Is it a good company at a reasonable price? Analysts say there is an infrastructure super cycle going on in North America and this company will benefit from that. They are saying it is a Strong Buy even though the stock is quite high. However, almost all the stock I follow have a Strong Buy, so I generally do not read much into this. I think that the stock price is expensive. It is true that this stock is expensive but analysts could be right that it will continue to charge ahead.
I do not own this stock of Badger Infrastructure Solutions Ltd (TSX-BDGI, OTC-BDGIF). I started to follow this stock after reading a couple of articles in February 2012 in the G&M that talked about the company. The first article looked at what the pros who manage small-cap funds are buying. Badger was one of 10 stocks mentioned and it looked like an interesting stock. It is a dividend paying small cap. The second article looked at why stocks might appeal to a conservative investor looking for income.
When I was updating my spreadsheet, I noticed the stock price is up 104% in 2025 compared to a decline of 12% in 2024. Also, the stock price is up some 19% so far this year. This is in CDN$. The company reports in US$, with the dividend being paid in CDN$. The estimates give are in CDN$.
This company is growing well. In the chart below, I am showing 5 and 10 year total growth and per year growth in columns 3 and 4. In column 5, I am showing what growth has been over the past 12 months to the end of the second quarter in June 2026 and what is expected to the end of this year.
| Yr | Item | Tot. Gwth | Per Year | Gwth | Coverage |
|---|---|---|---|---|---|
| 5 | Revenue Growth US$ | 89.56% | 13.64% | 9.56% | <-12 mths |
| 5 | ACFFO Growth | 112.81% | 16.30% | 9.06% | <-12 mths |
| 5 | Net Income Growth | 204.70% | 24.96% | 2.65% | <-12 mths |
| 5 | Cash Flow Growth | 49.67% | 8.40% | 7.99% | <-12 mths |
| 5 | Dividend Growth | 16.41% | 3.09% | 1.65% | <-12 mths |
| 5 | Stock Price Growth | 86.67% | 13.30% | 21.95% | <-12 mths |
| 10 | Revenue Growth US$ | 184.64% | 11.03% | 18.96% | <-this year |
| 10 | ACFFO Growth | 297.10% | 14.79% | 9.06% | <-this year |
| 10 | Net Income Growth | 113.09% | 7.86% | 20.83% | <-this year |
| 10 | Cash Flow Growth | 140.57% | 9.18% | 15.72% | <-this year |
| 10 | Dividend Growth | 108.38% | 7.62% | 17.71% | <-this year |
| 10 | Stock Price Growth | 211.08% | 12.02% | 47.65% | <-this year |
The current dividend yield is low with dividend growth low. The current dividend yield is low (below 2%) at 0.86%. The 5, 10 and historical dividend yields are also low at 1.65%, 1.65% and 1.91%. The dividend growth is low (below 8% per year) at 4.6% per year over the past 5 years. The last dividend increase was for 4% and it occurred in 2026.
The dividends are low, so if you buy this stock what sort of dividends would you get in the future? This chart is an attempt to show this. If dividends continue to increase by 4.62% as they have in the past 5 years, what you would get in dividends in 5, 10 and 15 years is shown in the Dividends Paid (Div Pd) column. The next column shows what your yield on the current stock price of $87.22 would be. The last column shows the percentage of your stock’s price would be covered by dividends in 5, 10 and 15 years.
| Div Pd | Div Yield | Years | At IRR | Div Cov |
|---|---|---|---|---|
| $0.98 | 1.12% | 5 | 4.62% | 4.90% |
| $1.22 | 1.40% | 10 | 4.62% | 9.93% |
| $1.54 | 1.76% | 15 | 4.62% | 16.23% |
The Dividend Payout Ratios (DPR) are fine. The DPR for 2025 for Earnings per Share (EPS) is good at 31% with 5 year coverage high at 52%. The DPR for 2025 for Adjusted Operations Cash Flow (AOCF) is good at 9% with 5 year coverage at 15%. The DPR for 2025 for Cash Flow per Share (CFPS) is good at 9% with 5 year coverage at 12%. The DPR for 2025 for Free Cash Flow (FCF) is high at 63% with 5 year coverage at 105%. FCF varies in 2025 from $28M to $45M in US$. I am using the $28M figure as I generally the MS figures. If I used the $45M figure, the FCF is good at 40% with 5 year coverage at 37%.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 30.96% | 51.79% |
| AOCF | 9.26% | 14.89% |
| CFPS | 9.24% | 12.14% |
| FCF | 63.87% | 105.33% |
Debt Ratios are good. The Long Term Debt/Market Cap Ratio for 2025 is good at 0.11 and currently at 0.10. The Liquidity Ratio for 2025 is low at 1.37 and good at 1.56 currently. If you added in Cash Flow after dividends, the ratios are good at 2.27 and currently at 2.72. The Debt Ratio for 2025 is good at 1.63 and 1.59 currently. The Leverage and Debt/Equity Ratios for 2025 are fine at 2.58 and 1.58 and currently at 2.70 and 1.70.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 0.11 | 0.10 |
| Intang/GW | 0.02 | 0.01 |
| Liquidity | 1.37 | 1.56 |
| Liq. + CF | 2.27 | 2.72 |
| Debt Ratio | 1.63 | 1.59 |
| Leverage | 2.58 | 2.70 |
| D/E Ratio | 1.58 | 1.70 |
The Total Return per Year is shown below for years of 5 to 28 to the end of 2025 in CDN$. 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. |
|---|---|---|---|---|---|
| 2020 | 5 | 4.62% | 15.31% | 13.97% | 1.34% |
| 2015 | 10 | 7.51% | 13.03% | 11.59% | 1.43% |
| 2010 | 15 | 3.87% | 20.47% | 17.67% | 2.80% |
| 2005 | 20 | 4.19% | 16.56% | 13.48% | 3.08% |
| 2000 | 25 | 6.93% | 29.15% | 20.67% | 8.47% |
| 1997 | 28 | 12.64% | 10.94% | 1.71% |
The Total Return per Year is shown below for years of 5 to 21 to the end of 2025 in US$. 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. |
|---|---|---|---|---|---|
| 2020 | 5 | 3.09% | 14.61% | 13.30% | 1.31% |
| 2015 | 10 | 7.62% | 13.50% | 12.02% | 1.48% |
| 2010 | 15 | 1.67% | 16.35% | 15.57% | 2.62% |
| 2005 | 20 | 3.35% | 14.37% | 12.68% | 3.31% |
| 2004 | 21 | 6.27% | 14.37% | 13.25% | 3.83% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 15.66, 21.65 and 25.64. The corresponding historical ratios are 16.66, 22.62 and 27.60. The corresponding historical ratios are 12.40, 16.39 and 20.35. The current ratio is 29.45 based on a stock price of $87.22 and EPS estimate for 2026 of $2.96. The current ratio is above the high ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.
I have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 14.47, 18.73 and 22.99. The corresponding historical ratios are 14.59, 19.39 and 25.49. The corresponding historical ratios are 16.48, 22.01 and 28.58. The current ratio is 30.76 based on a stock price of $66.76 and AEPS for the last 12 months of $2.17. The current ratio is above the high ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$.
I get a Graham Price of $27.25. The 10-year low, median, and high median Price/Graham Price Ratios are 1.57, 2.18 and 2.70. The current ratio is 3.20 based on a stock price of $66.76. The current ratio is above the high ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.
I get a 10-year median Price/Book Value per Share Ratio of 3.51. The current ratio is 7.83 based on a Book Value of $375M, Book Value per Share of $11.15 and a stock price of $87.22. The current ratio is 123% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.
I get a 10-year median Price/Cash Flow per Share Ratio of 9.61. The current ratio is 11.07 based on Cash Flow per Share estimate for 2026 of $7.88, Cash Flow of $265M and a s tock price of $87.22. The current ratio is 15% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in CDN$.
I get an historical median dividend yield of 1.91%. The current dividend yield is 0.89% based on dividends of $0.78 and a stock price of $87.22. The current dividend yield is 53% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.
I get a 10 year median dividend yield of 1.65%. The current dividend yield is 0.89% based on dividends of $0.78 and a stock price of $87.22. The current dividend yield is 46% below the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.
The 10-year median Price/Sales (Revenue) Ratio is 1.70. The current ratio is 2.12 based on Revenue estimate for 2026 of $1,388M, Revenue per Share of $41.24 and a stock price of $87.22. The current ratio is 24% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.
Results of stock price testing is that the stock price is probably expensive. The dividend yield tests are saying this and it is confirmed by the P/S Ratio test. Most of the rest of the testing is saying the same thing.
When I look at analysts’ recommendations, I find Strong Buy (5) and Buy (3). The consensus would be a Strong Buy. The 12 month stock price consensus is $113.41 with a high of $125.00 and a low of $105.00. The consensus stock price of $113.41 implies a total return of 30.92% with 30.03% from capital gains and 0.89% from dividends based on a current stock price of $87.22.
There is only one entry on Stock Chase for 2026 and it is a Top Pick. Analyst says there is an infrastructure super cycle in NA. There are 4 entries for 2025 and they are all buys. Sneha Nahata on Motley Fool says that Canada is entering a new wave of infrastructure investment creating opportunities to companies like Badger. Amy Legate-Wolfe on Motley Fool says this company will benefit from the wider spending wave around digital infrastructure. The company put out a press release about their fourth quarter results for 2025. The company put out a Press Release about its second quarterly results for 2026.
Simply Wall Street via Yahoo Finance reviews this company and says that the fair value is $83.17 CDN$. Simply Wall Street has one warning on this stock of has a high level of debt.
Badger Infrastructure Solutions Ltd is North America's provider of non-destructive excavating and related services, with operations in both the United States and Canada. Its key technology is the Badger Hydrovac, which is used predominantly for safe excavation around critical infrastructure and in congested underground conditions. Its web site is here Badger Infrastructure Solutions Ltd.
The last stock I wrote about was about was Pulse Seismic Inc (TSX-PSD, OTC-PLSDF) ... learn more. The next stock I will write about will be GFL Environmental Inc (TSX-GFL, NYSE-GFL) ... learn more on Friday, August 14, 2026 around 5 pm. Tomorrow on my other blog I will write about AL and S&P 500.... learn more on Thursday, August 13, 2026 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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