Is it a good company at a reasonable price? This is a small cap Tech stock. It is very risky and you should not buy it with money you can not afford to lose. Their DPRs are too high and will not change any time soon, so they could cut the dividends again. I think small companies should have a good Liquidity Ratio and this company does not. If you look at the Dividend Yield testing, the stock price is cheap, but if they cut dividends, that may not be the case. Analysts are still expecting the stock price is rise over the next year.
I do not own this stock of Sylogist Ltd (TSX-SYZ, OTC-SYZLF). I learned about this stock from the newsletter I subscribe to.
When I was updating my spreadsheet, I noticed that the financial statements are no longer on their website. Their website is annoying as it sends you around in cycles. When I complained to the company about this, they sent me the financial statements for 2023 but this is not good for the future. This is a Tech company with a confusing website? Another thing that they did was change their financial year from September 30 each year to December 31 each year.
If you had invested in this company in December 2013, for $1,001.96 you would have bought 148 shares at $6.77 per share. In December 2023, after 10 years you would have received $523.18 in dividends. The stock would be worth $1,104.08. Your total return would have been $1,627.26. This would be a total return of 6.20% per year with 0.98% from capital gain and 5.22% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $6.77 | $1,001.96 | 148 | 10 | $523.18 | $1,104.08 | $1,627.26 |
The current dividend yield is moderate with dividend growth low and a recent dividend cut. The current dividend yield is moderate (2% to 4% ranges) at 4.32%. The 5, 10 and historical median dividend yields are also moderate at 4.65%, 3.02% and 3.16%.
The Dividend Payout Ratios (DPR) are far too high. The DPR for 2023 for Earnings per Share (EPS) is far too high at 800% with 5 year coverage at 255%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is far too high at 800% with 5 year coverage at 295%. The DPR for 2023 for Cash Flow per Share (CFPS) is far too high at 66% with 5 year coverage at 73%. The DPR for 2023 for Free Cash Flow (FCF) is far too high at 143% with 5 year coverage at 94%.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 800.00% | 255.17% |
| AEPS | 800.00% | 294.83% |
| CFPS | 66.44% | 73.18% |
| FCF | 142.56% | 93.91% |
For Debt Ratios, the Liquidity Ratio is concerning, but rest of debt ratios are fine. The Long Term Debt/Market Cap Ratio for 2023 is good at 0.10 and currently at 0.09. The Liquidity Ratio for 2023 is far too low at 0.54 and 0.48 currently. If you added in Cash Flow after dividends, the ratios are still awful at 0.59 and currently at 0.39. If you add back the current portion of long term debt the ratios are good at 3.63 and currently at 6.64. However, be careful about this and make sure they can cover this debt or roll it over. The Debt Ratio for 2023 is good at 1.64 and 1.64 currently. The Leverage and Debt/Equity Ratios for 2023 are fine at 2.57 and 4.47 and currently at 2.56 and 1.56.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 0.10 | 0.09 |
| Intang/GW | 0.39 | 0.32 |
| Liquidity | 0.54 | 0.48 |
| Liq. + CF | 0.59 | 0.39 |
| Liq. + CF+D | 3.63 | 6.64 |
| Debt Ratio | 1.64 | 1.64 |
| Leverage | 2.57 | 2.56 |
| D/E Ratio | 1.57 | 1.56 |
The Total Return per year is shown below for years of 5 to 25 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 | 4.56% | -5.45% | -9.82% | 4.38% |
| 2013 | 10 | 9.26% | 6.20% | 0.98% | 5.22% |
| 2008 | 15 | 15.14% | 39.20% | 22.62% | 16.58% |
| 2003 | 20 | 27.32% | 19.27% | 8.05% | |
| 1998 | 25 | 1.40% | -0.54% | 1.94% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 54.17, 77.54 and 109.83. The corresponding historical ratios are 44.59, 69.93 and 90.81. The corresponding historical ratios are 15.30, 22.60 and 28.44. The current P/E Ratio is 94.39 based on a stock price of $9.75 and EPS estimate for 2024 of $0.10. 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.
These ratios are very high. The problem is that when EPS falls, the stock price only falls so far, this is what happened in this case. The EPS over the past 5 years fell 58%, but the median stock price fell on 11%.
I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 31.94, 54.74 and 71. The corresponding 10 year ratios are 28.24, 43.02 and 55.77. The current ratio is 69.64 based on a stock price of $9.75 and AEPS estimate for 2024 of $0.14. 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.
I get a Graham Price of $2.22. The 10-year low, median, and high median Price/Graham Price Ratios are 2.15, 2.92 and 3.76. The current P/GP Ratio is 4.39 based on a stock price of $9.75. 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. These ratios are also very high ones.
I get a 10-year median Price/Book Value per Share Ratio of 4.84. The current P/B Ratio is 6.24 based on a stock price of $9.75, Book Value of $37.08M, and Book Value per Share of $1.56. The current ratio is 29% 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 17.48. The current P/CF Ratio is 42.85 based on Cash Flow per Share estimate for 2024 of $0.23, Cash Flow of $5.4M and a stock price of $9.75. The current ratio is 145% above the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get an historical median dividend yield of 3.16%. The current dividend yield is 4.0% based on a stock price of $9.75 and dividends of $0.40. The current dividend is 30% 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 3.02%. The current dividend yield is 4.0% based on a stock price of $9.75 and dividends of $0.40. The current dividend is 36% 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 6.45. The current P/S Ratio is 3.22 based on Revenue estimate for 2024 of $71.8M, Revenue per Share of $3.02 and a stock price of $9.75. The current ratio is 50% 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 relatively cheap. The dividend yield testing is showing the stock price as cheap. This is confirmed by the P/S Ratio test which says the stock price is relatively cheap. I do not that all the other tests are basically saying the stock price is relatively expensive.
When I look at analysts’ recommendations, I find Strong Buy (4), Buy (2). The consensus would be a Strong Buy. The 12 month stock price consensus is $12.42, with a high of $14.00 and low of $10.00. The stock price consensus implies a total return of 31.49%, with 27.38% from capital gains and 4.10% from dividends based on a current stock price of $9.75.
Last year when I look at analysts’ recommendations, I find Strong Buy (1), Buy (2) and Hold (1). The consensus would be a Buy. The 12 month stock price consensus was $9.38. That implied a total return of 61.65% with 55.04% from capital gains and 6.61% from dividend based on a stock price of $6.05. What happened is the stock price moved from $6.05 to $9.75 for a total return of 67.77% with 61.16% from capital gains and 6.61% from dividends. The stock price better over the past year than analysts thought.
The only remark for 2024 on Stock Chase is that the analyst is watching this stock. He does like the company. In 2023 the remarks were Buy, Do not Buy and Risky. Stock Chase gives this stock 3 stars out of 5. Robin Brown on Motley Fool says the stock is a turnaround stock as it was mismanaged for several years. Aditya Raghunath on Motley Fool thinks this is a good small cap to invest in. The company put out a Press Release about their fourth quarter of 2023. The company put out a Press Release about their first quarter of 2024.
Simply Wall Street via Yahoo Finance looks at this stocks and says that the first quarter of 2024 results misses expectations. Simply Wall Street has two warnings of large one-off items impacting financial results; and profit margins (0.7%) are lower than last year (2.5%). Simply Wall Street gives this stock 2 and one half stars out of t.
Sylogist Ltd is a software company that provides software-as-a-service (SaaS) solutions that provides ERP, CRM, fundraising, education administration, and payments solutions to education verticals., including fund accounting, grant management, and payroll to public service organizations. Geographically, the company offers its services to the United States of America, Canada, the United Kingdom, and other regions. The majority of the revenue comes from the United States of America. Its web site is here Sylogist Ltd.
The last stock I wrote about was about was Ensign Energy Services (TSX-ESI, OTC-ESVIF) ... learn more. The next stock I will write about will be Algonquin Power & Utilities Corp (TSX-AQN, NTSE-AQN) ... learn more on Wednesday, June 12, 2024 around 5 pm. Tomorrow on my other blog I will write about Smokeshow .... learn more on Tuesday, June 11, 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.
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