Sound bite for Twitter and StockTwits is: Dividend Paying Industrial. Stock price might be reasonable. They just started to pay a dividend in 2020. This is a small industrial company using tech and is quite speculative. You should not invest any money in this stock that you cannot afford to lose. That is why I am using my fooling around money on this. See my spreadsheet on Titanium Transportation Group Inc .
I do now own this stock of Titanium Transportation Group Inc (TSX-TRR, OTC-PVVTF). I found this stock on a blog of Our Life Financial.
When I was updating my spreadsheet, I found it quite fun. This is a relatively new company on the TSX and it is small and paying a dividend. I also wanted to look at this because I have TFI International which is also into transportation and logistics. I have had this TFI for just under 5 years and have made a total return of 50.30% per year with 48.11% from capital gains and 2.19% from dividends.
The dividend yields are moderate with dividend growth unknown. The current dividend yield is moderate (2% to 4% range) at 2.22%. They just started to pay dividends with one dividend payment at the end of 2020 and 4 quarterly payments expected in 2021. It is unknown at this time if this will be a dividend growth stock, but I speculate that it will be.
The Dividend Payout Ratios (DPR) seem fine. The DPR for 2020 for EPS is 12%, with 5 year coverage 7%. The DPR for EPS is expected to be 42% in 2021 and then dropping to 27% in 2022. Since only one dividend payment was made in 2020, it is important to see what is expected this year and next. The DPR for CFPS for 2020 is 7%, with 5 year coverage at 1%. The DPR for CFPS is expected to be 24% in 2021. The DPR for Free Cash Flow for 2020 is 5% with 5 year coverage at 1%. The DPR for FCF for 2021 is expected to be 490% with 5 year coverage at 7%. The DPR for FCF for 2022 is expected to be 21%.
Debt Ratios are fine. The Long Term Debt/Market Cap Ratio is low and good at 0.14. The Liquidity Ratio for 2020 is low at 1.24. However, if you add in Cash Flow after Dividends it is good at 1.65. It is low again in the Second Quarter of 2021 at just 1.03 and when you add in Cash Flow after dividends it is still low at 1.15. The Debt Ratio for 2020 is good at 1.51. The Leverage and Debt/Equity Ratios for 2020 are fine at 2.95 and 1.95.
The Total Return per year is shown below for years of 5 to 6 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 | 0.00% | -0.78% | -0.94% | 0.16% |
| 2014 | 6 | 0.00% | 8.75% | 8.61% | 0.15% |
The Total Return per year is shown below for years of 5 to 7 to the 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. I did this because the stock is up some 53% to date.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2015 | 5 | 0.00% | 20.29% | 19.64% | 0.65% |
| 2014 | 7 | 0.00% | 14.52% | 14.08% | 0.44% |
The 5 year low, median, and high median Price/Earnings per Share Ratios are 5.25. 9.44 and 13.63. The corresponding 6 year and historical ratios are 5.86, 10.00 and 14.14. The current P/E Ratio is 18.95 based on a stock price of $3.60 and EPS estimate for 2021 of $0.19. The current ratio is above the 6 year median ratio. This stock price testing suggests that the stock price is relatively expensive.
I get a Graham Price of $2.89. The 6 year low, median, and high median Price/Graham Price Ratios are 0.53, 0.81 and 1.12. The current P/GP Ratio is 1.24 based on a stock price of $3.60. The current ratio is above the 7 year median P/GP Ratio. This stock price testing suggests that the stock price is relatively expensive.
I get a 6 year median Price/Book Value per Share Ratio of 1.40. The current P/B Ratio is 1.84 based on a Book Value of $71.9M, Book Value per Share of $1.96 and a stock price of $3.60. The current ratio is 31% above the 6 year median ratio. This stock price testing suggests that the stock price is relatively expensive.
I get a 6 year median Price/Cash Flow per Share Ratio of 4.16. The current P/CF Ratio is 10.98 based on a stock price of $3.60 and Cash Flow for the last 12 months at $12.04M and Cash Flow per Share of $0.33. The current ratio is 163% above the 6 year median ratio.
I cannot do any dividend yield tests as they have only paid dividends for one year.
The 6 year median Price/Sales (Revenue) Ratio is 0.33. The current P/S Ratio is 0.35 based on Revenue estimate for 2021 of $374M, Revenue per Share of $10.18 and a stock price of $3.60. The current ratio is 8% above the 6 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 might be reasonable based on the P/S Ratio test. All the other tests say that the stock price is expensive, but no dividend yield test can be done because dividends have just started. For the P/B Ratio test to get into the reasonable range, the stock would need to be at $3.25. Then the P/S Ratio would be below the 6 year median ratio by 2.8% and show as reasonable and below the median.
I looked 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. I have included charts for starting value ending December 31, 2020 and to date.
In the following chart the total return for the 5 years to December 31, 2020 is a loss of 0.78%. The beginning yield was not available as dividends were just started and the P/E Ratio and the P/S Ratio were at 65 and 0.86. Does this chart change my opinion of the stock price? No really. The P/S Ratio currently at 0.35 looks moderate.
| # Years | Total Ret | Beg P/E | Beg P/S | Beg Yield |
|---|---|---|---|---|
| 5 | -0.78% | 65.00 | 0.86 | |
| 6 | 8.75% | 0.23 | ||
| current | 18.95 | 0.35 | 2.22% | |
| # Years | Total Ret | Beg P/E | Beg P/S | Beg Yield |
| 5 | 20.29% | -933.34 | 0.50 | |
| 7 | 14.52% | 0.23 | ||
| current | 18.95 | 0.35 | 2.22% |
Is it a good company at a reasonable price? The stock price might be reasonable at $3.60. However, this is a small industrial company using tech and is therefore quite speculative. You should not invest any money in this stock that you cannot afford to lose.
When I look at analysts’ recommendations, I find Strong Buy (1) and Buy (2). The consensus would be a Buy. The 12 month stock price consensus is $6.08. This implies a total return of 71.11% with 68.89% from capital gains and 2.22% from dividends.
An analyst on Stock Chase says he is not buying because he has TFII and TTR is struggling with its balance sheet. Adam Othman on Motley Fool suggests this is the stock to buy with your 2021 TFSA money. The Executive Summary on Simply Wall Street gives this stock 4 stars out of 5 and lists 4 risks. A writer on Simply Wall Street says the ROCE is low, but the stock is up 117% over the past 5 years. The company reports on their second quarterly results for 2021 on Globe Newswire.
Titanium Transportation Group Inc is assets based transportation and logistics firm that provides services like, truckload, dedicated, cross-border trucking services, freight logistics, warehousing, and distribution. The group has a business presence in Canada and the United States. Its web site is here Titanium Transportation Group Inc .
The last stock I wrote about was about was Dollarama Inc (TSX-DOL, OTC-DLMAF) ... learn more. The next stock I will write about will be Keyera Corp (TSX-KEY, OTC-KEYUF) ... learn more on Friday, October 29, 2021 around 5 pm. Tomorrow on my other blog I will write about Dividend Safety .... learn more on Thursday, October 28, 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.
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