I first bought this stock (TSX-TRP) in 2000, after they lowered their dividends because of restructuring. They upset a lot of investors and the stock price plummeted. On these shares, I have made a return of 18.6% per year. About 6.4% of that return is dividend income. I bought more shares of this company in 2006 and my total return to date is 11.5% per year. Approximately 5% of this return would be in dividend income.
My total return on the stock I bought in 2006 would be around 7% per year, with approximately 4% of this return in dividend income. As you can see from this, the total return has not been great over the past few years. In fact, Revenue, Earnings and Cash Flow having been declining over the past couple of years (2009 and 2010). However, analysts expect all these items to be much better for the financial year ending in 2011.
Because of the recent declines in revenue, the 5 and 10 year growth figures are poor with revenue per share growth being negative for the last 5 years and at just 3% per year for the last 10 years. The earnings per share have likewise been poor with negative growth for the last 5 years and at just 2% per year for the last 10 year.
The cash flow per share has been better. The 5 year growth is at 5.2% per year. The only reason that the 10 year growth rate is negative is because the cash flow 10 years ago was higher than usual. Without this higher than usual cash flow 10 years ago, the growth would be in the 6% range. The growth in book value is fine with the 5 and 10 year growth at 8% per year.
When looking at debt ratios, I find that the Liquidity Ratio is low, but it has a tendency to be low on this type of company. The Liquidity Ratio for 2010 is 0.57. The Asset/Liability Ratio is much better at 1.62. The Leverage Ratio at 2.79 and the Debt/Equity Ratio of 1.72 are both fine. The Return on Equity for 2010 is ok at 7.3% and the 5 year average is better at 10.5%.
I am happy with my investment in this company. They are on the dividend lists that I follow of Dividend Achievers and Dividend Aristocrats (see indices).
TransCanada is a leader in energy infrastructure. Their network of pipeline taps into virtually all major gas supply basins in North America. TransCanada is one of the continent’s largest providers of gas storage and related services. It is a growing independent power producer. Its web site is here TransCanada. See my spreadsheet at trp.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Monday, March 28, 2011
Friday, March 25, 2011
RioCan Real Estate 2
I first bought this stock (TSX-REI.UN) for my RRSP account in January 1998 then I bought some for my Trading account in April 2000 and some more in January 2002. In June 2006, and in December 2010, I bought this stock for the Locked-in Pension account. I have made a total return on this stock of 17.1% per year.
When I look at Insider Trading, I find $10m of Insider Selling and $.5M of Insider Buying for a net Insider Selling of $9.5M. Insider selling seems to be of options and some gifting. Insiders’ own some shares, but have far more options than shares. The number of shares owned by insiders really hasn’t changed at all over the past year. No insider owns a significant number of shares.
The 5 year median low Price/Earnings Ratio is 21.1 and the 5 year median high P/E Ratio is 31.5. The current P/E Ratio of 18.1 is relatively low, but not low on an absolute basis. I get a Graham Price of $15.62. The current stock price of $23.69 is 52% above this. On average, the stock price has been some 40% above the Graham Price. On average, the high stock prices have been some 62% above the Graham Price. So this shows a relatively big difference, but not an extreme one for this stock.
I get a 5 and 10 year average Price/Book Value Ratio of 2.55 and 2.20, respectively. The current P/B Ratio at 2.86 is some 12% higher than the 5 year average and 30% higher than the 10 year average. This is unsurprising, as the Book Value has not grown over the past 5 and 10 years. The current yield is 5.83%. The 5 year average yield is 6.9%. The 5 year average low yield is 5.75%. So this points to a higher than average price, but not quite to a relatively high stock price.
When I look at the Price/Funds from Operation Ratio, I get a current one of 15.59, a 5 year average of 14.20 and a 5 year average high of 16.83. Here again, it shows that the current price is higher than average, but not quite to a relatively high price.
When I looked at analysts recommendations, I find Strong Buy, Buy and Hold. The consensus is probably a Buy. There are, however, lots of Hold recommendations. (See my site for information on analyst ratings.)
It would seem that analysts with a Hold rating feel that this stock is overpriced. A number of analysts, no matter what their recommendations, feel that this company has excellent manager. They also feel that the company will benefit from Target coming to Canada. The advantages to REITs are the high tax efficient yield and the ability of the REITS to grow distributions, at minimum, in line with inflation.
I have done very well in this stock. The stock I bought in 1998 is giving me a current 13% yield on my original money and stock I bought in 2000, some 11 years ago, is giving me a current return on my original investment of 17.2%. This stock has a Beta of .742 (according to the Globe and Mail). This means that the stock is less volatile that the market (TSX). I feel that this stock has given me a nice income over the years and has also given me some portfolio diversification.
I know that this stock had a rough year in 2009, but overall, I am pleased with my investment.
For a blog entry talking about this company and Target see Iewy News. For a blog talking about this stock in connection with technical analysis see Trade Online.ca.
RioCan is Canada's largest real estate investment trust. It owns and manages Canada's largest portfolio of shopping centers. RioCan owns an 80% interest in 31 grocery anchored and new format retail centers in the United States through various joint venture arrangements. In addition, RioCan owns a 14% equity interest in Cedar Shopping Centers, Inc., a real estate investment trust focused on supermarket-anchored shopping centers and drug store-anchored convenience centers located predominantly in the Northeastern United States. This stock is rated STA-2M by DBRS. Its web site is here RioCan. See my spreadsheet at rei.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
When I look at Insider Trading, I find $10m of Insider Selling and $.5M of Insider Buying for a net Insider Selling of $9.5M. Insider selling seems to be of options and some gifting. Insiders’ own some shares, but have far more options than shares. The number of shares owned by insiders really hasn’t changed at all over the past year. No insider owns a significant number of shares.
The 5 year median low Price/Earnings Ratio is 21.1 and the 5 year median high P/E Ratio is 31.5. The current P/E Ratio of 18.1 is relatively low, but not low on an absolute basis. I get a Graham Price of $15.62. The current stock price of $23.69 is 52% above this. On average, the stock price has been some 40% above the Graham Price. On average, the high stock prices have been some 62% above the Graham Price. So this shows a relatively big difference, but not an extreme one for this stock.
I get a 5 and 10 year average Price/Book Value Ratio of 2.55 and 2.20, respectively. The current P/B Ratio at 2.86 is some 12% higher than the 5 year average and 30% higher than the 10 year average. This is unsurprising, as the Book Value has not grown over the past 5 and 10 years. The current yield is 5.83%. The 5 year average yield is 6.9%. The 5 year average low yield is 5.75%. So this points to a higher than average price, but not quite to a relatively high stock price.
When I look at the Price/Funds from Operation Ratio, I get a current one of 15.59, a 5 year average of 14.20 and a 5 year average high of 16.83. Here again, it shows that the current price is higher than average, but not quite to a relatively high price.
When I looked at analysts recommendations, I find Strong Buy, Buy and Hold. The consensus is probably a Buy. There are, however, lots of Hold recommendations. (See my site for information on analyst ratings.)
It would seem that analysts with a Hold rating feel that this stock is overpriced. A number of analysts, no matter what their recommendations, feel that this company has excellent manager. They also feel that the company will benefit from Target coming to Canada. The advantages to REITs are the high tax efficient yield and the ability of the REITS to grow distributions, at minimum, in line with inflation.
I have done very well in this stock. The stock I bought in 1998 is giving me a current 13% yield on my original money and stock I bought in 2000, some 11 years ago, is giving me a current return on my original investment of 17.2%. This stock has a Beta of .742 (according to the Globe and Mail). This means that the stock is less volatile that the market (TSX). I feel that this stock has given me a nice income over the years and has also given me some portfolio diversification.
I know that this stock had a rough year in 2009, but overall, I am pleased with my investment.
For a blog entry talking about this company and Target see Iewy News. For a blog talking about this stock in connection with technical analysis see Trade Online.ca.
RioCan is Canada's largest real estate investment trust. It owns and manages Canada's largest portfolio of shopping centers. RioCan owns an 80% interest in 31 grocery anchored and new format retail centers in the United States through various joint venture arrangements. In addition, RioCan owns a 14% equity interest in Cedar Shopping Centers, Inc., a real estate investment trust focused on supermarket-anchored shopping centers and drug store-anchored convenience centers located predominantly in the Northeastern United States. This stock is rated STA-2M by DBRS. Its web site is here RioCan. See my spreadsheet at rei.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Thursday, March 24, 2011
RioCan Real Estate
I first bought this stock (TSX-REI.UN) for my RRSP account in January 1998 then I bought some for my Trading account in April 2000 and some more in January 2002. In June 2006, and in December 2010, I bought this stock for the Locked-in Pension account. I have made a total return on this stock of 17.1% per year. Probably 7 to 8% of my total return is in distributions.
A potential problem with this stock in my Trading Account is that part of the yearly distributions is considered return of capital. This return of capital is subtracted from your Adjusted Cost Basis (ACB) each year. Once your ACB is at zero, you have to include any further return of capital in your capital gain calculations. The result is that you would have to pay capital gain tax on return of capital distributions when your ACB gets to zero. Currently, on any return of capital distribution, I pay no tax at all. I do not really feel this is a problem, so I will continue to hold some of this stock in my Trading Account.
RioCan says its purpose is to deliver to its unitholders stable and reliable cash distributions that will increase over the long term. They had been criticized for keeping their payout ratios high. Their 5 year average payout ratio against Funds from Operations (FFO) is 96% compared to CDN REIT’s (REF.UN) 61%. However, this payout ratio has been declining, as they have not raised their distributions since the last part of 2008. The FFO Payout Ratio is expected to be 91% in 2011 and 87% in 2012 if there is no change in distributions.
The 5 year growth in distributions is at 1.6% compared to 5 year growth in inflation of 1.8%. The 10 year growth in distributions is better at 2.6% compared to 10 year growth in inflation of 2%. Their last increase in distributions in 2008 was at 2.2%. Most of their increases just prior to 2008 were around this value. Total Return is better for the last 10 years than for the last 5.
Total Return has grown, over the past 5 and 10 years at the rate of 6% and 18.5% per year, respectively. The problem is that the stock price has really not changed over the past 5 years and the total return is all distributions.
For this company, 10 year growth is generally better than the 5 year growth. There is one exception and that is for earnings. The 5 and 10 year earnings growth for this company is at 12.4% per year and 2.8% per year, respectively. The book value has not grown at all over the past 5 and 10 years.
Revenue per share and cash flow per share have not grown much. Revenue per share has grown over the past 5 and 10 years at the rate of 1.9% and 4.9% per year, respectively. Cash Flow from Operations per share has grown at the 1.2% and 4.1% per year, respectively.
Debt Ratios are ok on this stock. The Liquidity Ratio is at 1.65 with a 5 year average of 2.30. The Asset/Liability Ratio is 1.47, with a 5 year average of 1.49. For both this ratios, you would want them at 1.50 or better. The Leverage Ratio is 3.19 (which is a little high), with a better 10 year average of 2.72. The problem is that this ratio has been increasing lately. The Debt/Equity Ratio is better at 2.17, with a 10 year average of 1.72. It has also been increasing. The problem is the lack of growth in book value.
The financial year ending in December 2010 was a good one for this stock. Return on Equity was good for 2010 at 14.1%. This is better than the 5 year average of 9.9%. Revenue per share grew at the rate of 9%; earnings grew 149%; and cash flow by 26%. Book Value in 2010 grew at the rate of 8% after a number of years of negative growth.
I plan to hold onto the shares I own in this company. I will probably not buy anymore as I have enough.
RioCan is Canada's largest real estate investment trust. It owns and manages Canada's largest portfolio of shopping centers. RioCan owns an 80% interest in 31 grocery anchored and new format retail centers in the United States through various joint venture arrangements. In addition, RioCan owns a 14% equity interest in Cedar Shopping Centers, Inc., a real estate investment trust focused on supermarket-anchored shopping centers and drug store-anchored convenience centers located predominantly in the Northeastern United States. This stock is rated STA-2M by DBRS. Its web site is here RioCan. See my spreadsheet at rei.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
A potential problem with this stock in my Trading Account is that part of the yearly distributions is considered return of capital. This return of capital is subtracted from your Adjusted Cost Basis (ACB) each year. Once your ACB is at zero, you have to include any further return of capital in your capital gain calculations. The result is that you would have to pay capital gain tax on return of capital distributions when your ACB gets to zero. Currently, on any return of capital distribution, I pay no tax at all. I do not really feel this is a problem, so I will continue to hold some of this stock in my Trading Account.
RioCan says its purpose is to deliver to its unitholders stable and reliable cash distributions that will increase over the long term. They had been criticized for keeping their payout ratios high. Their 5 year average payout ratio against Funds from Operations (FFO) is 96% compared to CDN REIT’s (REF.UN) 61%. However, this payout ratio has been declining, as they have not raised their distributions since the last part of 2008. The FFO Payout Ratio is expected to be 91% in 2011 and 87% in 2012 if there is no change in distributions.
The 5 year growth in distributions is at 1.6% compared to 5 year growth in inflation of 1.8%. The 10 year growth in distributions is better at 2.6% compared to 10 year growth in inflation of 2%. Their last increase in distributions in 2008 was at 2.2%. Most of their increases just prior to 2008 were around this value. Total Return is better for the last 10 years than for the last 5.
Total Return has grown, over the past 5 and 10 years at the rate of 6% and 18.5% per year, respectively. The problem is that the stock price has really not changed over the past 5 years and the total return is all distributions.
For this company, 10 year growth is generally better than the 5 year growth. There is one exception and that is for earnings. The 5 and 10 year earnings growth for this company is at 12.4% per year and 2.8% per year, respectively. The book value has not grown at all over the past 5 and 10 years.
Revenue per share and cash flow per share have not grown much. Revenue per share has grown over the past 5 and 10 years at the rate of 1.9% and 4.9% per year, respectively. Cash Flow from Operations per share has grown at the 1.2% and 4.1% per year, respectively.
Debt Ratios are ok on this stock. The Liquidity Ratio is at 1.65 with a 5 year average of 2.30. The Asset/Liability Ratio is 1.47, with a 5 year average of 1.49. For both this ratios, you would want them at 1.50 or better. The Leverage Ratio is 3.19 (which is a little high), with a better 10 year average of 2.72. The problem is that this ratio has been increasing lately. The Debt/Equity Ratio is better at 2.17, with a 10 year average of 1.72. It has also been increasing. The problem is the lack of growth in book value.
The financial year ending in December 2010 was a good one for this stock. Return on Equity was good for 2010 at 14.1%. This is better than the 5 year average of 9.9%. Revenue per share grew at the rate of 9%; earnings grew 149%; and cash flow by 26%. Book Value in 2010 grew at the rate of 8% after a number of years of negative growth.
I plan to hold onto the shares I own in this company. I will probably not buy anymore as I have enough.
RioCan is Canada's largest real estate investment trust. It owns and manages Canada's largest portfolio of shopping centers. RioCan owns an 80% interest in 31 grocery anchored and new format retail centers in the United States through various joint venture arrangements. In addition, RioCan owns a 14% equity interest in Cedar Shopping Centers, Inc., a real estate investment trust focused on supermarket-anchored shopping centers and drug store-anchored convenience centers located predominantly in the Northeastern United States. This stock is rated STA-2M by DBRS. Its web site is here RioCan. See my spreadsheet at rei.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Wednesday, March 23, 2011
Canadian Real Estate Investment Trust 2
I bought this stock (TSX-REF.UN) in September 2006. I have made a total return of 10.1% per year on this stock. I estimate that the dividend portion of my total yearly return would be between 5% and 5.5%. I feel that this stock has been a decent investment for me and has provided me with some good income and a good rate of return.
When I look at the Insider Trading report, I find that there has been a bit of Insider Selling and a bit of Insider Buying. There is a net to insider selling. All the buying seems to be by the directors under the company’s stock buying plan. All the selling was by the CFO. This company has recently raised their income by 2.2%, which for this company is a good increase. The other thing to note is that insiders do own shares, but no one has any stock options.
I get a 5 year median low Price/Earnings Ratio of 17.7 and a 5 year median high P/E Ratio of 24.6. I get a current P/E of 26.7. This is because analysts that are quoting next year’s earnings think that it will be significantly lower than for 2010. The P/E based on last year earnings is just 13. However, the Price/Cash Flow Ratio average is 13 and the current P/CF is 14. These ratios are much closer. Looking at Price/Funds from Operations Ratio, I get a current one of 13.7 and with a 5 year average high of 14.5 and a 5 year average low of 10.5. These other ratios do not look as bad as the current P/E ratio does.
Since the Graham Price is based on estimated earnings for 2011, it is way below the current stock price of $32.28 by 74%, as it is only $18.59. The 10 year average Price/Book Value Ratio is 2.04 and the 5 year P/B Ratio is 2.54. The current P/B Ratio of 2.54 is the same as the 5 year average, but below the 10 year average by 25%. Because this is an Income Trust, Book Values grow slowly.
When looking at the yield, the current one of 4.4% is below the 5 year average of 5%. Please note that some people think that the only stock price comparison you should use is the yield. By this measure, the stock price is a bit high. Also, note that the 10 year average high yield is 6% and the 5 year average low yield is 4.2%.
I did not look at the debt ratios yesterday and I will cover this today. The debt ratios are all fine. The Liquidity Ratio tends to bob around quite a bit, but all values are rather small. The Asset/Debt ratios are good with a current one of 1.65 and a 5 year average of 1.52. The Leverage Ratio is 2.56 and the Debt/Equity Ratio is 1.55. Both these are fine.
When I look at analysts recommendations, I find Strong Buy, Buy and Hold recommendations. There are lots of Strong Buys and Holds. The consensus is probably a Buy. (See my site for information on analyst ratings.) The 12 month target for Hold is $34 and the 12 month target for a buy is $35.75. Analysts talk about this company having good occupancy rates.
One analyst says that this company has good properties and it is well managed. Another analyst mentions its low payout ratio compared to cash flow. This Payout Ratio is currently at 61% and the 5 year average is just 68%. It also has a low Payout Ratio compared to the FFO and this is running at around 61%. One analyst is rating this a Hold because he thinks it is a little pricey at the moment.
As I said yesterday, I have been pleased with my investment in this company and I will continue to hold the shares that I own.
I have one final remark. I know that the past couple of weeks have been part exciting and part harrowing, what with the problems in Libya (and the rest of the Middle East) and Japan. I have been though such weeks before and I am not worried about my investments because in the long term they will be just fine. I certainly hope that the people of the Middle East will be able to get the sort of governments they desire. I also pray for all those in Japan and I hope their problems are over soon.
Canadian Real Estate Investment Trust is an equity real estate trust, which acquires and owns a portfolio of income-producing properties. It specializes in the acquisition and ownership of community shopping centers, industrial and office properties across Canada. This company owns office, industrial, retail properties and some miscellaneous items such as apartment buildings. This stock is rated STA-3M by DBRS. Its web site is here CDN Real Estate. See my spreadsheet at ref.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
When I look at the Insider Trading report, I find that there has been a bit of Insider Selling and a bit of Insider Buying. There is a net to insider selling. All the buying seems to be by the directors under the company’s stock buying plan. All the selling was by the CFO. This company has recently raised their income by 2.2%, which for this company is a good increase. The other thing to note is that insiders do own shares, but no one has any stock options.
I get a 5 year median low Price/Earnings Ratio of 17.7 and a 5 year median high P/E Ratio of 24.6. I get a current P/E of 26.7. This is because analysts that are quoting next year’s earnings think that it will be significantly lower than for 2010. The P/E based on last year earnings is just 13. However, the Price/Cash Flow Ratio average is 13 and the current P/CF is 14. These ratios are much closer. Looking at Price/Funds from Operations Ratio, I get a current one of 13.7 and with a 5 year average high of 14.5 and a 5 year average low of 10.5. These other ratios do not look as bad as the current P/E ratio does.
Since the Graham Price is based on estimated earnings for 2011, it is way below the current stock price of $32.28 by 74%, as it is only $18.59. The 10 year average Price/Book Value Ratio is 2.04 and the 5 year P/B Ratio is 2.54. The current P/B Ratio of 2.54 is the same as the 5 year average, but below the 10 year average by 25%. Because this is an Income Trust, Book Values grow slowly.
When looking at the yield, the current one of 4.4% is below the 5 year average of 5%. Please note that some people think that the only stock price comparison you should use is the yield. By this measure, the stock price is a bit high. Also, note that the 10 year average high yield is 6% and the 5 year average low yield is 4.2%.
I did not look at the debt ratios yesterday and I will cover this today. The debt ratios are all fine. The Liquidity Ratio tends to bob around quite a bit, but all values are rather small. The Asset/Debt ratios are good with a current one of 1.65 and a 5 year average of 1.52. The Leverage Ratio is 2.56 and the Debt/Equity Ratio is 1.55. Both these are fine.
When I look at analysts recommendations, I find Strong Buy, Buy and Hold recommendations. There are lots of Strong Buys and Holds. The consensus is probably a Buy. (See my site for information on analyst ratings.) The 12 month target for Hold is $34 and the 12 month target for a buy is $35.75. Analysts talk about this company having good occupancy rates.
One analyst says that this company has good properties and it is well managed. Another analyst mentions its low payout ratio compared to cash flow. This Payout Ratio is currently at 61% and the 5 year average is just 68%. It also has a low Payout Ratio compared to the FFO and this is running at around 61%. One analyst is rating this a Hold because he thinks it is a little pricey at the moment.
As I said yesterday, I have been pleased with my investment in this company and I will continue to hold the shares that I own.
I have one final remark. I know that the past couple of weeks have been part exciting and part harrowing, what with the problems in Libya (and the rest of the Middle East) and Japan. I have been though such weeks before and I am not worried about my investments because in the long term they will be just fine. I certainly hope that the people of the Middle East will be able to get the sort of governments they desire. I also pray for all those in Japan and I hope their problems are over soon.
Canadian Real Estate Investment Trust is an equity real estate trust, which acquires and owns a portfolio of income-producing properties. It specializes in the acquisition and ownership of community shopping centers, industrial and office properties across Canada. This company owns office, industrial, retail properties and some miscellaneous items such as apartment buildings. This stock is rated STA-3M by DBRS. Its web site is here CDN Real Estate. See my spreadsheet at ref.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Tuesday, March 22, 2011
Canadian Real Estate Investment Trust
I bought this stock (TSX-REF.UN) in September 2006. I have made a total return of 10.1% per year on this stock. I estimate that the dividend portion of my total yearly return would be between 5% and 5.5%. This company is on one of the dividend lists that I follow of Dividend Achievers .
They have raised their dividend each year since 2002. The growth in distributions for the last 5 and 10 years is 1.90% and 1.77% each year, respectively. According to the Bank of Canada, core inflation has grown over the last 5 and 10 years at the rate of 1.78% and 1.87% per year, respectively. Also, Total Inflation has grown over the last 5 and 10 years at the rate of 1.78% and 1.97% per year, respectively. So from this you can see that distributions have done slightly better than inflation over the past 5 years and slightly worse than inflation over the past 10 years.
The current distribution yield is 4.4% and the 5 year average is 5%. This is a Real Estate Investment Trust type of company and what you can expect from it is a good yield, but your increases will be about the rate of inflation. In my portfolio, I have this type of stock, plus stock with lower yields, but higher rates of increases. Overall, my growth in dividends is above the rate of inflation, or even background inflation. Note that long term background inflation is considered to be at the rate of 3% per year.
When you look at growth figures for this company, the worse is for Book Value. Over the past 5 and 10 years, the book value has grown at the rate of 3.7% and 2% per year, respectively. This is rather typical for an Income Trust company. Do not forget that in the calculation of Funds from Operations (FFO) and Adjusted Funds from Operations (AFFO), the replacements for the older Distributable Income, you include depreciation and amortization expenses.
The amount available for distribution has grown over the past 5 and 10 years at the rate of 10.4% and 6.8% per year, respectively. However, the way to calculate this value has been changing. Earnings have been growing well, with the growth over the past 5 and 10 years at 19% and 7.6% per year, respectively. Total Return has grown over the past 5 and 10 years at the rate of 12% and 18.5% per year, respectively.
Revenue growth per share is rather low having only grown, over the past 5 and 10 years at the rate of 3% and 3.8% per year, respectively. Cash Flow from Operations is better over the past 5 and 10 years, growing at the rate of 10% and 9.6% per year, respectively.
Overall, I am pleased with my investment in this company. Tomorrow, I will talk about what the analysts say about this company and what my spreadsheet says about its current stock price.
Canadian Real Estate Investment Trust is an equity real estate trust, which acquires and owns a portfolio of income-producing properties. It specializes in the acquisition and ownership of community shopping centers, industrial and office properties across Canada. This company owns office, industrial, retail properties and some miscellaneous items such as apartment buildings. This stock is rated STA-3M by DBRS. Its web site is here CDN Real Estate . See my spreadsheet at ref.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
They have raised their dividend each year since 2002. The growth in distributions for the last 5 and 10 years is 1.90% and 1.77% each year, respectively. According to the Bank of Canada, core inflation has grown over the last 5 and 10 years at the rate of 1.78% and 1.87% per year, respectively. Also, Total Inflation has grown over the last 5 and 10 years at the rate of 1.78% and 1.97% per year, respectively. So from this you can see that distributions have done slightly better than inflation over the past 5 years and slightly worse than inflation over the past 10 years.
The current distribution yield is 4.4% and the 5 year average is 5%. This is a Real Estate Investment Trust type of company and what you can expect from it is a good yield, but your increases will be about the rate of inflation. In my portfolio, I have this type of stock, plus stock with lower yields, but higher rates of increases. Overall, my growth in dividends is above the rate of inflation, or even background inflation. Note that long term background inflation is considered to be at the rate of 3% per year.
When you look at growth figures for this company, the worse is for Book Value. Over the past 5 and 10 years, the book value has grown at the rate of 3.7% and 2% per year, respectively. This is rather typical for an Income Trust company. Do not forget that in the calculation of Funds from Operations (FFO) and Adjusted Funds from Operations (AFFO), the replacements for the older Distributable Income, you include depreciation and amortization expenses.
The amount available for distribution has grown over the past 5 and 10 years at the rate of 10.4% and 6.8% per year, respectively. However, the way to calculate this value has been changing. Earnings have been growing well, with the growth over the past 5 and 10 years at 19% and 7.6% per year, respectively. Total Return has grown over the past 5 and 10 years at the rate of 12% and 18.5% per year, respectively.
Revenue growth per share is rather low having only grown, over the past 5 and 10 years at the rate of 3% and 3.8% per year, respectively. Cash Flow from Operations is better over the past 5 and 10 years, growing at the rate of 10% and 9.6% per year, respectively.
Overall, I am pleased with my investment in this company. Tomorrow, I will talk about what the analysts say about this company and what my spreadsheet says about its current stock price.
Canadian Real Estate Investment Trust is an equity real estate trust, which acquires and owns a portfolio of income-producing properties. It specializes in the acquisition and ownership of community shopping centers, industrial and office properties across Canada. This company owns office, industrial, retail properties and some miscellaneous items such as apartment buildings. This stock is rated STA-3M by DBRS. Its web site is here CDN Real Estate . See my spreadsheet at ref.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Monday, March 21, 2011
Canadian Pacific Railway 3
I bought this stock (TSX-CP) in October 2006. I have made a total return on this stock of 5.8%. Just over 2% of the total annual return would be due to dividends. This stock is on the dividend lists that I follow of Dividend Achievers and Dividend Aristocrats (see indices).
In looking at the Insider Trading Report, there is minimal insider buying and insider selling. All insiders, including directors have more stock options than shares. Dividends were raised in 2010, so this shows that the management has confidence in the ability of the company to earn a profit in the next while.
I get a 5 year low median Price/Earnings Ratio of 9.9 and a 5 year high median P/E Ratio of 15.8. My current P/E Ratio of 14.1 is closer to the high rather than the low P/E Ratio. I get a current Graham Price of $53.55. The current stock price of $63.03 is some 17.7% higher. The average high 10 year difference between the Graham Price and the stock price is 14%. So this shows a rather high current stock price.
I get a 10 year average Price/Book Value Ratio of 1.71. The current P/B Ratio is 2.21, which is some 30% higher. So this also points to a rather high stock price. The only measure to show a reasonable stock price is the yield. The current yield is 1.71% and the 5 year average is 1.67%. These yields are very close.
When I look at analysts’ recommendations, I find Strong Buy, Buy, Hold and Sell. There is only one Sell recommendation, but there are lots of Hold recommendations. The consensus recommendation would be a Buy. This is common when you get both Strong Buy and Hold recommendations on a stock. (See my site for information on analyst ratings.)
One analyst thought that for the financial year ending in December 2010, CP delivered a solid performance, with revenue increasing across all lines of business. Another analyst thinks that exports are increasing in Canada due to Asian appetite for our resources. He feels that both CPR and CNR will benefit from this. One analyst states that CPR will benefit from increased fertilizer sales because one of the things CPR ships is fertilizer. Another feels that CPR is reducing its costs and that therefore there will be more upside in stock. I do not know why there is one sell recommendation.
Here is one bloggers analysis of this stock which recommends a Hold at Stock Pick Bloggers. Also, here is a slightly older report recommending a Hold from Daily Markets.
This company is a transcontinental railway operating in Canada and the U.S. Its rail network serves the principal centers of Canada, from Montreal to Vancouver and the U.S. Northeast and Midwest regions. Alliances with other carriers extend its market reach throughout the U.S. and into Mexico. Canadian Pacific Solutions provides logistics and supply chain expertise. Its web site is here CPR. See my spreadsheet at cp.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
In looking at the Insider Trading Report, there is minimal insider buying and insider selling. All insiders, including directors have more stock options than shares. Dividends were raised in 2010, so this shows that the management has confidence in the ability of the company to earn a profit in the next while.
I get a 5 year low median Price/Earnings Ratio of 9.9 and a 5 year high median P/E Ratio of 15.8. My current P/E Ratio of 14.1 is closer to the high rather than the low P/E Ratio. I get a current Graham Price of $53.55. The current stock price of $63.03 is some 17.7% higher. The average high 10 year difference between the Graham Price and the stock price is 14%. So this shows a rather high current stock price.
I get a 10 year average Price/Book Value Ratio of 1.71. The current P/B Ratio is 2.21, which is some 30% higher. So this also points to a rather high stock price. The only measure to show a reasonable stock price is the yield. The current yield is 1.71% and the 5 year average is 1.67%. These yields are very close.
When I look at analysts’ recommendations, I find Strong Buy, Buy, Hold and Sell. There is only one Sell recommendation, but there are lots of Hold recommendations. The consensus recommendation would be a Buy. This is common when you get both Strong Buy and Hold recommendations on a stock. (See my site for information on analyst ratings.)
One analyst thought that for the financial year ending in December 2010, CP delivered a solid performance, with revenue increasing across all lines of business. Another analyst thinks that exports are increasing in Canada due to Asian appetite for our resources. He feels that both CPR and CNR will benefit from this. One analyst states that CPR will benefit from increased fertilizer sales because one of the things CPR ships is fertilizer. Another feels that CPR is reducing its costs and that therefore there will be more upside in stock. I do not know why there is one sell recommendation.
Here is one bloggers analysis of this stock which recommends a Hold at Stock Pick Bloggers. Also, here is a slightly older report recommending a Hold from Daily Markets.
This company is a transcontinental railway operating in Canada and the U.S. Its rail network serves the principal centers of Canada, from Montreal to Vancouver and the U.S. Northeast and Midwest regions. Alliances with other carriers extend its market reach throughout the U.S. and into Mexico. Canadian Pacific Solutions provides logistics and supply chain expertise. Its web site is here CPR. See my spreadsheet at cp.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Friday, March 18, 2011
Canadian Pacific Railway 2
I bought this stock (TSX-CP) in October 2006. I had wanted some more railway stock and I thought that Canadian National Railway (TSX-CN) was too pricey. I have made a total return on this stock of 5.8%. If I had bought some more CNR, I would have had a total return of 13% in this same time period. It was probably not my best decision to buy CP. I had owned CP previously between 1987 and 1999 and my total return on the stock in this period was 5.4%.
The dividend growth has been ok over the past 5 years at 12% per year. I do not have a growth figure for 10 years, as this stock was a spin off from Canadian Pacific Limited in 2001. However, 8 year growth of dividends is a respectable 9.3%. Total return on this stock has been around 17% and 13% per year over the past 5 and 10 years. About 2% of this total return is due to dividends.
Where growth has not been good is for revenues, earnings, cash flow and book value. The earnings growth has probably been the best, where the 5 and 10 year growth figures are 2.6% and 9.7% per year, respectively. Because we are coming out a recession a lot of companies do not have good growth over the past 5 years, but you would hope that the 10 year growth is decent.
Revenue growth per share over the past 5 and 10 years is 1.5% and 2.5% per year, respectively. No matter how you look at cash flow growth, it is negative. It is negative for 5 and 10 year periods and for cash flow excluding changes in working capital. For book value, there is no growth over the past 5 years and the growth for the 10 year period is just 2.6% per year. I also dealt with changes in account for book value in my post of yesterday.
The Return on Equity has been good for this stock. The ROE for the financial year ending in December 2010 was 11.8%. The 5 year average ROE is 12.8%. However, the Accrual Ratios is a bit high at 5.7%. The problem is that the Net Income is higher than the Cash Flow from Operations. What you want to see is the Cash Flow from Operations higher than the Net Income.
The last thing to talk about is debt ratios. The Liquidity Ratio is 0.93. Part of the reason is the inclusion of the current portion of long term debt. Without this inclusion, the Liquidity Ratio is still a bit low at 1.19. The company has a history of low Liquidity Ratios. The Leverage Ratio is 2.83 and the Debt/Equity Ratio at 1.83 are both fine.
On Monday, I will talk about what my spreadsheet says about the current price and what the analysts say about this stock.
This company is a transcontinental railway operating in Canada and the U.S. Its rail network serves the principal centers of Canada, from Montreal to Vancouver and the U.S. Northeast and Midwest regions. Alliances with other carriers extend its market reach throughout the U.S. and into Mexico. Canadian Pacific Solutions provides logistics and supply chain expertise. Its web site is here CPR. See my spreadsheet at cp.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
The dividend growth has been ok over the past 5 years at 12% per year. I do not have a growth figure for 10 years, as this stock was a spin off from Canadian Pacific Limited in 2001. However, 8 year growth of dividends is a respectable 9.3%. Total return on this stock has been around 17% and 13% per year over the past 5 and 10 years. About 2% of this total return is due to dividends.
Where growth has not been good is for revenues, earnings, cash flow and book value. The earnings growth has probably been the best, where the 5 and 10 year growth figures are 2.6% and 9.7% per year, respectively. Because we are coming out a recession a lot of companies do not have good growth over the past 5 years, but you would hope that the 10 year growth is decent.
Revenue growth per share over the past 5 and 10 years is 1.5% and 2.5% per year, respectively. No matter how you look at cash flow growth, it is negative. It is negative for 5 and 10 year periods and for cash flow excluding changes in working capital. For book value, there is no growth over the past 5 years and the growth for the 10 year period is just 2.6% per year. I also dealt with changes in account for book value in my post of yesterday.
The Return on Equity has been good for this stock. The ROE for the financial year ending in December 2010 was 11.8%. The 5 year average ROE is 12.8%. However, the Accrual Ratios is a bit high at 5.7%. The problem is that the Net Income is higher than the Cash Flow from Operations. What you want to see is the Cash Flow from Operations higher than the Net Income.
The last thing to talk about is debt ratios. The Liquidity Ratio is 0.93. Part of the reason is the inclusion of the current portion of long term debt. Without this inclusion, the Liquidity Ratio is still a bit low at 1.19. The company has a history of low Liquidity Ratios. The Leverage Ratio is 2.83 and the Debt/Equity Ratio at 1.83 are both fine.
On Monday, I will talk about what my spreadsheet says about the current price and what the analysts say about this stock.
This company is a transcontinental railway operating in Canada and the U.S. Its rail network serves the principal centers of Canada, from Montreal to Vancouver and the U.S. Northeast and Midwest regions. Alliances with other carriers extend its market reach throughout the U.S. and into Mexico. Canadian Pacific Solutions provides logistics and supply chain expertise. Its web site is here CPR. See my spreadsheet at cp.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Thursday, March 17, 2011
Canadian Pacific Railway
The first thing to discuss is the recent account rule changes. The FASB (Financial Accounting Standards Board) and such board to various countries together with the IASB (International Accounting Standards Board) make changes on how companies can do their financial statements. Often with these changes, companies also restate previous results. Sometimes these can be substantial. For this company, their book value under new rules decreased by almost 30%.
Book Value is theoretically the break up value of the company or the shareholders’ net value in the company. It is an important measure of the company’s progress to look at the growth in book value. However, this is really only in theory as companies in financial difficulties usually lose their shareholders’ value if they are going bankrupt. So at the point of bankruptcy this value does not seem to matter much. Hopefully, you are out of a stock before this happens. However, it is an important measure of the value of the company to the shareholders.
New accounting rules can affect a number of my measurements as I use accounting values on my spreadsheets. These changes will not stop me from using these values, but it is important to understand, that they are not absolute as they can change and some times change a lot with new accounting rules. Looking at various values like book value, revenue, earnings etc can give you an idea of where a company is going and where it is currently. This is, of course, to give a feel for where the company was and is going. It is never meant to be absolute. Accounting is often more art than science.
In investing, it is handy to have a feel for the past and present, but you also want to look at the future too. Analyst’s reports and news items are a good place to look about what the company may do in the future. I also look at analysts’ recommendations. I look at the range of recommendations as well as the consensus recommendation. Most consensus recommendations are a Buy and a few are a Hold. You seldom get other consensus recommendations, but they do happen.
Another place to look for what is in the company’s future is the annual statement. Look at parts that cover such things as management discussion and analysis. Look for messages from the President and other executives.
Of course, none of this stuff is absolute. That is why you want to diversify your portfolio. It is also, why you do not let any one stock get to be a too big of percentage of your portfolio. My limit is 10%. I have sold off good companies, like SNC-Lavalin because it grew so much. It grew to a higher percentage of my portfolio than I was comfortable. SNC-Lavalin is still a great company and I still have a good investment in it, but I still cannot afford to have too much in it because it could really damage my portfolio is anything happens to it.
I should also mention that I seldom change past accounting figures. I know that sites that give you accounting values change past ones when they are restated. The Globe and Mail site comes to mind in this. See CP Financials. My approach is almost never to change values because of restatements in financial statements. Although, I must admit that when I do a new spreadsheet, I use financial statements to do two years at a time.
My goal is for the spreadsheets to provide me with a good idea on how the company is doing. Besides, there are no absolutes in life. I also wonder if investing may be more art than science. I remember being at a party and a man I know well talked about his new investment. I had an investment in that company also, which I sold. What was my reasoning for this? Whatever company he invested in, it seemed to have difficulties after he invested in it.
Tomorrow, I will talk about what my spreadsheets says about this company.
This company is a transcontinental railway operating in Canada and the U.S. Its rail network serves the principal centers of Canada, from Montreal to Vancouver and the U.S. Northeast and Midwest regions. Alliances with other carriers extend its market reach throughout the U.S. and into Mexico. Canadian Pacific Solutions provides logistics and supply chain expertise. Its web site is here CPR. See my spreadsheet at cp.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Book Value is theoretically the break up value of the company or the shareholders’ net value in the company. It is an important measure of the company’s progress to look at the growth in book value. However, this is really only in theory as companies in financial difficulties usually lose their shareholders’ value if they are going bankrupt. So at the point of bankruptcy this value does not seem to matter much. Hopefully, you are out of a stock before this happens. However, it is an important measure of the value of the company to the shareholders.
New accounting rules can affect a number of my measurements as I use accounting values on my spreadsheets. These changes will not stop me from using these values, but it is important to understand, that they are not absolute as they can change and some times change a lot with new accounting rules. Looking at various values like book value, revenue, earnings etc can give you an idea of where a company is going and where it is currently. This is, of course, to give a feel for where the company was and is going. It is never meant to be absolute. Accounting is often more art than science.
In investing, it is handy to have a feel for the past and present, but you also want to look at the future too. Analyst’s reports and news items are a good place to look about what the company may do in the future. I also look at analysts’ recommendations. I look at the range of recommendations as well as the consensus recommendation. Most consensus recommendations are a Buy and a few are a Hold. You seldom get other consensus recommendations, but they do happen.
Another place to look for what is in the company’s future is the annual statement. Look at parts that cover such things as management discussion and analysis. Look for messages from the President and other executives.
Of course, none of this stuff is absolute. That is why you want to diversify your portfolio. It is also, why you do not let any one stock get to be a too big of percentage of your portfolio. My limit is 10%. I have sold off good companies, like SNC-Lavalin because it grew so much. It grew to a higher percentage of my portfolio than I was comfortable. SNC-Lavalin is still a great company and I still have a good investment in it, but I still cannot afford to have too much in it because it could really damage my portfolio is anything happens to it.
I should also mention that I seldom change past accounting figures. I know that sites that give you accounting values change past ones when they are restated. The Globe and Mail site comes to mind in this. See CP Financials. My approach is almost never to change values because of restatements in financial statements. Although, I must admit that when I do a new spreadsheet, I use financial statements to do two years at a time.
My goal is for the spreadsheets to provide me with a good idea on how the company is doing. Besides, there are no absolutes in life. I also wonder if investing may be more art than science. I remember being at a party and a man I know well talked about his new investment. I had an investment in that company also, which I sold. What was my reasoning for this? Whatever company he invested in, it seemed to have difficulties after he invested in it.
Tomorrow, I will talk about what my spreadsheets says about this company.
This company is a transcontinental railway operating in Canada and the U.S. Its rail network serves the principal centers of Canada, from Montreal to Vancouver and the U.S. Northeast and Midwest regions. Alliances with other carriers extend its market reach throughout the U.S. and into Mexico. Canadian Pacific Solutions provides logistics and supply chain expertise. Its web site is here CPR. See my spreadsheet at cp.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Wednesday, March 16, 2011
Algonquin Power & Utilities Corp 2
I recently read a report on this stock (TSX-AQN) saying it will do much better in the future and that Emera is interested in buying shares in this company after the company completes its buy of two New Hampshire power utilities. Emera is a stock I own and follow.
When I look at insider trading, I find a net of insider buying, but insider selling and insider buy are both very small and inconsequential. However, the company has announced an 8% increase to their dividends for the second dividend payable in 2011. This is a good indication of the confidence of management. This company has a relatively low payout ratio from cash flow relative to its peers.
For this stock, I have a 5 year median low Price/Earnings Ratio of 17.8 and a 5 year median high P/E Ratio of 24.1. I get a current P/E ratio of 21.3. The current P/E Ratio is about the 5 year median average P/E Ratio. For the Graham price, I get a current one of $4.35. The current stock price of $4.91 is some 8% higher. On average, the difference between the Graham Price and Stock Price has been 8%. So this points to a current average stock price.
I get a 10 year average Price/Book Value Ratio of 1.31 and a current P/B Ratio of 1.34. The current one is only 2% higher than the 10 year average. The current dividend yield is 5.3% and the 5 year average is 9.8%. However, this stock has just lowered its dividend when changing from an income trust. Most of the other comparisons say the price is about average. When buying stock, average is probably the best we can hope for. You do not want to pay a relatively high price, and it is hard to find relatively low prices.
When I look at analysts’ recommendations, I find Strong Buy, Buy, Hold and Underperform. There is only 1 underperform recommendations. The consensus recommendations would be a Buy. (See my site for information on analyst ratings.) Analysts feel that this company will continue to develop and that it will have stronger fundamentals and improved valuations in the future. The 12 month stock price estimate is given from $5.50 to $6.00 by analysts feeling this stock is a buy.
Analysts are saying that this company is growing as they expect it to. What I had wanted to see on this stock was some dividend increase and this stock has now done that.
Also, I note that Dividend Ninja has an article on buying Uranium Stock. See Dividend Ninja. Larry MacDonald talks about buying Japanese stock at Canadian Business. The thing is stock market investors do seem to always overreact.
APUC owns and operates a diversified portfolio of clean renewable electric generation and sustainable utility distribution businesses in North America. Liberty Water Co., APUC's water utility subsidiary, provides regulated water utility services. Through its wholly owned subsidiary Liberty Energy Utilities Co., APUC provides regulated electricity and natural gas distribution services. Algonquin Power Co., APUC's electric generation subsidiary, includes renewable energy facilities and thermal energy facilities. Its web site is here Algonquin. See my spreadsheet at aqn.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
When I look at insider trading, I find a net of insider buying, but insider selling and insider buy are both very small and inconsequential. However, the company has announced an 8% increase to their dividends for the second dividend payable in 2011. This is a good indication of the confidence of management. This company has a relatively low payout ratio from cash flow relative to its peers.
For this stock, I have a 5 year median low Price/Earnings Ratio of 17.8 and a 5 year median high P/E Ratio of 24.1. I get a current P/E ratio of 21.3. The current P/E Ratio is about the 5 year median average P/E Ratio. For the Graham price, I get a current one of $4.35. The current stock price of $4.91 is some 8% higher. On average, the difference between the Graham Price and Stock Price has been 8%. So this points to a current average stock price.
I get a 10 year average Price/Book Value Ratio of 1.31 and a current P/B Ratio of 1.34. The current one is only 2% higher than the 10 year average. The current dividend yield is 5.3% and the 5 year average is 9.8%. However, this stock has just lowered its dividend when changing from an income trust. Most of the other comparisons say the price is about average. When buying stock, average is probably the best we can hope for. You do not want to pay a relatively high price, and it is hard to find relatively low prices.
When I look at analysts’ recommendations, I find Strong Buy, Buy, Hold and Underperform. There is only 1 underperform recommendations. The consensus recommendations would be a Buy. (See my site for information on analyst ratings.) Analysts feel that this company will continue to develop and that it will have stronger fundamentals and improved valuations in the future. The 12 month stock price estimate is given from $5.50 to $6.00 by analysts feeling this stock is a buy.
Analysts are saying that this company is growing as they expect it to. What I had wanted to see on this stock was some dividend increase and this stock has now done that.
Also, I note that Dividend Ninja has an article on buying Uranium Stock. See Dividend Ninja. Larry MacDonald talks about buying Japanese stock at Canadian Business. The thing is stock market investors do seem to always overreact.
APUC owns and operates a diversified portfolio of clean renewable electric generation and sustainable utility distribution businesses in North America. Liberty Water Co., APUC's water utility subsidiary, provides regulated water utility services. Through its wholly owned subsidiary Liberty Energy Utilities Co., APUC provides regulated electricity and natural gas distribution services. Algonquin Power Co., APUC's electric generation subsidiary, includes renewable energy facilities and thermal energy facilities. Its web site is here Algonquin. See my spreadsheet at aqn.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Tuesday, March 15, 2011
Algonquin Power & Utilities Corp
I have a lot of my utility money in pipelines. I think that sometime in the future I may have to move this money to other utilities. I do not think that the new types of power generation are going to go away. This company (TSX-AQN) might be a good investment at some time in the future. I recently read a report on this stock saying it will do much better in the future and that Emera is interested in buying shares in this company after the company completes its buy of two New Hampshire power utilities. Emera is a stock I own and follow.
This company, at the present time, does not have a good record to making money for its shareholders. Dividends have gone down more than up and have spent most of the time being flat. They took a dive again when this company went from an income trust to a corporation. The decrease was about 73%. Before I even consider this company, I would like to see some better dividend history. However, the current dividend rate of 4.9% is good.
The company has had some growth in earnings, revenues, book value and cash flow, but not on a per share basis. It is the per share basis growth that, as an investor, I like to see. Book value has gone up, but book value per share has gone down. Over the past 5 and 10 years, book value per share has declined at the rate of 11% and 8% per year, respectively. Cash flow per share, over the past 5 and 10 years has decline by 10% and 5.5% per year over the past 5 and 10 years.
There has been an average increase in shares of 16% per year over the past 10 years. Recently, they have raised capital, convert debentures to shares and bought assets. I do not that that all this really matters if I, as a shareholder, is not better off.
In looking at debt ratios, I find that the Liquidity Ratio is low at 0.44. This means that the current assets cannot cover current liabilities. However, the current liabilities included a portion of the long term debt. The company has arrangements to cover the long term debt and without that, the Liquidity Ratio is better, but not great at 1.02. The 5 year average for the Liquidity Ratio is just 0.92. The Asset/Liability Ratio is better at 1.55 with a 5 year average of 1.62. Both the Leverage Ratio and the Debt/Equity ratios are ok at 2.18 and 1.81, respectively.
The Return on Equity for the financial year ending December 2010 was 5.6%. The 5 year average ROE is 4.4%. Over the past 10 years, shareholders would have made a return of around 4% per year, with dividends providing around 10.5%. This, of course, points to the fact that the stock price is lower now that it was 10 years ago.
Tomorrow, I will look at what the analysts say about this stock and what the spreadsheets says about the current stock price.
APUC owns and operates a diversified portfolio of clean renewable electric generation and sustainable utility distribution businesses in North America. Liberty Water Co., APUC's water utility subsidiary, provides regulated water utility services. Through its wholly owned subsidiary Liberty Energy Utilities Co., APUC provides regulated electricity and natural gas distribution services. Algonquin Power Co., APUC's electric generation subsidiary, includes renewable energy facilities and thermal energy facilities. Its web site is here Algonquin. See my spreadsheet at aqn.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
This company, at the present time, does not have a good record to making money for its shareholders. Dividends have gone down more than up and have spent most of the time being flat. They took a dive again when this company went from an income trust to a corporation. The decrease was about 73%. Before I even consider this company, I would like to see some better dividend history. However, the current dividend rate of 4.9% is good.
The company has had some growth in earnings, revenues, book value and cash flow, but not on a per share basis. It is the per share basis growth that, as an investor, I like to see. Book value has gone up, but book value per share has gone down. Over the past 5 and 10 years, book value per share has declined at the rate of 11% and 8% per year, respectively. Cash flow per share, over the past 5 and 10 years has decline by 10% and 5.5% per year over the past 5 and 10 years.
There has been an average increase in shares of 16% per year over the past 10 years. Recently, they have raised capital, convert debentures to shares and bought assets. I do not that that all this really matters if I, as a shareholder, is not better off.
In looking at debt ratios, I find that the Liquidity Ratio is low at 0.44. This means that the current assets cannot cover current liabilities. However, the current liabilities included a portion of the long term debt. The company has arrangements to cover the long term debt and without that, the Liquidity Ratio is better, but not great at 1.02. The 5 year average for the Liquidity Ratio is just 0.92. The Asset/Liability Ratio is better at 1.55 with a 5 year average of 1.62. Both the Leverage Ratio and the Debt/Equity ratios are ok at 2.18 and 1.81, respectively.
The Return on Equity for the financial year ending December 2010 was 5.6%. The 5 year average ROE is 4.4%. Over the past 10 years, shareholders would have made a return of around 4% per year, with dividends providing around 10.5%. This, of course, points to the fact that the stock price is lower now that it was 10 years ago.
Tomorrow, I will look at what the analysts say about this stock and what the spreadsheets says about the current stock price.
APUC owns and operates a diversified portfolio of clean renewable electric generation and sustainable utility distribution businesses in North America. Liberty Water Co., APUC's water utility subsidiary, provides regulated water utility services. Through its wholly owned subsidiary Liberty Energy Utilities Co., APUC provides regulated electricity and natural gas distribution services. Algonquin Power Co., APUC's electric generation subsidiary, includes renewable energy facilities and thermal energy facilities. Its web site is here Algonquin. See my spreadsheet at aqn.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
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