Waterloo Brewing Ltd

Today I sold my stake in Home Capital Group (TSX-HCG, OTC-HMCBF). This company is to be bought out See press release on Reuters. The Buy out is at $44.00 and I sold for $42.68. Because of the buyout, the shares have doubled in price. I see no reason to hold them any longer as nothing much will happen and buyouts take time to happen. I might as well move on and replace this stock. It is held in the RIF account.

Sound bite for Twitter and StockTwits is: Dividend Growth Consumer. The stock price is currently cheap. Debt Ratios are showing debt problems. The Dividend Payout Ratios (DPR) need to improve for EPS, but fine for CFPS. The dividend yields are moderate with dividend growth high. See my spreadsheet on Waterloo Brewing Ltd.

Is it a good company at a reasonable price? The stock price is currently cheap. However, I do not like the Debt Ratios, especially, the Liquidity Ratio. With a low Liquidity Ratio, companies and get into trouble during hard times. We are going into and are in a recession. I never like a low Liquidity Ratio in the best of times, and certainly not in this climate. So caution is called for.

I do not own this stock of Waterloo Brewing Ltd (TSX-WBR, OTC-BIBLF). This stock has come up on the Dividend All-Star List at Dividend Growth Investing and Retirement site. The company has a financial year ending January 31 each year, so I am reviewing the January 31, 2022 year end and the financial year starting at January 31, 2021 to January 31, 2022.

When I was updating my spreadsheet, I noticed their long term debt is the highest it has ever been. It was low in 2021 because a lot was current debt to roll over. Debt was up by 63% from 2020. The Long Term Debt/Market Cap is still in a good range at 0.10. Alpha Spread says this stock is undervalued by 39% with a DCF Value of $5.10. See Alpha Spread.

If you had invested in this company in December 2011, for $1,000.16 you would have bought 893 shares at $1.12 per share. In December 2021, after 10 years you would have received $593.76 in dividends. The stock would be worth $5,188.33. Your total return would have been $5,782.09.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$1.12	$1,000.16	893	10	$593.76	$5,188.33	$5,782.09

The dividend yields are moderate with dividend growth high. The current dividend yield is moderate (2% to 4% ranges) at 3.90%. The 5 and 6 year median dividend yield is also moderate at 2.33%. The dividend growth over the past 5 years is good (14% and over) at 18.7% per year. The last dividend increase was for 10% and it occurred in 2022.

The Dividend Payout Ratios (DPR) need to improve for EPS, but fine for CFPS. The DPR for EPS for 2021 is 71% with 5 year coverage at 1312%. The DPR for EPS is expected to be around 152% in 2023 before declining to 72% in 2024. The DPR for Cash Flow per Share (CFPS) for 2022 is 19% with 5 year coverage at 27%. The DPR for Free Cash Flow (FCF) for 2022 could be 110% with 5 year coverage non-calculable due to negative FCF. There is disagreement on what the FCF is.

Debt Ratios are showing debt problems. The Long Term Debt/Market Cap Ratio for 2022 is 010. They increased their debt a lot this year and ratio was only 0.01 last year. The Liquidity Ratio for 2022 is very low at 0.80. Add in Cash Flow after dividends and it is still low at 1.20. I prefer this to be 1.50 or higher. The Debt Ratio is also low at 1.39 and I prefer this to be 1.50 or higher. The Leverage and Debt/Equity Ratios for 2022 are too high at 3.58 and 2.58. 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 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	18.72%	16.44%	14.06%	2.38%
2011	10	15.37%	19.67%	17.90%	1.78%
2006	15		9.01%	8.17%	0.84%
2001	20		14.53%	13.77%	0.76%
1996	25		5.41%	4.97%	0.45%
1991	30		4.44%	4.08%	0.36%
1990	31		4.30%	3.95%	0.35%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 37.14, 49.63 and 72.38. The corresponding 10 year ratios are 34.51, 48.74 and 65.47. The corresponding historical ratios are 31.88, 47.86 and 57.00. The current P/E Ratio is 39.00 based on a stock price of $3.12 and EPS estimate for 2023 of $0.08. 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. These ratios are very high ratios, but when earnings get bad on a stock, the stock price will only go so low, because of the value of the company.

I get a Graham Price of $1.32 . The 10-year low, median, and high median Price/Graham Price Ratios are 1.71, 2.47 and 3.05. The current P/GP Ratio is 2.36 based on a stock price of $3.12. This ratio is between the low the median ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median. These ratios are very high ratios, but when earnings get bad on a stock, the stock price will only go so low, because of the value of the company.

I get a 10-year median Price/Book Value per Share Ratio of 2.78. The current P/B Ratio is 3.21 based on a Book Value of $34,830M, Book Value per Share of $0.97 and a stock price of $3.12. The current ratio is 16% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a 10-year median Price/Cash Flow per Share Ratio of 13.60. The current P/CF Ratio is 7.80 based on a stock price of $3.12, Cash Flow per Share (CFPS) estimate for 2023 of $0.40 and a Cash Flow of $14.4M. The current ratio is 43% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I get an historical and 6 year median dividend yield of 2.33%. The current dividend yield is 3.90% based on dividends of $0.1216, and a stock price of $3.12. The current yield is 67% above the 6 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 1.85. The current P/S Ratio is 1.00 based on Revenue estimate for 2023 of $112M, Revenue per Share of $3.12 and a stock price of $3.12. The current ratio is 56% 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 is probably cheap. The dividend yield test says this and it is confirmed by the P/S Ratio test. The P/CF Ratio test says the stock is cheap. The other tests say it is reasonable and below the median.

When I look at analysts’ recommendations, I find Strong Buy (3) and Buy (1). The consensus would be a Strong Buy. The 12 month stock price is $5.88. This implies a total return of 92.36% with 88.46% from capital gains and 3.90% from dividends based on a current price of $3.12.

There is nothing recent on Stock Chase. However, analysts thought it was a buy in 2021. Stock Chase gives this stock 4 stars out of 5. It is not on Money Sense list. Ambrose O'Callaghan on Motley Fool thought it was oversold in March 2022. Chen Liu on Motley Fool reviewed this stock in 2019. The company put out a Press Release on their fourth quarter results. The company put out a Press Release on their second quarter of 2023 results.

Simply Wall Street reviews this stock via Yahoo Finance. Simply Wall Street gives 4 warnings on this stock of interest payments are not well covered by earnings; dividend of 3.92% is not well covered by earnings or cash flows; profit margins (1.4%) are lower than last year (4.9%); and does not have a meaningful market cap (CA$111M). Simply Wall Street gives this stock 2 stars out of 5.

Waterloo Brewing Ltd engages in the production and distribution of alcohol-based products. Its products are distributed to end consumers primarily through The Beer Store in Ontario and Provincial Liquor Boards across Canada. Its web site is here Waterloo Brewing Ltd .

The last stock I wrote about was about was Wild Brain Ltd (TSX-WILD, OTC-WLDBF) ... learn more. The next stock I will write about will be Keg Royalties Income Fund (TSX-KEG.UN, OTC-KRIUF) ... learn more on Friday, December 2, 2022 around 5 pm. Tomorrow on my other blog I will write about Emergency Fund .... learn more on Thursday, December 1, 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.

Wild Brain Ltd

Sound bite for Twitter and StockTwits is: Consumer Sector Stock. The stock price maybe cheap. The company has been able to grown their revenue, but not earnings. The dividends were suspended in 2019. No Debt Ratios are good and some are really bad. It is interesting that analysts are interested in this stock. See my spreadsheet on Wild Brain Ltd.

Is it a good company at a reasonable price? The stock price maybe cheap. This is a small company that does not seem to be able to grow their earnings. It would be a high risk investment, but it might be fun.

I do not own this stock of Wild Brain Ltd (TSX-WILD, OTC-WLDBF). In the CanTech Letter Investors should accumulate DHX Media “aggressively,” says Byron Capital. In the CanTech Letter of May 2014 Byron Capital says investors should accumulate DHX Media aggressively. I also have a report on this stock from Global Maxfin Capital who rates this stock a strong buy in January 2014.

When I was updating my spreadsheet, I noticed that the company lost less than was expected in earnings. EPS loss for 2022 was expected to be $0.09, but came in at $0.01. This company has a financial year ending in June, so I am reviewing the June 2022 financial year. This is a small company and I am surprised at how many analysts are following it and therefore are interested in this company.

The company has been able to grown their revenue, but not earnings. See chart below. EPS is basically depressed by Share-Based compensation and Exchangeable Debentures. See charge covering the last 5 and 10 years below.

Year	Item	Growth
5	Revenue Growth	69.80%
5	EPS Growth	0.00%
5	Net Income Growth	255.20%
5	Cash Flow Growth	606.43%
5	Dividend Growth	0.00%
5	Stock Price Growth	-104.94%
10	Revenue Growth	598.20%
10	EPS Growth	0.00%
10	Net Income Growth	85.10%
10	Cash Flow Growth	132.22%
10	Dividend Growth	0.00%
10	Stock Price Growth	371.23%

The other thing I notice is the debt. They range from not too bad to awful. The Long Term Debt/Market Ratio is 1.00. It is better than it has been, but should be below 1.00. The Intangible and Goodwill/Market Cap Ratio is currently at 1.14. This means that the Intangible and Goodwill items are higher than the market cap and this is not good. The Leverage and Debt/Equity Ratios at 15.35 and 11.38 are awful.

If you had invested in this company in December 2011, for $1,000.10 you would have bought 1370 shares at $2.0.73 per share. In December 2021, after 10 years you would have received $463.06 in dividends. The stock would be worth $4,712.80. Your total return would have been $5,175.86.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$0.73	$1,000.10	1,370	10	$463.06	$4,712.80	$5,175.86

But, if you had invested in this company in December 2016, for $1,001.10 you would have bought 142 shares at $7.05 per share. In December 2021, after 5 years you would have received $21.87 in dividends. The stock would be worth $488.48. Your total return would have been $510.35.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$7.05	$1,001.10	142	5	$21.87	$488.48	$510.35

The dividends were suspended in 2019 and I can find no information on if and when they might be restarted.

No Debt Ratios are good and some are bad. The Long Term Debt/Market Cap ratio for 2022 is 1.12 and is currently 1.14. This is too high. Some analysts think it should be 0.50 or lower and others that it should be below 1.00. The Liquidity Ratio for 2022 is 1.33 and this is low. The Debt Ratio for 2022 is 1.35 and this is low. For these ratios I prefer them to be 1.50 or higher. The Leverage and Debt/Equity Ratios for 2022 are 15.35 and 11.38 and these ratios are awful. I prefer them to be below 3.00 and 2.00.

The Total Return per year is shown below for years of 5 to 16 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	0.00%	-13.14%	-13.37%	0.00%
2011	10	0.00%	19.87%	16.77%	2.49%
2006	15		4.93%	4.07%	1.09%
2001	20		3.45%	2.72%	0.83%

The 5-year low, median, and high median Price/Earnings per Share Ratios are negative and therefore unusable. The corresponding 10 year ratios are negative and unusable. The corresponding historical ratios are negative and unusable. The current P/E Ratio is 39.86 based on a stock price of $2.79 and EPS estimate for 2023 of $0.07. This is a high ratio. Normally, a ratio of 10.00 or below is a cheap price and probably getting expensive is a ratio of 20.00 or higher.

I get a Graham Price of $0.86. The 10-year low, median, and high median Price/Graham Price Ratios are probably 1.64, 2.65 and 3.76. The problem is lots of the EPS losses. The current P/GP Ratio is 3.25 based on a stock price of $2.79. This 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. Also, the P/GP Ratios high. A high P/GP Ratio is one above 1.50.

I get a 10-year median Price/Book Value per Share Ratio of 2.60. The current P/B Ratio is 5.97 based on a Book Value of $80.91M, Book Value per Share of $0.47 and a stock price of $2.79. The current ratio is 114% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

I also have a Book Value per Share estimate for 2023 of $0.67. This value points to a P/B Ratio of 4.16 based on a stock price of $2.97 and Book Value of $116M. This ratio is 49% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

I get a 10-year median Price/Cash Flow per Share Ratio of 4.77. The current P/CF Ratio is 6.98 based on a stock price of $2.97 and Cash Flow of $69.2M. The current ratio is 46% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

I cannot do any dividend yield testing as dividends have been suspended.

The 10-year median Price/Sales (Revenue) Ratio is 1.89. The current P/S Ratio is 0.89 based on Revenue estimate for 2023 of $541M, Revenue per Share of $3.13 and a stock price of $2.79. The current ratio is 53% 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 is probably cheap. The most important test is the P/S Ratio test. Revenue drives both Net Income and Cash Flow, hopefully, anyway. There are problems with the other tests and most ones say stock is expensive.

When I look at analysts’ recommendations, I find Strong Buy (2), Buy (2) and Hold (2). The consensus is a Buy. The 12 months consensus stock price is 3.68. This implies a total return of 31.9% based on a current stock price of $2.79. Alpha Spread says Consensus Price Target is $3.88 and Estimated DCF Value is $3.95.

No recent recommendations on Stock Chase. Last ones in 2019 and were Do Not Buy. Stock Chase gives this stock 1 star out of 5. Christopher Liew on Motley Fool reviews this stock and says it is a dark horse that might surprise you in October 2021. Ambrose O'Callaghan on Motley Fool says this company is betting on streaming. The company put out a Press Release on their 2022 annual results. The company put out a Press Release on their first quarter of 2023 results.

Simply Wall Street on Yahoo Finance does a short review of this stock. Simply Wall Street has one warning of interest payments are not well covered by earnings for this company.

WildBrain Ltd is a children's content and brands company, recognized globally for properties such as Peanuts, Strawberry Shortcake, Caillou, Inspector Gadget, and Degrassi franchise. It operates through the following segments: the Content Business, CPLG, which manages copyrights, licensing, and brands for third parties and the Television segment. The company through its subsidiary operates networks of children's channels on YouTube. Its web site is here Wild Brain Ltd.

The last stock I wrote about was about was Stella-Jones Inc (TSX-SJ, OTC-STLJF) ... learn more. The next stock I will write about will be Waterloo Brewing Ltd (TSX-WBR, OTC-BIBLF) ... learn more on Wednesday, November 30, 2022 around 5 pm. Tomorrow on my other blog I will write about Peter Sweden – Substack ... learn more on Tuesday, November 29, 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.

Stella-Jones Inc

Sound bite for Twitter and StockTwits is: Dividend Growth Materials. The stock price seems cheap. The dividend yields are low with dividend growth moderate. The Dividend Payout Ratios (DPR) are good. Debt Ratios are good. See my spreadsheet on Stella-Jones Inc.

Is it a good company at a reasonable price? The stock price seems cheap. This stock has produced good results for its shareholders over a long period of time. This is a low dividend yield stock and it is one that is good to buy when you are building a portfolio of stocks to be used as income in the future.

I do not own this stock of Stella-Jones Inc (TSX-SJ, OTC-STLJF). I started a spreadsheet on this stock in mid-2009 because of a favorable report I read on this stock. It was a dividend growth stock and I am always on the lookout for dividend growth stocks.

When I was updating my spreadsheet, I noticed that the Liquidity Ratio and Debt Ratios are very good. A good ratio is 1.50 (or above). The ratios for this company are a Liquidity Ratio of 5.74 and a Debt Ratio of 2.19. Having such good ratios can see a company through difficult times.

This company has had great growth over the past 5 and 10 years. See the chart below. (Note: I orginally had the wrong formula for 10 year growth.)

Year	Item	Growth
5	Revenue Growth	49.59%
5	EPS Growth	57.21%
5	Net Income Growth	47.50%
5	Cash Flow Growth	113.39%
5	Dividend Growth	80.00%
5	Stock Price Growth	-8.92%
10	Revenue Growth	329.59%
10	EPS Growth	301.15%
10	Net Income Growth	307.47%
10	Cash Flow Growth	1083.14%
10	Dividend Growth	476.00%
10	Stock Price Growth	295.16%

If you had invested in this company in December 2011, for $1,002.38 you would have bought 99 shares at $10.13 per share. In December 2021, after 10 years you would have received $411.35 in dividends. The stock would be worth $3,690.99. Your total return would have been $4,372.34.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$10.13	$1,002.38	99	10	$411.35	$3,960.99	$4,372.34

The dividend yields are low with dividend growth moderate. The current dividend yield is low (below 2%) at 1.69%. The 5, 10 and historical dividend yields are also low at 1.33%, 1.00% and 1.26%. The dividend growth is moderate (8% to 14% ranges) at 12.5% per year over the past 5 years.

If the company increases the dividend at the same rate as they used per year over the past 5 years of 12.47%, starting from a dividend yield is 1.69%, then in 20 years’ time, the dividend yield on your original investment would be at 17.77%.

Div Yd	Years	At IRR	Div Inc
3.05%	5	12.47%	80.00%
5.48%	10	12.47%	224.00%
9.87%	15	12.47%	483.20%
17.77%	20	12.47%	949.76%
31.99%	25	12.47%	1789.57%

The Dividend Payout Ratios (DPR) are good. The DPR for Earnings per Share (EPS) for 2021 is 21% with 5 year coverage also at 21%. The DPR for Cash Flow per Share (CFPS) is 9% with 5 year coverage at 11%. The DPR for Free Cash Flow (FCF) is probably 22% with 5 year coverage at 28%. (There is some disagreement on FCF, but not a lot.)

Debt Ratios are good. The Long Term Debt/Market Cap Ratio for 2021 is 0.27 and is good. The Liquidity Ratio for 2021 is great at 5.74. The Debt Ratio for 2021 is good at 2.19. Leverage and Debt/Equity Ratios for 2021 are good at 1.84 and 0.84

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	12.47%	-0.36%	-1.69%	1.33%
2011	10	19.14%	16.74%	14.73%	2.01%
2006	15	22.34%	12.17%	10.79%	1.38%
2001	20	20.42%	27.82%	24.50%	3.32%
1996	25		23.03%	21.05%	1.98%
1994	27		15.61%	14.54%	1.07%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 15.31, 17.80, 20.29. The corresponding 10 year ratios are 15.54, 18.17 and 21.44. The corresponding historical ratios are 9.14, 12.43 and 15.15. The current P/E Ratio is 12.12 based on a stock price of $47.26, and EPS estimate for 2022 of 3.90. 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.

I get a Graham Price of $46.71. The 10-year low, median, and high median Price/Graham Price Ratios are 1.22, 1.50 and 1.77. The current P/GP Ratio is 1.01 based on a stock price of $47.26. 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 2.60. The current P/B Ratio is 1.90 based on a stock price of $47.26, Book Value of $1,586M and Book Value per Share of $24.87. The current ratio is 27% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I also have a Book Value per Share estimate for 2022 of $26.40. This produces a P/B Ratio of 1.79 based on a stock price of $47.26 and Book Value of $1,684M. This ratio is 31% 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 20.67. The current ratio 7.62 based on Cash Flow per Share (CFPS) estimate for 2022 of $6.20, Cash Flow of $395M and a stock price of $47.26. The current P/CF Ratio is 56% 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 1.26%. The current dividend yield is 1.69% based on dividends of $0.80 and a stock price of $47.26. The current dividend yield is 34% 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 1.00%. The current dividend yield is 1.69% based on dividends of $0.80 and a stock price of $47.26. The current dividend yield is 69% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

The 10-year median Price/Sales (Revenue) Ratio is 1.55. The current P/S Ratio is 1.00 based on Revenue estimate for 2022 of $3,020M, Revenue per Share of $47.36 and a stock price of $47.26. The current ratio is 36% 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 is cheap. The Dividend yield tests are showing the stock price as cheap and this is confirmed by P/S Ratio test. All the testing shows the stock price as relatively cheap.

When I look at analysts’ recommendations, I find Strong Buy (2) and Buy (5). The consensus would be a Strong Buy. The 12 month consensus stock price is $54.00. This implies a total return of 15.95% with 14.26% from capital gains and 1.69% from dividends based on a stock price $47.26.

Analysts on Stock Chase really like this stock. Stock Chase gives this stock 5 stars out of 5. It is on Money Sense list with a rating of B. Adam Othman on Motley Fool in July 2022 thought it might be down for a while. Kay Ng on Motley Fool says if you not need income now, this is a good stock to buy. I agree. The company put out a press release on Global Newswire about their 2021 results. The company put out a press release on Global Newswire about their third quarter of 2022. .

Simply Wall Street reviews this stock via Yahoo Finance. Simply Wall Street gives out one warning of has a high level of debt.

Stella-Jones Inc produces and sells lumber and wood products. The company operates in two segments: Pressure-treated wood, and Logs & Lumber segment. It also includes the sale of excess lumber to local home-building markets. Most of its revenue comes from the Pressure-treated wood segment. Its geographical segments are the United States and Canada, of which most of its revenue is derived from the United States. Its web site is here Stella-Jones Inc.

The last stock I wrote about was about was First Capital REIT (TSX-FCR.UN, OTC-FCXXF) ... learn more. The next stock I will write about will be Wild Brain Ltd (TSX-WILD, OTC-WLDBF) ... learn more on Monday, November 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.

First Capital REIT

Sound bite for Twitter and StockTwits is: Dividend Paying REIT. The stock price is probably reasonable based on the P/S Ratio test. However, the P/AFFO Ratio and the P/FFO Ratio tests show the stock price as cheap. The dividend yields are good with dividend growth low to non-existent. The Dividend Payout Ratios (DPR) are fine, with the important ones being for AFFO and FFO. Debt Ratios are probably fine. See my spreadsheet on First Capital REIT.

Is it a good company at a reasonable price? The stock price is probably reasonable. The P/S Ratio tests show it is close to cheap. They have had some problems recently and cut the dividends. Dividends are back to what they were, but that makes them flat for 7 years. For a REIT, with high dividends, you should expect that dividends would grow at the rate of inflation.

The important measures are the Adjusted Funds from Operations (AFFO) and Funds from Operations (FFO). The AFFO is up only 0.4% per year over the past 10 years and is down by 0.8% per year over the past 5 years. The FFO is up by 1.73% per year over the past 10 years and up by 0.5% over the past 5 years. This is not a great record. Total return is low over the past 15 years. It would not be a favourite REIT of mine.

I do not own this stock of First Capital REIT (TSX-FCR.UN, OTC-FCXXF). Myowneradvistor.com asked me to investigate this stock. In 2011 a reader asked me to review this real estate stock. Also, the site Canadian Dividend Stock site mentions this company as a top Canadian REIT.

When I was updating my spreadsheet, I noticed I it is a slow growing REIT, and this is offset by a good dividend. Revenue is down by 0.04% and up by 2.5% per year over the past 5 and 10 years. The 5 year running average for Revenue is up by 1.9% and 4.5% per year over the past 5 and 10 years. Dividend yield is current 5.19% and the 5 year median dividend yield is 4.51%.

If you had invested in this company in December 2011, for $1,003.40 you would have bought 58 shares at $17.60 per share. In December 2021, after 10 years you would have received $494.43 in dividends. The stock would be worth $1,077.06. Your total return would have been $1,571.49.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$17.30	$1,003.40	58	10	$494.43	$1,077.06	$1,571.49

The dividend yields are good with dividend growth low to non-existent. The current dividend yield is good (5% to 6% ranges) at 5.06%. The 5 and 10 year median dividend yields are moderate (2% to 4% ranges) at 4.51% and 4.56%. The historical median dividend yield is good at 5.07%. Dividends, until 2015 were being increased most years, but at a low rate (below 8% per year) with a 5 year running rate 1.5%.

At the end of 2019 the company changed to a REIT and in 2020 they started to pay dividends monthly. Dividend used to be quarterly. For 2021, dividends were decreased, but they increased them back to what they were in 2020, in 2022. The last dividend increase was in 2022 and it was for 100% (changed from $0.036 to $0.072, monthly).

The Dividend Payout Ratios (DPR) are fine, with the important ones being for AFFO and FFO. The DPR for EPS for 2021 is 22% with 5 year coverage at 50%. The company is expected to have an earnings loss in 2022, but the 5 year coverage in 2022 is expected to be 79%. The DPR for Adjusted Funds from Operations (AFFO) for 2021 is 49% with 5 year coverage at 78%. The DPR for 2021 is 41% with 5 year coverage at 67%. The DPR for Cash Flow per Share (CFPS) for 2021 is 26% with 5 year coverage at 43%. The DPR for Free Cash Flow for 2021 might be 39% with 5 year coverage at 63%. (There are differences in what different sites think is the FCF.)

Debt Ratios are probably fine. The Long Term Debt/Market Cap Ratio for 2021 is 0.93. The Long Term Debt/Coving Assets Ratio is 0.40. These are fine. The Liquidity Ratio for 2021 is 0.70 and with cash flow less dividends it is still very low at 0.89. However, if you add back in the current debt due, it is 2.52. A problem could occur where in a recession they cannot turn over their debt. The Debt Ratio is 1.86 and that is good. The Leverage Debt/Equity Ratios are fine at 2.17 and 1.17.

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	-11.47%	2.12%	-1.82%	3.93%
2011	10	-5.23%	5.44%	0.87%	4.58%
2006	15	-3.21%	5.19%	0.55%	4.64%
2001	20	-1.24%	11.52%	4.22%	7.30%
1996	25	-0.19%	9.23%	3.09%	6.14%
1994	27	1.29%	12.54%	4.58%	7.96%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 10.85, 11.94 and 13.02. The corresponding 10 year ratios are 11.73, 13.40 and 15.06. The corresponding historical ratios are 15.87, 18.04 and 19.71. The current P/E Ratio is negative, so I cannot do testing with that. The P/E Ratio for 2023 is expected to be 15.53 based on a current stock price of $17.08 and EPS estimate for 2023 of $1.10. 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. EPS is not an important number when dealing with REITs. AFFO and FFO is more important.

The 5-year low, median, and high median Price/Funds from Operations (FFO) are 13.91, 16.43 and 18.40. The corresponding 10 year ratios are 16.03, 17.65 and 19.46. The current P/FFO Ratio for 2022 is 14.98 based on a stock price of $17.08 and FFO estimate for 2022 of $1.14. This ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

The 5-year low, median, and high median Price/Adjusted Funds from Operations (AFFO) are 15.80, 18.02 and 20.72. The corresponding 10 year ratios are 17.04, 18.46 and 20.62. The current P/AFFO Ratio for 2022 is 16.11 based on a stock price of $17.08 and AFFO estimate for 2022 of $1.06. This 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 $22.69. The 10-year low, median, and high median Price/Graham Price Ratios are 0.86, 0.93 and 1.03. The current P/GP Ratio is 0.75 based on a stock price of $17.08. The current ratio is below the low ratio 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 1.11. The current P/B Ratio is 0.85 based on a stock price of $17.08, Book Value of $4,291M and Book Value per Share of $20.08. The current ratio is 23% 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 17.19. The current P/CF Ratio is 14.15 based on Cash Flow for the last 12 months of $258M, Cash Flow per Share of $1.21 and a stock price of $17.08. The current ratio is 18% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get an historical median dividend yield of 4.89%. The current dividend yield is 5.06% based on a stock price of $17.08 and dividends of $0.864. The current dividend yield is 3% above the historical median 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 4.48%. The current dividend yield is 5.06% based on a stock price of $17.08 and dividends of $0.864. The current dividend yield is 13% 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 6.26. The current P/S Ratio is 5.11 based on Revenue estimate for 2022 of $715M, Revenue per Share of $3.35 and a stock price of $17.08. The current ratio is 18% 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 dividend yield tests say this and it is confirmed by the P/S Ratio test. However, Dividend Yield tests work best with companies that increase their dividends. The P/AFFO Ratio and P/FFO Ratio tests show the stock price as cheap.

When I look at analysts’ recommendations, I find Strong Buy (3), Buy (3) and Hold (1). The consensus would be a Strong Buy. The 12 month stock price consensus is $18.75. This implies a total return of 14.84% with 5.06% from dividends and 9.78% from capital gains based on a current stock price of $17.08.

Some analysts do not like this stock on Stock Chase. Stock Chase gives this company 1 star out of 5. Daniel Da Costa on Motley Fool thinks this is a safe stock to buy for its dividend. Adam Othman on Motley Fool thinks that this stock will bounce back. The company put out a news release on Newswire about their fourth quarter of 2021. The company put out a press release on Newswire about their third quarter of 2022.

Simply Wall Street via Yahoo Finance looks at who owns shares in this company. Simply Wall Street has 3 warnings of earnings have declined by 20.1% per year over past 5 years; interest payments are not well covered by earnings; and unstable dividend track record.

First Capital REIT is a developer, owner, and operator of mixed-use urban real estate in Canada's populated centres. The company's focus is on creating thriving neighbourhoods that create value for businesses, residents, communities, and investors. Its web site is here First Capital REIT.

The last stock I wrote about was about was FirstService Corp (TSX-FSV, NASDAQ-FSV) ... learn more. The next stock I will write about will be Stella-Jones Inc (TSX-SJ, OTC-STLJF) ... learn more on Friday, November around 5 pm. Tomorrow on my other blog I will write about Kyla Scanlon – Substack .... learn more on Thursday, November 24, 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.

FirstService Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Real Estate. The stock price is probably expensive. The dividend yields are low with dividend growth moderate. The Dividend Payout Ratios (DPR) are fine. Debt Ratios are fine. See my spreadsheet on FirstService Corp.

Is it a good company at a reasonable price? The stock price is probably expensive. The dividend yields are below 1%, so hardly a dividend stock. I generally do not buy stocks when the dividend yield is below 1%. Although sometimes these sorts of stocks can be good earnings for you when the dividends do rise above 1%.

I do not own this stock of FirstService Corp (TSX-FSV, NASDAQ-FSV). I bought FirstService Corp in 2002 as it looked like a good solid company that knows how to make money. By 2010 the company was underperforming so I sold the stock and kept the preferred shares until the end of the year before selling them too. Preferred shares are not by favorite why of getting dividends. The company started dividends in 2013.

When I was updating my spreadsheet, I noticed return over the last 10 year is high at 35.05% per year. See chart below. However, so far this year, the stock has fallen some 34%. It has a very low dividend yield (less than 1%) at 0.64%. The company has some very high ratios. P/E Ratios with 5 year and 10 year median ratios at 42.62 and 41.09. High P/E Ratios are probably between 20.00 and 30.00. The 10 year median P/B Ratio is 8.18 and a good one is around at 1.50.

If you had invested in this company in December 2011, for $1,010.51 you would have bought 74 shares at $13.66 per share. In December 2021, after 10 years you would have received $415.21 in dividends. The stock would be worth $18,396.40. Your total return would have been $18,811.61.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$13.66	$1,051.10	74	10	$415.21	$18,396.40	$18,811.61

The dividend yields are low with dividend growth moderate. The current dividend yield is low (below 2%) at 0.66%. The 5 and 8 year dividend yields are also low at 0.67% and 0.80%. The dividend growth is moderate (8% to 14% ranges) at 10.6% per year over the past 5 years. The last dividend increase was for 11% and it was in 2022.

The Dividend Payout Ratios (DPR) are fine. The DPR for EPS for 2021 is 23.36% with 5 year coverage at 169%. The DPR for 2022 is expected to be around 30%. The DPR for Adjusted Earnings per Share (AEPS) is 16% with 5 year coverage at 20%. The DPR for Cash Flow per Share (CFPS) for 2021 is 12% with 5 year coverage at 14%. The DPR for Free Cash Flow (FCF) for 29% with 5 year coverage at 20%.

Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2021 is good at 0.07. The Liquidity Ratio for 2021 is good at 1.56. The Debt Ratio for 2021 is good at 1.68. The Leverage and Debt/Equity Ratios are fine at 2.46 and 1.46 respectively.

The Total Return per year is shown below for years of 5 to 26 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	9.36%	32.07%	31.29%	0.78%
2011	10	8.80%	35.05%	33.67%	1.38%
2006	15		20.47%	20.01%	0.46%
2001	20		18.42%	18.11%	0.31%
1996	25		21.82%	21.53%	0.29%
1995	26		23.37%	23.06%	0.30%

The Total Return per year is shown below for years of 5 to 26 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	10.63%	33.57%	32.85%	0.72%
2011	10	7.48%	31.66%	30.78%	0.87%
2006	15		19.59%	19.25%	0.34%
2001	20		19.56%	19.31%	0.26%
1996	25		22.12%	21.89%	0.23%
1995	26		23.68%	23.44%	0.24%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 35.71, 42.22 and 49.83. The corresponding 10 year ratios are 32.73, 41.78 and 49.28. The corresponding historical ratios are 14.29, 18.53 and 23.55. The current P/E Ratio is 47.58 based on a stock price of $125.61 and EPS estimate for 2022 of $2.64. The current P/E Ratio is between the median and high ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$.

I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 23.94, 29.32 and 36.31. The corresponding 10 year ratios are 19.94, 28.10 and 34.38. The current P/AEPS Ratio is 29.91 based on a stock price of $125.61 and AEPS estimate for 2022 of $4.20. This ratio is between the median and high ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$.

I get a Graham Price of $45.67 . The 10-year low, median, and high median Price/Graham Price Ratios are 2.75, 3.94 and 5.09. The current P/GP Ratio is 3.69 based on a stock price of $168.56. The current ratio is between the low and median ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in CDN$.

I get a 10-year median Price/Book Value per Share Ratio of 8.18. The current P/B Ratio is 6.34 based on a Book Value of $872M, Book Value per Share of $19.82 and a stock price of $125.61. The current ratio is 22% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$.

I also have estimates for the Book Value per share for 2022. The estimate is $22.60 for the Book Value per Share. The P/B Ratio would be 5.56 based on this Book Value per Share, Book Value of $995M, and a stock price of $125.61. This P/B Ratio is 32% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$.

I get a 10-year median Price/Cash Flow per Share Ratio of 14.62. The current P/CF Ratio is 22.80 based on Cash Flow per Share estimate for 2022 of $5.51, Cash Flow of $243M and a stock price of $125.61. The current ratio is 56% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$.

I get an historical median dividend yield of 0.80%. The current dividend yield is $0.64 based on dividends of $0.81 and a stock price of $125.61. The current dividend yield is 19.4% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$.

I get a 10 year median dividend yield also of 0.80%. The current dividend yield is $0.64 based on dividends of $0.81 and a stock price of $125.61. The current dividend yield is 19.4% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$.

The 10-year median Price/Sales (Revenue) Ratio is 1.15. The current P/S Ratio is 1.49 based on Revenue estimate for 2022 of $3,703M, Revenue per Share of $84.13 and a stock price of $125.61. The current ratio is 30% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$.

Results of stock price testing is that the stock price is probably expensive. The dividend yield testing says it is reasonable, but above the median. With a current yield 19.4% below the 10 year median, it is very close to expensive. The P/S Ratio test says the stock price is expensive. Some other testings are showing the stock price as reasonable, but some of this stock’s ratios are very high. For example, the 10 year ratios for P/E Ratio are 32.73, 41.78 and 49.28 and these are very high.

When I look at analysts’ recommendations, I find Strong Buy, (1), Buy (2) and Hold (3). The consensus would be a Buy. The 12 month stock price consensus is $174.37 CDN$ ($131.00 US$). This implies a total return of 4.09% with 3.45% from capital gains and 0.64% from dividends based on a stock price of $168.56 CDN$.

Analysts on Stock Chase says this stock is a Buy or their Top Pick. Stock Chase gives this stock 5 stars out of 5. It is not on the Money Sense list. Adam Othman on Motley Fool says this is a discounted real estate stock. Kay Ng on Motley Fool says this is REIT to buy for growth. The company put out a press release on Globe Newswire about their 2021 year end results. The company has a press release on Globe Newswire about it third quarter of 2022 results. Simply Wall Street via Yahoo Finance reviews this stock. Simply Wall Street has two warnings about this company of debt is not well covered by operating cash flow; and significant insider selling over the past 3 months.

FirstService Corp operates in two business divisions: FirstService Residential and FirstService Brands. The company earns the majority of its revenue in the United States, with the remaining revenue generated in Canada. Its web site is here FirstService Corp.

The last stock I wrote about was about was Northland Power Inc (TSX-NPI, OTC-NPIFF) ... learn more. The next stock I will write about will be First Capital REIT (TSX-FCR.UN, OTC-FCXXF) ... learn more on Wednesday, November 23, 2022 around 5 pm. Tomorrow on my other blog I will write about Future Crunch.... learn more on Tuesday, November 22, 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.

Northland Power Inc

Sound bite for Twitter and StockTwits is: Dividend Paying Utility. The stock price seems reasonable. The dividend yields are moderate with dividend growth low. The Dividend Payout Ratios (DPR) are expected to be fine in the future. Some Debt Ratios are too high. See my spreadsheet on Northland Power Inc.

Is it a good company at a reasonable price? The stock price is probably reasonable. It is not a dividend growth stock and because of that I would not be interested in this utility. The dividend yield is a decent one. The Dividend Payout Ratio is too high to expect a dividend increase anytime soon. Debt is high.

I do not own this stock of Northland Power Inc (TSX-NPI, OTC-NPIFF). This company is into generating electric power. I have a lot invested in pipelines and I would like to have more invested in electric power as part of my utility’s investments. I read a report on this stock that said it was a good defensive stock to buy. That is, it is a good stock to hold in a stock market correction. I can certainly see the logic of using utility stocks as defensive stocks.

When I was updating my spreadsheet, I noticed that last year, analysts thought that this company might start to raise their dividends in 2023. Now they do not think dividends will be raise then or in 2024. Analysts are expecting Earnings of $2.80, $1.65, $1.70 over the next 3 years. However, AFFO is expected to be $1.57, $1.66, $1.71 over the same time frame.

If you had invested in this company in December 2000, for $1,004.08 you would have bought 56 shares at $17.93 per share. In December 2021, after 10 years you would have received $631.68 in dividends. The stock would be worth $2,125.20. Your total return would have been $2,756.88.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$17.93	$1,004.08	56	10	$631.68	$2,125.20	$2,756.88

The dividend yields are moderate with dividend growth low. The current dividend yield is moderate (2% to 4% ranges) at 3.26%. The 5 year median dividend yield is also moderate at 4.54%. The 10 year mediate dividend yield is good (5% and 6% ranges) at 5.19%. The historical dividend yield is high (7% and higher) at 7.52%. The dividend increases have been low (below 8% per year) at 2.13% per year over the past 5 years. In the past 5 years there has been only one dividend increase and it was in 2018 and it was for 11%. Over the past 24 years, dividends have increased in 8 years and decreased in 2 years.

The company used to be an income trust and as such it had high dividends. Since having to change to a corporation they had basically kept the dividends flat with only one increase in 2018. The Dividend Payout Ratios (DPR) are expected to be fine in the future.

The Dividend Payout Ratios (DPR) are expected to be fine. The DPR for EPS for 2021 is 146% with 5 year coverage at 90%. The DPR for EPS for 2022 is expected to be around 43%. The DPR for Free Cash Flow (FCF) calculated by the company in 2021 is 86% with 5 year coverage at 72%. This DPR is expected to be around 76% in 2022. The DPR for Cash Flow per Share (CFPS) for 2021 is 21% with 5 year coverage at 19%. The FCF calculated by Morningstar and WSJ is negative, so no DPR can be calculated.

Some Debt Ratios are too high. The Long Term Debt/Market Cap for 2021 is 0.81 and is fine. The Liquidity Ratio for 2021 is 1.01. If you add in cash flow after dividends it is good at 1.96. The Debt Ratio for 2021 is low at 1.30 and I prefer it to be 1.50 or higher. The Leverage and Debt/Equity Ratios are 4.34 and 3.34 and are too high. I prefer them to be under 3.00 and under 2.00, respectively.

The Total Return per year is shown below for years of 5 to 24 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	2.13%	14.45%	10.25%	4.20%
2011	10	1.06%	12.43%	7.79%	4.65%
2006	15	0.66%	13.07%	7.36%	5.71%
2001	20	1.02%	12.57%	6.22%	6.35%
1997	24	2.93%	12.44%	5.71%	6.73%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 13.68, 19.14 and 26.46. The corresponding 10 year ratios are 13.41, 16.03 and 18.38. The corresponding historical ratios are 13.41, 16.03 and 18.26. The current P/E Ratio is 13.16 based on a stock price of $36.85 and EPS estimate for 2022 of $2.80. 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.

The company also supplies Free Cash Flow (FCF) or AFFO data. The 5-year low, median, and high median Price/FCF are 12.42, 16.30 and 17.03. The corresponding 10 year ratios are 13.23, 15.83 and 17.73. The current P/FCF Ratio is 23.47 based on FCF estimate for 2022 of $1.57 and a stock price of $36.85. The current ratio is above the high of the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $32.53 . The 10-year low, median, and high median Price/Graham Price Ratios are 1.93, 2.20 and 2.59. The current P/GP Ratio is 1.13 based on a stock price of $36.85. The current ratio is below the low ratio 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 4.68. The current P/B Ratio is 2.19 based on a Book Value of $3,812M, Book Value per Share of $16.80 and a stock price of $36.85. The current ratio is 53% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I also have a Book Value per Share estimate for 2022 of $10.90. The P/B Ratio here would be 3.38 based on a stock price of $36.85 and Book Value of $2,473M. This ratio is 28% 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 5.64. The current P/CF Ratio is 6.38 based on Cash Flow per Share (CFPS) estimate for 2022 of $5.78, Cash Flow of $1,311M and a stock price of $36.85. The current ratio is 13% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get an historical median dividend yield of 7.52%. The current dividend yield is 3.26% based on a stock price of $32.68 and Dividends of $1.20. The current dividend yield is 57% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive. Problem is current flat dividends and company used to be an income trust.

I get a 10 year median dividend yield of 5.19%. The current dividend yield is 3.26% based on a stock price of $32.68 and Dividends of $1.20. The current dividend yield is 37% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive. Problem is current flat dividends and company used to be an income trust.

The 10-year median Price/Sales (Revenue) Ratio is 3.30. The current P/S Ratio is 3.45 based on Revenue estimate for 2022 of $2,424M Revenue per Share of $10.68 and a stock price of $32.68. The current P/S Ratio is 4.5% above the 10 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 is probably reasonable. The P/S Ratio test says this. The dividend yield tests are not good because this company used to be an income trust with very high dividends. A couple of the stock price tests say that the stock price is cheap and a couple say it is reasonable and above the median.

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 consensus is $48.00. this implies a total return of 33.51% with 30.26% from capital gains and 3.26% from dividends based on a current stock price of $36.85.

Analysts on Stock Chase gives mixed recommendations from Do not Buy to Top Pick. Stock Chase gives this stock 4 stars out of 5. Nicholas Dobroruka on Motley Fool thinks this is a high dividend stock you could hold for years. Staff on Motley Fool gives their stock picks for November 2022. The company put out a Press Release for their fourth quarter of 2021. The company has a Press Release on their third quarter of 2022.

Simply Wall Street on Yahoo Finance talks about this stock. Simply Wall Street has 4 warnings on this company of earnings are forecast to decline by an average of 17.1% per year for the next 3 years; has a high level of debt; unstable dividend track record; and shareholders have been diluted in the past year.

Northland Power develops, constructs, and operates maintainable infrastructure assets across a range of clean and green technologies, such as wind (offshore and onshore), solar, and supplying energy through a regulated utility. Northland's growth opportunities are global and span North America, Europe, Latin America, and Asia. Its web site is here Northland Power Inc.

The last stock I wrote about was about was Chesswood Group Ltd (TSX-CHW, OTC-CHWWF) ... learn more. The next stock I will write about will be FirstService Corp (TSX-FSV, NASDAQ-FSV) ... learn more on Monday, November 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.

Chesswood Group Ltd

Sound bite for Twitter and StockTwits is: Dividend Paying Financial. The stock price seems cheap. The dividend yields are moderate with dividend growth restarted. Over the past 15 years, the company increased dividends 8 times and decreased then 4 times, so dividends are unstable. The Dividend Payout Ratios (DPR) are fine. Debt Ratios are fine. See my spreadsheet on Chesswood Group Ltd.

Is it a good company at a reasonable price? The stock price seems relatively cheap. This is not a dividend growth company. Dividends are unstable. They maybe a dividend growth company in the future. It used to be an Income Trust and all the old income trusts are having a hard time with dividends and the switch to a corporation. The risk level would be high.

I do not own this stock of Chesswood Group Ltd (TSX-CHW, OTC-CHWWF). A reader wrote me in 2012 that he was researching and found a company that he hoped I could give him a brief outlook on. He said that the company is Chesswood Group and they are basically a financial leasing company. From 2009 to 2012 they increased their dividends from 2.5 cents to 5.5 cents per month. This is a 120% increase.

When I was updating my spreadsheet, I noticed the accrual ratio has been fairly accurate, especially lately. The accrual ratio has done 12 predictions over the past 16 years and has been accurate 67% of the time on the movement of the stock price in the following year. Over the past 7 years, there has been 7 predictions and 5 have been correct with a prediction rate of 71%. The Accrual Ratio expects the stock price to be low in 2022 than in 2021. So far, the stock price has fallen in 2022 by 21%.

I found interesting that the analysts on Market Screener agree with the Free Cash Flow (FCF) value of the company at $33M for 2021. Morningstar (MS) gave a FCF of a negative $500M and Wall Street Journal (WSJ) gave a negative of $470M.

If you had invested in this company in December 2011, for $1,001.70 you would have bought 159 shares at $26.30 per share. In December 2021, after 10 years you would have received $1,170.24 in dividends. The stock would be worth $2,288.01. Your total return would have been $3,458.25.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$6.30	$1,001.70	159	10	$1,170.24	$2,288.01	$3,458.25

The dividend yields are moderate with dividend growth restarted. The current dividend yield is moderate (2% to 4% ranges) at 4.24%. The 5 and 10 year dividend yields are good (5% to 6% ranges) at 6.52% and 6.85%. The historical median dividend yield is high (7% and over) at 7.93%. The dividends are down by 17% per year over the past 5 years. The last dividend change was an increase in 2022 by 33%.

The company changed from a corporation to an income trust in 2006. Because the law changed, the company changed back to a corporation in 2011. The problem is that income trusts can pay a higher dividend than corporations. All previous income trust must find a way to lower the dividends to an affordable rate for corporations.

In 2008 the company lowered the dividend by 70%. The Dividend Payout Ratio was often quite high over the following years. The company decreased the dividends again in 2020 by 71%. Over the past 15 years, the company increased dividends 8 times and decreased then 4 times.

The Dividend Payout Ratios (DPR) are fine. The DPR for EPS for 2021 is 20% with 5 year coverage at 69%. The DPR for EPS is expected to be around 30% in 2022. The company shows a Free Cash Flow (FCF) or AFFO DPR and for 2021 that DPR is 18% with 5 year coverage at 43%. This DPR is expected to be around 16% in 2022. The DPR for Cash Flow per Share (CFPS) for 2021 is 6% with 5 year coverage at 12%.

Debt Ratios are fine. Because this is a financial, I am looking at Long Term Debt/Covering Asset Ratio and for 2021 is it 0.93 and acceptable. The Liquidity Ratio for 2021 is good at 2.86. The Debt Ratio is fine for a financial at 1.13.

The Total Return per year is shown below for years of 5 to 15 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	-16.96%	8.93%	3.79%	5.15%
2011	10	-6.31%	17.65%	8.61%	9.03%
2006	15	-6.43%	12.08%	4.63%	7.46%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 6.53, 7.82 and 9.12. The corresponding 10 year ratios are 7.74, 9.38 and 10.92. The corresponding historical ratios are 6.98, 8.70 and 10.92. The current P/E Ratio is 7.40 based on a stock price of $11.32 and EPS estimate for 2022 of $1.53. 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 also have Free Cash Flow (FCF) from this company. The 5-year low, median, and high median Price/FCF Ratios are 5.92, 7.09 and 8.37. The corresponding 8 year ratios are 6.50,7.73 and 9.86. The current P/FCF is 3.91 based on FCF per Share estimate for 2022 of $2.90 and a stock price of 11.32. The current ratio is 45% below the 8 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $11.32. The 10-year low, median, and high median Price/Graham Price Ratios are 0.61, 0.75 and 0.87. The current P/GP Ratio is 0.54 based on a stock price of $11.32. 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 10-year median Price/Book Value per Share Ratio of 1.21. The current P/B Ratio is 0.89 based on a stock price of $11.32, Book Value of $210M and Book Value per Share of $12.68. The current ratio is 26% below the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I also have a Book Value per Share (BVPS) estimate for 2022 of $12.00. This BVPS results in a ratio of 0.94 based on a stock price of $11.32 and Book Value of $199M. This ratio is 80% 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 that is negative. You cannot do P/CF Ratio testing with a negative ratio.

I get an historical median dividend yield of 7.93%. The current dividend yield is 4.24% based on dividends of $0.48 and a stock price of $11.32. The current dividend yield is 47% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive. The problem with this test is that this stock used to be an income trust. All income trust had to reduced their dividends or keep them flat when becoming a corporation again.

I get a 10 year median dividend yield of 6.85%. The current dividend yield is 4.24% based on dividends of $0.48 and a stock price of $11.32. The current dividend yield is 38% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive. The problem with this test is that this stock used to be an income trust. All income trust had to reduced their dividends or keep them flat when becoming a corporation again.

The 10-year median Price/Sales (Revenue) Ratio is 1.44. The current ratio is 0.67 based on Revenue estimate for 2022 of $279M, Revenue per Share of $16.83 and a stock price of $11.32. the current ratio is 53% 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 is probably cheap. The P/S Ratio test is showing this. Analysts do expect a sharp rise in Revenue in 2022 of some 102%. (They were close in 2021 saying Revenue would be $136M and it was $138M.) The results of the second quarter of 2022 also support this revenue. The dividend yield tests are not good as dividends are declining. The other valid tests say that the stock price is cheap.

When I look at analysts’ recommendations, I find Buy (2) and Hold (1). The consensus would be a Buy. The 12 month stock price consensus is $15.75. This implies a total return of 43.37% with 39.13% from capital gains and 4.24% from dividends based on a current stock price of $11.32.

Last entries for this company on Stock Chase was in 2019. They liked the stock then. Stock Chase give this company 1 star out of 5. It is not on the Money Sense list. Nikhil Kumar on Motley Fool says Chesswood Group is North America’s only public company focused exclusively on commercial equipment finance for small and medium-sized businesses. Jason Hoang on Motley Fool talked about this company in March 2020. The company talks about on Newswire its 2021 year end results. The company on Newswire talk about their third quarter of 2022 results.

Simply Wall Street via Yahoo Finance talk about who owns shares in this company. Simply Wall Street has 4 warnings signs of debt is not well covered by operating cash flow; high level of non-cash earnings; dividend of 4.24% is not well covered; and shareholders have been diluted in the past year.

Chesswood Group Ltd is a Canada-based company focused on commercial equipment finance for small and medium-sized businesses. The company's operations consist of Equipment Financing- US; and Equipment Financing-Canada. The US Equipment Financing business, which is the key revenue driver, is in the US and is involved in small-ticket equipment leasing and lending to small and medium-sized businesses. Its web site is here Chesswood Group Ltd.

The last stock I wrote about was about was Quarterhill Inc (TSX-QTRH, OTC-QTRHF) ... learn more. The next stock I will write about will be Northland Power Inc (TSX-NPI, OTC-NPIFF) ... learn more on Friday, November 18, 2022 around 5 pm. Tomorrow on my other blog I will write about Low Interest Credit Cards .... learn more on Thursday, November 17, 2022 around 5 pm.

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