Is it a good company at a reasonable price? I realized I was buying a volatile small cap stock when I bought this stock. I bought stock when the stock was taking off in 2014 and probably paid too much for it. I am still into this stock for the long term. However, anyone buying it should realize it is a risky buy as I did when I bought this stock. The stock is testing as relatively cheap.
I own this stock of Mullen Group Ltd (TSX-MTL, OTC-MLLGF). I like to look at recommended small cap dividend paying stock to see if they would be a possible good investment now or in the future. The other thing to mention about this stock is that it converted from an income trust and decreased it dividends. The reduction in dividend brought the Dividend Payout Ratios down to a place that would allow for the company to begin growing dividends again.
When I was updating my spreadsheet, I noticed I have had this stock for 10 year and I have a total return of 0.43% with a 3.48% capital loss and 3.91% from dividends. I noticed a number of stocks that have low returns over the past 10 year, but this one has had low returns for also 15 and 20 year period. I obviously paid too much when I bought shares in 2024, but this stock had a good run up to 20214 and has not done much since.
It is, however, a positive that they have been raising the dividends again in 2021 after a decrease in 2020. I must admit they also had a decrease in 2016 and then started to raise them in 2018.
If you had invested in this company in December 2014, for $1,001.57 you would have bought 47 shares at $21.31 per share. In December 2024, after 10 years you would have received $297.51 in dividends. The stock would be worth $685.26. Your total return would have been $982.77. This would be a total loss of 0.22% per year with 3.72% from capital loss and 3.50% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $21.31 | $1,001.57 | 47 | 10 | $297.51 | $685.26 | $982.77 |
However, if you had invested in this company in December 2019, for $1,001.16 you would have bought 108 shares at $9.27 per share. In December 2024, after 5 years you would have received $319.68 in dividends. The stock would be worth $1,574.64. Your total return would have been $1,894.32. This would be a total return of 14.63% per year with 9.48% from capital gain and 5.15% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $9.27 | $1,001.16 | 108 | 5 | $319.68 | $1,574.64 | $1,894.32 |
The current dividend yield is good with dividend growth low. The current dividend yield is good (5% to 6% ranges) at 5.84%. The 5, 10 and historical median dividend yields are moderate (2% to 4% ranges) at 4.91%, 4.61% and 4.44%. The dividend growth is low (below 8% per year) at 4.8% per year over the past 5 years. The last dividend increase was in 2024 and it was for 16.7%.
Dividends on this stock have gone down and well as up. Note dividend were decreased in 2020. Over the past 24 years, dividends have increased in 13 years and decreased in 5 years.
The Dividend Payout Ratios (DPR) are fine, but could improve. The DPR for 2024 for Earnings per Share (EPS) is too high at 62% with 5 year coverage at 52%. The DPR for 2024 for Funds from Operations (FFO) is good at 23% with 5 year coverage at 22%. The DPR for 2024 for Adjusted Earnings per Share (AEPS) is too high at 62% with 5 year coverage at 55%. A better DPR for AEPS is no higher than 49% (that is in the 40% range). The DPR for 2024 for Cash Flow per Share (CFPS) is good at 20% with 5 year coverage at 19%. The DPR for 2024 for Free Cash Flow (FCF) is good at 37% with 5 year coverage at 42%. There is no agreement on what FCF is.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 61.79% | 52.02% |
| FFO | 22.55% | 21.57% |
| AEPS | 61.78% | 54.64% |
| CFPS | 19.64% | 18.82% |
| FCF | 37.02% | 42.39% |
Debt Ratios are fine, but the company has a fair bit of debt. The Long Term Debt/Market Cap Ratio for 2024 is fine at 0.60 and fine currently at 0.52. The Liquidity Ratio for 2024 is good at 2.32 and 2.24 currently. The Debt Ratio for 2024 is good at 1.77 and 1.77 currently. The Leverage and Debt/Equity Ratios for 2024 are fine at 2.29 and 1.29 and currently at 2.30 and 1.30.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term | 0.60 | 0.52 |
| Intang/GW | 0.38 | 0.39 |
| Liquidity | 2.32 | 2.24 |
| Liq. + CF | 2.55 | 3.06 |
| Debt Ratio | 1.77 | 1.77 |
| Leverage | 2.29 | 2.30 |
| D/E Ratio | 1.29 | 1.30 |
The Total Return per year is shown below for years of 5 to 27 to the end of 2024. 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. |
|---|---|---|---|---|---|
| 2019 | 5 | 4.84% | 14.63% | 9.48% | 5.15% |
| 2014 | 10 | -4.46% | -0.22% | -3.72% | 3.50% |
| 2009 | 15 | 2.83% | 4.19% | -0.76% | 4.95% |
| 2004 | 20 | 7.88% | 5.48% | -0.65% | 6.14% |
| 1999 | 25 | 7.52% | 11.34% | 3.28% | 8.05% |
| 1997 | 27 | 9.17% | 2.75% | 6.41% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 8.97, 11.50 and 12.80. The corresponding 10 year ratios are 10.48, 13.47 and 18.45. The corresponding historical ratios are 10.84, 14.59 and 18.02. The current P/E Ratio is 11.81 based on a stock price of $14.38 and EPS estimate for 2025 of $1.22. The current ratio is between the low and median ratio 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 9.59, 11.50 and 12.80. The corresponding 10 year ratios are 14.87, 19.29 and 23.72. The corresponding historical ratios are 13.08, 16.19 and 19.24. The current P/E Ratio is 11.79 based on a stock price of $14.38 and EPS estimate for 2025 of $1.22. The current ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.
I get a Graham Price of $17.75. The 10-year low, median, and high median Price/Graham Price Ratios are 0.79, 1.02 and 1.25. The current P/GP Ratio is 0.81 based on a stock price of $14.38. The current ratio is between the low and median ratio 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 1.32. The current P/B Ratio is 1.25 based on a stock price of $14.38, Book Value of $1,003M and Book Value per Share of $11.47. The current ratio is 5% 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 2025 of $11.89. The analyst calculates the Book Value differently than I do and has a 10 year P/B Ratio of 1.30. The current P/B Ratio is 1.21 with a stock price of $14.38 and a Book Value of $1,040. The current ratio is 7% 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 5.40. The current P/CF Ratio is 4.85 based on a Stock Price of $14.38, Cash Flow per Share estimate for 2025 of $2.96 and Cash Flow of $259M. The current ratio is 10% 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 4.44%. The current dividend yield is 5.84% based on dividends of $0.84 and a stock price of $14.38. The current dividend yield is 32% 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 4.69%. The current dividend yield is 5.84% based on dividends of $0.84 and a stock price of $14.38. The current dividend yield is 25% 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 0.70. The current P/S Ratio is 0.58 based on Revenue estimate for 2025 of $2,169M, Revenue per Share of $24.80 and a stock price of $14.38. The current ratio is 28% 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 cheap. The dividend yield tests say this. It is confirmed by the P/S Ratio test. The other tests say the stock price is either cheap or reasonable and below the median.
When I look at analysts’ recommendations, I find Strong Buy (3), Buy (7) and Hold (1). The consensus would be a Strong Buy. The 12 month stock price consensus is $16.64 with a high of $18.25 and low of $14.00. The consensus stock price of $16.64 implies a total return of 21.56% with 15.72% from capital gains and 5.84% from dividends based on a current stock price of $14.38.
The only entry for 2025 on Stock Chase gives it a weak buy. The two of the three entries for 2024 says Do Not Buy. They do not like the connection to the oil and gas industries. Amy Legate-Wolfe onMotley Fool thinks that Mullen is an overlooked opportunity. She thinks it has long term potential. Aditya Raghunath on Motley Fool thinks you should buy this stock for its cash flow. The company put out a press release via Globe Newswire about its fourth quarter of 2024 results. The company put out a press release via Globe Newswire about its first quarter of 2025 results.
Simply Wall Street via Yahoo Finance reviews this stock. Simply Wall Street conclusion is that they like Mullen Group's growing earnings per share and the fact that - while its payout ratio is around average - it paid out a lower percentage of its cash flow. Simply Wall Street has two warning messages out on this stock of has a high level of debt; and unstable dividend track record.
Mullen Group Ltd is a logistics provider with a network of independently operated businesses providing a wide range of service offerings including less-than-truckload, truckload, Specialized & Industrial Services warehousing and logistics, U.S., and International Logistics, and Corporate. The company also provides a diverse set of specialized services related to the energy, mining, forestry, and construction industries in western Canada. Its web site is here Mullen Group Ltd.
The last stock I wrote about was about was Hammond Power Solutions Inc (TSX-HPS.A, OTC-HMDPF) ... learn more. The next stock I will write about will be Canadian Utilities Ltd (TSX-CU, OTC-CDUAF) ... learn more on Friday, May 23, 2025 around 5 pm. Tomorrow on my other blog I will write about Ontario’s Economy Is Broken.... learn more on Thursday, May 22, 2025 around 5 pm.
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