors have done well, but they would have had extremely low or negative returns between the 5 years ending in 2003 and 2011. For US investors during this period, the 5 year total returns were low, but not as bad as for Canadian investors. This is because the Canadian Dollar was strong in these years.

The dividend yields are moderate with dividend growth currently low. The current dividend yield is moderate (2% to 4%) at 2.75%. The 5, 10 and historical median dividend yields are also moderate at 2.76%, 2.92% and 2.28%. The dividend growth over the past 5 years has been low (under 8%) at 6.32% per year. The last dividend increase was in 2020 and it was for 6.3%.

The Dividend Payout Ratios (DPR) are on the high side. The DPR for EPS for 2019 was 67% with 5 year coverage at 72%. The DPR for CFPS was 54% with 5 year coverage at 50%. Both these DPRs are on the high side. The DPR for Free Cash Flow was 50% with 5 year coverage at 52%.

Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2019 is low and quite good at 0.07. The Liquidity Ratio for 2019 is lower than normal at 1.26 with the 5 year median at 1.50. The Debt Ratio is good at 1.61. The Leverage and Debt/Equity Ratios are fine at 2.65 and 1.65.

The Total Return per year is shown below for years of 5 to 31 to the end of 2019 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.
2014	5	8.75%	12.39%	9.33%	3.06%
2009	10	9.16%	13.96%	10.85%	3.11%
2004	15	9.10%	8.56%	6.24%	2.32%
1999	20	9.43%	7.18%	5.20%	1.97%
1994	25	10.60%	12.59%	9.63%	2.95%
1989	30	11.90%	14.01%	10.75%	3.26%
1988	31	12.16%	15.41%	11.69%	3.73%

The Total Return per year is shown below for years of 5 to 31 to the end of 2019 in US$. 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	6.32%	9.67%	6.88%	2.79%
2009	10	6.87%	11.58%	8.52%	3.06%
2004	15	8.55%	8.20%	5.71%	2.49%
1999	20	10.12%	8.11%	5.87%	2.24%
1994	25	10.90%	13.06%	9.93%	3.14%
1989	30	11.58%	13.57%	10.44%	3.13%
1988	31	11.74%	14.78%	11.27%	3.50%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 21.28, 23.82 and 26.01. The corresponding 10 year ratios are 16.33, 17.99 and 19.63. The corresponding historical ratios are 15.53, 18.68 and 21.24. The current P/E Ratio is 24.20 based on a stock price of $147.11 and EPS estimate for 6.08. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $57.88. The 10 year low, median, and high median Price/Graham Price Ratios are 1.57, 1.74 and 1.90. The current P/GP Ratio is 2.54 based on a stock price $147.11. 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 3.86. The current P/B Ratio is 6.01 based on a Book Value of $64,473M, Book Value per Share of $24.49 and a stock price of $147.11. The current ratio is 56% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median Price/Cash Flow per Share Ratio of 6.20. The current P/CF Ratio is 19.13 based on Cash Flow per Share estimate for 2020 of $7.69, Cash Flow of $20,244M and a stock price of $147.11. The current ratio is 218% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

I get an historical median dividend yield of 2.28%. The current dividend yield is 2.75% based on dividends of $4.04 and a stock price of $147.11. The current dividend yield is 19% above historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10 year median dividend yield of 2.92%. The current dividend yield is 2.75% based on dividends of $4.04 and a stock price of $147.11. The current dividend yield is 6% below 10 year median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.

The 10 year median Price/Sales (Revenue) Ratio is 3.77. The current P/S Ratio is 4.73 based on a stock price of $147.11, Revenue estimate for 2020 of $81,814 and Revenue per Share of $31.08. The current ratio is 26% 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 relatively expensive. The dividend yield tests are showing the stock price as reasonable and above and below the median. However, this is not confirmed by the P/S Ratio test. All of the other tests show that the stock price is relatively expensive.

Is it a good company at a reasonable price? This stock has done well for shareholders over the longer term. Unfortunately, the current price seems to be on the high side. But last year the testing showed the stock price as above the median or expensive except for the dividend yield tests. The stock did well over the past year.

When I look at analysts’ recommendations, I find Strong Buy (8), Buy (4) and Hold (6). The Consensus would be a Buy. The 12 month stock price consensus is $165.38. This implies a total return of 15.17% with 12.42% from capital gains and 2.75% from dividends based on a current price of $147.11.

When I looked at analysts’ recommendations last year, I found Strong Buy (6), Buy (4) and Hold (9). The consensus would be a Buy. The 12 month stock price consensus is $149.37. This implies a total return of 16.73% that includes 13.83% from capital gains and 2.90% from dividends based on a current stock price of $131.22. The stock price this year is $147.11, and this is not far off the consensus stock price of $149.37 of last year. Last year my analysis showed the stock price to be on the expensive side also.

It is interesting that analysts have differing views of this stock on Stock Chase. John Bromels on Motley Fool talks of three dividend stocks to love which includes this stock. A writer on Simply Wall Street calculates the intrinsic value of this stock to be $181.21 US$. A writer on Simply Wall Street says that the company’s high P/E Ratio maybe justified because analysts expect a future rise in EPS. The blogger on Old School Value does an analysis of this stock.

Johnson & Johnson is engaged in the research and development, manufacture, and sale of a range of products in the healthcare field. The Company operates in three segments: Consumer, Pharmaceutical, and Medical Devices and Diagnostics. Its web site is here Johnson and Johnson.

The last stock I wrote about was about was Cenovus Energy Inc (TSX-CVE, NYSE-CVE) ... learn more. The next stock I will write about will be IBI Group Inc (TSX-IBG, OTC-IBIBF) ... learn more on Friday, November 13, 2020 around 5 pm. Tomorrow on my other blog I will write about Investing Books.... learn more on Tuesday, November 10, 2020 around 5 pm.

Also, on my book blog I have put a review of the book Seeking Virtue in Finance by JC de Swaan 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.