Is it a good company at a reasonable price? The stock price is testing as reasonable, but I would worry because the stock price is at an historical high. Generally, that is not an ideal time to buy a stock. On the other hand, this stock has produced good returns and rising dividends for its shareholders. But analysts do not think that the stock will grow much more in the near year. It is always wise to buy shares in a company over time and in different months.
I do not own this stock of IA Financial Corp (TSX-IAG, OTC-IDLLF). This was a stock shown as a dividend growth stock on the Canadian All Star List. See site.
When I was updating my spreadsheet, I noticed that the stock price has really taken off this year. The stock price was up 48% in 2024 and up 6% so far this year.
If you had invested in this company in December 2014, for $1,021.89 you would have bought 23 shares at $44.43 per share. In December 2024, after 10 years you would have received $463.57 in dividends. The stock would be worth $3,066.36. Your total return would have been $3,529.93. This would be a total return of 14.22% per year with 11.61% from capital gain and 2.61% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $44.43 | $1,021.89 | 23 | 10 | $463.57 | $3,066.36 | $3,529.93 |
The current dividend yield is moderate with dividend growth moderate. The current dividend yield is moderate (2% to 4% ranges) at 2.57%. The 5, 10 and historical dividend yields are also moderate at 3.47%, 3.09% and 2.71%. The dividend growth is moderate (8% to 14% ranges per year) at 13.7% per year over the past 5 years. The last dividend increase was in 2024 and it was for 9.8%.
The Dividend Payout Ratios (DPR) are good. The DPR for 2024 for Earnings per Share (EPS) is good at 34% with 5 year coverage at 34%. The DPR for 2024 for Adjusted Earnings per Share (AEPS) is good at 30% with 5 year coverage at 29%. The DPR for 2024 for Cash Flow per Share (CFPS) is good at 30% with 5 year coverage at 26%. The DPR for 2024 for Free Cash Flow (FCF) is non-calculable 2024 because of a negative FCF with 5 year coverage good at 20%. I was getting values from MS, but they do not agree with earlier values. I do not put much stock into FCF as few agree on how to calculate and sites keep changing their minds on how to calculate it.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 34.39% | 33.81% |
| AEPS | 30.11% | 28.73% |
| CFPS | 30.15% | 26.13% |
| FCF | -21.33% | 19.90% |
Debt Ratios are fine. The Long Term Debt/Coverage Assets Ratio for 2024 is fine at 0.95 and currently at 0.96. The Long Term Debt/Market Cap Ratio for 2024 is high at 3.47 and currently at 3.35, but financial tend to be on the high side. The Liquidity Ratio for 2024 is good at 1.83 and 1.83 currently, but not important for financials. The Debt Ratio for 2024 is fine for financials at 1.07 and 1.07 currently. The Financial Leverage is are fine at 17.3% and currently at 14.8%.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term A | 0.95 | 0.96 |
| Lg Term | 3.47 | 3.35 |
| Intang/GW | 0.28 | 0.27 |
| Liquidity | 1.83 | 1.83 |
| Liq. + CF | 1.57 | 1.55 |
| Debt Ratio | 1.07 | 1.07 |
| Fin Leverage | 17.3% | 14.8% |
The Total Return per year is shown below for years of 5 to 24 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 | 13.74% | 16.09% | 13.32% | 2.77% |
| 2014 | 10 | 12.23% | 14.22% | 11.61% | 2.61% |
| 2009 | 15 | 8.56% | 12.40% | 9.93% | 2.47% |
| 2004 | 20 | 11.09% | 10.41% | 8.21% | 2.20% |
| 2000 | 24 | 10.59% | 10.20% | 8.15% | 2.05% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 7.77, 9.40 and 12.45. The corresponding 10 year ratios are 7.61, 9.38 and 11.82. The corresponding historical ratios are 10.10, 11.43 and 12.88. The current P/E Ratio is 14.77 based on a stock price of $139.91 and EPS estimate for 2025 of $9.47. The current ratio is above the high ratio of the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.
I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 6.71, 8.12 and 10.00. The corresponding 10 year ratios are 7.15, 9.11 and 10.96. The current P/AEPS Ratio is 11.52 based on a stock price of $139.91 and AEPS estimate for 2025 of $12.14. This stock price testing suggests that the stock price is relatively expensive.
I get a Graham Price of $148.82. The 10-year low, median, and high median Price/Graham Price Ratios are 0.54, 0.66 and 0.80. The current P/GP Ratio is 0.94 based on a stock price of $139.91. 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.
I get a 10-year median Price/Book Value per Share Ratio of 1.10. The current P/B Ratio is 1.73 based on a stock price of $139.91, Book Value of $7,562M, and Book Value per Share of $81.09. The current ratio is 57% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.
I also have a Book Value per Share estimate for 2025 of $78.56, but this analyst calculates the Book Value differently than I do and, in this case, the 10 year median ratio is 1.09. This implies a ratio of 1.78 based on a stock price of $139.91 and Book Value of $7,326M. This ratio is 64% 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 9.44. The current P/CF Ratio is 8.36 based on Cash Flow for the last 12 months of $1,561M, Cash Flow per Share of $16.74 and a stock price of $139.91. This 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.
I get an historical median dividend yield of 2.71%. The current dividend yield is 2.57% based on dividends of $3.60 and a stock price of $139.91. The current dividend yield is 5% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.
I get a 10 year median dividend yield of 3.09%. The current dividend yield is 2.57% based on dividends of $3.60 and a stock price of $139.91. The current dividend yield is 17% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.
The 10-year median Price/Sales (Revenue) Ratio is 0.56. The current P/S Ratio is 0.55 based on a stock price of $139.91, Revenue for the last 12 months of $23,640 and Revenue per Share of $253.49. The current ratio is 0.6% 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 could still be in a reasonable range. The dividend yield tests say that the stock price is reasonable but above the median. The P/S Ratio test says it is reasonable but below the median. However, a lot of the rest of the testing is saying that the stock price is relatively expensive.
When I look at analysts’ recommendations, I find Strong Buy (2), Buy (2) and Hold (3). The consensus would be a Buy. The 12 month stock price consensus is $143.29 with a high of $148.00 and low of $139.00. The consensus stock price of $143.29 implies a total return of 4.99% with 2.42% from capital gains and 2.57% from dividends based on a current stock price of $139.91.
The last entry on Stock Chase was in 2021. There was one entry. There were lots of entries in 2020 and all thought of this stock as a Top Pick. Amy Legate-Wolfe on Motley Fool thinks you should buy this stock for safety and yield. Jitendra Parasharon Motley Fool talks about this stock being a top mover in February. The company put out a press release via Newswire about their fourth quarter of 2024. The company put out a press release via Newswire about their first quarter of 2025 .
Simply Wall Street via Yahoo Finance reviews who owns shares in this company. Simply Wall Street via Yahoo Finance reviews this stock and says they are pretty happy with the company’s performance. Simply Wall Street has no warnings out on this stock.
iA Financial Corp Inc is a life and health insurance company. The company operates and manages its activities according to five main reportable operating segments Insurance Canada, Individual Wealth Management, Investment, Corporate, and U.S Operations. The majority of its revenue comes from Insurance Canada. Its web site is here IA Financial Corp.
The last stock I wrote about was about was RB Global Inc (TSX-RBA, NYSE-RBA) ... learn more. The next stock I will write about will be Adentra Inc (TSX-ADEN, OTC-HDIUF) ... learn more on Friday, June 6, 2025 around 5 pm. Tomorrow on my other blog I will write about Something to Buy June 2025.... learn more on Thursday, June 5, 2025 around 5 pm.
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