I do not own this stock of Morneau Shepell Inc. (TSX-MSI, OTC- MSIXF). Everyone once in a while I go through the stocks that my brokerage, TD Waterhouse, is recommending to find promising new stocks. This stock was rated a buy recently by TD Waterhouse. It was under Diversified Financials.
I first looked at dividends. TD had listed a 6% dividend, which is good. The dividends for this company started in 2005. They had a few increases until it decided to convert from an income trust to a corporation. They then decreased the distributions by 17.5%, but retained a monthly distribution format. This was effective January 2011 and distributions have remained level since. I would like it better when it can increase dividends.
I next looked up the earnings estimates as the 2012 financial report has not yet been produced. I wanted to check the Dividend Payout Ratios. The DPR ratios for EPS were high, with the 2012 estimates at 136%. However, this was expected to move below 100% by 2014. The DPR ratios for CF were better as they were in the 70% range. I would like it better if the DPRs were much better, especially the DPR for earnings.
Next I check the stock prices over the years to see if the company has made any money for their shareholders. Well, they have made some money for the shareholders who bought at the time of the IPO (initial public offering), but not much over the past 5 years.
For those who bought at the IPO the return has been 9.87% per year with 6.84% per year from distributions and 3.03% per year from capital gains. Over the past 5 years this stock has gained 3.51% per year for its shareholders, with 6.33% per year from distributions and a capital loss of 2.82% per year. I do not much like stocks where you gain dividends, but lose capital.
I finished off the spreadsheet. The first thing that I do not like is the very high Dividend Payout Ratio in regards to earnings. The 5 year median DPR for earnings is 214%. It has been coming down with the one for 2012 expected to be at 162%, for 2013 to be 128% and for 2014 to be 99%.
Another thing is that the Intangible and Goodwill assets have been higher than the stocks' market cap (106% in 2011). However, with the 3rd quarter of 2012 these assets are now only 87% of the market cap.
The outstanding shares have been increasing strongly mainly due to acquisitions. This is not bad within itself as long per share values are increasing. However, growth in Book Value per Share is very low at 3.7% and 2% over the past 5 and 10 years.
This stock has a good dividend yield at 6%, but I prefer stocks that have growing dividend. I do not think that they will be in a position to raise their dividends for some time. I would not be interested in this stock at this point in time, so I am not waiting for the fourth quarterly results to report on this stock.
The Earnings per Share growth is not great. The one for the past 7 years looks good, but it starts from a very low point. The earnings using the 5 year running average has grown over the past 3 years at 6.5%. This is ok, but not great.
Cash flow growth is not great either at 0.25% over the past 5 years and the 5 year running average growth over the past 3 years is at 6.8%. The 7 year growth looks very good, but this is starting from a low level. The 5 year running averages growth is probably a better indicator on growth for this company.
The Return on Equity is quite low with the ROE for the last 12 months at just 5.6%. The 5 year median ROE is also just 5.6%. The ROE on comprehensive income is a bit better at 6%.
A good thing about this stock is the growth in revenue. Revenue has grown at 23% and 20% per year over the past 5 and 7 years. Revenue per Share is good at 11% and 10.5% per year. The 5 year running average growth over the past 3 years is almost 10%, so this is good.
Another good thing is the debt ratios. The current Liquidity Ratio is 1.97. The current Debt Ratio is 2.51. The current Leverage and Debt/Equity Ratios are also quite good at 1.66 and 0.66, respectively.
When I look at analysts' recommendations, I find Buy, Hold and Underperform recommendations. The consensus recommendation is a Hold. The 1 year stock price is $16.30, implying a return of 8.94% with 5.91 from dividends and 3.03% from capital gains.
The P/E is 21.64, a ratio below the 5 year median of 22.13 for this stock. I get a 2013 Graham Price of $10.81 and the P/GP ratio is 1.22. This is between the 10 year low and median P/GP Ratios of 1.12 and 1.23. The current P/B Ratio is 1.55 and the 8 year median P/B Ratio is 4% lower at 1.48. I cannot use the dividend yield test as dividends have been travelling down.
The testing suggests that the current price is relative good to reasonable. However, I think that the P/E Ratio of 21.64 is too high a P/E ratio for this stock. In other words, the price may be relatively good; I just do not think it is really that good on an absolute basis. Yes the dividend yield might be good, but there is not much growth possible for capital gain. I would not buy it at this relatively price. It cannot grow it dividends and without that, the capital gain will not grow, for the value of this business will not grow.
Morneau Shepell Inc. is provides human resource consulting and outsourcing services. The firm delivers solutions to assist employers in managing the financial security, health and productivity of their employees. Its web site is here Morneau Shepell. See my spreadsheet at msi.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 or StockTwits.
Thursday, February 14, 2013
Wednesday, February 13, 2013
Canadian National Railway 2
On my other blog I am today writing about Saving For Retirement...continue...
I own this stock of Canadian National Railway (TSX-CNR, NYSE-CNI). I originally bought this stock in 2005 and in 2009 for my trading account. To date, I have made 16.52% per year on this stock. For this stock, of my total return some 1.63% is in dividends and 14.89% is in capital gains.
When I look at the Insider Trading report, I find $73.3M of insider selling and $3.2M of insider buying. Some $24.6M of the insider selling is by the CEO. Not only are there options under this company there are also Deferred Share Units and Restricted Share Units. Selling seems to be in connection with options. The company is also buying back shares for cancellation.
The CEO has shares worth $2.9M, and has options are worth $126.6M. The CFO has shares worth $0.2M and has options worth $30M. An officer has shares worth $0.3M and has options worth $3.8M. A director has shares worth $1.9M and has options worth $3.9M. This is just to give you an idea on insider share ownership and option values. The CEO owns 6.8% of the outstanding shares. (See my blog entry on stock options.)
The 5 year low, median and high median Price/Earnings per Share Ratios are 11.87, 13.49 and 14.84. The current P/E is 16.08 based on a $99.07 stock price and 2013 earnings of $6.16. I get a Graham Price of $60.37. The 10 year low, median and high median Price/Graham Price Ratios are 1.02, 1.20 and 1.35. The current P/GP Ratio is 1.64.
I get a 10 year Price/Book Value per Share Ratio of 2.52 and a current one of 3.77. The current ratio is almost 50% higher than the 10 year ratio. I get a 5 year median dividend yield of 1.80% and a current one of 1.51 a yield some 16% higher.
All my tests show that the stock price is high. It is not extraordinarily high, but still high.
When I look at analysts' recommendations I find Buy, Hold and Underperform recommendations. The consensus, as there are a lot more Hold recommendations than anything else is a Hold recommendation. The 12 months consensus stock price is $95.40. This is a value below the current stock price and suggests a loss of 2.91% with a capital loss of 3.71 and dividends of 1.51%.
One analyst with a Hold recommendation gave a 12 month stock price of $104, and thought that CNR deserved a premium over other railway stocks. Another analysts thought the stock was a bit pricey and gave it an Underperform (or partial sell) rating. This company is well thought of. Analysts are impressed by the 15% dividend increase in 2012 and that the company has raised dividends for 17 years in a row.
The web site Seeking Alpha has the recording of the management discussing the Q4 2012 results. For the financial post Scott Deveau commented on the 4th quarter results for this company. He says that CNR completed a record year.
Canadian National Railway Company and its operating railway subsidiaries, spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key metropolitan areas of Toronto, Buffalo, Chicago, Detroit, Duluth, Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis, St. Louis, and Jackson, Miss., with connections to all points in North America. Its web site is here CNR. See my spreadsheet at cnr.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 or StockTwits.
I own this stock of Canadian National Railway (TSX-CNR, NYSE-CNI). I originally bought this stock in 2005 and in 2009 for my trading account. To date, I have made 16.52% per year on this stock. For this stock, of my total return some 1.63% is in dividends and 14.89% is in capital gains.
When I look at the Insider Trading report, I find $73.3M of insider selling and $3.2M of insider buying. Some $24.6M of the insider selling is by the CEO. Not only are there options under this company there are also Deferred Share Units and Restricted Share Units. Selling seems to be in connection with options. The company is also buying back shares for cancellation.
The CEO has shares worth $2.9M, and has options are worth $126.6M. The CFO has shares worth $0.2M and has options worth $30M. An officer has shares worth $0.3M and has options worth $3.8M. A director has shares worth $1.9M and has options worth $3.9M. This is just to give you an idea on insider share ownership and option values. The CEO owns 6.8% of the outstanding shares. (See my blog entry on stock options.)
The 5 year low, median and high median Price/Earnings per Share Ratios are 11.87, 13.49 and 14.84. The current P/E is 16.08 based on a $99.07 stock price and 2013 earnings of $6.16. I get a Graham Price of $60.37. The 10 year low, median and high median Price/Graham Price Ratios are 1.02, 1.20 and 1.35. The current P/GP Ratio is 1.64.
I get a 10 year Price/Book Value per Share Ratio of 2.52 and a current one of 3.77. The current ratio is almost 50% higher than the 10 year ratio. I get a 5 year median dividend yield of 1.80% and a current one of 1.51 a yield some 16% higher.
All my tests show that the stock price is high. It is not extraordinarily high, but still high.
When I look at analysts' recommendations I find Buy, Hold and Underperform recommendations. The consensus, as there are a lot more Hold recommendations than anything else is a Hold recommendation. The 12 months consensus stock price is $95.40. This is a value below the current stock price and suggests a loss of 2.91% with a capital loss of 3.71 and dividends of 1.51%.
One analyst with a Hold recommendation gave a 12 month stock price of $104, and thought that CNR deserved a premium over other railway stocks. Another analysts thought the stock was a bit pricey and gave it an Underperform (or partial sell) rating. This company is well thought of. Analysts are impressed by the 15% dividend increase in 2012 and that the company has raised dividends for 17 years in a row.
The web site Seeking Alpha has the recording of the management discussing the Q4 2012 results. For the financial post Scott Deveau commented on the 4th quarter results for this company. He says that CNR completed a record year.
Canadian National Railway Company and its operating railway subsidiaries, spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key metropolitan areas of Toronto, Buffalo, Chicago, Detroit, Duluth, Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis, St. Louis, and Jackson, Miss., with connections to all points in North America. Its web site is here CNR. See my spreadsheet at cnr.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 or StockTwits.
Tuesday, February 12, 2013
Canadian National Railway
I own this stock of Canadian National Railway (TSX-CNR, NYSE-CNI). I originally bought this stock in 2005 and in 2009 for my trading account. To date, I have made 16.52% per year on this stock. For this stock of my total return some 1.63% is in dividends and 14.89% is in capital gains.
I had also had some of this stock in my RRSP account. However, I am changing the stocks in my RRSP account as I have too many with low dividends. With low dividends, it means that I need to keep a lot of cash in my RRSP account so that projected dividends and cash add up to 5 years in which I do not need to sell stocks to raise money for RRSP withdrawals. I will talk about this subject later.
Even though dividends are low (5 year median dividend yield is just 1.8%), the dividend increases have been good with growth at 12.3% and 18% per year. For the stock I bought in 2005, I am making a return of 4.16% in dividend yield on my original purchase. In 15 years, you could expect to make between 10% and 14% return on your original investment.
The dividends are low and so are the Dividend Payout Ratios. For the financial year of 2012, the DPRs were 24.5% for earnings and 21.5% for cash flow. These are close to the 5 year median values of 24% and 19%.
The total return on this stock over the past 5 and 10 years is at 16.01% and 17.49% per year. The portion attributed to dividends is 1.88% and 1.89% per year over these periods. The capital gain portion is 14.13% and 15.60% per year over these periods.
They have been quite business in buying back shares. The outstanding shares have decreased by 2.5% and 3.2% per year over the past 5 and 10 years. This is a high rate of buy backs. The shares have been increased on this same period of stock options. This high rate of stock buy backs can distort some of the values I look at. Buying back shares is not bad in itself, but you should be aware of the consequences.
Revenue has increased by 4.7% and 5% over the past 5 and 10 years. The Revenue per Share has increased much better at 7.3% and 8.4% per year. When a company buys back a lot of shares, this can cause the per share values to be better.
Earnings per Share have increased by 7.8% and 16.6% per year over the past 5 and 10 years. The Cash Flow per Share has grown at the rate of 6.4% and 8.3% per year over the past 5 and 10 years. Book Value per Share has grown at 4.2% and 6.2% per year over the past 5 and 10 years.
The Return on Equity is very good at 24.3% for the financial year ending in 2012. Their buy back policy could affect this number. (See my blog for further information on Return on Equity.) Also, the ROE on comprehensive income is lower at 20.5%. This is over 15% lower and I think a bit significant.
However, there is often a big difference between the ROE on Net Income and on Comprehensive Income. Although I expect the ROE to be good on this stock, it just may not be as good as it appears. This is just a warning. I note that the EPS/CFPS ratio is 0.88 and this is fine as it is below 1.00. (If this ratio was higher than 1.00, it would also be a warning.)
The Liquidity Ratio has always been low on this stock with the current Ratio being 0.85 and the 5 year median ratio being 0.93. If you include cash flow after dividends the Ratio raises to 1.95 a good value. Also, if you take off the current portion of the debt (which has been handled) you get a better Ratio of 1.15.
The Debt Ratio has always been much better and quite good at 1.70. The Leverage and Debt/Equity Ratios are fine at 2.42 and 1.42 for this type of company.
Canadian National Railway Company and its operating railway subsidiaries, spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key metropolitan areas of Toronto, Buffalo, Chicago, Detroit, Duluth, Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis, St. Louis, and Jackson, Miss., with connections to all points in North America. Its web site is here CNR. See my spreadsheet at cnr.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 or StockTwits.
I had also had some of this stock in my RRSP account. However, I am changing the stocks in my RRSP account as I have too many with low dividends. With low dividends, it means that I need to keep a lot of cash in my RRSP account so that projected dividends and cash add up to 5 years in which I do not need to sell stocks to raise money for RRSP withdrawals. I will talk about this subject later.
Even though dividends are low (5 year median dividend yield is just 1.8%), the dividend increases have been good with growth at 12.3% and 18% per year. For the stock I bought in 2005, I am making a return of 4.16% in dividend yield on my original purchase. In 15 years, you could expect to make between 10% and 14% return on your original investment.
The dividends are low and so are the Dividend Payout Ratios. For the financial year of 2012, the DPRs were 24.5% for earnings and 21.5% for cash flow. These are close to the 5 year median values of 24% and 19%.
The total return on this stock over the past 5 and 10 years is at 16.01% and 17.49% per year. The portion attributed to dividends is 1.88% and 1.89% per year over these periods. The capital gain portion is 14.13% and 15.60% per year over these periods.
They have been quite business in buying back shares. The outstanding shares have decreased by 2.5% and 3.2% per year over the past 5 and 10 years. This is a high rate of buy backs. The shares have been increased on this same period of stock options. This high rate of stock buy backs can distort some of the values I look at. Buying back shares is not bad in itself, but you should be aware of the consequences.
Revenue has increased by 4.7% and 5% over the past 5 and 10 years. The Revenue per Share has increased much better at 7.3% and 8.4% per year. When a company buys back a lot of shares, this can cause the per share values to be better.
Earnings per Share have increased by 7.8% and 16.6% per year over the past 5 and 10 years. The Cash Flow per Share has grown at the rate of 6.4% and 8.3% per year over the past 5 and 10 years. Book Value per Share has grown at 4.2% and 6.2% per year over the past 5 and 10 years.
The Return on Equity is very good at 24.3% for the financial year ending in 2012. Their buy back policy could affect this number. (See my blog for further information on Return on Equity.) Also, the ROE on comprehensive income is lower at 20.5%. This is over 15% lower and I think a bit significant.
However, there is often a big difference between the ROE on Net Income and on Comprehensive Income. Although I expect the ROE to be good on this stock, it just may not be as good as it appears. This is just a warning. I note that the EPS/CFPS ratio is 0.88 and this is fine as it is below 1.00. (If this ratio was higher than 1.00, it would also be a warning.)
The Liquidity Ratio has always been low on this stock with the current Ratio being 0.85 and the 5 year median ratio being 0.93. If you include cash flow after dividends the Ratio raises to 1.95 a good value. Also, if you take off the current portion of the debt (which has been handled) you get a better Ratio of 1.15.
The Debt Ratio has always been much better and quite good at 1.70. The Leverage and Debt/Equity Ratios are fine at 2.42 and 1.42 for this type of company.
Canadian National Railway Company and its operating railway subsidiaries, spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key metropolitan areas of Toronto, Buffalo, Chicago, Detroit, Duluth, Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis, St. Louis, and Jackson, Miss., with connections to all points in North America. Its web site is here CNR. See my spreadsheet at cnr.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 or StockTwits.
Monday, February 11, 2013
Richelieu Hardware Ltd 2
On my other blog I am today writing about modest money blogger's entry on great Canadian Blogs...continue...
I own this stock of Richelieu Hardware Ltd (TSX-RCH, OTC- RHUHF). I first bought this stock in 2007 because it was on the Investment Reporter's list of good stocks to own. After I bought it the stock proceed to go down for the next two years. When I reviewed the stock in March 2009, I had lost 16% per year. So in 2009, I bought some more. To date, I have earnings of 20.28% per year on this stock.
When I look at insider trading I find $1.6M of insider selling and a bit of insider buying with a net of insider selling of $1.4M. The selling is all by officers of the company and seems to be concerning options. The buying is by officers and directors and buying seems mainly under the company's stock plan. The company is also buying back shares for cancellation.
According to Reuters some 44% of the outstanding shares are owned by institutions and they have sold just over 3% of the shares over the past 3 months.
The CEO has shares worth $47.36M, and his options are worth $11.7M. The CFO has very few shares and options worth $0.5M. An officer has very few shares and options worth $0.6M. A director has very few shares and has very few options. This is just to give you an idea on insider share ownership and option values. The CEO owns 6.8% of the outstanding shares.
The 5 year low, median and high median Price/Earnings Ratios are 12.05, 14.37 and 16.65. I calculated the current P/E of 16.88 using 2013 earnings of $2.34 and stock price of $39.50. I get a Graham Price of 26.81 and the 10 year low, median and high median Price/Graham Price Ratios of 12.94, 29.49 and 42.62. The current P/GP Ratio is 47.35.
The 10 year Price/Book Value per Share is 2.52. The current P/B Ratio is 2.89 a value almost 15% higher. The 5 year dividend yield is 2.58% and the current dividend yield is 1.22% a value some 23% higher.
All my stock testing shows that the current stock price is relatively high, although not excessively so.
There are not many analysts following this stock. I find two with recommendations of Buy and Hold. The 1 year consensus stock price is $40.50. This implies a total return of 3.75% with 1.22% from dividends and 2.53% from capital gains.
Localized USA blog says that Scotia Capital, in the latter part of January increased their target price on this stock. They have an outperform call on this stock (which is the same as a buy).
This company is a distributor, importer and manufacturer of specialty hardware and complementary products. Its products are kitchen and bathroom cabinets, furniture, and window and door. It is also involved with residential and commercial woodworking industry. It has a large customer base of hardware retailers. Its web site is here Richelieu. See my spreadsheet at rch.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 or StockTwits.
I own this stock of Richelieu Hardware Ltd (TSX-RCH, OTC- RHUHF). I first bought this stock in 2007 because it was on the Investment Reporter's list of good stocks to own. After I bought it the stock proceed to go down for the next two years. When I reviewed the stock in March 2009, I had lost 16% per year. So in 2009, I bought some more. To date, I have earnings of 20.28% per year on this stock.
When I look at insider trading I find $1.6M of insider selling and a bit of insider buying with a net of insider selling of $1.4M. The selling is all by officers of the company and seems to be concerning options. The buying is by officers and directors and buying seems mainly under the company's stock plan. The company is also buying back shares for cancellation.
According to Reuters some 44% of the outstanding shares are owned by institutions and they have sold just over 3% of the shares over the past 3 months.
The CEO has shares worth $47.36M, and his options are worth $11.7M. The CFO has very few shares and options worth $0.5M. An officer has very few shares and options worth $0.6M. A director has very few shares and has very few options. This is just to give you an idea on insider share ownership and option values. The CEO owns 6.8% of the outstanding shares.
The 5 year low, median and high median Price/Earnings Ratios are 12.05, 14.37 and 16.65. I calculated the current P/E of 16.88 using 2013 earnings of $2.34 and stock price of $39.50. I get a Graham Price of 26.81 and the 10 year low, median and high median Price/Graham Price Ratios of 12.94, 29.49 and 42.62. The current P/GP Ratio is 47.35.
The 10 year Price/Book Value per Share is 2.52. The current P/B Ratio is 2.89 a value almost 15% higher. The 5 year dividend yield is 2.58% and the current dividend yield is 1.22% a value some 23% higher.
All my stock testing shows that the current stock price is relatively high, although not excessively so.
There are not many analysts following this stock. I find two with recommendations of Buy and Hold. The 1 year consensus stock price is $40.50. This implies a total return of 3.75% with 1.22% from dividends and 2.53% from capital gains.
Localized USA blog says that Scotia Capital, in the latter part of January increased their target price on this stock. They have an outperform call on this stock (which is the same as a buy).
This company is a distributor, importer and manufacturer of specialty hardware and complementary products. Its products are kitchen and bathroom cabinets, furniture, and window and door. It is also involved with residential and commercial woodworking industry. It has a large customer base of hardware retailers. Its web site is here Richelieu. See my spreadsheet at rch.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 or StockTwits.
Friday, February 8, 2013
Richelieu Hardware Ltd
I own this stock of Richelieu Hardware Ltd (TSX-RCH, OTC- RHUHF). I first bought this stock in 2007 because it was on the Investment Reporter's list of good stocks to own. After I bought it the stock proceed to go down for the next two years. When I reviewed the stock in March 2009, I had lost 16% per year.
However, The Investment Report does follow good stocks. Also, the company had good growth in revenue, earnings, dividend, book value and cash flow. So in 2009, I bought some more. To date, I have earnings of 20.28% per year on this stock. They only started to pay dividends in 2002 and dividend yield is low. The portion of my return attributable to dividends is 1.27% per year and the portion attributable to capital gains is 19.01% per year. Investment Reporter is produced by MPL communications .
The stock is considered to be a dividend growth stock. The dividends have grown at the rate of 11.4% and 15.9% per year over the past 5 and 10 years. The current dividend yield is just 1.43%, but the 5 year dividend yield is a bit higher at 1.58%. Commiserate with the low dividend yield is low Dividend Payout Ratios. The 5 year DPRs for EPS is 22.3% and for Cash Flow is 18.3%.
Over the past 5 and 10 years to the end of 2012, this stock has had total returns of 10.19% and 11% per year. The portion of these returns attributable to dividends is 1.32% and 1.27% per year. The portion attributable to capital gains is 8.87% and 9.73%. (I did better because I bought this stock at a low price in 2009.)
The outstanding shares have been decreasing over the past 5 and 10 years at the rate of 2% and 0.9% per year. Outstanding share are increased due to stock options and decreased because of share buy backs. Revenues have increased over the past 5 and 10 years by 5.3% and 8% per year. Revenues per Share have increased at 7.6% and 9% per year over the past 5 and 10 years.
The Earnings per Share have increased by 8% and 9.9% per year over the past 5 and 10 years. The Cash Flow per Share has increased by 9% and 10.4% per year over the past 5 and 10 years and the Book Value per Share have increased by 8.6% and 12.3% per year over the past 5 and 10 years.
Return on Equity is very good with the ROE for the financial year ending November 2012 at 16.2% and the 5 year median ROE at 15.5%. (ROE has not been lower than 10% over the past 5 years.) The ROE on comprehensive income is fairly close coming in at 15.8% and the 5 year median at 15%.
The company has a very strong balance sheet, with the current Liquidity Ratio at 4.57 and the Debt Ratio at 5.65. The Leverage and Debt/Equity Ratios are also good at 1.23 and 0.22, respectively.
I think that this stock has been a very good investment for me. It is the sort you would buy when building a portfolio when you do not need much in the way of dividend income. The thing with dividend paying stock is that they tend to be more disciplined than non-dividend paying stock.
This company is a distributor, importer and manufacturer of specialty hardware and complementary products. Its products are kitchen and bathroom cabinets, furniture, and window and door. It is also involved with residential and commercial woodworking industry. It has a large customer base of hardware retailers. Its web site is here Richelieu. See my spreadsheet at rch.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 or StockTwits.
However, The Investment Report does follow good stocks. Also, the company had good growth in revenue, earnings, dividend, book value and cash flow. So in 2009, I bought some more. To date, I have earnings of 20.28% per year on this stock. They only started to pay dividends in 2002 and dividend yield is low. The portion of my return attributable to dividends is 1.27% per year and the portion attributable to capital gains is 19.01% per year. Investment Reporter is produced by MPL communications .
The stock is considered to be a dividend growth stock. The dividends have grown at the rate of 11.4% and 15.9% per year over the past 5 and 10 years. The current dividend yield is just 1.43%, but the 5 year dividend yield is a bit higher at 1.58%. Commiserate with the low dividend yield is low Dividend Payout Ratios. The 5 year DPRs for EPS is 22.3% and for Cash Flow is 18.3%.
Over the past 5 and 10 years to the end of 2012, this stock has had total returns of 10.19% and 11% per year. The portion of these returns attributable to dividends is 1.32% and 1.27% per year. The portion attributable to capital gains is 8.87% and 9.73%. (I did better because I bought this stock at a low price in 2009.)
The outstanding shares have been decreasing over the past 5 and 10 years at the rate of 2% and 0.9% per year. Outstanding share are increased due to stock options and decreased because of share buy backs. Revenues have increased over the past 5 and 10 years by 5.3% and 8% per year. Revenues per Share have increased at 7.6% and 9% per year over the past 5 and 10 years.
The Earnings per Share have increased by 8% and 9.9% per year over the past 5 and 10 years. The Cash Flow per Share has increased by 9% and 10.4% per year over the past 5 and 10 years and the Book Value per Share have increased by 8.6% and 12.3% per year over the past 5 and 10 years.
Return on Equity is very good with the ROE for the financial year ending November 2012 at 16.2% and the 5 year median ROE at 15.5%. (ROE has not been lower than 10% over the past 5 years.) The ROE on comprehensive income is fairly close coming in at 15.8% and the 5 year median at 15%.
The company has a very strong balance sheet, with the current Liquidity Ratio at 4.57 and the Debt Ratio at 5.65. The Leverage and Debt/Equity Ratios are also good at 1.23 and 0.22, respectively.
I think that this stock has been a very good investment for me. It is the sort you would buy when building a portfolio when you do not need much in the way of dividend income. The thing with dividend paying stock is that they tend to be more disciplined than non-dividend paying stock.
This company is a distributor, importer and manufacturer of specialty hardware and complementary products. Its products are kitchen and bathroom cabinets, furniture, and window and door. It is also involved with residential and commercial woodworking industry. It has a large customer base of hardware retailers. Its web site is here Richelieu. See my spreadsheet at rch.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 or StockTwits.
Thursday, February 7, 2013
Nordion Inc
I do not own this stock of Nordion Inc. (TSX-NDN, NYSE-NDZ), but I used to own it when it was called MDS Inc. I bought stock in the MDS in 1996, 1997, and 1998. I sold all my shares in 2006. On this stock, I made a total return per year of 5%. Basically, in 2006 I thought this company had lost its way and was going nowhere. I had invested in it as it was one of very few Health Care sector companies in Canada and it was considered to be a very good company at the time I bought it.
After paying some dividends in 2011 and 2012, this company has again cut the dividends to zero. To me it seems like this company just cannot get its act together. Total return is very much negative over the past 5 and 10 years with declines at 18% per year and 10.5% per year. These are heavy losses for shareholders. Shares were down by some 25% between the end of 2011 and 2012.
Outstanding shares have been decreasing as over the past 5 and 10 years at the rate of 12.8% and 7.9% per year. Shares have increased for stock options and decreased for buy backs. In 2010 they bought back some 44% of the outstanding shares and in 2012 they bought back 8% of their outstanding shares.
The heavy buyback of shares has not helped in per share values. Revenue per share growth is down by 16% and 10% per year over the past 5 and 10 years. Cash flow per share is not down as much at a decline of 3% and 7.5% per year over the past 5 and 10 years.
Return on Equity is non-existent because there was only one year of profits within the last 5 years. The only good thing to say is that debt ratios are good. The Liquidity ratio is quite good at 1.96 as is the Debt Ratio at 1.83.
I suppose you could say that the stock price is good. I do not get much of a fix on the relative stock price as it has had lots of negative EPS years lately, Book Value has been tanking and the dividend has been cut to zero. The Price/Earnings Ratio is 10.65, which is a good one. I used a stock price of $10.37 and a 2013 EPS of $0.69. The Price/Graham Price Ratio is 1.01, which shows a good price.
When I look at the analysts' recommendations, I find Strong Buy, Hold, Underperform and Sell. The consensus would be a Hold. The 12 months consensus stock price is $8.52. This implies a 15.6% capital gain. One analyst said that this company has been out of favour lately.
See CNBC article on medical isotope problems. The apprentice millionaire portfolio blogger wrote about this company in mid-December 2012. He has a more optimistic view that I do.
This company cannot seem to make money. It may not be entirely their fault; however, it still is not making money.
Nordion Inc. is a global life sciences company that provides products and services for the development of drugs and diagnosis and treatment of disease. The company is a provider of pharmaceutical contract research, medical isotopes for molecular imaging, radiotherapeutics, and analytical instruments. Its web site is here Nordion. See my spreadsheet at ndn.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 or StockTwits.
After paying some dividends in 2011 and 2012, this company has again cut the dividends to zero. To me it seems like this company just cannot get its act together. Total return is very much negative over the past 5 and 10 years with declines at 18% per year and 10.5% per year. These are heavy losses for shareholders. Shares were down by some 25% between the end of 2011 and 2012.
Outstanding shares have been decreasing as over the past 5 and 10 years at the rate of 12.8% and 7.9% per year. Shares have increased for stock options and decreased for buy backs. In 2010 they bought back some 44% of the outstanding shares and in 2012 they bought back 8% of their outstanding shares.
The heavy buyback of shares has not helped in per share values. Revenue per share growth is down by 16% and 10% per year over the past 5 and 10 years. Cash flow per share is not down as much at a decline of 3% and 7.5% per year over the past 5 and 10 years.
Return on Equity is non-existent because there was only one year of profits within the last 5 years. The only good thing to say is that debt ratios are good. The Liquidity ratio is quite good at 1.96 as is the Debt Ratio at 1.83.
I suppose you could say that the stock price is good. I do not get much of a fix on the relative stock price as it has had lots of negative EPS years lately, Book Value has been tanking and the dividend has been cut to zero. The Price/Earnings Ratio is 10.65, which is a good one. I used a stock price of $10.37 and a 2013 EPS of $0.69. The Price/Graham Price Ratio is 1.01, which shows a good price.
When I look at the analysts' recommendations, I find Strong Buy, Hold, Underperform and Sell. The consensus would be a Hold. The 12 months consensus stock price is $8.52. This implies a 15.6% capital gain. One analyst said that this company has been out of favour lately.
See CNBC article on medical isotope problems. The apprentice millionaire portfolio blogger wrote about this company in mid-December 2012. He has a more optimistic view that I do.
This company cannot seem to make money. It may not be entirely their fault; however, it still is not making money.
Nordion Inc. is a global life sciences company that provides products and services for the development of drugs and diagnosis and treatment of disease. The company is a provider of pharmaceutical contract research, medical isotopes for molecular imaging, radiotherapeutics, and analytical instruments. Its web site is here Nordion. See my spreadsheet at ndn.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 or StockTwits.
Wednesday, February 6, 2013
Exco Technologies Ltd 2
On my other blog I am today writing about the return on equity (ROE)...continue...
I do not own this stock of Exco Technologies Ltd (TSX-XTC, OTC- EXCOF). This is a stock given as a recommendation by Keystone at the Toronto Money Show of 2012. I decided to check into it as it is a small tech company that is paying dividends. Also, I decided to review this stock because Keystone has recommended some very good stocks in the past.
When I look at insider trading I find $1M and insider selling and $0.4M of insider buying with $0.6M net insider selling. Insider buying was both bought at lower and higher stock prices than insider selling, so this tells us nothing. Some of the selling is of stock options. The company is also buying back and cancelling shares.
The CEO has shares worth $56M, and his options are worth $0.7M. The CFO has shares worth $1.5M and options worth $0.5M. An officer has shares worth $0.3M and options worth $1M. A director has shares worth $0.1M and has options worth 0.2M. This is just to give you an idea on insider share ownership and option values. If you look at insiders with large holdings, these holding add up to 36% of the outstanding shares.
The 5 year low, median and high median Price/Earnings Ratios are 7.00, 7.13 and 8.83. These are very low. The P/E Ratio may not be a good measure as there have been a number of years lately of very low and negative earnings. The current P/E Ratio is 9.00 based on a stock price of $5.85 and a 2013 EPS of $0.65. This is a low P/E Ratio and so suggests a good stock price.
I get a Graham Price of $7.33. The 10 year low, median and high median Price/Graham Price Ratios are 0.82, 1.20 and 1.47. However, these Ratios have all been under 1.00 over the past 3 years. The current P/GP Ratio of .080 is low on a relative basis and low on an absolute basis. (Any ratio at or below 1.00 is considered low.)
I get a 10 year median Price/Book Value per Share Ratio of 1.14. The current ratio is 1.59. The current one is some 40% higher than the 10 year median ratio. This is not surprising as the book value has been fall because of negative earnings.
I would take more seriously the dividend yield test. The 5 year median dividend yield is 3.16%. The current is almost 3% lower at 3.08%. The company has been increasing the dividend at a very good clip lately and the relative dividend yield is lower than the 5 year dividend yield, but it is quite close. This would suggest that the stock price is reasonable.
The way I look at stock price testing is that if there are inconsistent outcomes, and there is no good reason to disregard the dividend yield test, you should go with the dividend yield test. This says that the stock price is relatively reasonable.
When I look at analysts' recommendations, I find two, a Strong Buy and a Buy. There is not many analysts following this stock. The 12 month consensus stock price is $6.63. This implies a total return of 16.41%, with 3.08% from dividends and 13.33% from capital gains.
The Jags report talks about Canaccord Genuity rising its target price on this stock from $6.50 to $6.75 on February 1, 2013. The Canadian Dividend Blogger talks about this stock being on his list of high dividend growers. According to the Edmonton Journal BMO listed this company as one of their top Canadian Small Cap picks for 2013.
I can see why people like this stock. It has very good dividend growth and dividend is at a nice 3%. The current stock price seems reasonable. However, it is a small cap stock and it is an industrial stock in the auto industry, so it is risky. However, it has very good debt ratios and with a large insider ownership. I do not see them increasing the dividends beyond what can be afforded.
Exco is a global designer, developer and manufacturer of dies, moulds, equipment, components and assemblies to the die-cast, extrusion and automotive industries. The Die Casting and Extrusion Technology groups operations are based in Canada, U.S., Mexico and Colombia and primarily serve automotive and industrial markets throughout the world. The Automotive Solutions Group has facilities are located in Canada, U.S., Mexico and Morocco and supply the North American, European and Asian markets. Its web site is here Exco. See my spreadsheet at xtc.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 or StockTwits.
I do not own this stock of Exco Technologies Ltd (TSX-XTC, OTC- EXCOF). This is a stock given as a recommendation by Keystone at the Toronto Money Show of 2012. I decided to check into it as it is a small tech company that is paying dividends. Also, I decided to review this stock because Keystone has recommended some very good stocks in the past.
When I look at insider trading I find $1M and insider selling and $0.4M of insider buying with $0.6M net insider selling. Insider buying was both bought at lower and higher stock prices than insider selling, so this tells us nothing. Some of the selling is of stock options. The company is also buying back and cancelling shares.
The CEO has shares worth $56M, and his options are worth $0.7M. The CFO has shares worth $1.5M and options worth $0.5M. An officer has shares worth $0.3M and options worth $1M. A director has shares worth $0.1M and has options worth 0.2M. This is just to give you an idea on insider share ownership and option values. If you look at insiders with large holdings, these holding add up to 36% of the outstanding shares.
The 5 year low, median and high median Price/Earnings Ratios are 7.00, 7.13 and 8.83. These are very low. The P/E Ratio may not be a good measure as there have been a number of years lately of very low and negative earnings. The current P/E Ratio is 9.00 based on a stock price of $5.85 and a 2013 EPS of $0.65. This is a low P/E Ratio and so suggests a good stock price.
I get a Graham Price of $7.33. The 10 year low, median and high median Price/Graham Price Ratios are 0.82, 1.20 and 1.47. However, these Ratios have all been under 1.00 over the past 3 years. The current P/GP Ratio of .080 is low on a relative basis and low on an absolute basis. (Any ratio at or below 1.00 is considered low.)
I get a 10 year median Price/Book Value per Share Ratio of 1.14. The current ratio is 1.59. The current one is some 40% higher than the 10 year median ratio. This is not surprising as the book value has been fall because of negative earnings.
I would take more seriously the dividend yield test. The 5 year median dividend yield is 3.16%. The current is almost 3% lower at 3.08%. The company has been increasing the dividend at a very good clip lately and the relative dividend yield is lower than the 5 year dividend yield, but it is quite close. This would suggest that the stock price is reasonable.
The way I look at stock price testing is that if there are inconsistent outcomes, and there is no good reason to disregard the dividend yield test, you should go with the dividend yield test. This says that the stock price is relatively reasonable.
When I look at analysts' recommendations, I find two, a Strong Buy and a Buy. There is not many analysts following this stock. The 12 month consensus stock price is $6.63. This implies a total return of 16.41%, with 3.08% from dividends and 13.33% from capital gains.
The Jags report talks about Canaccord Genuity rising its target price on this stock from $6.50 to $6.75 on February 1, 2013. The Canadian Dividend Blogger talks about this stock being on his list of high dividend growers. According to the Edmonton Journal BMO listed this company as one of their top Canadian Small Cap picks for 2013.
I can see why people like this stock. It has very good dividend growth and dividend is at a nice 3%. The current stock price seems reasonable. However, it is a small cap stock and it is an industrial stock in the auto industry, so it is risky. However, it has very good debt ratios and with a large insider ownership. I do not see them increasing the dividends beyond what can be afforded.
Exco is a global designer, developer and manufacturer of dies, moulds, equipment, components and assemblies to the die-cast, extrusion and automotive industries. The Die Casting and Extrusion Technology groups operations are based in Canada, U.S., Mexico and Colombia and primarily serve automotive and industrial markets throughout the world. The Automotive Solutions Group has facilities are located in Canada, U.S., Mexico and Morocco and supply the North American, European and Asian markets. Its web site is here Exco. See my spreadsheet at xtc.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 or StockTwits.
Tuesday, February 5, 2013
Exco Technologies Ltd
I do not own this stock of Exco Technologies Ltd (TSX-XTC, OTC- EXCOF). This is a stock given as a recommendation by Keystone at the Toronto Money Show of 2012. I decided to check into it as it is a small tech company that is paying dividends. Also, I decided to review this stock because Keystone has recommended some very good stocks in the past.
This may be called a tech stock, but it supports the auto industry. This is a tough business to be in at present. The company has high insider ownership which is a plus. The dividends are reasonable with the current one at 3.02% and the 5 year median at 3.16%. Since they started to pay dividends in 2003, they have increased the dividend yield and the Dividend Payout Ratios.
The 5 year median DPRs are 22.5% for earnings and 17.3% for cash flow. They DPRs are similar for the financial year ending in September 2012. These are reasonable DPRs for this type of company. What is also good is the dividend growth which over the past 5 and 10 years was at 17.6% and 11.7% per year.
To the end of 2012, this stock has made money for its shareholders over the past 5 years, with an 11.26% per year total return. The portion of this return attributed to dividends was 1.88% per year. The portion attributable to capital gain was 9.39% per year. About 17% of the total return was dividends.
The stock did not do as well over the past 10 years for its shareholders. The total return over the past 10 years was 0.13% per year, with the portion attributable to dividends at 1.10% per year. There was a capital loss of 0.97% per year. So basically, the shareholders have broken even on this stock over the past 10 years. This stock seems to have peaked in 2006 and then got hurt badly by the bear market in 2008.
The outstanding shares have decreased by 0.4% per year over the past 5 years and increased by 0.3% per year over the past 10 years. Shares have increased due to stock options and have decreased due to the company buying back shares.
Revenues haven't grown much in the past 5 and 10 years. They were dropping from 2004 to 2009. Over the last 3 years the grown in revenue has been good (15% to 20% range). However, analysts' are expecting low growth over the next two years.
For Earnings per Share, after 4 years of negative earnings, the company has been making money over the past 2 years. However, here again, analysts' expect EPS to grow, but not by much over the next 2 years. For cash flows, there is no growth over the past 10 years, but a very good 12.8% growth per year over the past 5 years. There has been no growth in Book Value per Share over the past 5 and 10 years. This is not surprising considering there were a number of years with negative EPS.
Return on Equity was good for the financial year ending in September 2012. It was 17%. The 5 year median is a lot lower at 8.5%. This is because of the negative EPS years of late. The ROE on Comprehensive income is only 3% off the ROE on Net Income and came in at 14%.
For the 12 months ending in December 2012, ROE is also good at 16.7% and the ROE on comprehensive income is also quite good at 16.3%.
As is common on companies with large insider ownership, this company has a very strong balance sheet. The Liquidity Ratio is very good at 3.81 for the September 2012 financial year. The current Ratio is higher at 4.63. The Debt Ratio is also very good with the one for September 2012 at 5.24 and the current one at 6.36. The Leverage and Debt/Equity Ratios are also very good at 1.19 and 0.19 respectively.
This stock is more an industrial stock then tech. It is also rather small. However, management expects to have slow, but steady growth over the next few years and I find this reasonable. They have some very good features, such as a strong balance sheet that will see it through tough times. They have a nice dividend yield at 3%. I would expect the dividends growth to slower in the future, but I am sure growth will be reasonable.
I think it has the potential to be a solid performer with reasonable dividend. You would buy for the rising dividend and some capital gains.
Exco is a global designer, developer and manufacturer of dies, moulds, equipment, components and assemblies to the die-cast, extrusion and automotive industries. The Die Casting and Extrusion Technology groups operations are based in Canada, U.S., Mexico and Colombia and primarily serve automotive and industrial markets throughout the world. The Automotive Solutions Group has facilities are located in Canada, U.S., Mexico and Morocco and supply the North American, European and Asian markets. Its web site is here Exco. See my spreadsheet at xtc.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 or StockTwits.
This may be called a tech stock, but it supports the auto industry. This is a tough business to be in at present. The company has high insider ownership which is a plus. The dividends are reasonable with the current one at 3.02% and the 5 year median at 3.16%. Since they started to pay dividends in 2003, they have increased the dividend yield and the Dividend Payout Ratios.
The 5 year median DPRs are 22.5% for earnings and 17.3% for cash flow. They DPRs are similar for the financial year ending in September 2012. These are reasonable DPRs for this type of company. What is also good is the dividend growth which over the past 5 and 10 years was at 17.6% and 11.7% per year.
To the end of 2012, this stock has made money for its shareholders over the past 5 years, with an 11.26% per year total return. The portion of this return attributed to dividends was 1.88% per year. The portion attributable to capital gain was 9.39% per year. About 17% of the total return was dividends.
The stock did not do as well over the past 10 years for its shareholders. The total return over the past 10 years was 0.13% per year, with the portion attributable to dividends at 1.10% per year. There was a capital loss of 0.97% per year. So basically, the shareholders have broken even on this stock over the past 10 years. This stock seems to have peaked in 2006 and then got hurt badly by the bear market in 2008.
The outstanding shares have decreased by 0.4% per year over the past 5 years and increased by 0.3% per year over the past 10 years. Shares have increased due to stock options and have decreased due to the company buying back shares.
Revenues haven't grown much in the past 5 and 10 years. They were dropping from 2004 to 2009. Over the last 3 years the grown in revenue has been good (15% to 20% range). However, analysts' are expecting low growth over the next two years.
For Earnings per Share, after 4 years of negative earnings, the company has been making money over the past 2 years. However, here again, analysts' expect EPS to grow, but not by much over the next 2 years. For cash flows, there is no growth over the past 10 years, but a very good 12.8% growth per year over the past 5 years. There has been no growth in Book Value per Share over the past 5 and 10 years. This is not surprising considering there were a number of years with negative EPS.
Return on Equity was good for the financial year ending in September 2012. It was 17%. The 5 year median is a lot lower at 8.5%. This is because of the negative EPS years of late. The ROE on Comprehensive income is only 3% off the ROE on Net Income and came in at 14%.
For the 12 months ending in December 2012, ROE is also good at 16.7% and the ROE on comprehensive income is also quite good at 16.3%.
As is common on companies with large insider ownership, this company has a very strong balance sheet. The Liquidity Ratio is very good at 3.81 for the September 2012 financial year. The current Ratio is higher at 4.63. The Debt Ratio is also very good with the one for September 2012 at 5.24 and the current one at 6.36. The Leverage and Debt/Equity Ratios are also very good at 1.19 and 0.19 respectively.
This stock is more an industrial stock then tech. It is also rather small. However, management expects to have slow, but steady growth over the next few years and I find this reasonable. They have some very good features, such as a strong balance sheet that will see it through tough times. They have a nice dividend yield at 3%. I would expect the dividends growth to slower in the future, but I am sure growth will be reasonable.
I think it has the potential to be a solid performer with reasonable dividend. You would buy for the rising dividend and some capital gains.
Exco is a global designer, developer and manufacturer of dies, moulds, equipment, components and assemblies to the die-cast, extrusion and automotive industries. The Die Casting and Extrusion Technology groups operations are based in Canada, U.S., Mexico and Colombia and primarily serve automotive and industrial markets throughout the world. The Automotive Solutions Group has facilities are located in Canada, U.S., Mexico and Morocco and supply the North American, European and Asian markets. Its web site is here Exco. See my spreadsheet at xtc.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 or StockTwits.
Monday, February 4, 2013
Transcontinental Inc 2
On my other blog I am today writing about the Respect for Democracy Rally...continue...
I do not own this stock of Transcontinental Inc. (TSX-TCL.A, OTC-TCLAF). I have tracked this stock for some time as it is on the dividend lists that I follow of Dividend Achievers (see resources) and Dividend Aristocrats (see indices).
When I look at the insiders' trading report, I find $1.1M of insider selling and a net insider selling of $0.9M. Insiders not only have options, but Deferred Share Units of Participation, Restricted Share Units of Participation, and Participation Units of Deferred Shares. (This is the best I can translate as options like vehicles are denoted in French.)
The CEO has very few shares, but his options are worth $10M. The CFO has very few shares and options worth $1M. An officer has very few shares and options worth $1.4M. A director has shares worth $2.2M and has options worth 0.5M. This is just to give you an idea on insider share ownership and option values. Rémi Marcoux owns most of the Class B multiple voting shares worth around $155.8M.
According to Reuters, there are 61 institutions that own some 87% of this company. Over the past 3 months they have increased their shares by some 11.5%. See their information on this company.
The 5 year low, median and high median Price/Earnings ratios are 5.20, 6.89 and 7.88. These are very low P/E Ratios. The 10 year low, median and high median P/E Ratios are 8.06, 10.45 and 12.81. The current P/E Ratio of 6.48 is quite low. This P/E Ratio is based on 2013 EPS of 1.84 and a stock price of $11.93.
I get a Graham Price of $20.51. The10 year low, median and high median Price/Graham Price Ratios are 0.65, 0.80 and 0.93. The current P/GP Ratio is 0.58. Also, a stock price is considered to be a good one when the stock price is at or below the Graham Price (that is a P/GP Ratio of 1.00 or below.)
The 10 year median Price/Book Value per Share Ratio is 1.37 and the current P/B Ratio is 1.17 a value 85% of the 10 year ratio. The 5 year median dividend yield is 3.56% and the current yield is 4.86%. The current yield is some 37% above the 5 year dividend yield. Both these tests say that the current stock price is good.
When I look at analysts' recommendations, I find Buy, Hold and Underperform recommendations. The consensus recommendation would be a Hold. The 12 months consensus stock price is $11.60. This implies a 2.09% gain with 4.86% coming from dividends and a capital loss of 2.77%.
Old industries can hang on a lot longer than you can image. This company is still basically a printing company and it is having a tough time, but it does generally make money. They print magazines and newspapers and magazines and newspapers are still surviving, but none are really thriving. Another negative is that goodwill and intangible assets make up some 80% of the market cap of this company.
On the other hand the stock price is from quite good to cheap. They have a nice 4.9% dividend yield. They have positive cash flow. They have very good dividend growth and a very low Dividend Payout Ratios. However, personally, I rather move on to tech stocks than purchase a company making money in an old industry. I also like companies that I can shove into my portfolio for the very long term. It is hard to know if this company will survive in the longer term.
Transcontinental, one of Canada's top media groups, is the largest printer in Canada and Mexico and the fourth-largest in North America. In addition to commercial printing, it operates 150 websites and is a leading publisher of consumer magazines, French-language educational resources and community newspapers in Quebec and the Atlantic provinces. Its web site is here Transcontinental. See my spreadsheet at tcl.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 or StockTwits.
I do not own this stock of Transcontinental Inc. (TSX-TCL.A, OTC-TCLAF). I have tracked this stock for some time as it is on the dividend lists that I follow of Dividend Achievers (see resources) and Dividend Aristocrats (see indices).
When I look at the insiders' trading report, I find $1.1M of insider selling and a net insider selling of $0.9M. Insiders not only have options, but Deferred Share Units of Participation, Restricted Share Units of Participation, and Participation Units of Deferred Shares. (This is the best I can translate as options like vehicles are denoted in French.)
The CEO has very few shares, but his options are worth $10M. The CFO has very few shares and options worth $1M. An officer has very few shares and options worth $1.4M. A director has shares worth $2.2M and has options worth 0.5M. This is just to give you an idea on insider share ownership and option values. Rémi Marcoux owns most of the Class B multiple voting shares worth around $155.8M.
According to Reuters, there are 61 institutions that own some 87% of this company. Over the past 3 months they have increased their shares by some 11.5%. See their information on this company.
The 5 year low, median and high median Price/Earnings ratios are 5.20, 6.89 and 7.88. These are very low P/E Ratios. The 10 year low, median and high median P/E Ratios are 8.06, 10.45 and 12.81. The current P/E Ratio of 6.48 is quite low. This P/E Ratio is based on 2013 EPS of 1.84 and a stock price of $11.93.
I get a Graham Price of $20.51. The10 year low, median and high median Price/Graham Price Ratios are 0.65, 0.80 and 0.93. The current P/GP Ratio is 0.58. Also, a stock price is considered to be a good one when the stock price is at or below the Graham Price (that is a P/GP Ratio of 1.00 or below.)
The 10 year median Price/Book Value per Share Ratio is 1.37 and the current P/B Ratio is 1.17 a value 85% of the 10 year ratio. The 5 year median dividend yield is 3.56% and the current yield is 4.86%. The current yield is some 37% above the 5 year dividend yield. Both these tests say that the current stock price is good.
When I look at analysts' recommendations, I find Buy, Hold and Underperform recommendations. The consensus recommendation would be a Hold. The 12 months consensus stock price is $11.60. This implies a 2.09% gain with 4.86% coming from dividends and a capital loss of 2.77%.
Old industries can hang on a lot longer than you can image. This company is still basically a printing company and it is having a tough time, but it does generally make money. They print magazines and newspapers and magazines and newspapers are still surviving, but none are really thriving. Another negative is that goodwill and intangible assets make up some 80% of the market cap of this company.
On the other hand the stock price is from quite good to cheap. They have a nice 4.9% dividend yield. They have positive cash flow. They have very good dividend growth and a very low Dividend Payout Ratios. However, personally, I rather move on to tech stocks than purchase a company making money in an old industry. I also like companies that I can shove into my portfolio for the very long term. It is hard to know if this company will survive in the longer term.
Transcontinental, one of Canada's top media groups, is the largest printer in Canada and Mexico and the fourth-largest in North America. In addition to commercial printing, it operates 150 websites and is a leading publisher of consumer magazines, French-language educational resources and community newspapers in Quebec and the Atlantic provinces. Its web site is here Transcontinental. See my spreadsheet at tcl.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 or StockTwits.
Friday, February 1, 2013
Transcontinental Inc
I do not own this stock of Transcontinental Inc. (TSX-TCL.A, OTC-TCLAF). I have tracked this stock for some time as it is on the dividend lists that I follow of Dividend Achievers (see resources) and Dividend Aristocrats (see indices).
The 5 and 10 year growth in dividends is at 15.7% and 16.9% per year. The last dividend increase was for 7.4%, but dividends between 2011 and 2012 were increased by 16.3%. They have been increasing their yield. For this stock, dividends started out low in 1993 (around 1%) and the yield has been steadily rising and today the yield is 4.86% with a 5 year median dividend yield of 3.56%.
As the yield has been rising, so have the Dividend Payout Ratios. The 5 year DPRs for earnings is 19.9% and for cash flow is 10.5%. The DPR for the financial year ending in 2012 were 31% for earnings and 16.5% for cash flow. There was a big rise in dividend in 2011 when the dividends were increased by 40%. The DRPs are currently affordable.
Share prices have been tracking down over the past 5 and 10 years. So, for the 5 and 10 years ending at the end of 2012, total returns are a negative 3.65% and 2.77%. Returns attributed to dividends are at 3.01% and 2.16% per year over the past 5 and 10 years. The capital losses were 6.66% and 4.94% per year over the past 5 and 10 years.
The outstanding shares have decreased by 1.1% per year over the past 5 and 10 years. They have increased basically due to stock options and have decreased because of share buy backs. As far as growth goes, this company has low to no growth in most categories.
Over the past 5 years revenues are down by 1.9%. Over the past 10 years revenues are up by 1.7%. Revenues per Share are down by 0.8% over the past 5 years and up by 2.9% per year over the past 10 years.
Over the past 5 years the company has been reporting adjusted Earnings per Share, which most analysts are following. The adjusted EPS excludes special items and discontinued operations. EPS has grown by 4.3% and 2.5% per year over the past 5 and 10 years.
Cash Flow per Share has grown over the past 5 and 10 years by 0% and 3% per year. Book Value per Share has decreased over the past 5 years by 6.3% and has increased over the past 10 years by 1.7%.
The Liquidity Ratio is low as it is just 0.83. That means that the current assets cannot cover the current liabilities. If you add in cash flow after dividends this ratio goes up to 1.09, which is still a low ratio, but liabilities are covered. This is an industrial stock, so you would expect fluctuation in the cash flow.
Since there was an earnings loss this year, the Return on Equity is, of course, negative. What I do not like is that there is a big difference between the ROE on Net Income and the ROE on comprehensive income. The difference between the two rates is at 32%. Maybe a sign that the loss was larger than it first appears?
The Debt Ratio is currently very good and it has always been very good. The current ratio is 1.73. Leverage and Debt/Equity Ratios are ok at 2.66 and 1.54.
The last thing to mention and it is a bit negative also is that they have a lot of Goodwill on the books and it equals about 60% of the stock's market Cap.
Basically, this stock has gone nowhere since the economic problems of 2001. They are in print median and that is an old business. I know that are involved with Interactive Marketing, as they call it, but they are trying to make money from the internet. A lot of companies are trying to make money from the internet and not many are getting anywhere. Companies will eventually figure this out, but will this company be a winner? Who knows? They certainly are trying.
The low Liquidity Ratio makes them vulnerable in the event of an economic crisis. What is fine for one company is not necessarily fine for another. For example, some companies can count on cash flow no matter what the economy does. An example would be a Utility company can generally count on their cash flow. An industrial company cannot. I think that this company could be vulnerable to cash flow drying up.
Transcontinental, one of Canada's top media groups, is the largest printer in Canada and Mexico and the fourth-largest in North America. In addition to commercial printing, it operates 150 websites and is a leading publisher of consumer magazines, French-language educational resources and community newspapers in Quebec and the Atlantic provinces. Its web site is here Transcontinental. See my spreadsheet at tcl.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 or StockTwits.
The 5 and 10 year growth in dividends is at 15.7% and 16.9% per year. The last dividend increase was for 7.4%, but dividends between 2011 and 2012 were increased by 16.3%. They have been increasing their yield. For this stock, dividends started out low in 1993 (around 1%) and the yield has been steadily rising and today the yield is 4.86% with a 5 year median dividend yield of 3.56%.
As the yield has been rising, so have the Dividend Payout Ratios. The 5 year DPRs for earnings is 19.9% and for cash flow is 10.5%. The DPR for the financial year ending in 2012 were 31% for earnings and 16.5% for cash flow. There was a big rise in dividend in 2011 when the dividends were increased by 40%. The DRPs are currently affordable.
Share prices have been tracking down over the past 5 and 10 years. So, for the 5 and 10 years ending at the end of 2012, total returns are a negative 3.65% and 2.77%. Returns attributed to dividends are at 3.01% and 2.16% per year over the past 5 and 10 years. The capital losses were 6.66% and 4.94% per year over the past 5 and 10 years.
The outstanding shares have decreased by 1.1% per year over the past 5 and 10 years. They have increased basically due to stock options and have decreased because of share buy backs. As far as growth goes, this company has low to no growth in most categories.
Over the past 5 years revenues are down by 1.9%. Over the past 10 years revenues are up by 1.7%. Revenues per Share are down by 0.8% over the past 5 years and up by 2.9% per year over the past 10 years.
Over the past 5 years the company has been reporting adjusted Earnings per Share, which most analysts are following. The adjusted EPS excludes special items and discontinued operations. EPS has grown by 4.3% and 2.5% per year over the past 5 and 10 years.
Cash Flow per Share has grown over the past 5 and 10 years by 0% and 3% per year. Book Value per Share has decreased over the past 5 years by 6.3% and has increased over the past 10 years by 1.7%.
The Liquidity Ratio is low as it is just 0.83. That means that the current assets cannot cover the current liabilities. If you add in cash flow after dividends this ratio goes up to 1.09, which is still a low ratio, but liabilities are covered. This is an industrial stock, so you would expect fluctuation in the cash flow.
Since there was an earnings loss this year, the Return on Equity is, of course, negative. What I do not like is that there is a big difference between the ROE on Net Income and the ROE on comprehensive income. The difference between the two rates is at 32%. Maybe a sign that the loss was larger than it first appears?
The Debt Ratio is currently very good and it has always been very good. The current ratio is 1.73. Leverage and Debt/Equity Ratios are ok at 2.66 and 1.54.
The last thing to mention and it is a bit negative also is that they have a lot of Goodwill on the books and it equals about 60% of the stock's market Cap.
Basically, this stock has gone nowhere since the economic problems of 2001. They are in print median and that is an old business. I know that are involved with Interactive Marketing, as they call it, but they are trying to make money from the internet. A lot of companies are trying to make money from the internet and not many are getting anywhere. Companies will eventually figure this out, but will this company be a winner? Who knows? They certainly are trying.
The low Liquidity Ratio makes them vulnerable in the event of an economic crisis. What is fine for one company is not necessarily fine for another. For example, some companies can count on cash flow no matter what the economy does. An example would be a Utility company can generally count on their cash flow. An industrial company cannot. I think that this company could be vulnerable to cash flow drying up.
Transcontinental, one of Canada's top media groups, is the largest printer in Canada and Mexico and the fourth-largest in North America. In addition to commercial printing, it operates 150 websites and is a leading publisher of consumer magazines, French-language educational resources and community newspapers in Quebec and the Atlantic provinces. Its web site is here Transcontinental. See my spreadsheet at tcl.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 or StockTwits.
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