Monday, December 27, 2021

Neighbourly Pharmacy Inc

This is the first of three new stocks I will be following. They are Neighbourly Pharmacy Inc (TSX-NBLY, OTC-none), Maple Leaf Foods Inc (TSX-MFI, OTC-MLFNF) and KP Tissue Inc (TSX-KPT, OTC-KPTSF). They all will be reviewed this week.

Sound bite for Twitter and StockTwits is: Dividend Growth Health Care. The stock price would seem to be expensive, but the stock price has increased by 87% this year and shows no sign of slowing. The stock price has not moved in a straight line, but the end result is a climb in price. Dividend yield is very low at just 0.47%. See my spreadsheet on Neighbourly Pharmacy Inc.

I do not own this stock of Neighbourly Pharmacy Inc (TSX-NBLY, OTC-none). I read about it on the Daily Advice website. This stock has a financial year ending in March 31 each year. This is a new stock I am now following.

When I was updating my spreadsheet, I noticed that even though there is not much information on this stock and it just went public in May 2021. However, there is a surprising number of analyst’s estimates and number of analysts following this stock.

The dividend yields are low with has little to go on for dividend growth, but the only increase was good. The current dividend yield is low (below2%) at 0.47%. The only other yield was lower at 0.39%. There has only been one dividend increase and it was for 21.62%.

The Dividend Payout Ratios (DPR) seem that they will be fine. The DPR for EPS for 2021 cannot be calculated as this stock has yet to make a profit. This is expected in for the March 31, 2023 financial year. At that point the DPR for EPS for 2023 is expected be 16%. The DPR for CFPS for 2022 is expected to be 25%. The DPR for Free Cash Flow for 2021 is 16%.

Debt Ratios are currently fine. The Long Term Debt/Market Cap for 2021 is 1.96, which is too high. If over 1.00 is means that the Long Term Debt is higher than the stock’s Market Cap. However, the current ratio is good at 0.07. The Liquidity Ratio for 2021 is 0.31 and with Cash Flow less Dividends the ratio is 0.41. However, the current Liquidity Ratio is good at 2.38. The Debt Ratio for 2021 is 0.74, but the current one is 2.62. The Leverage and Debt/Equity Ratios are not calculable for 2021, but the current ones are 1.66 and 0.63.

The Total Return per year is unknown as this stock has been listed for less than a year. During that time this stock is up 87%.

The 5 year low, median, and high median Price/Earnings per Share Ratios are not calculable since this stock only started to trade in May 2021. The P/E Ratio for 2021 cannot be calculated because of a potential earnings loss in 2021. The P/E Ratio for 2022 is 34.62. This is a rather high P/E Ratio. It is based on a stock price of $38.43 and 2022 EPS estimate of $1.11. The P/E Ratio for 2023 is also quite high at 28.26 and it is based on a stock price of $38.43 and EPS estimate for 2023 of $1.36. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $15.20 for 2022 and $16.83 for 2023. The 10 year low, median, and high median Price/Graham Price Ratios cannot be calculated because the stock started to trade in May 2021. The P/GP Ratio of 2022 is 2.53 and the P/GP Ratio for 2023 is 2.28. These are based on a stock price of $38.43. These are high P/GP Ratios as generally, the top P/GP Ratio for purchasing a stock is 1.50. This stock price testing suggests that the stock price is relatively expensive.

I get a current Price/Book Value per Share Ratio of 4.15 based on a stock price of $38.43, a Book Value of $305.6M and Book Value per Share of $9.26. A normal P/B Ratio is probably 1.50. When buying a stock, it is often suggested that the top P/B Ratio be 3.00. By this standard, the P/B Ratio of 4.15 is high. This stock price testing suggests that the stock price is relatively expensive.

I get a current Price/Cash Flow per Share Ratio of 64.05 based on CFPS estimate for 2022 of $0.60, Cash Flow of $20M and a stock price of $38.43. The ratio for 2023 is 21.35 based on CFPS estimate $1.80, Cash Flow of $60M and a stock price of $38.43. A decent P/CF Ratio for buying stock is generally considered around 15.00 to 20.00. The P/CF for 2021 is much too high at 64.05, but the one for 2022 is close to good. However, the further out estimates are, the more unreliable they are. But let’s go with reasonable for 2022.

I get a current dividend yield of 0.47% based on a dividend of $0.18 and a stock price of $38.43. There is nothing to compare this to. This dividend yield is very low.

The current Price/Sales (Revenue) Ratio of 2.19 based on Revenue estimate for 2022 of $442M, Revenue per Share of $13.22 and a stock price of $38.43. For small cap stocks, a P/S Ratio of 1.00 is considered a good one.

Results of stock price testing is that the stock price is probably expensive. This is hard to gauge. I can only compare the ratios to some rules of thumb. These are good guides, but not perfect.

Is it a good company at a reasonable price? It may be expensive. I find that this could be an interesting company. Certainly, the stock is up some 87% this year so far. It shows no sign of slowing down.

When I look at analysts’ recommendations, I find Buy (2), Hold (4) and Underperform (1). The consensus is a Hold. The 12 month stock price is $33.86. This implies a total loss of 11.42% with a capital loss of 11.89% and dividends of 0.47%. The range for the 12 months stock price is $29.00 to $36.00. So, it would appear that analysts do not expect that the stock price will rise much over the next year.

A Simply Wall Street report is on Yahoo Finance. It talks about the company becoming profitable. The company on Globe Newswire announces a bought deal. The company announces on Newswire acquiring 5 pharmacies in Western Canada. On October 7, 2021 the company via Cision talks about acquiring 20 more stores.

Neighbourly Pharmacy Inc is a network of community pharmacies. Its pharmacies act as the centre of care within their communities, representing an indispensable source of both healthcare delivery and trusted advice for their patients. Its web site is here Neighbourly Pharmacy Inc.

The last stock I wrote about was about was Element Fleet Management Corp (TSX-EFN, OTC-ELEEF) ... learn more. The next stock I will write about will be Maple Leaf Foods Inc (TSX-MFI, OTC-MLFNF) ... learn more on Wednesday, December 29, 2021 around 5 pm. Tomorrow on my other blog I will write about RRSP at 71.... learn more on Tuesday, December 28 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