Is it a good company at a reasonable price? Growth seems to have slowed over the past 5 years compared to the last 10 years. However, analysts think that growth will pick up again this year. The stock price is up over 40% this year and that is probably why the 12 months stock price from here is low. Shareholders have done well with this stock over the long term. My testing is showing the stock price as still reasonable with the dividend yield testing showing the stock price as cheap.
I do not own this stock of CCL Industries Inc (TSX-CCL.B, OTC-CCDBF). In 2009 I read a favorable report on this stock of which I had also heard before. This is also a dividend paying stock and in 2009 it was on Dividend Achievers list.
When I was updating my spreadsheet, I noticed between February 21 and 23, of 2024 the stock price shot up some 18%. February 21 was the day that they released the financials for the last quarter of the year and for the year. The title of the release was that the company announced strong fourth quarter and 2023 results.
Over the past year there was a lot of insiders selling by CEO, CFO, some Officers, and some Directors. A lot of this selling when the price spiked in February 2024.
In the chart below, I am showing 5 and 10 year total growth and per year growth in columns 3 and 4. Column 5 shows growth expected over 12 months to the first quarter in 2024 and expected growth over this year. Growth does seem to have slowed down, but better growth seems to be expected this year.
| Yr | Item | Tot. Gwth | Per Year | Gwth | Coverage |
|---|---|---|---|---|---|
| 5 | Revenue Growth | 28.83% | 5.20% | 4.30% | <-12 mths |
| 5 | AEPS Growth | 37.73% | 6.61% | 9.84% | <-12 mths |
| 5 | Net Income Growth | 13.58% | 2.58% | 28.16% | <-12 mths |
| 5 | Cash Flow Growth | 29.84% | 5.36% | 6.05% | <-12 mths |
| 5 | Dividend Growth | 103.85% | 15.31% | 9.43% | <-12 mths |
| 5 | Stock Price Growth | 18.54% | 3.46% | 40.70% | <-12 mths |
| 10 | Revenue Growth | 251.94% | 13.41% | 8.20% | <-this year |
| 10 | AEPS Growth | 324.38% | 15.55% | 18.88% | <-this year |
| 10 | Net Income Growth | 411.84% | 17.74% | 59.81% | <-this year |
| 10 | Cash Flow Growth | 200.63% | 11.64% | 23.43% | <-this year |
| 10 | Dividend Growth | 516.28% | 19.94% | 9.43% | <-this year |
| 10 | Stock Price Growth | 274.53% | 14.12% | 47.96% | <-this year |
If you had invested in this company in December 2013, for $1,014.02 you would have bought 64 shares at $15.84 per share. In December 2023, after 10 years you would have received $394.24 in dividends. The stock would be worth $3,797.76. Your total return would have been $4,192.00. This would be a total return of 16.05% per year with 14.12% from capital gain and 1.93% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $15.84 | $1,014.02 | 64 | 10 | $394.24 | $3,797.76 | $4,192.00 |
The current dividend yield is low with dividend growth good. The current dividend yield is low (below 2%) at 1.39%. The 5, 10 and historical median dividend yields are also low at 1.50%, 1.12% and 1.97%. The dividend growth has been good (15% per year or higher) at 15.3% per year over the past 5 years. The last dividend increase was in 2024 and it was for 9.43%.
The Dividend Payout Ratios (DPR) are good. The DPR for 2023 for Earnings per Share (EPS) is good at 36% with 5 year coverage at 28%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is good at 28% with 5 year coverage at 26%. The DPR for 2023 for Cash Flow per Share (CFPS) is good at 14% with 5 year coverage at 13%. The DPR for 2023 for Free Cash Flow (FCF) is good at 34% with 5 year coverage at 29%.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 35.93% | 27.77% |
| AEPS | 28.19% | 25.55% |
| CFPS | 14.08% | 12.75% |
| FCF | 34.72% | 28.80% |
Debt Ratios are good. The Long Term Debt/Market Cap Ratio for 2023 is good at 0.20 and currently at 0.14. The Liquidity Ratio for 2023 is good at 1.90 and 2.05 currently. The Debt Ratio for 2023 is good at 2.07 and 2.07 currently. The Leverage and Debt/Equity Ratios for 2023 are good at 1.93 and 0.93 and currently at 1.93 and 0.93.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 0.20 | 0.14 |
| Intang/GW | 0.32 | 0.21 |
| Liquidity | 1.90 | 2.05 |
| Liq. + CF | 2.47 | 2.83 |
| Debt Ratio | 2.07 | 2.07 |
| Leverage | 1.93 | 1.93 |
| D/E Ratio | 0.93 | 0.93 |
The Total Return per year is shown below for years of 5 to 36 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 | 15.31% | 5.03% | 3.46% | 1.58% |
| 2013 | 10 | 19.94% | 16.05% | 14.12% | 1.93% |
| 2008 | 15 | 16.16% | 20.15% | 17.93% | 2.22% |
| 2003 | 20 | 14.39% | 16.67% | 14.86% | 1.81% |
| 1998 | 25 | 12.48% | 13.35% | 11.92% | 1.42% |
| 1993 | 30 | 10.30% | 13.38% | 11.82% | 1.56% |
| 1988 | 35 | 9.25% | 11.29% | 9.94% | 1.34% |
| 1987 | 36 | 12.45% | 10.81% | 1.65% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 17.46, 19.84 and 22.21. The corresponding 10 year ratios are 17.61, 20.92 and 24.81. The corresponding historical ratios are 12.08, 15.07 and 20.73. The current P/E Ratio is 18.15 based on a stock price of $83.49 and EPS estimate for 2024 of $4.60. 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 15.16, 17.25 and 19.79. The corresponding 10 year ratios are 15.20, 19.57 and 22.95. The current P/AEPS Ratio is 18.68 based a stock price of $83.49 and AEPS estimate for 2024 of $4.47. 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 $50.30. The 10-year low, median, and high median Price/Graham Price Ratios are 1.35, 1.74 and 1.99. The current P/GP Ratio is 1.66 based on a stock price of $83.49. 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 get a 10-year median Price/Book Value per Share Ratio of 3.38. The current ratio is 3.32 based on a stock price of $83.49, Book Value of $4,473M and Book Value per Share of $25.16. The current ratio is 2% 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 estimate for 2024 of $29.57. This implies a ratio of 2.82 where the stock price of $83.49 and the Book Value is $5,258M. this ratio is 17% 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 13.04. The current P/CF Ratio is 12.01 based on Cash Flow per Share estimate for 2024 of $6.95, Cash Flow of $1,236M and a stock price of $83.49. The current ratio is 8% 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 1.97%. The current dividend yield is 1.39% based on a stock price of $83.49 and dividends of $1.16. The current ratio is 29% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive.
I get a 10 year median dividend yield of 1.12%. The current dividend yield is 1.39% based on a stock price of $83.49 and dividends of $1.16. The current ratio is 24% 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 1.97. The current P/S Ratio is 2.06 based on a stock price of $83.49, Revenue estimate for 2024 of $7,195M and Revenue per Share of $40.47. The current ratio is 4% 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, but maybe cheap. The 10 year dividend yield test says that the stock price is relatively cheap. The P/S Ratio test says it is reasonable but above the median. All of the rest of the testing says that the stock price is reasonable and below the median.
When I look at analysts’ recommendations, I find Strong Buy (3), and Buy (7). The consensus would be a Strong Buy. The 12 month stock price consensus is $87.80 with a high of $92.00 and low of $84.00. The consensus stock price of $87.80 implies a total return of 6.55% with 5.16% from capital gains and 1.39% from dividends based on a current stock price of $83.49.
There is a number of analysts’ recommendations on Stock Chase for this stock. Analysts seem to like it. Stock Chase gives this stock 5 stars out of 5. Amy Legate-Wolfe on Motley Fool talks about 5 stocks she likes including this one. Jitendra Parashar on Motley Fool talks about this stock in February 2024. The company put our a press release via Accesswire about their results for 2023. The company put out a press release via Accesswire about their second quarter of 2024.
Simply Wall Street via Yahoo Finance reviews this stock. They have one warnings of significant insider selling over the past 3 months. Simply Wall Street gives this stock 4 stars out of 5.
CCL Industries Inc manufactures and sells packaging and packaging-related products. The company operates through various segments which include the CCL segment, the Avery segment, and the Checkpoint segment Its geographical segments include Canada; USA and Puerto Rico; Mexico, Brazil, Chile, and Argentina; Europe; and Asia, Australia, Africa, and New Zealand. Its web site is here CCL Industries Inc.
The last stock I wrote about was about was Brookfield Corp (TSX-BN, NYSE-BN) ... learn more. The next stock I will write about will be Ovintiv Inc (TSX-OVV, NYSE-OVV) ... learn more on Monday, October 21, 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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