I do not own this stock of Logistec Corp (TSX-LGT.B, OTC-LTKBF). I got this stock from Dividend Growth Investing and Retirement blogger’s all-star spreadsheet for March 2017.
When I was updating my spreadsheet, I noticed they have Class A shares (with 30 votes per share) and Class B shares (with one vote per share). The common shares to buy is the Class B shares. The Class A shares have lower dividends. They also divide up the earnings and say what earnings are attributable to Class A shares and what are attributable to Class B shares. I do not see much value in this division of earnings because if you own this company, you want to know what the company is earning. I think that this just makes it more difficult to analyze the company.
The dividend yields are low with dividend growth low. The current dividend yield for Class B is low (under 1%) at 1.01%. The 5, 10 and historical dividend yields are also low at 0.86%, 0.91% and 1.92%. The dividend growth over the past 5 years is low (below 8%) at 7.34% per year. Dividends were increased 18 times in the last 24 years (or 75% of the time).
The Dividend Payout Ratios (DPR) are good. The DPR for EPS for 2020 is 16% with 5 year coverage at 19%. The DPR for CFPS for 2020 is 10% with 5 year coverage at 12%. The DPR for Free Cash Flow for 2020 is 6% with 5 year coverage at 12%.
Debt Ratios are generally good. the Long Term Debt/Market Cap Ratio for 2020 is good at 0.35. The Liquidity Ratio for 2020 is good at 1.70. 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 24 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.|
The 5 year low, median, and high median Price/Earnings per Share Ratios are 17.65, 19.70 and 21.75. The corresponding 10 year ratios are 12.00, 15.05 and 18.11. The corresponding historical ratios are 9.32, 10.93 and 12.82. The current P/E Ratio is 14.65 based on a stock price of $42.60 and last 12 month EPS of $2.81. This ratio is between the low and median ratios of the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get a Graham Price of $38.94. The 10 year low, median, and high median Price/Graham Price Ratios are 1.07, 1.32 and 1.47. The current P/GP Ratio is 1.09 based on a stock price of $42.60. The current ratio is between the low and median ratios of the 10 year median ratios. 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 2.10. The current P/B Ratio is 1.83 based on a stock price of $42.60, Book Value of $303M and Book Value per Share of $23.23. The current ratio is 13% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get a 10 year median Price/Cash Flow per Share Ratio of 9.80. The current P/CF Ratio is 5.28 based on last 12 months Cash Flow of $104M, Cash Flow per Share of $7.97 and a stock price of $42.60. The current ratio is 46% 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 1.92%. The current dividend yield is 1.01% based on dividends of $0.42 and a stock price of $42.60. The current yield is 47% 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 0.91%. The current dividend yield is 1.01% based on dividends of $0.42 and a stock price of $42.60. The current yield is 11% 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 0.94. The current P/S Ratio is 0.86 based on a stock price of $42.60, Revenue for last 12 months of $649M, and Revenue per Share of $49.74. The current ratio is 9% 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. The 10 year median dividend yield test shows this and is confirmed by the P/S Ratio test. Most of the other testing shows this with the exception of the historical dividend yield test that says the stock is expensive and the P/CF Ratio test that says the stock is cheap.
I look at the total return over a number of years. For P/S Ratio and P/E Ratio, the lower the ratio the cheaper the stock. For yield, the higher the yield, the cheaper the stock. In the chart below you can see that the beginning P/E Ratios for good returns are lower than today. This is the same with P/S Ratio. Also, the beginning yield was higher than today. However, both the beginning P/E Ratio and P/S Ratio were higher with the 5 year negative total return and the beginning yield was lower than is the case today.
In the following chart the total return for the 10 years to December 31, 2020 is 15.97%. The beginning yield was high at 1.80%, and the P/S Ratio and the P/E Ratio were relatively low at 9.05 and 0.49. This chart does not change my opinion of the reasonableness of the current stock price.
|# Years||Total Ret||Beg P/E||Beg P/S||Beg Yield|
Is it a good company at a reasonable price? The stock price is probably reasonable. This is a small cap company that is not followed much by analysts. So, this is a risk. Even though they had trouble with the pandemic, Revenue and EPS has risen in the first two quarters of 2021. They have produced some good long term results for investors.
When I look at analysts’ recommendations, I find that the last recommendation was a Hold (1). The consensus would be a Hold. Most sites show no current recommendations. There is no 12 month stock price consensus.
It was a top pick on Stock Chase by an analyst in 2019, but no entries after that. Nikhil Kumar on Motley Fool says it is cheap and growing fast. The Executive Summary on Simply Wall Street gives this stock 4 stars out of 5 and list two risks. Selling seems to be by the old Chairman; the CEO and CFO are not selling. A writer on Simply Wall Street sees the dividend increasing and being well covered by earnings. The CEO is interviewed on C-Suite.
Logistec Corp provides specialized cargo handling and other services to a wide variety of marine, industrial, and municipal customers. It has cargo handling facilities in the ports across North America, and offers marine agency services to foreign shipowners and operators serving the Canadian market. It has a business presence in Canada and the US. Its web site is here Logistec Corp.
The last stock I wrote about was about was Teck Resources Ltd (TSX-TECK.B, NYSE-TECK) ... learn more. The next stock I will write about will be Trigon Metals Inc (TSX-TM, OTC-PNTZF) ... learn more on Monday, October 4, 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.
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