I do not own this stock of Sylogist Ltd (TSX-SYZ, OTC-SYZLF). I learned about this stock from the newsletter I subscribe to.
When I was updating my spreadsheet, I noticed that this company gives almost nothing on their site. I had to collect information for my spreadsheet from other sources including financials, company leadership and board members.
The dividend yields are moderate with dividend growth moderate. The current dividend yield is moderate (2% to 4% ranges) at 4.26%. The 5, 10 and historical median dividend yields are also moderate at 3.02%, 3.02% and 3.02%. The dividend growth over the last 5 years is moderate (8% to 14% ranges) at 12% per year. The last dividend increase was in 2020 and it was for was for 13.6%. There has often been more than one increase in a year.
The above combination of moderate yields and moderate (had past good) growth in dividends means that the dividend yield on an original price paid 5, 10, 15 and 20 years ago would give a current dividend yield of 5.7%, 24.5%, 27.9% and 3.9%. Also, it means that the percentage of the original cost covered by dividends over the past 5, 10, 15 and 20 years would be 23%, 160%, 192% and 26.8%. The low values for the 20 year period are because of much higher stock price in the 2000 bull market.
The Dividend Payout Ratios (DPR) are too high and need improvement. The DPR for EPS for 2020 was 544% with 5 year coverage at 99%. The DPR for CFPS for 2020 was 131% with 5 year coverage at 64%. The DPR for Free Cash Flow for 2020 is 409% with 5 year coverage at 79%. Analysts expect better DPRs in 2021 with the ones for EPS at 102% and then declining to 89% in 2022. They expect the DPR for CFPS in 2021 to decline to 89% and expected the DPR for FCF in 2021 to decline to 61%.
Debt Ratios are very good. They have no long term debt. The Liquidity Ratio for 2020 is 2.89 and the Debt Ratio for 2020 is 3.72. The Leverage and Debt/Equity Ratios for 2020 are 1.37 and 0.37.
The Total Return per year is shown below for years of 5 to 22 to the end of 2020. 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. |
|---|---|---|---|---|---|
| 2015 | 5 | 12.17% | 9.91% | 5.95% | 3.96% |
| 2010 | 10 | 21.12% | 23.22% | 17.61% | 5.61% |
| 2005 | 15 | 16.29% | 13.35% | 2.94% | |
| 2000 | 20 | 10.51% | 8.79% | 1.73% | |
| 1995 | 25 | 2.59% | 1.48% | 1.12% |
The 5 year low, median, and high median Price/Earnings per Share Ratios are 23.94, 29.03 and 34.13. The corresponding 10 year ratios are 23.00, 29.00 and 33.97. The corresponding historical ratios are 9.21, 14.90 and 20.48. The current P/E Ratio is 23.98 based on a stock price of $11.75 and EPS Estimate for 2021 of $0.49. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get a Graham Price of $4.91. The 10 year low, median, and high median Price/Graham Price Ratios are 1.95, 2.54 and 3.14. The current P/GP Ratio is 2.40 based on a stock price of $11.75. 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 4.41. The current P/B Ratio is 5.38 based on a Book Value of $51.87M, Book Value per Share of $2.18 and a stock price of $11.75. The current P/B Ratio is 22% 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 18.05. The current P/CF Ratio is 71.96 based on the last 12 month cash flow. The current ratio is 299% above the 10 year ratio. This stock price testing suggests that the stock price is relatively reasonable expensive.
I get an historical and 10 year median dividend yield of 3.02%. The current dividend yield is 4.26% based on dividends of $0.50 and a stock price of $11.75. The current dividend yield is 41% above the historical and 10 year dividend yield. This stock price testing suggests that the stock price is relatively cheap. (Dividends have only been paid for 10 years.)
The 10 year median Price/Sales (Revenue) Ratio is 6.45. The current P/S Ratio is 6.54 based on Revenue estimate for 2021 of $42.7M, Revenue per Share of $1.80 and a stock price of $11.75. The current ratio is 1% higher than the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median. But it is just above the median.
Results of stock price testing is that the stock price is probably reasonable. The dividend yield test says cheap, but they have increased dividend beyond what they can afford currently. However, increases in dividends does signal that management is bullish on the company’s future. The P/S Ratio tests shows a price close to the median. It is a bit worrisome that the P/B Ratio test says the stock is expensive. The problem with the P/CF Ratio test is that the cash flow was unusually low over the past 12 months.
Is it a good company at a reasonable price? The price is probably reasonable. It is a dividend growth company and I like those. This might be a good investment if you are looking for a small cap tech. However, being a small cap tech makes this stock risky.
When I look at analysts’ recommendations, I find Strong Buy (1) and Buy (1). The consensus would be a Strong Buy. The 12 month stock price consensus is $15.38. This implies a total return of 35.13% with 30.89% from capital gains and 4.26% from dividends.
Analysts on Stock Chase sort of like this stock, but they do not expect much to happen with it in the short term. Jed Lloren on Motley Fool talks about why you should invest in this stock. The Executive Summary on Simply Wall Street gives this stock 3 stars out of 5 and list 3 risks of this stock. A writer on Simply Wall Street says that the stock is currently selling near its Fair Market Value. Enterprising Investors on Seeking Alpha analyzed this stock in February 2020.
Sylogist Ltd is a software company that provides Enterprise Resource Planning solutions, including fund accounting, grant management, and payroll to public service organizations. Geographically, the company offers its services to the United States of America, Canada, and the United Kingdom region. The majority of the revenue comes from the United States of America. Its web site is here Sylogist Ltd .
The last stock I wrote about was about was Transcontinental Inc (TSX-TCL.A, OTC-TCLAF) ... learn more. The next stock I will write about will be Enghouse Systems Ltd (TSX-ENGH, OTC-EGHSF) ... learn more on Wednesday, January 27, 2021 around 5 pm. Tomorrow on my other blog I will write about Banks and Ratios.... learn more on Tuesday, January 26, 2021 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.
No comments:
Post a Comment