The Analysts’ Recommendations for TECSYS are Strong Buy (1) and Buy (3) with a consensus of a Strong Buy. The consensus stock price is $47.00 with a high of $50.00 and low of $45.00. Although looking at analysts’ recommendations was an afterthought, but I was curious.
Sound bite for Twitter and StockTwits is: Dividend Growth Bank. Results of stock price testing is that the stock price is reasonable and may even be cheap. Debt Ratios are fine. The Dividend Payout Ratios (DPR) are good. The current dividend yield is good with dividend growth moderate. See my spreadsheet on Toronto Dominion Bank.
Is it a good company at a reasonable price? This bank has provided shareholders with a decent total return in the past, although the total return is lower today that in the past. Banks do provide good dividend income. I have this bank and I have no intentions of selling any of the Canadian banks I have. The current price is testing as reasonable, and the 10 year median dividend test is saying that the stock price is relatively cheap.
I own this stock of Toronto Dominion Bank (TSX-TD, NYSE-TD). This stock, as all banks, was on Mike Higgs' Canadian Dividend Growth Stock list and the other dividend lists that I followed. When I sold some Metro in 2009, I bought this stock. It is the 3rd bank stock I bought.
When I was updating my spreadsheet, I noticed that I have done well with this bank also. I have owned this bank for over 23 years and my total return is 12.79% per year with 8.46% from capital gains and 4.33% from dividends.
If you had invested in this company in December 2013, for $1,001.10 you would have bought 20 shares at $50.06 per share. In December 2023, after 10 years you would have received $550.40 in dividends. The stock would be worth $1,712.40. Your total return would have been $2,262.80. This is a total return would be a total return of 9.69% per year with 5.51% from capital gain and 4.18% from dividends. This calculation takes into consideration stock splits, which means that the original cost would be lowered by these splits.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $50.06 | $1,001.10 | 20 | 10 | $550.40 | $1,712.40 | $2,262.80 |
If you had invested in this company in December 1993, for $1,003.59 you would have bought 189 shares at $5.31 per share. In December 2023, after 30 years you would have received $5,780.57 in dividends. The stock would be worth $16,182.18. Your total return would have been $21,962.75. This is a total return would be a total return of 14.67% per year with 9.71% from capital gain and 4.86% from dividends. If you are earning 8% or more per year total return, your stock is doing well. This calculation takes into consideration stock splits, which means that the original cost would be lowered by these splits.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $5.31 | $1,003.59 | 189 | 30 | $5,780.57 | $16,182.18 | $21,962.75 |
The current dividend yield is good with dividend growth moderate. The current dividend yield is good (5% to 6% ranges) at 5.05%. The 5, 10 and historical median dividend yields are moderate at 4.25%, 3.88% and 3.53%. The dividends have been growing at a moderate rate (8% to 14%) at 8% per year over the past 5 years. The last dividend increase was in 2024 and it was for 6.3%. This bank tends to do only one dividend increase in a year.
The Dividend Payout Ratios (DPR) are good. The DPR for 2023 for Earnings per Share (EPS) is fine at 69% with 5 year coverage at 47%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is good at 48% with 5 year coverage at 46%. The DPR for 2023 for Cash Flow per Share (CFPS) is good at 4.9% with 5 year coverage at 15%. The DPR for 2023 for Free Cash Flow (FCF) is not calculable for currently because of a negative FCF, but the 5 year coverage at 11% is good.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 68.57% | 46.69% |
| AEPS | 48.06% | 46.36% |
| CFPS | 4.87% | 14.77% |
| FCF | -8.67% | 11.35% |
Debt Ratios are fine. The Long Term Debt/Covering Asset Ratio for 2023 is good at 0.90 and this is the important one, not the Long Term Debt/Market Cap Ratio. The Liquidity Ratio for 2023 is a good at 2.70, but this is not very important for banks. The Debt Ratio for 2023 is fine at 1.06, which is a fine ratio for banks.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R A | 0.90 | 0.90 |
| Lg Term R | 8.63 | 8.28 |
| Intang/GW | 0.15 | 0.15 |
| Liquidity | 2.70 | 2.70 |
| Liq. + CF | 3.87 | 3.87 |
| Debt Ratio | 1.06 | 1.06 |
The Total Return per year is shown below for years of 5 to 48 to the end of 2023. 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. |
|---|---|---|---|---|---|
| 2018 | 5 | 8.03% | 9.18% | 4.76% | 4.42% |
| 2013 | 10 | 9.01% | 9.69% | 5.51% | 4.18% |
| 2008 | 15 | 8.18% | 14.77% | 9.57% | 5.20% |
| 2003 | 20 | 9.91% | 11.36% | 7.24% | 4.12% |
| 1998 | 25 | 10.31% | 11.68% | 7.68% | 4.00% |
| 1993 | 30 | 10.54% | 14.57% | 9.71% | 4.86% |
| 1988 | 35 | 10.22% | 12.91% | 8.82% | 4.09% |
| 1983 | 40 | 9.94% | 14.51% | 9.77% | 4.75% |
| 1978 | 45 | 10.96% | 16.34% | 10.57% | 5.77% |
| 1975 | 48 | 10.70% | 15.24% | 10.23% | 5.02% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 8.25, 9.82 and 11.82. The corresponding 10 year ratios are 10.68, 11.93 and 13.15. The corresponding historical ratios are 10.50, 11.76 and 13.03. The current P/E Ratio is 10.79 based on a stock price of $80.80 and EPS estimate for 2024 of $7.49. 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.
I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Earnings per Share Ratios are 9.35, 10.71 and 11.71. The corresponding 10 year ratios are 9.94, 11.40 and 12.50. The current P/AEPS Ratio is 10.29 based on a stock price of $80.80 and AEPS estimate for 2024 of $7.85. 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.
I get a Graham Price of $102.47. The 10-year low, median, and high median Price/Graham Price Ratios are 0.78, 0.88 and 0.98. The current P/GP Ratio is 0.79 based on a stock price of $80.80. 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.
I get a 10-year median Price/Book Value per Share Ratio of 1.58. The current P/B Ratio is 1.36 based on a stock price of $80.80, Book Value of $106,507M and Book Value per share of $59.45. The current ratio is 14% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I also have a Book Value per Share for 2024 of $60.00. This implies a P/B Ratio of 1.35 based on a Stock Price of $80.80 and a Book Value of $107,484M. The current ratio is 15% below the 10 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 Price/Cash Flow per Share Ratio of 3.16. The current P/CF Ratio is 2.12 based on Cash Flow for the last 12 months of $65,302M, Cash Flow per Share of $36.45 and a stock price of $80.80. The current ratio is 33% 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 3.53%. The current dividend yield is 5.05% based on dividends of $4.08 and a stock price of $80.80. 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 3.88%. The current dividend yield is 5.05% based on dividends of $4.08 and a stock price of $80.80. 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 3.18. The current P/S Ratio is 2.83 based on a stock price of $80.80, Revenue estimate for 2024 of $51,131M, and Revenue per Share of $25.84. The current ratio is 11% 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 reasonable and may even be cheap. Both the dividend yield tests say the stock price is cheap, but the 10 year median dividend yield test is the most important. This is not confirmed by the P/S Ratio test as they test just say the stock price is reasonable. However, the 10 year median yield test is important. Most of the other tests are saying the stock price is reasonable and below the median.
When I look at analysts’ recommendations, I find Strong Buy (2), Buy (4), Hold (7) and Underperform (1). The consensus would be a Buy. The 12 months stock price consensus is $87.58, with a high of $96.00 and Low of $66.00. The consensus stock price of $87.58 implies a total return of 13.44% with 8.39% from capital gains and 5.05% from dividends.
All the recommendations on Stock Chase are Buys or Holds. Stock Chase gives this stock 5 stars out of 5. It is on all the dividend lists I follow. Joey Frenette on Motley Fool says you can buy and hold this stock for decades. Karen Thomas on Motley Fool talks about what a great investment this bank has been over the past 10 years. This bank put out a press release via Newswire about their 2023 year end results.
Simply Wall Street via Yahoo Finance talk about who owns the shares of this bank. Simply Wall Street gives this stock 3 and one half stars out of 5. Simply Wall Street gives 3 warnings of unstable dividend track record; and Profit margins (20.8%) are lower than last year (36%). Note that SWS cannot not always tell the difference between unstable dividends track record and dividends paid in CDN$ that when translated into US$ look unstable because of the currency exchange rate varying over time.
Toronto-Dominion is one of Canada's two largest banks and operates three business segments: Canadian retail banking, U.S. retail banking, and wholesale banking. The bank's U.S. operations span from Maine to Florida, with a strong presence in the Northeast. It also has an ownership stake in Charles Schwab. Its web site is here Toronto Dominion Bank.
The last stock I wrote about was about was Calian Group Ltd (TSX-CGY, OTC-CLNFF) ... learn more. The next stock I will write about will be Bank of Nova Scotia (TSX-BNS, NYSE-BNS) ... learn more on Monday, January 15, 2024 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.
See my site for an index to these blog entries and for stocks followed. 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. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.
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