Is it a good company at a reasonable price? This is not a dividend growth stock. It seems that they cannot afford to pay a dividend. I like companies that grow their dividends over time and produce a total return in the long term of at least 8% per year. This stock does not fit. They are not growing their dividends. Shareholders have not done well with stock over the past 12 years. See Total Return per Year section below. The current stock price seems reasonable.
I do not own this stock of KP Tissue Inc (TSX-KPT, OTC-KPTSF). This was a stock suggested by a speaker at the Ellen's Investment Club. It is not a dividend growth stock.
When I was updating my spreadsheet, I find this analysis complicated. How well Kruger is doing is more important that what KP Tissue is doing as KP Tissue just owns shares in Kruger. I cannot probably analyze Kruger as I do not know what the company is worth. You really need to analyze two companies. And, I do not want to spend more time on a stock that I know I would never buy.
If you had invested in this company in December 2014, for $1,000.64 you would have bought 51 shares at $16.96 per share. In December 2024, after 10 years you would have received $424.80 in dividends. The stock would be worth $4.85.57. Your total return would have been $910.37. This would be a total loss of 1.18% per year with 6.08% from capital loss and 5.79% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $16.96 | $1,000.64 | 59 | 10 | $424.80 | $485.57 | $910.37 |
The current dividend yield is good with dividend growth nil. The dividend yield is good (5% to 6% ranges) at 6.91%. The 5, 10 year and historical median dividend yields are all good at 6.72%, 6.61% and 6.44%. The dividends are not increasing and have never increased. Although the first dividend payment in 2013 was almost 5% higher than other dividends paid.
The Dividend Payout Ratios (DPR) are far too high. The DPR for 2024 for Earnings per Share (EPS) is far too high at 300% with 5 year coverage non-calculable because of earnings losses apparently transfer from Kruger. The DPR for 2024 for Cash Flow per Share (CFPS) is non-calculable because of no Cash Flow. The DPR for 2024 for Free Cash Flow (FCF) is too high at 100% with 5 year coverage at 100%. FCF varied from $0.6M to 26.66. I am using 6.974M.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 300.00% | 0.00% |
| CFPS | 0.00% | 0.00% |
| FCF | 100.14% | 100.03% |
The company of KP Tissue has no debt, but their Liquidity Ratio is too low. The Long Term Debt/Market Cap Ratio for 2024 is good at 0.00 and currently at 0.00 because the company has no long term debt. The Liquidity Ratio for 2024 is too low at 1.00 and 1.00 currently. If you added in Cash Flow after dividends, the ratios are even lower as there is no Cash Flow at 0.20 and currently at 0.20. The Debt Ratio for 2024 is good at 39.66 and 39.59 currently because KP Tissue has no debt. The Leverage and Debt/Equity Ratios for 2024 are good at 1.03 and 0.03 and currently at 1.03 and 0.03.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 0.00 | 0.00 |
| Intang/GW | 0.00 | 0.00 |
| Liquidity | 1.00 | 1.00 |
| Liq. + CF | 0.20 | 0.20 |
| Debt Ratio | 39.66 | 39.59 |
| Leverage | 1.03 | 1.03 |
| D/E Ratio | 0.03 | 0.03 |
The Total Return per year is shown below for years of 5 to 12 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 | 0.00% | 4.79% | -3.13% | 7.92% |
| 2014 | 10 | 0.00% | -1.18% | -6.98% | 5.79% |
| 2012 | 12 | -0.36% | -6.08% | 5.72% |
The 5 and 10 year low, median, and high median Price/Earnings per Share Ratios are negative, so I cannot do any P/E Testing. The current P/E Ratio is 11.58 based on a stock price of $10.42 and EPS estimate for 2025 of $0.90. This is a reasonable P/E Ratio, so the stock price would probably be reasonable.
I get a Graham Price of $10.42. The 10-year low, median, and high median Price/Graham Price Ratios are 2.91, 4.36 and 5.82. The current P/GP Ratio is 0.88 based on a stock price of $10.42. The current ratio is below the low ratio of the 10 year median ratio. These 10 year median ratios are really high because a reasonable ratio would be from around 0.80 to 1.20. The current ratio would be considered a low ratio and so the stock price would be reasonable.
I get a 10-year median Price/Book Value per Share Ratio of 1.31. The current ratio is 1.50 based on a Book Value of $69.5M, Book Value per Share of $6.96 and a stock price of $10.42. The current ratio is 14% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.
I also have a Book Value per Share estimate for 2025 of $8.35. This implies a book value of $8.3M and a ratio of 1.25. This 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 cannot do any Price/Cash Flow per Share Ratio test because the stock has no Cash Flow.
I get an historical median dividend yield of 6.44%. The current dividend yield is 6.91% based on dividends of $0.72 and stock price of $10.42. The current dividend yield is 7.3% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get a 10 year median dividend yield of 6.61%. The current dividend yield is 6.91% based on dividends of $0.72 and stock price of $10.42. The current dividend yield is 4.5% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable and below the median.
The 10-year median Price/Sales (Revenue) Ratio is 0.48. The current ratio is 0.37 based on Kruger Revenue estimate for 2025 of $2,211M, Revenue per Share of $28.08 and a Stock Price for KPT of $10.42. The current ratio is 23% below the 10 year median ratio. This stock price testing suggests that the stock price is cheap.
Results of stock price testing is that the stock price is probably reasonable. The dividend yield testing is showing this. However, these are not particularly good tests when dividends do not increase. The P/S Ratio testing seems to show that the stock is relatively cheap. The rest of the testing is probably showing that the stock price is reasonable, but some of the tests are no clean. For example, I cannot do a P/E Ratio test because of earnings losses.
When I look at analysts’ recommendations, I find only a Hold (4). The 12 month consensus stock price is $10.50 with a high a $11.00 and low of $10.00. The consensus stock price of $10.52 implies a total return of 7.68%, with 0.77% from capital gains and 6.91% from dividends based on a stock price of $10.42.
There a few entries on Stock Chase for this company. The last one was in 2023 and it was a Do Not Buy. He said we are not very impressed by the fundamentals or financials. Amy Legate-Wolfe on Motley Fool she says the opportunity today comes from the fact that KPT still trades under the radar and often at a valuation that doesn’t reflect its long-term stability. Aditya RaghunathMotley Fool likes it because of the high dividend yield. The company put out a press release via Globe Newswire about their fourth quarter of 2024 results. The company put out a press release via Globe Newswire about their third quarter for 2025.
GuruFocus News via Yahoo Finance recently wrote on this stock. They gave both the positive and negative points to the company. They said they have 3 warnings out on this stock but do not say what they are. Simply Wall Street has no write up on this stock but they have two warnings of makes less than USD$1m in revenue (CA$0) and does not have a meaningful market cap (CA$105M).
KP Tissue Inc is a holding company. Through its equity holdings in Kruger Products Inc. (the operating company), it is involved in the business of producing, distributing, marketing, and selling various disposable tissue products, including bathroom tissue, facial tissue, paper towels, and napkins for both the consumer and away-from-home markets in North America. Geographically, the company derives maximum revenue from Canada and the rest from the United States. Its web site is here KP Tissue Inc.
The last stock I wrote about was about was Maple Leaf Foods Inc (TSX-MFI, OTC-MLFNF) ... learn more. The next stock I will write about will be Agnico Eagle Mines Ltd (TSX-AEM, NYSE-AEM) ... learn more on Friday, December 19, 2025 around 5 pm. Tomorrow on my other blog I will write about Small-Cap Stocks .... learn more on Thursday, December 18, 2025 around 5 pm.
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