Is it a good company at a reasonable price? I see analyst recommendation of a Strong Buy but the 12 month price consensus is only a 3.01% total return, which is very low. This does not make much sense to me. I do think that this is a great company, but the it seems to be that it is currently rather expensive.
I own this stock of TFI International Inc (TSX-TFII, OTC-TFIFF). I read a report called "6 Canadian Dividend Stocks That Fly Under the Radar" by John Heinzl in April of 2013. This is one of the stocks mentioned. There was also a good review of this stock by Advice Hotline by MPL Communications.
When I was updating my spreadsheet, I noticed I have done incredibly well with this stock. I have had it for just almost 7 years and have made a total return of 35.18% per year with 33.04% from capital gains and 2.14% from dividends.
If you had invested in this company in December 2013, for $1,010.40 you would have bought 40 shares at $25.26 per share. In December 2023, after 10 years you would have received $400.77 in dividends. The stock would be worth $7,209.60. Your total return would have been $7,610.37. This would be a total return of 23.31% per year with 21.71% from capital gain and 1.60% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $25.26 | $1,010.40 | 40 | 10 | $400.77 | $7,209.60 | $7,610.37 |
The current dividend yield is low with dividend growth good. The current dividend is low (below 2%) at 1.08%. The 5 year median dividend yield is also low at 1.18. The 10 year and historical median dividend yields are moderate (2% to 4% ranges) at 2.24% and 2.58%. The dividend increases are good (15% and above per year) at 17.9% per year over the past 5 years. The last dividend increase was in 2024 and it was for 14.3%.
The Dividend Payout Ratios (DPR) are good. The DPR for 2023 for Earnings per Share (EPS) is good at 24% with 5 year coverage at 18%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is good at 23% with 5 year coverage at 21%. The DPR for 2023 for Cash Flow per Share (CFPS) is good at 10% with 5 year coverage at 9%. The DPR for 2023 for Free Cash Flow (FCF) is good at 19% with 5 year coverage at 17%.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 24.14% | 17.86% |
| AEPS | 22.65% | 20.56% |
| CFPS | 9.76% | 8.74% |
| FCF | 18.63% | 17.10% |
Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2023 is good at 0.11 and currently at 0.10. The Liquidity Ratio for 2023 is a bit low at 1.25 and 1.25 currently. If you added in Cash Flow after dividends, the ratios are fine at 2.09 and currently at 2.05. The Debt Ratio for 2023 is good at 1.70 and 1.70 currently. The Leverage and Debt/Equity Ratios for 2023 are fine at 2.42 and 1.42.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 0.11 | 0.10 |
| Intang/GW | 0.18 | 0.16 |
| Liquidity | 1.25 | 1.25 |
| Liq. + CF | 2.09 | 2.05 |
| Debt Ratio | 1.70 | 1.70 |
| Leverage | 2.42 | 2.42 |
| D/E Ratio | 1.42 | 1.42 |
The Total Return per year is shown below for years of 5 to 33 to the end of 2023 in CDN$. 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. |
|---|---|---|---|---|---|
| 2018 | 5 | 17.13% | 40.47% | 38.55% | 1.92% |
| 2013 | 10 | 13.54% | 23.31% | 21.71% | 1.60% |
| 2008 | 15 | 5.64% | 32.63% | 28.58% | 4.05% |
| 2003 | 20 | 2.45% | 20.76% | 15.82% | 4.94% |
| 1998 | 25 | 2.34% | 25.06% | 17.72% | 7.34% |
| 1993 | 30 | 23.91% | 18.32% | 5.60% | |
| 1990 | 33 | 19.38% | 16.01% | 3.37% |
The Total Return per year is shown below for years of 5 to 20 to the end of 2023 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. |
|---|---|---|---|---|---|
| 2018 | 5 | 17.85% | 41.29% | 39.29% | 1.99% |
| 2013 | 10 | 11.09% | 20.54% | 19.11% | 1.43% |
| 2008 | 15 | 5.10% | 32.50% | 27.88% | 4.62% |
| 2003 | 20 | 2.34% | 21.62% | 15.67% | 5.95% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 7.76, 12.07 and 16.77. The corresponding 10 year ratios are 9.07, 12.12 and 17.31. The corresponding historical ratios are 8.45, 11.86 and 14.16. The current P/E Ratio is 20.51 based on a stock price of $201.46 and EPS estimate for $9.82. The current ratio is above the high ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.
I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/AEPS Earnings per Share Ratios 8.73, 11.12 and 16.39. The corresponding 10 year ratios are 9.91, 14.53 and 17.63. The current P/AEPS Ratio is 20.07 based on a stock price of $201.46 and AEPS estimate for 2024 of $10.04. This ratio is above the high ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.
I get a Graham Price of $96.72. The 10-year low, median, and high median Price/Graham Price Ratios are 0.97, 1.20 and 1.47. The current P/GP Ratio is 2.08 based on a stock price of $201.46. The current ratio is above the high ratio of the 10 year median ratios. This ratio is above the high ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.
I get a 10-year median Price/Book Value per Share Ratio of 2.45. The current P/B Ratio is 4.83 based on a stock price of $148.31, Book Value of $2,591M, and a Book Value per Share of $30.69. The current ratio is 97% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$ and you will a similar result in CDN$.
I also have Book Value per Share estimate for 2024 of $34.30 US$. This implies a P/B Ratio of 4.32 with a Book Value of $2,896M and stock price of $148.31. This ratio is 77% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$.
I get a 10-year median Price/Cash Flow per Share Ratio of 7.78. The current P/CF Ratio is 12.79 based on a stock price of $148.31, Cash Flow per Share estimate for 2024 of $11.60 and Cash Flow of $979.5M. The current ratio is 64% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$ and you will a similar result in CDN$.
I get an historical median dividend yield of 2.58%. The current dividend yield is 1.08% based on dividends of $1.60 and a stock price of $148.31. The current ratio is 58% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$ and you will a similar result in CDN$.
I get a 10 year median dividend yield of 2.51%. The current dividend yield is 1.08% based on dividends of $1.60 and a stock price of $148.31. The current ratio is 52% below the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$ and you will a similar result in CDN$.
The 10-year median Price/Sales (Revenue) Ratio is 0.72. The current P/S Ratio is 1.39 based on a stock price of $148.31, Revenue estimate for 2024 of $8,991M and Revenue per Share of $106.48. The current ratio is 94% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$ and you will a similar result in CDN$.
Results of stock price testing is that the stock price is probably relatively expensive. The dividend yield tests points to an expensive stock price. The P/S Ratio test confirms this. All the other testing is saying that the stock price is relatively expensive.
When I look at analysts’ recommendations, I find Strong Buy (10), Buy (6) and Hold (4). The current consensus would be a Strong Buy. The 12 month stock price consensus is $205.36 ($151.40 US$), with a high of $237.37 ($175.00US$) and low of $166.57 ($122.80 US$. The 12 month stock price consensus price of $205.36 implies a total return of 3.01% with 1.94% from capital gains and 1.08% from dividends.
Analysts seem to like this stock on Stock Chase. The two entries for 2024 are buys. Stock Chase gives this stock 5 stars out of 5. It is on all my dividend lists. Amy Legate-Wolfe on Motley Fool reviews this stock and still thinks it is a buy even after it is up a lot. Robin Brown Motley Fool calls this stock a trucking success story. The company put out a press release via Newswire about their fourth quarter of 2023 results.
Simply Wall Street via Yahoo Finance reviews this stock. Simply Wall Street put out one warning of has a high level of debt. Simply Wall Street gives this stock 3 and one half stars out of 5.
TFI International Inc is a transportation and logistics company domiciled in Canada. The company organizes itself into four segments: package and courier, less-than-truckload, truckload, and logistics. TFI International derives the majority of revenue domestically, followed by the United States. Its web site is here TFI International Inc.
The last stock I wrote about was about was Atrium Mortgage Investment Corp (TSX-AI, OTC-AMIVF) ... learn more. The next stock I will write about will be IGM Financial Inc (TSX-IGM, OTC-IGIFF) ... learn more on Wednesday, March 6, 2024 around 5 pm. Tomorrow on my other blog I will write about Dividend Stocks March 2024 .... learn more on Tuesday, March 5, 2024 around 5 pm.
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