Is it a good company at a reasonable price? Certainly, a positive is that the company has restarted dividends. This points to the company being optimistic about the future. Analysts certainly think that the company will be doing better in the future. However, this is a risky stock and you should not invest any money into that you cannot afford to lose. Results of stock price testing is that the stock price is probably reasonable.
I do not own this stock of Trican Well Service Ltd (TSX-TCW, OTC-TOLWF). I was following Canyon Services Group Inc. and Trican Well Services Ltd. had a plan of arrangement with Canyon Shareholders. I used to get a newsletter weekly from MPL Communications called Advice Hotline. They wrote up Canyon Services Group Inc on July 19, 2012 and I was impressed with it so I did a spreadsheet.
When I was updating my spreadsheet, I noticed this is company has reinstated dividends in 2023. The yield is currently at 4.85% and that is a decent yield. They have had a good year in 2022. Revenue is up by 54%. EPS is up by 357% from 0.07 to 0.32. They had earnings losses in 2018, 2019 and 2020. The stock price is up 42.6% year to date.
The stock hit a low of $0.84 in November of 2019. To date this stock is up 521% to $5.22. The last 3 years to 2022 had gains of 47.37%, 64.88%, and 32.13%. Year to date this stock is up 42.62%.
If you had invested in this company in December 2012, for $1,001.47 you would have bought 150 shares at $6.68 per share. In December 2022, after 10 years you would have received $144.26 in dividends. The stock would be worth $549.25. Your total return would have been $639.26. This is a total return would be a loss of 4.22% per year with 5.83% from capital loss and 1.62% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $6.68 | $1,001.47 | 150 | 10 | $144.26 | $549.00 | $693.26 |
The current dividend yield is moderate with dividend growth variable but probably low in the future. The current dividend yield is moderate (2% to 4%) at 3.35%. The 5, 10 and historical dividend yields are all extremely low or non-existent at 0%, 0% and 0.29% as not dividends were not paid between 2017 to 2022. Dividends were restarted in 2023 and there have been no increases. In the past, dividend changes varied from 412% up and 100% down, so the future is hard to know, but analysts think there will be a 6% increase in 2024.
The Dividend Payout Ratios (DPR) seems fine in the future. As you can see from the following chart, there is no data on DPRs for this company. That is because there were no dividends for the 5 years going into 2022. However, analysts expect the DPR for Earnings per Share (EPS) to be 28% in 2023 and also 28% in 2024. The DPR for Cash Flow per Share is expected to be 16% in 2023 and 15 in 2024. The DPR for Free Cash Flow (FCF) for 2023 is expected to be 31% in 2023 and 29% in 2024.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 0.00% | 0.00% |
| CFPS | 0.00% | 0.00% |
| FCF | 0.00% | 0.00% |
Debt Ratios are good. The Long Term Debt/Market Cap Ratio for 2022 is 0.04 and currently is 0.00 as they paid off this debt. The Liquidity Ratio for 2022 is good and high at 2.80 and currently at 2.32. The Debt Ratio is good and high at 4.03 and 4.47. For these last two ratios, a ratio of 1.50 or above is good, so they are very good. The Leverage and Debt/Equity Ratios are good at 1.33 and 0.33.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 0.04 | 0.00 |
| Intang/GW | 0.00 | 0.00 |
| Liquidity | 2.80 | 2.32 |
| Liq. + CF | 4.83 | 4.38 |
| Debt Ratio | 4.03 | 4.47 |
| Leverage | 1.33 | 1.29 |
| D/E Ratio | 0.33 | 0.29 |
The Total Return per year is shown below for years of 5 to 16 to the end of 2022. 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. |
|---|---|---|---|---|---|
| 2017 | 5 | 0.00% | -2.15% | -2.15% | 0.00% |
| 2012 | 10 | 0.00% | -4.22% | -5.83% | 1.62% |
| 2007 | 15 | 0.00% | 11.96% | 7.02% | 4.94% |
| 2006 | 16 | 0.00% | 4.09% | 1.44% | 2.65% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are negative and therefore useless. The corresponding 10 year ratios are also negative and useless. The corresponding historical ratios are negative and useless. The current P/E Ratio is 8.24 based on a stock price of $4.78 and EPS estimate for 2023 of $0.58. Generally speaking, any P/E Ratio below 10.00 is considered cheap. This stock price testing suggests that the stock price is relatively cheap.
I get a Graham Price of $5.26. The 10-year low, median, and high median Price/Graham Price Ratios are 0.63, 1.05 and 1.26. The current P/GP Ratio is 0.91 based on a stock price of $4.78. This 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. However, you have to wonder how valid this test is because there are so many years of earning losses.
I get a 10-year median Price/Book Value per Share Ratio of 1.28. The current P/B Ratio is 2.25 based on a stock price of $4.78, Book Value of $504M and Book Value per Share of $2.12. The current ratio is 77% 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 $2.37. This implies a Book Value of $545M and a P/B Ratio of 2.02 based on a stock price of $4.78. This ratio is 58% 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 9.88. The current P/CF Ratio is 5.07 based on a stock price of $4.78, Cash Flow per Share estimate for 2023 of $1.03 and Cash Flow of $237M. This ratio is 49% 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 0.29%. The current dividend is 3.35% based on dividends of $0.16 and a stock price of $4.78. The current dividend yield is 1054% above this yield. This stock price testing suggests that the stock price is relatively cheap.
However, if you just use the 6 year median dividend for the years that this stock paid dividends, you get a dividend of 4.33%. The current dividend is 3.35% based on dividends of $0.16 and a stock price of $4.78. The current dividend yield is 23% below this yield. This stock price testing suggests that the stock price is relatively expensive. Interesting, but I do wonder how valid it is excluding all those years of no dividends.
The 10-year median Price/Sales (Revenue) Ratio is 1.12. The current P/S Ratio is 1.11 based on Revenue estimate for 2023 of $991M, Revenue per Share of $4.31 and a stock price of $4.78. The current ratio is 0.6% 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. This is what the P/S Ratio test is saying. It is between the two dividend yield tests I did which resulted in cheap and expensive stock prices. The P/CF Ratio test say that the stock price of reasonable. The P/E Ratio is relatively low.
When I look at analysts’ recommendations, I find Strong Buy (2) and Buy (6). The consensus would be a Strong Buy. The 12 month stock price consensus is $6.00 with high of $6.75 and low of $5.50. The price consensus of $6.00 implies a total return of 28.87% with 3.35% from dividends and $25.52%.
The recent analysts on this stock on Stock Chase like this company, but one notes it is risky. Stock Chase gives this stock 4 stars out of 5. It has not been on the Money Sense list of dividend stocks, nor any other dividend list I follow. Christopher Liew on Motley Fool talks about how much this stock has gained over the past 3 years. Christopher Liew on Motley Fool thinks it is a no brainer investing in this stock. He seems to be the only one of Motley Fool following this stock. The company put out a press release on Newsfile about their four quarter of 2022. The company put out a press release via Newsfile about their second quarter of 2023.
Simply Wall Street on Yahoo Finance talks about who owns shares in this company. Simply Wall Street has one warning out on this stock of unstable dividend track record and they are correct for this company. Simply Wall Street gives this stock 4 stars out of 5. This agrees with Stock Chase. Stock Chase and Simply Wall Street often disagree on the number of stars out of 5.
Trican Well Service Ltd is an equipment services company. It provides products, equipment, services, and technology for use in the drilling, completion, stimulation, and reworking of oil and gas wells primarily through its continuing pressure pumping operations in Canada. The company offers services related to coiled tubing, pipeline service, cementing, fracturing and reservoir solutions. Its web site is here Trican Well Service Ltd.
The last stock I wrote about was about was Wajax Corp (TSX-WJX, OTC-WJXFF) ... learn more. The next stock I will write about will be Great-West Lifeco Inc (TSX-GWO, OTC-GWLIF) ...learn more on Wednesday, September 20, 2023 around 5 pm. Tomorrow on my other blog I will write about Your portfolio in stocks.... learn more on Tuesday, September 19, 2023 around 5 pm.
This blog is meant for educational purposes only and is not to provide investment advice. I am not a licensed professional investment advisor. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.
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