Thursday, June 30, 2022

Saputo Inc

Sound bite for Twitter and StockTwits is: Dividend Growth Consumer. The stock price seems to be cheap. This stock has spent most of its time with a dividend yield of less than 2%. It is often a very good time to buy when the yield is above 2% and in this case 2.50%. Both the Dividend Payout Ratios and Debt Ratio seem currently fine. See my spreadsheet on Saputo Inc.

Is it a good company at a reasonable price? The stock price is testing as cheap, so it is a reasonable price to pay. I still think this is a good company. They have had problems because of Covid, but I expect improvements in the future. Of course, I could be wrong, but I have not lost faith in this company. They are still increasing their dividends, even if it is at a low rate. Future growth might be lower than in the past.

I own this stock of Saputo Inc (TSX-SAP, OTC-SAPIF). When I sold RIM in 2006, I bought some Saputo. I had been following this stock and thought it was a strong Canadian Dividend paying stock. In 2012, I sold some that I had in my RRSP account because I need more dividend income and dividend yield is low on this stock.

In 2013, I need to raise more money in the RRSP account because of yearly withdrawals. I sold the stock with the lowest dividend yield. I still want to hold this stock, but it would be a better stock in my Trading account rather than in my RRSP accounts because of the low dividends. In 2013 and 2014 I bought some of this stock for my TFSA.

When I was updating my spreadsheet, I noticed that this stock also has been publishing Adjusted Net Earnings and Adjusted EPS (AEPS) data. The financial year ends March 31, so the financial year I am reporting on is for March 31, 2022.

I have made money on this stock, at the rate of 15.12% per year over the past 16 years. However, I have made money because I have sold some of my stock at a higher price than I have paid for them.

If you had invested in this company in December 2011, $1014.78 you would have bought 52 shares at $19.52 per share. In December 2021, after 10 years you would have received $304.20 in dividends. The stock would be worth $1,482.00. Your total return would have been $1,786.20.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$19.52 $1,014.78 52 10 $304.20 $1,482.00 $1,786.20

The dividend yields are moderate with dividend growth low. The current dividend yield is moderate (2% to 4%) at 2.50%. The 5, 10 and historical dividend yields are low (below 2%) at 1.61%, 1.59% and 1.21%. The dividend growth over the past 5 years is low (below 8%) at 4% per year. The last dividend increase was in low at 2.9% and it was made in 2022.

The Dividend Payout Ratios (DPR) seem fine, although some are high for 2022, but 5 year coverage counts. The DPR for EPS for 2022 is 108% with 5 year coverage at 43%. The DPR for AEPS is 61% with 5 year coverage at 43%. The DPR for Cash Flow per Share (CFPS) is 25% with 5 year coverage at 20%. The Free Cash Flow for the Financial year of 2022 has not been published, and sites do not agree on what the FCF is, but both WSJ and MS imply it will be below $300 and that would give a DPR for FCF of 70% with 5 year coverage at 55%.

Debt Ratios are fine. The Long Term Debt/Market Cap for 2022 is 0.25 and is good. The Liquidity for 2022 is good at 1.54. The Debt Ratio is good at 1.91. The Leverage and Debt/Equity Ratio are fine at 2.10 and 1.10.

The Total Return per year is shown below for years of 5 to 25 to the end of 2021. 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.
2016 5 3.95% -7.96% -9.72% 1.76%
2011 10 17.04% 6.34% 3.86% 2.48%
2006 15 9.00% 10.73% 7.80% 2.93%
2001 20 13.64% 9.67% 7.18% 2.49%
1996 25 13.49% 15.22% 7.91% 7.31%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 19.50, 23.33 and 27.21. The corresponding 10 year ratios are 19.26, 22.44 and 25.36. The corresponding historical ratios are 17.14, 19.12 and 21.75. The current P/E Ratio is 18.09 based on a stock price of $28.76 and EPS estimate for 2023 of $1.59. The current ratio is below the low ratio 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I also have Adjusted Earnings per Share (AEPS) data. The 5 year low, median, and high median Price/Earnings per Share Ratios are 22.19, 24.28 and 26.38. The corresponding 10 year ratios are 19.68, 22.79 and 25.91. The current P/AEPS Ratio is 17.33 based on AEPS estimate for 2023 of $1.66. The current ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $23.63. The 10 year low, median, and high median Price/Graham Price Ratios are 1.59, 1.83 and 2.03. The current P/GP Ratio is 1.22 based on a stock price of $28.76. This ratio is below the low of the 10 year median ratio. 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 3.49. The current P/B Ratio is 1.84 based on a stock price of $28.76, Book Value of $6,505M and Book Value per Share of $15.61. The current ratio is 47% below the 10 year median dividend yield. 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 16.41. The current P/CF Ratio is 17.29 based on Cash Flow for last 12 months of $693M, Cash Flow per Share of $1.66 and a stock price of $28.76. The current ratio is 5% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.

Mostly analysts expect Cash Flows to increase. If the Cash Flow increases by just 6% to 734M, then the P/CF Ratio would be at the median.

I get an historical median dividend yield of 1.67%. The current dividend yield is 2.50% based on a stock price of $28.76 and dividends of $0.72. The current dividend yield is 50% above 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 1.59%. The current dividend yield is 2.50% based on a stock price of $28.76 and dividends of $0.72. The current dividend yield is 57% above the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

The 10 year median Price/Sales (Revenue) Ratio is 1.20. The current P/S Ratio is 0.73 based on a stock price of $28.76, Revenue estimate for 2023 of $13,479M and Revenue per Share of $39.54. The current ratio is 39% below the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

Results of stock price testing is that the stock price is probably cheap. The dividend yield tests and the P/S Ratio tests both say this. Most of the other tests say the same thing.

When I look at analysts’ recommendations, I find Strong Buy (1), Buy (6) and Hold (2). The consensus would be a Buy. The 12 month stock price consensus is $33.67. This implies a total return of 19.58% with 17.07% from capital gains and 2.50% from dividends based on a current stock price of $28.76.

There are lots of recent entries on Stock Chase but analysts have very different views of this company. Stock Chase gives the company 4 stars out of 5. The company is no longer on Money Sense list of top stock. Ambrose O'Callaghan on Motley Fool says it is a cheap dividend stock. Tony Dong on Motley Fool reviews this stock and thinks it is a buy. The company released its results on Newswire for its fourth quarter 2022.

Simply Wall Street on Yahoo Finance talk about dividends of this company. Simply Wall Street list three risks for this company of debt is not well covered by operating cash flow; dividend of 2.59% is not well covered by earnings or forecast to be in the next 3 years; and profit margins (1.8%) are lower than last year (4.4%).

Saputo is a global dairy processor domiciled in Canada (29% of fiscal 2021 sales) with operations in the United States (43%), the U.K. (6%), and other international markets (22%). Saputo also competes in food service (29% of revenue) and industrials (18% of revenue), which houses its ingredients business. Its web site is here Saputo Inc.

The last stock I wrote about was about was Parkland Fuel Corp (TSX-PKI, OTC-PKIUF) ... learn more. The next stock I will write about will be Empire Company Ltd (TSX-EMP.A, OTC-EMLAF) ... learn more on Monday, July 4, 2022 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.

Wednesday, June 29, 2022

Parkland Fuel Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Industrial. The stock price is reasonable. Some test say it is cheap. This company also shows Adjusted Earnings per Share (AEPS) data. DPRs are fine. The company does have a debt problem. See my spreadsheet on Parkland Fuel Corp.

Is it a good company at a reasonable price? The stock price is reasonable. The company has a debt problem. The problem when debts are too high is that they can get into trouble quickly in a recession. On the other hand, this company has been in this business since 1977. They have increased their dividends in 17 years over the past 33 years (or 52%) of the time.

I do not own this stock of Parkland Fuel Corp (TSX-PKI, OTC-PKIUF). I decided to do a spreadsheet on this stock as it was a stock recommended by Roger Conrad in Money Show 2013.

When I was updating my spreadsheet, I noticed that they just started to use Adjusted Earnings per Share data in 2021 annual report. They had, for a number of years used Adjusted EBITDA data, but EBITDA is not something I personally follow, although I know a number of analysts have always valued this data.

The analysts last year expected Sales to grow 25% in 2021, but they grew 53%. They also expected the EPS to grow some 230% to $1.78. However, EPS only increased 19% to 0.64. This is probably why the company is now showing Adjusted EPS, which in 2021 is $2.45.

If you had invested in this company in December 2011, $1002.51 you would have bought 79 shares at $12.69 per share. In December 2021, after 10 years you would have received $888.87 in dividends. The stock would be worth $2,746.83. Your total return would have been $3,635.70.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$12.69 $1,002.51 79 10 $888.87 $2,746.83 $3,635.70

The dividend yields are moderate with dividend growth low. The current dividend yield is moderate (2% to 4% ranges) at 3.7%. The 5, 10 and historical dividend yields are also moderate at 3.22%, 4.25% and 3.36%. The dividend growth has been low (below 8% per year), actually very low, with dividend growth at 1.88% per year over the past 5 years. In 2022 they have switched to a quarterly dividend (Cycle 1) and have increased the dividends by 5.28%.

The Dividend Payout Ratios (DPR) are fine. The DPR for EPS for 2021 is 192% with 5 year coverage at 99.9%. This is high, but the DPR for the other measures is fine. The DPR for AEPS for 2021 is 50% with 5 year coverage at 39.5%. The DPR for Cash Flow per Share for 2021 is 15% with 5 year coverage at 24%. The DPR for Free Cash Flow for 2021 is 26% with 5 year coverage at 31%.

Debt Ratios are not good and the company does have a debt problem. The Long Term Debt/Market Cap Ratio is too high at 1.01. The current one is even higher at 1.16. The Liquidity Ratio for 2021 is low 1.39. If you add in cash flow after dividends, it is better at 1.71. The Debt Ratio is too low at 1.25. The Leverage and Debt/Equity Ratio for 2021 are too high at 5.83 and 4.65.

Some analysts think that a Long Term Debt/Market Cap Ratio is this is ok up to 1.00, but other say it should not be over 0.50. The current one is too high and this is partly due to falling stock price, but also due to increasing Debt. It is best that both the Liquidity Ratio and Debt Ratio be at 1.50 or higher. I prefer the Leverage and Debt/Equity Ratio to be below 3.00 and below 2.00.

The Total Return per year is shown below for years of 5 to 33 to the end of 2021. 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.
2016 5 1.88% 8.22% 4.33% 3.89%
2011 10 1.69% 16.57% 10.60% 5.96%
2006 15 3.47% 14.28% 6.87% 7.41%
2001 20 19.77% 23.93% 11.34% 12.59%
1996 25 18.77% 19.18% 11.25% 7.93%
1991 30 15.42% 16.53% 10.78% 5.74%
1988 33 13.92% 13.34% 9.09% 4.25%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 34.28, 40.43 and 46.59. The corresponding 10 year ratios are 30.42, 35.55 and 40.68. The corresponding historical ratios are 10.73, 13.51 and 16.10. The current P/E Ratio is 14.85 based on a stock price of $34.90 and EPS estimate for 2022 of 2.35. The current ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap. However, the 10 year P/E Ratios are very high and normally a P/E Ratio of 10.00 or less is considered cheap.

I also have Adjusted Earnings per Share (AEPS) data. The 5 year low, median, and high median Price/Earnings per Share Ratios are 17.50, 23.75 and 29.99. The corresponding 10 year ratios are 20.94, 27.21 and 32.38. The current P/AEPS Ratio is 14.13 based on a stock price of $34.90 and AEPS estimate for 2022 of $2.47. The current ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap. However, the 10 year P/E Ratios are high and normally a P/AEPS Ratio of 10.00 or less is considered cheap.

I get a Graham Price of $26.37. The 10 year low, median, and high median Price/Graham Price Ratios are 1.65, 2.00 and 2.28. The current P/GP Ratio is 1.32 based on a stock price of $34.90. The current ratio is below the low of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap. However, the 10 year P/GP Ratios are high and normally a P/GP Ratio of up to 1.50 is considered reasonable.

I get a 10 year median Price/Book Value per Share Ratio of 2.94. The current P/B Ratio is 2.65 based on a Book Value of $2,028M, Book Value per Share of $13.15 and a stock price of $34.90. The current ratio is 10% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median. Any P/B Ratio under 3.00 is considered reasonable, so this ratio is not high like some other ratios.

I get a 10 year median Price/Cash Flow per Share Ratio of 9.71. The current P/CF Ratio is 4.50 based on Cash Flow per Share of $7.75, Cash Flow of $1,195M and a stock price of $34.90. The current ratio is 54% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. The current ratio is a reasonable one. However, analysts estimate is showing a big increase (32%) in Cash Flow per Share.

I get an historical median dividend yield of 3.36%. The current dividend yield is 3.72% based on a stock price of $34.90 and dividends of $1.30. The current ratio is 11% above the historical 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 dividend yield of 4.25%. The current dividend yield is 3.72% based on a stock price of $34.90 and dividends of $1.30. The current ratio is 12% below the 10 year median ratio. 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 0.33. The current P/S Ratio is 0.19 based on a stock price of $34.90, Revenue estimate for 2022 of $28,380M and Revenue per Share of $184.08. The current ratio is 43% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. The ratios for P/S are low, but analysts are also expecting an increase in Revenue of 32%.

Results of stock price testing is that the stock price is the stock price is probably reasonable. The dividend yield tests show the stock price as reasonable and above and below the median. The P/S Ratio shows the stock price as cheap and has a really low P/S Ratio but analysts expect a big raise in Revenue. The P/B Ratio is showing the stock price as reasonable. This is a good clean test.

When I look at analysts’ recommendations, I find Strong Buy (6), Buy (7) and Hold (2). The consensus would be a Strong Buy. The 12 month stock price is $47.47. This implies a total return of 39.74% with 36.02% from capital gains and 3.72% from dividends.

Analyst on Stock Chase think it might be a buy, some are worried about the company. Aditya Raghunath on Motley Fool think this stock is a current buy. Kay Ng on Motley Fool says it is passive income stock that is changing the dividends from monthly to quarterly. In a News Release the company talks about their fourth quarter results for 2021. In a News Release the company talks about its first quarterly results for 2021.

Simply Wall Street report on Yahoo Finance says this stock is undervalued. Simply Wall Street talks about 4 risks for this stock of debt is not well covered by operating cash flow; dividend of 3.74% is not well covered by earnings or forecast to be in the next 3 years; large one-off items impacting financial results and profit margins (0.5%) are lower than last year (1.4%).

Parkland Corp distributes and markets fuels and lubricants. Refined fuels and other petroleum products are among the variety of offerings the company delivers to motorists, businesses, consumers, and wholesalers in the United States and Canada. Its web site is here Parkland Fuel Corp.

The last stock I wrote about was about was Computer Modelling Group Ltd (TSX-CMG, OTC-CMDXF) ... learn more. The next stock I will write about will be Saputo Inc (TSX-SAP, OTC-SAPIF) ... learn more on Thursday, June 30, 2022 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.

Monday, June 27, 2022

Computer Modelling Group Ltd

Sound bite for Twitter and StockTwits is: Dividend Paying Tech. The stock price could be cheap or perhaps reasonable. Both the CEO and Chairman have been recently replaced. Dividend Payout Ratios are too high, but the Debt Ratios are good. The stock price has been declining since 2015. See my spreadsheet on Computer Modelling Group Ltd.

Is it a good company at a reasonable price? The stock price could be cheap. It is certainly reasonable. I am retaining the stock I have as I have not lost faith in this company. I would like to see what the new CEO and Chairman do.

I own this stock of Computer Modelling Group Ltd (TSX-CMG, OTC-CMDXF). I bought this company in 2008 because it is a dividend paying growth stock that would also be considered to be a small cap with a capitalization of around $115 million. Insiders are currently buying this stock. It has great growth and it is information technology a favourite sector of mine. When I sold some of my TD Bank stock in June 2009, I bought some more. Because the stock grew rapidly and because it is a tech stock, I sold some shares in 2011 to lock in profit.

When I was updating my spreadsheet, I noticed that I have made 20.18% per year with 10.01% from capital gains and 17.17% from dividends over the past 14 years. However, the stock hit a high in 2015 at $15.56 which has never been matched. The current stock price is $4.61. I know everything seems to be declining this year, but the stock was down to $6.38 at the start of this year.

This company has recently changed both the CEO and Chairman. Will the company do better because of this? Note that this company has a year-end at March 31 each year. So, in this entry I am dealing with March 31, 2022 financial statements.

If you had invested in this company in December 2011, $1005.43 you would have bought 131 shares at $7.68 per share. In December 2021, after 10 years you would have received $466.36 in dividends. The stock would be worth $558.06. Your total return would have been $1024.42.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$7.68 $1,005.43 131 10 $466.36 $558.06 $1,024.42

The dividend yields are moderate with dividend growth non-existent. The current yield is moderate (2% to 4% ranges) at 4.15%. The 5, 10 and historical dividend yields are also moderate at 4.52%, 3.91% and 3.73%. The dividends were cut in 2021 and they have been flat ever since. It is expected that Dividend Payout Ratio will decline to 74% in 2023 and they have a new CEO and Chairman, so I am hoping for an improvement in this stock.

The Dividend Payout Ratios (DPR) are too high, but are expected to decline. The DPR for EPS for 2022 is 100% with 5 year coverage at 125%. The DPR for Cash Flow per Share for 2022 is 67% with 5 year coverage at 83%. The DPR for Free Cash Flow for 2022 is 62% with 5 year coverage at 113%.

Debt Ratios are good. The Long Term Debt/Market Cap for 2022 is very low at 0.01. The Liquidity Ratio for 2022 is good at 2.03. The Debt Ratio for 2022 is good at 1.60. The Leverage and Debt/Equity Ratios for 2022 are fine at 2.68 and 1.68.

The Total Return per year is shown below for years of 5 to 25 to the end of 2021. 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.
2016 5 -12.94% -9.49% -14.10% 4.61%
2011 10 -1.17% 0.24% -5.72% 5.96%
2006 15 12.06% 20.89% 7.78% 13.11%
2001 20 14.50% 47.68% 20.94% 26.74%
1996 25 17.66% 10.21% 7.45%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 19.30, 24.90 and 30.50. The corresponding 10 year ratio 19.71, 28.93 and 33.96. The corresponding historical ratios are 11.56, 17.47 and 21.88. The current P/E Ratio is 17.85 based on a stock price of $4.82 and EPS estimate for 2023 of $0.27. The current ratio is below the low of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $1.88. The 10 year low, median, and high median Price/Graham Price Ratios are 3.15, 4.04 and 4.86. The current P/GP Ratio is 2.56 based on a stock price of $4.82. This ratio is below the low of the 10 year median ratios. 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 12.69. The current P/B Ratio is 8.28 based on a stock price of $4.82, Book Value of $46.7M and Book Value per Share of $0.58. The current ratio is 35% 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 24.13. The current P/CF Ratio is 12.05 based on Cash Flow per Share estimate for 2023 of $0.40, Cash Flow of $32M and a stock price of $4.82. The current ratio is 50% 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 3.73%. The current dividend yield is 4.15% based on a stock price of $4.82 and dividends of $0.20. The current dividend yield is 11.24% above the historical 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 3.91%. The current dividend yield is 4.15% based on a stock price of $4.82 and dividends of $0.20. The current dividend yield is 6% above the 10 year 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 10.39. The current P/S Ratio is 5.47 based on Revenue estimate for 2023 of $70.8M, Revenue per Share of $0.88 and a stock price of $4.82. The current ratio is 47% below the 10 year median ratio.

Results of stock price testing is that the stock price is probably relatively cheap, but could be in a reasonable range. The dividend yield tests say that the stock price is reasonable and below the median. This result is probably because dividends were flat for a time and then cut. It is never a good sign when dividends are flat and then cut. All the ratios seem quite high. For example, the 10 year median P/B Ratio is 12.69 and the current one is 8.28. A good P/B Ratio is 1.50 and you should probably not buy a stock with one over 3.00.

The results of stock price testing last year were that the stock price was probably cheap. The dividend yield tests are showing the stock price at the median, but the dividend was cut by 50% in 2021. The P/S Ratio is showing the stock price as cheap as is a lot of the other tests. This has not really changed.

When I look at analysts’ recommendations, I find Strong Buy (2), Buy (2) and Hold (1). The consensus would be a Strong Buy. The 12 month stock price consensus is $6.50. This implies a total return of 39.00% with 34.85% from capital gains and 4.15% from dividends based on a stock price of $4.82.

When I look at analysts’ recommendations last year, I found Buy (4) and Hold (3). The consensus would be a Buy. The 12 month stock price is $6.64. This implies a total return of $25.97% with 22.28% from capital gains and 3.68% from dividends based on a stock price of $5.43. What happened was drop in the stock price to $4.82 for a Total Loss of $7.55% with a capital loss of 11.23% and dividend of $3.68.

The only recommendations on Stock Chase for 2022 is a Do Not Buy. He says that they are buying back shares, but they are not. Outstanding shares have increased very little at 0.2% per year in the past 5 years. Stock Chase gives this stock 3 stars out of 5. Ambrose O'Callaghan on Motley Fool reviews this company and says it is more dynamic than it appears. Adam Othman on Motley Fool says the company has potential. The company on Newswire announced their fourth quarter results for 2022.

Simply Wall Street on Yahoo Finance reviews this stock. They say they have mixed feelings about it. I can understand that. Simply Wall Street gives 2 risks for this company of unstable dividend track record and significant insider selling over the past 3 months. There was selling, but they just replaced their CEO and Chairman. Over the past year, the CFO has increased her shares by 4%.

Computer Modelling Group Ltd is a Canada-based provider of reservoir simulation software for the oil and gas industry. The firm has operations in over 60 countries in the Americas, Europe, Middle East, Africa, and Asia-Pacific regions. Its web site is here Computer Modelling Group Ltd.

The last stock I wrote about was about was CI Financial Corp (TSX-CIX, NYSE-CIXX) ... learn more. The next stock I will write about will be Parkland Fuel Corp (TSX-PKI, OTC-PKIUF) ... learn more on Wednesday, June 29, 2020 around 5 pm. Tomorrow on my other blog I will write about Smith Manoeuvre.... learn more on Tuesday, July 28, 2022 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.

Friday, June 24, 2022

CI Financial Corp

Sound bite for Twitter and StockTwits is: Dividend Paying Financial. Debt Ratios need improving. Analysts see this company increasing the dividends in the future. The stock price is cheap. Insider buying is a positive. I think that they have a debt problem. See my spreadsheet on CI Financial Corp.

Is it a good company at a reasonable price? It would appear that the stock price is cheap. It is less important what they think the future value of the stock is than the fact the stock price is cheap. Another main question is, will the company again be a dividend growth stock. Analysts seem to think that they will again increase the dividends, either this year or next.

I do not own this stock of CI Financial Corp (TSX-CIX, NYSE-CIXX). I started to follow this stock originally because it was a Mutual Fund company. People talked about it being easier to make money from buying a Mutual Fund company than buying Mutual Funds. When they became a Unit Trust in 2006, dividends were significantly increased, but these dividends proved to be unsustainable. They changed back to a corporation in 2009 and dividends were decreased in 2010. Since that time, they have been increasing their dividends since 2011. In June 2014, MPL communications called this stock a Buy and advised that they were adding it to their list of Key Stock for the Investment reporter.

When I was updating my spreadsheet, I noticed that his company is suppling Adjusted Earnings Per Share (AEPS) data. What AEPS is to show is the real earnings from Sales. It can be quite different from EPS which can include such things as write-offs and gains or losses from asset sales.

I noticed that analysts had expected an increase in EPS of 24% to $2.73. However, EPS came in at $2.02 a decrease of 9%. Revenue came in at $2,727M just above the estimate of $2,697 so, this was close. The Ratio of Expenses to Revenue in 2022 was 0.79, which is higher than other years. This explains the increase in Revenue, but decrease in EPS.

I noticed also that this company has been buying back a lot of stock. Over the past 12 years they have bought back over 130M shares at the cost of $1,051M. They have issued shares over the period and mostly for share options. Over this period outstanding shares have gone from 291.82M to 197.42M. Personally, I prefer companies to give out dividends rather than do share buy backs. Dividends have decreased by 12% per year over the past 5 years, but are up by 10% per year over the past 10 years.

The other thing I noticed was that there was a lot of insiders buying. The CFO, CFO and Chairman all bought increased their shares over the past year.

If you had invested in this company in December 2010, $1,012.80 you would have bought 48 shares at $21.10 per share. In December 2021, after 10 years you would have received $504.12 in dividends. The stock would be worth $1,269.12. Your total return would have been $1,773.24.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$21.10 $1,012.80 48 10 $504.12 $1,269.12 $1,773.24

The dividend yields are good with dividend growth non-existent. The current dividend yield is good (5% and 6% ranges) at 5.12%. The 5, 10 and historical dividend yields are moderate (2% to 4%) at 3.93%, 3.94% and 3.59%. Dividends were decreased in 2018 by 49% and changed from monthly to quarterly dividends. The dividend has been flat ever since. Analysts do expect the dividend increases to be restarted this year or next, but at a very low rate.

The Dividend Payout Ratios (DPR) are good. The DPR for EPS for 2021 is 36% with 5 year coverage at 43%. The DPR for Adjusted Earnings per Share (AEPS) for 2021 is 23% with 5 year coverage at 18%. The DPR for Cash Flow per Share (CFPS) for 2021 is 22% with 5 year coverage at 35%. The DPR for Free Cash Flow (FCF) for 2021 is 24% with 5 year coverage at 40%.

Debt Ratios need improving. The Long Term Debt/Market Cap Ratio is fine at 0.64. The Liquidity Ratio is low at 0.68 and if you add in Cash Flow after Dividends, it is just 0.88. When this ratio is under 1.00 it means that the current assets cannot cover the current liabilities. This is a problem. The Debt Ratio is 1.23 and it is better if this is at 1.50 or better. The Leverage and Debt/Equity Ratios for 2021 are 5.36 and 4.36. These are too high and I prefer them to be below 3.00 and below 2.00.

The Total Return per year is shown below for years of 5 to 27 to the end of 2021. 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.
2016 5 -11.88% 1.63% -1.74% 3.37%
2011 10 9.56% 6.91% 2.28% 4.63%
2006 15 0.28% 3.54% -1.06% 4.61%
2001 20 18.30% 8.84% 3.25% 5.59%
1996 25 15.41% 21.70% 11.80% 9.90%
1994 27 17.88% 19.69% 11.35% 8.33%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 7.48, 9.87 and 12.64. The corresponding 10 year ratios are 13.24, 14.74 and 16.24. The corresponding historical ratios are 14.84, 17.09 and 19.90. The current ratio is 4.93 base on a stock price of $14.06 and EPS estimate for 2022 of $2.85. This ratio is below the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I also have Adjusted Earnings per Share (AEPS) data. The 5 year low, median, and high median Price/Earnings per Share Ratios are 7.11, 8.10 and 10.39. The corresponding 10 year ratios are 11.94, 13.31 and 14.69. The current P/AEPS Ratio is 4.18 based on AEPS estimate for 2022 of $3.36 and a stock price of $14.06. The current ratio is below the low of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $23.10. The 10 year low, median, and high median Price/Graham Price Ratios are 1.44, 1.60 and 1.78. The current P/GP Ratio is 0.61 based on a stock price of $14.06. The current ratio is below the low of the 10 year median ratios. 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 3.92. The current P/B Ratio is 1.69 based on a stock price of $14.06, Book Value of $1,606M and Book Value per Share of $8.32. The current ratio is 57% 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 11.47. The current P/CF Ratio is 6.30 based on Cash Flow per Share estimate for 2022 of $2.23, Cash Flow of $430M and a stock price of $14.06. The current ratio is 45% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

The last 12 months of Cash Flow is much higher than the Cash Flow calculated above. The 12 month cash flow is $631M, the Cash Flow per Share is 3.27 and the stock price is $14.06 and this gives a P/CG Ratio of 4.30. This ratio is 63% 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 3.59%. The current dividend yield is 5.12% based on dividends of $0.72 and a stock price of $14.06. The current dividend yield is 43% above 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 3.94%. The current dividend yield is 5.12% based on dividends of $0.72 and a stock price of $14.06. The current dividend yield is 30% above the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

The 10 year median Price/Sales (Revenue) Ratio is 3.65. The current P/S Ratio is 0.90 based on a stock price of $14.06, Revenue estimate for 2022 of $3,011 and Revenue per Share of $15.60. The current ratio is 75% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

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 is $21.83. This implies a total return of 60.38% with 55.26% from capital gains and 5.12% from dividends.

There are various views on Stock Chase by analysts. Stock Chase gives this stock 4 stars out of 5. One analyst says it is cheap but there are better names to invest in. Adam Othman on Motley Fool says a bear phrase is right time to buy a decent company like CIX. Ambrose O'Callaghan on Motley Fool says it is time to buy cheap companies like CIX. The company put out a News Release on their fourth quarterly results. The company put out a News Release on their first quarterly results of 2022.

A Simply Wall Street report on Yahoo Finance talks about this stock’s decline. Simply Wall Street lists 4 risks for this stock of debt is not well covered by operating cash flow; unstable dividend track record; large one-off items impacting financial results; and profit margins (14.7%) are lower than last year (22.2%).

CI Financial is a diversified provider of wealth management products and services, primarily in the Canadian market. Its web site is here CI Financial Corp.

The last stock I wrote about was about was Intertape Polymer Group Inc (TSX-ITP, OTC-ITPOF) ... learn more. The next stock I will write about will be Computer Modelling Group Ltd (TSX-CMG, OTC-CMDXF) ... learn more on Monday, June 27, 2022 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.

Wednesday, June 22, 2022

Intertape Polymer Group Inc

Sound bite for Twitter and StockTwits is: Dividend Growth Industrial. The stock price is expensive. However, it is expected that the acquisition by Clearlake Capital will go ahead. The company’s Debt Ratios need improving. See my spreadsheet on Intertape Polymer Group Inc.

Is it a good company at a reasonable price? The stock price is expensive. This is because the stock price went up when it was announced that the company would be acquired by Clearlake Capital. Since the price is high, shareholders could sell now or just hold on until the company is acquired. Since the stock is unlikely to go up again and it will go down if the company is not acquired, I would personally just sell this stock and move on.

I do not own this stock of Intertape Polymer Group Inc (TSX-ITP, OTC-ITPOF). I got this stock suggestion from Peter who I met in an Investment Club. The company reports in US$ and distributes its dividend in US$.

When I was updating my spreadsheet, I noticed that his company is suppling Adjusted Earnings Per Share (AEPS) data. What AEPS is to show is the real earnings from Sales. It can be quite different from EPS which can include such things as write-offs and gains or losses from asset sales.

The other thing is that the stock price zoomed up in March 2022. This is because the company is expected to be bought out by Clearlake Capital. There was an earnings loss in March 2022 due to charges related to the Arrangement with Clearlake Capital.

The dividend yields are moderate with dividend growth low. The current dividend yield is moderate (2% to 4% ranges) at 2.24%. The 5, 10 and historical dividend yields are 4.10, 3.42 and 3.55. Note that dividends were stopped in 1998 and then restarted in 2013. The dividend increases over the past 5 years is low with a rate of 2.75% per year. Over the past 5 years, dividends have increased and decreased. The last dividend increase was in 2022 and it was for 7.9%.

The Dividend Payout Ratios (DPR) are fine. The DPR for EPS for 2021 is 58% with 5 year coverage at 60%. The DPR for Adjusted Earnings per Share (AEPS) for 2021 is 33% with 5 year coverage at 47%. The DPR for Cash Flow per Share for 2021 is 16% with 5 year coverage at 20%. The DPR for Free Cash Flow (FCF) for 2021 is 48% with 5 year coverage at 55%.

Debt Ratios need improving. The Long Term Debt/Market Cap Ratio for 2021 is good at 0.44. The Liquidity Ratio for 2021 is good at 1.55. The Debt Ratio for 2021 is low at 1.36 and I prefer to see this at 1.50 or higher. The Leverage and Debt/Equity Ratios for 2021 are 3.94 and 2.90. These are too high and prefer them to be below 3.00 and below 2.00.

The Total Return per year is shown below for years of 5 to 28 to the end of 2021 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.
2016 5 2.75% 3.85% 0.89% 2.97%
2011 10 11.79% 29.70% 23.04% 6.66%
2006 15 12.41% 10.13% 2.28%
2001 20 4.74% 3.49% 1.25%
1996 25 9.30% 0.63% -0.25% 0.88%
1993 28 10.56% 5.09% 4.01% 1.08%

The Total Return per year is shown below for years of 5 to 28 to the end of 2021 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.
2016 5 3.94% 4.94% 1.93% 3.01%
2011 10 9.37% 27.22% 21.09% 6.13%
2006 15 13.41% 11.04% 2.37%
2001 20 5.99% 4.69% 1.31%
1996 25 9.63% 0.90% 0.02% 0.88%
1993 28 10.73% 5.18% 4.12% 1.06%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 13.73, 17.31 and 20.88. The corresponding 10 year ratios are 13.30, 16.92 and 21.27. The corresponding historical ratios are 10.68, 15.79 and 21.26. The current P/E Ratio is 47.44 based on a stock price of $39.59 and EPS estimate for 2022 of $0.64. This Ratio is above the high ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive. Although the EPS estimate for 2022 is a 41% drop from that of 2021. This testing is in CDN$.

I also have Adjusted Earning (AEPS) per Share data. The 5 year low, median, and high median Price/Adjusted Earnings per Share Ratios are 10.39, 12.92 and 14.39. The corresponding 10 year ratios are 10.56, 13.37 and 15.83. The current P/AEPS Ratio is 15.00 based on a stock price of $30.15, and AEPS estimate for 2022 of $2.01. The current ratio is between the median and high ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is US$ and you will get similar results in CDN$.

I get a Graham Price of $10.72. The 10 year low, median, and high median Price/Graham Price Ratios are 1.28, 1.60 and 1.92. The current P/GP Ratio is 3.69 based on a stock price of $39.59. The current ratio is above the high of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.

In the above test, the very low EPS estimate for 2022 is part of the Graham Price calculation. I get a Graham Price for 2023 of $19.74. This gives a ratio of 2.01 based on a stock price of $39.59. This ratio is also above the high of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.

I get a 10 year median Price/Book Value per Share Ratio of 3.49. The current P/B Ratio is 6.42 based on a Book Value of $277M, Book Value per Share of $4.70 and a stock price of $30.15. The current ratio is 84% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is US$ and you will get similar results in CDN$.

I get a 10 year median Price/Cash Flow per Share Ratio of 8.00. The current P/CF Ratio is 8.17 based on Cash Flow per Share estimate for 2022 of $3.69, Cash Flow of $218M and a stock price of $30.15. The current ratio is 2% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is US$ and you will get similar results in CDN$.

I get an historical median dividend yield of 3.55%. The current dividend yield is 2.24% based on a dividend $0.89 and a stock price of $30.15. The current ratio is 37% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive. This testing is US$ and you will get similar results in CDN$.

I get a 10 year median dividend yield of 3.42%. The current dividend yield is 2.24% based on a dividend $0.89 and a stock price of $30.15. The current ratio is 34% below the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively expensive. This testing is US$ and you will get similar results in CDN$.

The 10 year median Price/Sales (Revenue) Ratio is 0.87. The current P/S Ratio is 1.05 based on Revenue estimate of $1,698M, Revenue per Share of $28.77 and a stock price of $30.15. The current ratio is 20.4% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is US$ and you will get similar results in CDN$.

Results of stock price testing is that the stock price is probably expensive. The dividend yield tests and the P/S Ratio test suggest this. The stock price also rose when the acquisition of the company by Clearlake Capital was announced. Most of the other testings show the same thing, but some show it is reasonable but above the median.

When I look at analysts’ recommendations, I find only one recommendation and this is a Hold. The consensus would be a Hold. The 12 month stock price consensus is $41.14 ($31.56 US$). This implies a total return of 6.18 with 3.94% from capital gains and 2.24% from dividends based on a current stock price of $39.58.

An article on Newswire talks about Clearlake Capital having an arrangement to acquire this company. There is only one recommendation on Stock Chase in 2022 and that is Hold because it is being taken out. Amy Legate-Wolfe Motley Fool talks about what happened after the company announce it was being acquired by Clearlake Capital. On May 13, 2022 the company has announced on Newswire that the Superior Court of Qu├ębec Approved the Arrangement with Clearlake Capital.

Intertape Polymer Group Inc manufactures and sells a variety of packaging products. The majority of revenue comes from the United States. Its web site is here Intertape Polymer Group Inc.

The last stock I wrote about was about was Waste Connections Inc (TSX-WCN, NYSE-WCN) ... learn more. The next stock I will write about will be CI Financial Corp (TSX-CIX, NYSE-CIXX) ... learn more on Friday, June 24, 2022 around 5 pm. Tomorrow on my other blog I will write about Debt Collectors .... learn more on Thursday, June 23, 2022 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.

Monday, June 20, 2022

Waste Connections Inc

Sound bite for Twitter and StockTwits is: Dividend Growth Industrial. The stock price is probably expensive or close to it. Dividends are very low at just 0.80%. It hardly seems like a dividend stock at all. But you have good Dividend Payout Ratios. Debt Ratios are fine. See my spreadsheet on Waste Connections Inc.

Is it a good company at a reasonable price? It is probably a rather stable business to be in. I sold when Waste Connection bought out my Canadian company. I did not want to be holding stock in a US company and I do not regret the decision. I do not generally like to hold companies with very low dividend yields. Even after 10 years of increases, the dividend yield would barely make it into the 2% range. The current price is probably expensive.

I do not own this stock of Waste Connections Inc. (TSX-WCN, NYSE-WCN), but I used to. I first bought this stock in 2007 because TD Securities had a very favorable report on this stock and had it on their action buy list. I had money because I had recently sold RIM. At that time, it was BFI Canada Income Fund. In 2010, I needed to buy something for Pension Account. It was on TD Action Buy List. I sold when it because the target of a reverse takeover by an American company.

When I was updating my spreadsheet, I noticed I am following Progressive Waste Solutions into Waste Connections Inc. These companies amalgamated in 2016. I used to own Progressive Waste Solutions. When I bought Progressive Waste Solutions, the company had a moderate dividend yield (2% to 4%) in the 3% ranges. However, the dividend yields have progressed lower and lower over the years and today, the yield is low (below 2%) and 0.74%. With dividend yields this low, you wonder about calling the company a dividend paying one.

If you had invested in this company in December 2011, $1020.97 you would have bought 37 shares at $27.59 per share. In December 2021, after 10 years you would have received $244.19 in dividends. The stock would be worth $6,378.80. Your total return would have been $6,622.99.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$27.59 $1,020.97 37 10 $244.19 $6,378.80 $6,622.99

The dividend yields are low with dividend growth moderate. The current dividend yield is low (below 2%) at just 0.76%. The 5, 10 and historical dividend yields are also low at 0.78%, 0.89% and 1.17%. The dividend growth is moderate (8% to 14% ranges) at around 10% per year over the past 5 years.

The Dividend Payout Ratios (DPR) are good. The DPR for EPS for 2021 is 36% with 5 year coverage at 35%. The DPR for Adjusted Earnings per Share (AEPS) for 2021 is 26% with 5 year coverage at 25%. The DPR for Cash Flow per Share is 12% with 5 year coverage also at 12%. The DPR for Free Cash Flow (FCF) for 2021 is 21% with 5 year coverage also at 21%.

Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2021 is good and low for 2021 at 0.14. The Liquidity Ratio for 2021 is 0.84, but if you add in Cash Flow after dividends, it is 2.04 and this is good. The Debt Ratio is 1.91 and this is good. The Leverage and Debt/Equity Ratios for 2021 are 2.10 and 1.10 and these are also good.

The Total Return per year is shown below for years of 5 to 20 to the end of 2021 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.
2016 5 9.56% 20.52% 19.68% 0.85%
2011 10 11.42% 21.10% 20.11% 0.99%
2006 15 -0.57% 11.64% 10.62% 1.02%
2001 20 3.60% 15.84% 13.44% 2.41%

The Total Return per year is shown below for years of 5 to 19 to the end of 2021 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.
2016 5 10.83% 21.93% 21.07% 0.86%
2011 10 9.04% 18.43% 17.52% 0.91%
2006 15 -1.12% 11.01% 9.94% 1.07%
2001 20 4.81% 15.66% 13.22% 2.44%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 35.59, 40.90 and 46.22. The corresponding 10 year ratios are 27.26, 31.53 and 35.81. The corresponding historical ratios are 20.68, 24.41 and 29.30. The current ratio is 35.09 based on a stock price of $149.57 and EPS estimate for 2022 of $4.29 ($3.27 US$). The current ratio is between the median and high ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in CDN$.

I also have Adjusted Earnings per Share (AEPS) data. The 5 year low, median, and high median Price/Adjusted Earnings per Share Ratios are 26.03, 29.00 and 34.90. The corresponding 10 year ratios are 18.60, 26.23 and 31.29. The current P/AEPS Ratio is 30.53 based on AEPS estimate for 2022 of $3.76 and a stock price of $114.80. The current ratio is between the median and high ratios of the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$, but you get the basically the same results with CDN$.

I get a Graham Price of $56.96. The 10 year low, median, and high median Price/Graham Price Ratios are 1.57, 1.91 and 2.24. The current P/GP Ratio is 2.63 based on a stock price of $149.57. The current ratio is above the high ratio of the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.

I get a 10 year median Price/Book Value per Share Ratio of 2.56. The current P/B Ratio is 4.42 based on a stock price of $114.80, Book Value of $6,754M and Book Value of $25.96. This ratio is 73% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$, but you get the basically the same results with CDN$.

I get a 10 year median Price/Cash Flow per Share Ratio of 13.65. The current ratio is 14.70 based on Cash Flow per Share estimate for 2022 of 7.81, Cash Flow of $2,032M and a stock price of $114.80. The current ratio is 8% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$, but you get the basically the same results with CDN$.

I get an historical median dividend yield of 1.19%. The current dividend yield is 0.80% based on dividends of $0.92 and a stock price of $114.80. The current dividend yield is 33% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$, but you get the basically the same results with CDN$.

I get a 10 year median dividend yield of 0.89%. The current dividend yield is 0.80% based on dividends of $0.92 and a stock price of $114.80. The current dividend yield is 10% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$, but you get the basically the same results with CDN$.

The 10 year median Price/Sales (Revenue) Ratio is 3.42. The current P/S Ratio is 4.23 based on Revenue estimate for 2022 of $7,056M, Revenue per Share of $27.11 and a stock price of $114.80. The current ratio is 24% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$, but you get the basically the same results with CDN$.

Results of stock price testing is that the stock price could be reasonable, but it is probably relatively expensive. The P/S Ratio test says this. The dividend yield test says reasonable and above the median to expensive. Both the P/GP Ratio test and the P/B Ratio test says that the stock is expensive.

When I look at analysts’ recommendations, I find Strong Buy (10), Buy (4), Hold (2), Underperform (1) and Sell (1). The consensus would be a Buy; however, the recommendations are all over the place. The 12 month stock price consensus is $192.77 ($147.89 US$). This implies a total return of 29.69%, with 28.89% from capital gains and 0.80% from dividends. One analyst that says Do not Buy, says that Waste management is not a growth story and can only grow via grow by consolidation. (When there are sell recommendations, I always wonder why.)

Some analysts on Stock Chase thinks that this company is a Top Pick, others say Do Not Buy. Stock Chase gives this company 3 stars out of 5. It is on the Dividend Aristocrat List, but not Money Sense. Rajiv Nanjapla on Motley Fool thinks this is a good stock for the volatile environment. Tony Dong on Motley Fool reviews this stock and feels it is fairly priced. The company has a News Release on it fourth quarter of 2021 results . The company has a News Release on it first quarter of 2022 results. A Simply Wall Street report on Yahoo Finance reviews this stock. Their only risk is that they say the company has a high level of debt.

Waste Connections is the third-largest integrated provider of traditional solid waste and recycling services in the North America. The firm serves residential, commercial, industrial, and energy end markets. Waste Connections entered the Canadian market with its 2016 merger with Progressive Waste. In 2020, 13% of consolidated revenue was generated from the firm's Canadian segment. Its web site is here Waste Connections Inc.

The last stock I wrote about was about was Lassonde Industries Inc (TSX-LAS.A, OTC-LSDAF) ... learn more. The next stock I will write about will be Intertape Polymer Group Inc (TSX-ITP, OTC-ITPOF) ... learn more on Wednesday, June 22, 2022 around 5 pm. Tomorrow on my other blog I will write about Andrew Peller .... learn more on Tuesday, June 21, 2022 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.

Friday, June 17, 2022

Lassonde Industries Inc

Sound bite for Twitter and StockTwits is: Dividend Growth Consumer. The stock price reasonable and could even be cheap. Debt Ratios are fine as are Dividend Payout Ratios. Dividends were cut in 2022. See my spreadsheet on Lassonde Industries Inc.

Is it a good company at a reasonable price? This company has done well for shareholders until just recently. The Covid Epidemic have caused problems for a lot of companies. The stock price would seem reasonable. I wonder why Money Sense has not had this company in the list of 100 best Canadian dividend Companies (I have the list going back to 2018). I worry about the dividend decrease as this is never a good sign. However, the yield is currently higher than it usually is.

I do not own this stock of Lassonde Industries Inc (TSX-LAS.A, OTC-LSDAF). Although this stock is not on the Investment Reporter list, MPL communications does write about this stock. It has been covered several times in their Advice Hotline emails in 2010. Reports have been favorable and they suggest buying it for dividends and long term capital gains.

When I was updating my spreadsheet, I noticed that the company hit a high early in 2018 and has been falling since. The stock price high a high June 2018 at $292.04 and has been falling since. Revenue and Earnings have revived over the past couple of years, but stock price has not.

The dividends were cut in 2019 and they started to increase them again, but they are at $2.80 now and not yet back to those of 2018 of $3.04. Dividends in 2021 was back up at $3.29 but were cut again in 2022. The stock is probably down because of the dividend cut in 2022.

If you had invested in this company in December 2011, $1024.00 you would have bought 16 shares at $64 per share. In December 2021, after 10 years you would have received $346.88 in dividends. The stock would be worth $2,517.44. Your total return would have been $2,864.32.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$64.00 $1,024.00 16 10 $346.88 $2,517.44 $2,864.32

The dividend yields are moderate with dividend growth moderate. The current dividend yield is moderate (2% to 4% ranges) at 2.31%. The 5, 10 and historical dividend yields are low (below 2%) at 1.45%, 1.39% and 1.76%. The Dividend Growth is moderate (8% to 14% ranges) at 11% per year over the past 5 years to 2021. However, the 10 year growth is just 0.7%. The dividends have been cut in 3 years over the past 31 years. Also, the dividends were cut again in 2022 by 21%.

The Dividend Payout Ratios (DPR) are fine. The DPR for EPS for 2021 is 29% with 5 year coverage at 24%. The DPR for Cash Flow per Share for 2022 is 13% with 5 year coverage at 11%. The DPR for Free Cash Flow for 2021 is 32% with 5 year coverage at 17%.

Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2021 is very low and good at 0.08. The Liquidity Ratios is low at 1.32, but if you add in cash flow after dividends it is 1.51 a better ratio. The Debt Ratio is high and good at 2.56. The Leverage and Debt/Equity Ratios are low and good at 1.64 and 0.64.

The Total Return per year is shown below for years of 5 to 31 to the end of 2021. 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.
2016 5 11.14% -5.30% -6.74% 1.44%
2011 10 0.72% 11.57% 9.41% 2.16%
2006 15 12.14% 12.70% 10.49% 2.21%
2001 20 12.36% 14.32% 11.94% 2.39%
1996 25 10.36% 11.29% 9.49% 1.80%
1991 30 10.60% 12.57% 10.50% 2.07%
1990 31 14.19% 11.68% 2.52%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 14.85, 17.31 and 19.77. The corresponding 10 year ratios are 15.26, 17.59 and 19.93. The corresponding historical ratios are 11.64, 13.18 and 15.93. The current ratio is 10.83 based on a stock price of $120.98 and EPS estimate for 2022 of $11.17. The current ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $171.59. The 10 year low, median, and high median Price/Graham Price Ratios are 1.07, 1.24 and 1.40. The current P/GP Ratio is 0.71 based on a stock price of $120.98. The current ratio is below the low of the 10 year median ratios. 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 1.95. The current P/B Ratio is 1.03 based on a stock price of $120.98, Book Value of $212M and Book Value per Share of $117.15. The current ratio is 47% 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 8.98. The current P/CF Ratio is 12.20 based on Cash Flow of last 12 months of $68.8M, Cash Flow per Share of $9.92 and a stock price of $120.98. The current ratio is 37% 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 1.76%. The current dividend yield is 2.31% based on a stock price of $120.98 and dividends of $2.80. The current dividend yield is 32% above 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 1.39%. The current dividend yield is 2.31% based on a stock price of $120.98 and dividends of $2.80. The current dividend yield is 66% above the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

The 10 year median Price/Sales (Revenue) Ratio is 0.71. The current P/S Ratio is 0.42 based on Revenue estimate for 2022 of $2,000M, Revenue per Share of $288.47 and a stock price of $120.98. The current ratio is 41% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

Results of stock price testing is that the stock price could be cheap. The dividend yield tests and P/S Ratio tests says this. Why I hesitate is because dividends were cut in 2022. I know the company does not talk about dividend increases and decreases, but only announces what the dividends will be. However, a dividend decrease is never good news. Also, the P/CF Ratio test is showing a slow down in cash flow and an expensive rating.

Last year, I said that the results of stock price testing are that the stock price is probably reasonable. Of the dividend yield test, the historical one says stock price is reasonable and the 10 year says cheap. The P/S Ratio test confirms the reasonableness of the stock price. A number of tests suggest a cheap stock price.

When I look at analysts’ recommendations, I find Buy (1) and Hold (1). The consensus would be a Buy. The 12 month stock is price is $162.00. This implies a total return of $36.22% with 33.91% from capital gains and 2.31% from dividends.

When I looked at analysts’ recommendations last year, I find Buy (2) recommendations. The consensus is a Buy. The 12 month stock price consensus is $211.00. This implies a total return of 17.22% with 15.30 from capital gains and 1.92% from dividends based on a stock price of 183.00. What happened was a stock price decline to $120.98 and a total return loss of $31.97% with a capital loss of 33.89% and dividends of 1.92%.

The last analysts’ comments on Stock Chase was in 2021, so analysts not much interested in this stock. Stock Chase gives this stock 3 starts out of 5. It is not included in Money Sense list of 100 best Canadian dividend stocks. Nikhil Kumar on Motley Fool reviewed this stock last year. The company did a News Release on their fourth quarterly results. The company did a News Release on their first quarter of 2022 results. Simply Wall Street via Yahoo Finance talk about dividend payments of this company. Simply Wall Street has one warning sign of unstable dividend track record and they are right.

Lassonde Industries Inc is engaged in the development, manufacturing, and marketing of ready-to-drink fruit and vegetable juices and drinks. It also acts as a producer of store brand shelf-stable fruit juices and drinks in the United States and a major producer of cranberry sauces. The company operates through a single segment being the development, manufacturing, and marketing of a wide range of ready-to-drink juices and drinks; frozen juice concentrates; and specialty food products; and the importation, packaging, and marketing of selected wines from several countries of origin. Lassonde has its presence in Canada and the United States. It earns the majority of the revenue in the United States. Its web site is here Lassonde Industries Inc.

The last stock I wrote about was about was Goeasy Ltd (TSX-GSY, OTC-EHMEF) ... learn more. The next stock I will write about will be Waste Connections Inc (TSX-WCN, NYSE-WCN) ... learn more on Monday, June 20, 2022 around 5 pm.

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