I own this stock of Thomson Reuters Corp (TSX-TRI, NYSE-TRI). I have held this stock since 1985 and have made 7.03% total return per year with 3.21% per year from capital gains and 3.82% per year from dividends.
The problem is that I hold this stock in my Canadian Trading Accounting. For US investors, this stock has made some money for them over the past 10 years, but not over the past 5. For Canadian investor this company has not made money for them over the past 5 or 10 years. However, the loss over the past 10 years is less than 1% per year.
One other problem is that the dividend is paid in US$. This means that each dividend payment is different, depending on the current currency exchange rate. In most year, the dividends have increased as the dividends paid in US$ have increased. However, there have been years where the dividend payments have gone down for Canadian investors.
The dividends have only increased by 3.8% and 1.3% per year over the past 5 and 10 years in CDN$ terms, but have increased by 5.5% and 6.2% per year in US$ terms. The CDN$ used to be worth a lot less than the US$, but has been close to par for several years now.
The company reports in US$ and has done better in US$ terms than in CDN$ terms as far as growth goes over the past 5 and 10 year. Also, the number of outstanding shares has increased by 2.4% and 5.3% per year over the past 5 and 10 years. The main increase has to do with shares issued in the amalgamation of Thomson and Reuters. Shares have increased because of stock options and DRIP. Shares have been decreased because of share buy backs.
Revenue has increased over the past 5 and 10 years by 12.7% and 5.5% per year in US$. Revenue has increased by 9.9% and 1% per year over the past 5 and 10 years in CDN$. Revenue per Share has increased by 7% and 3% per year over the past 5 and 10 years in US$. Revenue per Share has increased by 4.3% per year over the past 5 years and it has decreased by 1.3% per year over the past 10 years in CDN$.
Growth in EPS is much better than Revenue growth. Growth in Cash Flow per Share is worse. CFPS is up by 2.5% and 3.2% per year over the past 5 and 10 years in US$. CFPS is down by 2.4% and 1.1% per year over the past 5 and 10 years in CDN$.
I was wrong about the Return on Equity in my original report. There was a miscalculation in my spreadsheet. ROE on net income on this stock is 12.1%. The 5 year median ROE is low at 6.9%. The ROE on comprehensive income is 10.7%, a value 12% lower. It is not that big of a difference, but might point to the quality of the earnings. I have reloaded the corrected spreadsheet.
The last thing to look at is the debt ratios. The Liquidity Ratio is rather low at just 0.83. That means that the current assets cannot cover the current liabilities. If you add in cash flow after dividends, you get a more respectable ratio of 1.17. (I would rather see Liquidity at 1.50). The Debt Ratio is very good at 2.19. The Leverage and Debt/Equity Ratios are also very good at 1.90 and 0.88.
The thing is that you can get international exposure with Canadian stocks by investing in international companies. This would be a reason to invest in this company. The problem with this, of course, is that it also exposes you to currency fluctuations.
This stock has not performed as well as I would have hoped, but these are tough economic times. I still think that it has a good long term future. See my spreadsheet at tri.htm.
Thomson Reuters Corp is the leading source of intelligent information for businesses and professionals. The company delivers this must-have insight to the financial, legal, tax and accounting, healthcare and science and media markets, powered by the world's most trusted news organization. They derive the majority of their revenues from selling electronic content and services to professionals, primarily on a subscription basis. Its web site is here Thomson Reuters.
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, April 26, 2013
Thursday, April 25, 2013
Toromont Industries Ltd 2
I own this stock of Toromont Industries Ltd. (TSX-TIH, OTC-TMTNF). This stock is complicated by the spin-off of Enerflex (TSX-EFX), which I sold, but for less than the spin off price. If I look at this company with Enerflex, I have a total return of 6.72% with 1.89% from dividends and 4.83% from capital gains. If I look just at this company I get a total return of 8.13% with 1.97% from dividends and 6.16% from capital gains.
When I look at insider trading I find $1.4M of insider selling and $1.3M of net insider selling with a little insider buying. Insiders not only have options, but options like vehicles like Rights Deferred Share Units (cash settled). Leith Wheeler Investment Counsel Ltd, a Vancouver based investment firm, owns some 9.6% of the outstanding shares worth some $162M.
The CEO has shares worth $1.4M and has options are worth $5M. The CFO has shares worth $0.6M and has options worth $4.3M. An officer has shares worth $4.9M and has options worth $1.4M. A director has shares worth $0.3M and has options worth $0.5M. This is just to give you an idea on insider share ownership and option values.
The 5 year low, median and high median Price/Earnings Ratios are 11.97, 14.06 and 15.99. The current P/E Ratio is 13.90 based on 2013 earnings of $1.59 and stock price of $22.10. This shows that the stock price is reasonable.
I get a Graham Price of $15.09 and 10 year low, median and high median Price/Graham Price Ratios of 1.12, 1.32 and 1.54. The current P/GP Ratio is 1.46. This shows that the stock price, although a bit high is still reasonable.
The Price/Book Value per Share test shows that the current P/B Ratio of 3.47 is some 24% higher than the 10 year P/B Ratio of 2.80. This shows a stock price that is high. The problem, of course, is that with the Enerflex spin off, the Book Value took a big hit. However, they only bought Enerflex in 2010. I think this is a cautionary note. They did not do well by shareholders in their buy and spin-off of Enerflex.
The last test is the dividend yield test. The current dividend yield is 2.35% and this is 5.5% higher than the 5 year median dividend yield of 2.23%. This shows that the stock price is relatively reasonable. You want a current yield higher than the 5 year median, but 5.5% is not that much higher, so stock price is reasonable.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus is a Buy. The 12 months consensus stock price is $24.70. This implies a total return of 14.11% with 2.35% from dividends and 11.76% from capital gains.
Pat McKeough thinks that both Toromont and Enerflex have done well since the Enerflex spin-off. (Does he realize that they only bought Enerflex in 2010 and spin it off in 2011?) John Sartz gives us a much more complete picture of the Toromont and Enerflex story. After reading his story, you may not think that Toromont's involvement with Enerflex was in the best interest of shareholders.
This has not been as good as investment as I had hoped. They did not create any shareholder value (in fact it negatively affected shareholder value) with their purchase and then spin-off of Enerflex. If you want to buy Toromont, my spreadsheet basically shows that the price is reasonable. See my spreadsheet at tih.htm.
There are two sections to this company. The Equipment Group is for Caterpillar dealerships. CIMCO is a market leader in the design, engineering, fabrication and installation of industrial and recreational refrigeration systems. Its web site is here Toromont.
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.
When I look at insider trading I find $1.4M of insider selling and $1.3M of net insider selling with a little insider buying. Insiders not only have options, but options like vehicles like Rights Deferred Share Units (cash settled). Leith Wheeler Investment Counsel Ltd, a Vancouver based investment firm, owns some 9.6% of the outstanding shares worth some $162M.
The CEO has shares worth $1.4M and has options are worth $5M. The CFO has shares worth $0.6M and has options worth $4.3M. An officer has shares worth $4.9M and has options worth $1.4M. A director has shares worth $0.3M and has options worth $0.5M. This is just to give you an idea on insider share ownership and option values.
The 5 year low, median and high median Price/Earnings Ratios are 11.97, 14.06 and 15.99. The current P/E Ratio is 13.90 based on 2013 earnings of $1.59 and stock price of $22.10. This shows that the stock price is reasonable.
I get a Graham Price of $15.09 and 10 year low, median and high median Price/Graham Price Ratios of 1.12, 1.32 and 1.54. The current P/GP Ratio is 1.46. This shows that the stock price, although a bit high is still reasonable.
The Price/Book Value per Share test shows that the current P/B Ratio of 3.47 is some 24% higher than the 10 year P/B Ratio of 2.80. This shows a stock price that is high. The problem, of course, is that with the Enerflex spin off, the Book Value took a big hit. However, they only bought Enerflex in 2010. I think this is a cautionary note. They did not do well by shareholders in their buy and spin-off of Enerflex.
The last test is the dividend yield test. The current dividend yield is 2.35% and this is 5.5% higher than the 5 year median dividend yield of 2.23%. This shows that the stock price is relatively reasonable. You want a current yield higher than the 5 year median, but 5.5% is not that much higher, so stock price is reasonable.
When I look at analysts' recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus is a Buy. The 12 months consensus stock price is $24.70. This implies a total return of 14.11% with 2.35% from dividends and 11.76% from capital gains.
Pat McKeough thinks that both Toromont and Enerflex have done well since the Enerflex spin-off. (Does he realize that they only bought Enerflex in 2010 and spin it off in 2011?) John Sartz gives us a much more complete picture of the Toromont and Enerflex story. After reading his story, you may not think that Toromont's involvement with Enerflex was in the best interest of shareholders.
This has not been as good as investment as I had hoped. They did not create any shareholder value (in fact it negatively affected shareholder value) with their purchase and then spin-off of Enerflex. If you want to buy Toromont, my spreadsheet basically shows that the price is reasonable. See my spreadsheet at tih.htm.
There are two sections to this company. The Equipment Group is for Caterpillar dealerships. CIMCO is a market leader in the design, engineering, fabrication and installation of industrial and recreational refrigeration systems. Its web site is here Toromont.
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, April 24, 2013
Toromont Industries Ltd
On my other blog I am today writing about Investing Mistakes ...continue...
I own this stock of Toromont Industries Ltd. (TSX-TIH, OTC-TMTNF). This stock is complicated by the spin-off of Enerflex (TSX-EFX), which I sold, but for less than the spin off price. If I look at this company with Enerflex, I have a total return of 6.72% with 1.89% from dividends and 4.83% from capital gains. If I look just at this company I get a total return of 8.13% with 1.97% from dividends and 6.16% from capital gains.
I always like to talk about dividends and the dividend story on this stock is complicated by the Enerflex spin-off as dividends were decreased for Toromont Industries by the dividends to be paid by Enerflex. So this stock suffered a dividend decrease which leaves the dividends lower than what was paid in 2010. However, since this decrease, dividends were raised, the last raise being in 2013 at 8.3%.
The dividend is not bad at generally around 2% considering that the Dividend Payout Ratios are low. The 5 year median DPR for earnings is at 32% and the 5 year DPR for cash flow is at 25%. The current dividend yield is 2.35%.
The total return over the past 5 and 10 years is at 5.89% per year and 15.58% per year if we include Enerflex spin-off. The dividend portion of this return over the past 5 and 10 years is at 2.19% and 2.99% per year. The capital loss was at 5.68% per year over the past 5 years and the capital gain portion was at 7.40% per year over the past 10 years. The rest of the total return is related to the Enerflex spin off. However, I doubt that it was worth the spin-off price since it lost value immediately. However, the Enerflex stock did recover for those who have continued to hold it.
The outstanding shares have increased by 3.3% and 1.9% per year over the past 5 and 10 years. Shares have increased due to stock options and share issues and have decreased due to share buy backs.
Revenue has decreased by 4.6% per year and increased by 3.4% per year over the past 5 and 10 years. Revenue per Share has decreased by 7.6% per year and increased by 1.5% per year over the past 5 and 10 years. However, Revenue per Share has fared better looking at 5 year running averages and according to 5 year averages, Revenue per share has not changed over the past 5 years and is up by 6.4% per year over the past 10 years.
Earnings per Share is down by 3.7% per year and up by 9.3% per year over the past 5 and 10 years. EPS also looks better if taken from the 5 year running averages, where is has increased by 4.2% per year and 10.4% per year over the past 5 and 10 years.
Cash Flow per share shows the same sort of activity as it is down by 7.5% over the past 5 and has not change over the past 10 years, but the 5 year running increases over the past 5 and 10 years is at 2.5% and 6.6% per year.
The Return on Equity for 2012 is at 25.3% and the 5 year median ROE is at 18%. The ROE based on comprehensive income is at 24.3% and this is only 4% off the ROE on net income.
One good thing about this company is the strong balance sheet. The Liquidity Ratio for 2012 is at 2.15and the current one is 2.25. The Debt Ratio for 2012 is 2.04 and the current one is 2.08. The Leverage and Debt/Equity Ratios are also good with current ones at 1.92 and 0.92.
Since this is an industrial stock, it has not done badly in the current economic situation. The best thing about the stock is that it has a strong balance sheet. I bought this stock for diversifications and it is still a good hold for this reason. See my spreadsheet at tih.htm.
There are two sections to this company. The Equipment Group is for Caterpillar dealerships. CIMCO is a market leader in the design, engineering, fabrication and installation of industrial and recreational refrigeration systems. Its web site is here Toromont.
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 Toromont Industries Ltd. (TSX-TIH, OTC-TMTNF). This stock is complicated by the spin-off of Enerflex (TSX-EFX), which I sold, but for less than the spin off price. If I look at this company with Enerflex, I have a total return of 6.72% with 1.89% from dividends and 4.83% from capital gains. If I look just at this company I get a total return of 8.13% with 1.97% from dividends and 6.16% from capital gains.
I always like to talk about dividends and the dividend story on this stock is complicated by the Enerflex spin-off as dividends were decreased for Toromont Industries by the dividends to be paid by Enerflex. So this stock suffered a dividend decrease which leaves the dividends lower than what was paid in 2010. However, since this decrease, dividends were raised, the last raise being in 2013 at 8.3%.
The dividend is not bad at generally around 2% considering that the Dividend Payout Ratios are low. The 5 year median DPR for earnings is at 32% and the 5 year DPR for cash flow is at 25%. The current dividend yield is 2.35%.
The total return over the past 5 and 10 years is at 5.89% per year and 15.58% per year if we include Enerflex spin-off. The dividend portion of this return over the past 5 and 10 years is at 2.19% and 2.99% per year. The capital loss was at 5.68% per year over the past 5 years and the capital gain portion was at 7.40% per year over the past 10 years. The rest of the total return is related to the Enerflex spin off. However, I doubt that it was worth the spin-off price since it lost value immediately. However, the Enerflex stock did recover for those who have continued to hold it.
The outstanding shares have increased by 3.3% and 1.9% per year over the past 5 and 10 years. Shares have increased due to stock options and share issues and have decreased due to share buy backs.
Revenue has decreased by 4.6% per year and increased by 3.4% per year over the past 5 and 10 years. Revenue per Share has decreased by 7.6% per year and increased by 1.5% per year over the past 5 and 10 years. However, Revenue per Share has fared better looking at 5 year running averages and according to 5 year averages, Revenue per share has not changed over the past 5 years and is up by 6.4% per year over the past 10 years.
Earnings per Share is down by 3.7% per year and up by 9.3% per year over the past 5 and 10 years. EPS also looks better if taken from the 5 year running averages, where is has increased by 4.2% per year and 10.4% per year over the past 5 and 10 years.
Cash Flow per share shows the same sort of activity as it is down by 7.5% over the past 5 and has not change over the past 10 years, but the 5 year running increases over the past 5 and 10 years is at 2.5% and 6.6% per year.
The Return on Equity for 2012 is at 25.3% and the 5 year median ROE is at 18%. The ROE based on comprehensive income is at 24.3% and this is only 4% off the ROE on net income.
One good thing about this company is the strong balance sheet. The Liquidity Ratio for 2012 is at 2.15and the current one is 2.25. The Debt Ratio for 2012 is 2.04 and the current one is 2.08. The Leverage and Debt/Equity Ratios are also good with current ones at 1.92 and 0.92.
Since this is an industrial stock, it has not done badly in the current economic situation. The best thing about the stock is that it has a strong balance sheet. I bought this stock for diversifications and it is still a good hold for this reason. See my spreadsheet at tih.htm.
There are two sections to this company. The Equipment Group is for Caterpillar dealerships. CIMCO is a market leader in the design, engineering, fabrication and installation of industrial and recreational refrigeration systems. Its web site is here Toromont.
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, April 23, 2013
Barrick Gold Corp
I own this stock of Barrick Gold Corp. (TSX-ABX, NYSE-ABX). As I said yesterday, I bought some of this stock recently because its stock price had fallen hard. I believed the market over reacted. I just bought 100 shares as I am living off my portfolio and do not have much to invest.
Although my spreadsheet shows that 5 year low, median and high median Price/Earnings Ratios for this stock to be rather reasonable at 9.46, 10.84 and 12.23, this has not always been the case. Earnings have been quite volatile. I looked at stock prices going back to the early 1990’s and they have been quite high. The stock prices were about as high as they were recently. However, P/E Ratios were quite high at times (the P/E Ratio hit 104.66 in 2001).
The stock prices were relatively low in the 1980 and were quite high in the 1990’s before falling in the late 1990’s and they rising again to peaks in 2008, 2010 and 2011. The dividend yield was below 1% or just over 1% until fairly recently. I bought the stock recently with a dividend yield of around 4.5% and a forward P/E of 4.36
For this company revenue has been climbing as has earnings. There is an earnings loss in 2012 mainly because of a write-of (or impairment charge) on their Lumwana copper mine in Zambia. Cash Flow is also climbing. Book Value per share has done nothing over the past 5 years, but is up by 8.6% over the past 10 years. The real interesting thing is that the stock price has not done much since the 1990’s. It has fluctuated, but really has gone nowhere.
There is a recent article in the Financial Post of recent troubles of Barrick Gold. The price of gold has plunged, a key project is halted and pension fund investors are up in arms about the recent $11.9M signing bonus that Barrick paid to co-chairman John Thornton last year. Here is a G&M article on Pension Fund investors reaction to John Thornton’s signing bonus.
Well, if the stock recovers I will do fine. There is no doubt in my mind that this is a risky choice. The stock has just tanked. The stock chase site shows a lot of recent Don’t Buy comments. Many people like Goldcorp (TSX-G, NYSE-GG) better. Are we in a correction for the stock market? Who know? If we are, it probably has only just begun. The other problem with gold stocks is the price of gold has recently dropped.
If you look at analysts’ recommendations there are Strong Buy, Buy and Hold recommendations, with a toss-up between Buy and Hold (because there a lots of Hold recommendations). The average 12 months consensus target price is $42.00 and this implies capital gains of around 129%. (However, a lot of things can happen in a year.)
The thing is this is a risky stock pick but if things are turned around, there are good profits to be made. Do I want to keep this stock permanently? I do not know yet. I have to see how the present crisis works out. See my spreadsheet at tih.htm.
Barrick Gold Corporation is a gold mining company with a portfolio of operating mines, and advanced exploration and development projects located across five continents. Its web site is here Barrick.
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.
Although my spreadsheet shows that 5 year low, median and high median Price/Earnings Ratios for this stock to be rather reasonable at 9.46, 10.84 and 12.23, this has not always been the case. Earnings have been quite volatile. I looked at stock prices going back to the early 1990’s and they have been quite high. The stock prices were about as high as they were recently. However, P/E Ratios were quite high at times (the P/E Ratio hit 104.66 in 2001).
The stock prices were relatively low in the 1980 and were quite high in the 1990’s before falling in the late 1990’s and they rising again to peaks in 2008, 2010 and 2011. The dividend yield was below 1% or just over 1% until fairly recently. I bought the stock recently with a dividend yield of around 4.5% and a forward P/E of 4.36
For this company revenue has been climbing as has earnings. There is an earnings loss in 2012 mainly because of a write-of (or impairment charge) on their Lumwana copper mine in Zambia. Cash Flow is also climbing. Book Value per share has done nothing over the past 5 years, but is up by 8.6% over the past 10 years. The real interesting thing is that the stock price has not done much since the 1990’s. It has fluctuated, but really has gone nowhere.
There is a recent article in the Financial Post of recent troubles of Barrick Gold. The price of gold has plunged, a key project is halted and pension fund investors are up in arms about the recent $11.9M signing bonus that Barrick paid to co-chairman John Thornton last year. Here is a G&M article on Pension Fund investors reaction to John Thornton’s signing bonus.
Well, if the stock recovers I will do fine. There is no doubt in my mind that this is a risky choice. The stock has just tanked. The stock chase site shows a lot of recent Don’t Buy comments. Many people like Goldcorp (TSX-G, NYSE-GG) better. Are we in a correction for the stock market? Who know? If we are, it probably has only just begun. The other problem with gold stocks is the price of gold has recently dropped.
If you look at analysts’ recommendations there are Strong Buy, Buy and Hold recommendations, with a toss-up between Buy and Hold (because there a lots of Hold recommendations). The average 12 months consensus target price is $42.00 and this implies capital gains of around 129%. (However, a lot of things can happen in a year.)
The thing is this is a risky stock pick but if things are turned around, there are good profits to be made. Do I want to keep this stock permanently? I do not know yet. I have to see how the present crisis works out. See my spreadsheet at tih.htm.
Barrick Gold Corporation is a gold mining company with a portfolio of operating mines, and advanced exploration and development projects located across five continents. Its web site is here Barrick.
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, April 22, 2013
Enbridge Inc 2
On my other blog I am today writing about Gold Stocks ...continue...
I own this stock of Enbridge Inc. (TSX-ENB, NYSE-ENB). I had followed this stock for some time before I bought it in 2005. I also bought some more in 2008 and 2009. I have made a total return on this stock of 21.04% per year with 3.23% per year from dividends and 17.81% from capital gains.
When I look at insider trading, I find some 48.4M of insider selling and $47.7M of net insider selling. There is only $0.7M of insider buying. The CFO has some 14.6M of insider selling. There are lots and lots of options and options like vehicles outstanding. I cannot get a value on them as all the options come with a strike price.
There is some insider ownership, with the CEO owing $5.5M in shares, the CFO owing 14.2M in shares, an officer owning $04.M in shares and a director owning $2M in shares.
The 5 year low, median and high median Price/Earnings Ratios are 18.05, 20.27 and 22.50. The current P/E is 25.52 based on a stock price of $46.19 and 2013 earnings of $1.81. I get a Graham price of $18.54. The low, median and high median10 year Price/Graham Price Ratios are 1.39, 1.54 and 1.69. The current P/GP is 2.49.
I get a 10 year Price/Book Value per Share Ratio of 2.89. The current P/B Ratio is 5.47 a value some 89% high. The current dividend yield is 2.73% and the 5 year median dividend yield is 3.26% a value some 16% higher.
All my stock price tests suggest that the stock is overpriced. They all suggest that the current price is relatively high to relatively very high.
When I look at the analysts' recommendations I find Buy, Hold and Underperform. However, the vast majority of the recommendations are a Buy. The 12 month consensus stock price is $48.60. This implies a total return of 7.95% with 2.73% from dividends and 5.22% from capital gains.
There is an interesting article at Pipeline Observer is that hedge funds are selling Enbridge.
I get the thesis about investors buying safe and solid utility companies for their dividends. However, every utility company I have reviewed lately has been overbought (or has a relatively high stock price). Personally, I would stay away from this sector until the stock prices are more reasonable.
What are all the investors who bought utility stocks for the dividends going to do when the stock market has a correction? They would have had dividends, but will have lost capital. I think that they will bail.
I am going to hold on to my shares. I do not sell shares of good companies just because they have a relatively high stock price. The market tends to under and over price stocks and I buy for the long term. However, I do not think that now is the time to buy utility stocks. Buying at high prices will materially affect the long term return from every very good stock. See my spreadsheet at enb.htm.
Enbridge is focused on three core businesses of crude oil and liquids pipelines, natural gas pipelines, and natural gas distribution. They operate in Canada and US. Its web site is here Enbridge.
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 Enbridge Inc. (TSX-ENB, NYSE-ENB). I had followed this stock for some time before I bought it in 2005. I also bought some more in 2008 and 2009. I have made a total return on this stock of 21.04% per year with 3.23% per year from dividends and 17.81% from capital gains.
When I look at insider trading, I find some 48.4M of insider selling and $47.7M of net insider selling. There is only $0.7M of insider buying. The CFO has some 14.6M of insider selling. There are lots and lots of options and options like vehicles outstanding. I cannot get a value on them as all the options come with a strike price.
There is some insider ownership, with the CEO owing $5.5M in shares, the CFO owing 14.2M in shares, an officer owning $04.M in shares and a director owning $2M in shares.
The 5 year low, median and high median Price/Earnings Ratios are 18.05, 20.27 and 22.50. The current P/E is 25.52 based on a stock price of $46.19 and 2013 earnings of $1.81. I get a Graham price of $18.54. The low, median and high median10 year Price/Graham Price Ratios are 1.39, 1.54 and 1.69. The current P/GP is 2.49.
I get a 10 year Price/Book Value per Share Ratio of 2.89. The current P/B Ratio is 5.47 a value some 89% high. The current dividend yield is 2.73% and the 5 year median dividend yield is 3.26% a value some 16% higher.
All my stock price tests suggest that the stock is overpriced. They all suggest that the current price is relatively high to relatively very high.
When I look at the analysts' recommendations I find Buy, Hold and Underperform. However, the vast majority of the recommendations are a Buy. The 12 month consensus stock price is $48.60. This implies a total return of 7.95% with 2.73% from dividends and 5.22% from capital gains.
There is an interesting article at Pipeline Observer is that hedge funds are selling Enbridge.
I get the thesis about investors buying safe and solid utility companies for their dividends. However, every utility company I have reviewed lately has been overbought (or has a relatively high stock price). Personally, I would stay away from this sector until the stock prices are more reasonable.
What are all the investors who bought utility stocks for the dividends going to do when the stock market has a correction? They would have had dividends, but will have lost capital. I think that they will bail.
I am going to hold on to my shares. I do not sell shares of good companies just because they have a relatively high stock price. The market tends to under and over price stocks and I buy for the long term. However, I do not think that now is the time to buy utility stocks. Buying at high prices will materially affect the long term return from every very good stock. See my spreadsheet at enb.htm.
Enbridge is focused on three core businesses of crude oil and liquids pipelines, natural gas pipelines, and natural gas distribution. They operate in Canada and US. Its web site is here Enbridge.
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, April 19, 2013
Enbridge Inc
I own this stock of Enbridge Inc. (TSX-ENB, NYSE-ENB). I had followed this stock for some time before I bought it in 2005. I also bought some more in 2008 and 2009. I have made a total return on this stock of 21.04% per year with 3.23% per year from dividends and 17.81% from capital gains.
This is a stock with a reasonable dividend yield and good dividend increases. The 5 year median dividend yield is 3.26% and the 5 and 10 year dividend increases are at 12.9% and 11.5% per year. On my stock purchased in 2005, I started with a dividend yield of 2.78% and on that money I am now making a yield of 7.02%.
The dividend payout Ratios are fine for this company, with the 5 year median DPR for earnings at 66% and for Cash Flow at 32%. (See my site for information on Dividend Payout Ratios).
Over the past 5 and 10 years the outstanding shares have increased by 1.8% and 2.1% per year. The shares have been increased because of stock options and DRIP and share issues. There has been very nice growth in Revenue per Share at 14% and 16% per year over the past 5 and 10 years. Also adjusted EPS has grown nicely at13% and 9% per year over the past 5 and 10 years.
The Book Value has not grown much over the last 5 and 10 years with growth at just 3.8% and 5.7% per year. However this is because of change in accounting rules from CDN GAAP to US GAAP. If 2011 account was in US GAAP, then the Book Value would have grown between 2011 and 2012 instead of dropping.
The Return on Equity is good at 13.9% and with a 5 year median at also 13.9%. The ROE on comprehensive income is fine at 9%, but this makes it quite a bit lower than the ROE on net income. This is true of the difference between ROE on comprehensive income and net income generally. It can imply that the earnings are not of a good quality.
The thing I do not like about this stock is the high debt level. The current Liquidity Ratio is 0.93 and this is pretty typical of this stock. This means that the current assets do not cover the current liabilities. However, if you add in cash flow after dividends you get a better Liquidity Ratio of 1.21. This is low, but adequate. (Unfortunately, utility companies rely on cash flow to increase their Liquidity Ratios. This is not unusual.)
The Debt Ratio is also a bit low with a current ratio of 1.46. This is also typical of this stock. I prefer a Debt Ratio of at least 1.50. However, this is a utility stock and many utility stocks have rather high debt loads. The Leverage and Debt/Equity Ratios are also not what I like to see with these ratios at 6.94 and 4.77. These are higher than the 5 year medians of these ratios at 4.00 and 2.87 and a bit higher than most utility companies.
This is a core utility holding for me. It has a good history of paying and increasing its dividends. Although like a lot of utility companies, it does have a high debt load. However, investors have been well paid for the risk they take with this stock. See my spreadsheet at enb.htm.
Enbridge is focused on three core businesses of crude oil and liquids pipelines, natural gas pipelines, and natural gas distribution. They operate in Canada and US. Its web site is here Enbridge.
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 is a stock with a reasonable dividend yield and good dividend increases. The 5 year median dividend yield is 3.26% and the 5 and 10 year dividend increases are at 12.9% and 11.5% per year. On my stock purchased in 2005, I started with a dividend yield of 2.78% and on that money I am now making a yield of 7.02%.
The dividend payout Ratios are fine for this company, with the 5 year median DPR for earnings at 66% and for Cash Flow at 32%. (See my site for information on Dividend Payout Ratios).
Over the past 5 and 10 years the outstanding shares have increased by 1.8% and 2.1% per year. The shares have been increased because of stock options and DRIP and share issues. There has been very nice growth in Revenue per Share at 14% and 16% per year over the past 5 and 10 years. Also adjusted EPS has grown nicely at13% and 9% per year over the past 5 and 10 years.
The Book Value has not grown much over the last 5 and 10 years with growth at just 3.8% and 5.7% per year. However this is because of change in accounting rules from CDN GAAP to US GAAP. If 2011 account was in US GAAP, then the Book Value would have grown between 2011 and 2012 instead of dropping.
The Return on Equity is good at 13.9% and with a 5 year median at also 13.9%. The ROE on comprehensive income is fine at 9%, but this makes it quite a bit lower than the ROE on net income. This is true of the difference between ROE on comprehensive income and net income generally. It can imply that the earnings are not of a good quality.
The thing I do not like about this stock is the high debt level. The current Liquidity Ratio is 0.93 and this is pretty typical of this stock. This means that the current assets do not cover the current liabilities. However, if you add in cash flow after dividends you get a better Liquidity Ratio of 1.21. This is low, but adequate. (Unfortunately, utility companies rely on cash flow to increase their Liquidity Ratios. This is not unusual.)
The Debt Ratio is also a bit low with a current ratio of 1.46. This is also typical of this stock. I prefer a Debt Ratio of at least 1.50. However, this is a utility stock and many utility stocks have rather high debt loads. The Leverage and Debt/Equity Ratios are also not what I like to see with these ratios at 6.94 and 4.77. These are higher than the 5 year medians of these ratios at 4.00 and 2.87 and a bit higher than most utility companies.
This is a core utility holding for me. It has a good history of paying and increasing its dividends. Although like a lot of utility companies, it does have a high debt load. However, investors have been well paid for the risk they take with this stock. See my spreadsheet at enb.htm.
Enbridge is focused on three core businesses of crude oil and liquids pipelines, natural gas pipelines, and natural gas distribution. They operate in Canada and US. Its web site is here Enbridge.
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, April 18, 2013
Automodular Corp
I own this stock of Automodular Corp. (TSX-AM, OTC-AMZKF). Since January of 2012 I have used this small dividend paying small cap to use up small amounts of money in my TFSA. This includes money left after my main purchases in January and dividend income of this account.
I have some more dividend income at the moment, but I am just wondering if this stock will go lower in the current correction that seems underway. We are dealing with small amounts of money here, so the reason to do this is fun. To the end of March 2013 I have made a return of 104.23% per year, with 28.24% per year coming from dividends and 75.99% per year coming from capital gains.
As far as dividends go, this company paid dividends from 1992 to 2003 and then stopped. They paid a couple of dividends in 2008 and then a special dividend in 2010 and then restarted dividends in 2011. Note that there have been a number of years when this company paid special dividends. Recently special dividends were paid in 2010, 2011 and 2012.
This company did ok in the 2000 bear market and but did suffer in the 2008 bear market. Being in the automotive sector, you would expect the company to suffer in any recession. (Often recessions are started after a bear market starts, as occurred after the 2000 and 2008 bear markets.)
Shareholders that have held this stock for 10 years have not made any money. However, those that have held it for 5 years have. Over the past 5 years capital gains is only at 0.81% per year and dividends were at 14.24% per year giving a total return of 15.05% per year. All the money was from dividends and basically the dividends were special dividends.
There has been some growth in revenue and cash flow in the last 5 and 10 years. The really good growth has been in earnings. (Earnings growth over the past 5 years is at 20% per year.) Shares have decreased over the past 5 years at 4.8% per year and have increased over the past 10 by 4.1% per year. Shares have increased due to stock options and decreased due to buy backs. Currently there is not much in the way of options outstanding.
I get 5 year low, median and high median Price/Earnings Ratios of 1.18, 2.43 and 3.52. The only earnings we have are for last 12 months to December 2012 and that is at $0.82. The current stock price of $2.76 gives us a P/E of 3.37. I get a Graham Price of $6.12. The 10 year low, median and high median Price/Graham Price Ratios are 0.21, 0.47 and 0.66. The current P/GP Ratio is 0.45. On an absolute basis, these ratios are low. On a relative basis, the ratios just say that the stock price is reasonable.
The 10 year Price/Book Value per Share Ratio is 0.96 this is a low P/B Ratio. The current ratio at 1.36 is a reasonable ratio, but it says that the price is relatively high.
The last thing to look at is the dividend yield. Perhaps on a historical basis the dividend yield 8.70% is relatively good. However, the dividend yields of the last couple of years suggest that the stock price is reasonable as the median dividend yield is 8.75% over this period.
There is some insider ownership. The biggest ownership seems to be Franklin Templeton Investments Corp. with 23% of the outstanding shares worth currently around $12M. There does not appear to be any stock options outstanding currently.
There is a rather long and interesting review of this stock by a blogger called Rate Race Freedom. There is another interesting review on the blog Odd Ball Stocks. I cannot find any analysts following this stock.
The question on this stock is can it survive a severe downturn that will probably come before we get out of the current secular bear market. I held some small caps going into the first decline of this secular bear market in 2000 and they were all shattered in some way. I have dividend paying small caps now instead of just small caps, but I do not know if that will make a difference.
It might be an interesting ride. Of course, some of my initial basket of small caps only had revenue, but not much of earnings or cash flow. This is not the case with my current basket of small caps. My current small caps have revenue, earnings, cash flow, book value and dividends.
I think that this company has potential, has very good dividends, but it is risky. Also, the current price of $2.76 is a reasonable price. However, if a nice correction is coming, you might be able to pick this up at a very good price. See my spreadsheet at am.htm.
Automodular Corporation is a supplier of sub-assembly, sequencing and transportation services to the automotive industry - Ford's Oakville Assembly Plant and the renewable energy industry with Vestas Nacelles A/S. Its web site is here Automodular.
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 have some more dividend income at the moment, but I am just wondering if this stock will go lower in the current correction that seems underway. We are dealing with small amounts of money here, so the reason to do this is fun. To the end of March 2013 I have made a return of 104.23% per year, with 28.24% per year coming from dividends and 75.99% per year coming from capital gains.
As far as dividends go, this company paid dividends from 1992 to 2003 and then stopped. They paid a couple of dividends in 2008 and then a special dividend in 2010 and then restarted dividends in 2011. Note that there have been a number of years when this company paid special dividends. Recently special dividends were paid in 2010, 2011 and 2012.
This company did ok in the 2000 bear market and but did suffer in the 2008 bear market. Being in the automotive sector, you would expect the company to suffer in any recession. (Often recessions are started after a bear market starts, as occurred after the 2000 and 2008 bear markets.)
Shareholders that have held this stock for 10 years have not made any money. However, those that have held it for 5 years have. Over the past 5 years capital gains is only at 0.81% per year and dividends were at 14.24% per year giving a total return of 15.05% per year. All the money was from dividends and basically the dividends were special dividends.
There has been some growth in revenue and cash flow in the last 5 and 10 years. The really good growth has been in earnings. (Earnings growth over the past 5 years is at 20% per year.) Shares have decreased over the past 5 years at 4.8% per year and have increased over the past 10 by 4.1% per year. Shares have increased due to stock options and decreased due to buy backs. Currently there is not much in the way of options outstanding.
I get 5 year low, median and high median Price/Earnings Ratios of 1.18, 2.43 and 3.52. The only earnings we have are for last 12 months to December 2012 and that is at $0.82. The current stock price of $2.76 gives us a P/E of 3.37. I get a Graham Price of $6.12. The 10 year low, median and high median Price/Graham Price Ratios are 0.21, 0.47 and 0.66. The current P/GP Ratio is 0.45. On an absolute basis, these ratios are low. On a relative basis, the ratios just say that the stock price is reasonable.
The 10 year Price/Book Value per Share Ratio is 0.96 this is a low P/B Ratio. The current ratio at 1.36 is a reasonable ratio, but it says that the price is relatively high.
The last thing to look at is the dividend yield. Perhaps on a historical basis the dividend yield 8.70% is relatively good. However, the dividend yields of the last couple of years suggest that the stock price is reasonable as the median dividend yield is 8.75% over this period.
There is some insider ownership. The biggest ownership seems to be Franklin Templeton Investments Corp. with 23% of the outstanding shares worth currently around $12M. There does not appear to be any stock options outstanding currently.
There is a rather long and interesting review of this stock by a blogger called Rate Race Freedom. There is another interesting review on the blog Odd Ball Stocks. I cannot find any analysts following this stock.
The question on this stock is can it survive a severe downturn that will probably come before we get out of the current secular bear market. I held some small caps going into the first decline of this secular bear market in 2000 and they were all shattered in some way. I have dividend paying small caps now instead of just small caps, but I do not know if that will make a difference.
It might be an interesting ride. Of course, some of my initial basket of small caps only had revenue, but not much of earnings or cash flow. This is not the case with my current basket of small caps. My current small caps have revenue, earnings, cash flow, book value and dividends.
I think that this company has potential, has very good dividends, but it is risky. Also, the current price of $2.76 is a reasonable price. However, if a nice correction is coming, you might be able to pick this up at a very good price. See my spreadsheet at am.htm.
Automodular Corporation is a supplier of sub-assembly, sequencing and transportation services to the automotive industry - Ford's Oakville Assembly Plant and the renewable energy industry with Vestas Nacelles A/S. Its web site is here Automodular.
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, April 17, 2013
Sun Life Financial Inc 2
On my other blog I am today writing about Dividend Growth Companies ...continue...
I own this stock of Sun Life Financial Inc. (TSX-SLF, NYSE-SLF). I first bought it in 2000 when it became a public company, although I have known this company for a longer period. I have not made much money, especially lately, under this company. I have made a total return of 3.8% per year, with 4.23% per year from dividends and a capital loss of 0.43% per year.
When I look at insider trading, I find insider selling of $6.3M and net insider selling at $5.8M. There is a bit of insider buying at 0.5M. Insider selling seems to be of options and buying seems to be under the company plan. There are a number of different options types with this company called Units Performance Share Units, Units Restricted Share Units, Units Sun Shares and Deferred Share Units besides options.
The CEO has shares worth $0.5M and has options are worth $42.6M. The CFO has some shares worth $0.1M and has options worth $13.7M. An officer has shares $0.5M and has options worth $11.4M. A director has shares worth $0.3M and has options worth $0.2M. This is just to give you an idea on insider share ownership and option values.
The 5 year low, median and high median Price/Earnings Ratios are 8.75, 10.40 and 12.05. The current P/E is 10.08 based on a current stock price of $27.57 and 2013 earnings of $2.57. (The 2013 earnings exclude the loss on sale of US Annuity Business as this gives a more realistic picture.)
I get a Graham Price of $35.91 and 10 year low, median and high median Price/Graham Price Ratio of 0.73, 0.96 and 1.06. The current P/GP Ratio is 0.77. (This calculation also uses 2013 earnings excluding loss on sale of US Annuity Business.) Both of these tests show that the stock price is reasonable.
I get a 10 year Price/Book Value per Share Ratio of 1.28 and a current P/B Ratio of 1.23. The current ratio is 96% of the 10 year ratio and suggests a reasonable stock price. The 5 year median Dividend Yield 5.44% and the current dividend yield is 5.22%. The current yield is 4% lower than the 5 year median dividend yield and suggests a reasonable stock price.
When I look at the analysts' recommendation I find recommendations of Buy, Hold and Underperform. Most of the recommendations are a Hold and the consensus recommendation is a Hold. The 12 month stock price consensus is $29.80. This implies a total return of 13.31%, with 8.09% from capital gains and 5.22% from dividends.
This article talks about the sale of US Annuities business and why there might be an earnings hit because of this sale. A number of analysts talk about how this company will do well when interest rates start to raise. (They will rise, eventually.)
I find very little recent information by analysts on this stock. No one seems to be talking much about Life Insurance companies. They have not done much over the last while and probably will not do much until interest rates start to rise. It might be more tempting stock if stock price was cheap, but it is not, it is just reasonable. See my spreadsheet at slf.htm.
Sun Life Financial is a leading international financial services organization providing a diverse range of protection and wealth accumulation products and services to individuals and corporate customers. Chartered in 1865, Sun Life Financial and its partners today have operations in key markets worldwide, including Canada, the United States, the United Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. Its web site is here Sun Life.
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 Sun Life Financial Inc. (TSX-SLF, NYSE-SLF). I first bought it in 2000 when it became a public company, although I have known this company for a longer period. I have not made much money, especially lately, under this company. I have made a total return of 3.8% per year, with 4.23% per year from dividends and a capital loss of 0.43% per year.
When I look at insider trading, I find insider selling of $6.3M and net insider selling at $5.8M. There is a bit of insider buying at 0.5M. Insider selling seems to be of options and buying seems to be under the company plan. There are a number of different options types with this company called Units Performance Share Units, Units Restricted Share Units, Units Sun Shares and Deferred Share Units besides options.
The CEO has shares worth $0.5M and has options are worth $42.6M. The CFO has some shares worth $0.1M and has options worth $13.7M. An officer has shares $0.5M and has options worth $11.4M. A director has shares worth $0.3M and has options worth $0.2M. This is just to give you an idea on insider share ownership and option values.
The 5 year low, median and high median Price/Earnings Ratios are 8.75, 10.40 and 12.05. The current P/E is 10.08 based on a current stock price of $27.57 and 2013 earnings of $2.57. (The 2013 earnings exclude the loss on sale of US Annuity Business as this gives a more realistic picture.)
I get a Graham Price of $35.91 and 10 year low, median and high median Price/Graham Price Ratio of 0.73, 0.96 and 1.06. The current P/GP Ratio is 0.77. (This calculation also uses 2013 earnings excluding loss on sale of US Annuity Business.) Both of these tests show that the stock price is reasonable.
I get a 10 year Price/Book Value per Share Ratio of 1.28 and a current P/B Ratio of 1.23. The current ratio is 96% of the 10 year ratio and suggests a reasonable stock price. The 5 year median Dividend Yield 5.44% and the current dividend yield is 5.22%. The current yield is 4% lower than the 5 year median dividend yield and suggests a reasonable stock price.
When I look at the analysts' recommendation I find recommendations of Buy, Hold and Underperform. Most of the recommendations are a Hold and the consensus recommendation is a Hold. The 12 month stock price consensus is $29.80. This implies a total return of 13.31%, with 8.09% from capital gains and 5.22% from dividends.
This article talks about the sale of US Annuities business and why there might be an earnings hit because of this sale. A number of analysts talk about how this company will do well when interest rates start to raise. (They will rise, eventually.)
I find very little recent information by analysts on this stock. No one seems to be talking much about Life Insurance companies. They have not done much over the last while and probably will not do much until interest rates start to rise. It might be more tempting stock if stock price was cheap, but it is not, it is just reasonable. See my spreadsheet at slf.htm.
Sun Life Financial is a leading international financial services organization providing a diverse range of protection and wealth accumulation products and services to individuals and corporate customers. Chartered in 1865, Sun Life Financial and its partners today have operations in key markets worldwide, including Canada, the United States, the United Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. Its web site is here Sun Life.
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, April 16, 2013
Sun Life Financial Inc
I own this stock of Sun Life Financial Inc. (TSX-SLF, NYSE-SLF). I have followed and invested in this company for some time. I first bought it in 2000 when it became a public company, although I have known this company for a longer period. I have worked in several Life Insurance companies, however, never at Sun Life.
I have not made much money, especially lately, under this company. I have made a total return of 3.8% per year, with 4.23% per year from dividends and a capital loss of 0.43% per year. Over the past 5 years the company's total return is a loss of 10.82% per year, with the dividends were at 3.07% per year and with a capital loss of 13.89% per year. Over the past 10 years it has done a bit better with a total return of 4.09% per year with dividends at 4.22% per year and a capital loss of 0.13% per year.
The dividends on this stock have not changed since 2008. The 5 and 10 year dividend growth is at 1.76% and 9.9% per year. However, in the current economic climate the dividend yield is quite good. Last year the dividend was averaging around 6.1%, and currently it seems to be running around 5.2%. Some analysts think that the company will raise their dividend in 2015.
The outstanding shares have not changed much over the past 5 and 10 years. The outstanding shares are up by 1.2% per year over the past 5 years and have declined by 0.3% per year over the past 10 years. Shares have increased due to stock options, DRIP and share issues. Shares have decreased due to share buy backs.
What I see is no or little growth in the last 5 and 10 years in revenue, earnings, cash flow and book value. I cannot see much changing until there is an economic improvement. On the other hand I do not think that the firm is in any financial difficulty. I think that the company is strong enough to survive the current economic problems.
Currently I am holding on to my insurance stock. I believe that I will do just fine in the long term. Of course, this all depends on how you look at things. To me, on this stock, I am earning a good dividend while I wait for the insurance sector to do better. It may be a while before the economy improves. The main problem is the low interest rates and lower interest rates will not last forever. (However, such situations can last longer than anyone believes possible.)
I am collecting my dividends and will wait for better times. See my spreadsheet at slf.htm.
Sun Life Financial is a leading international financial services organization providing a diverse range of protection and wealth accumulation products and services to individuals and corporate customers. Chartered in 1865, Sun Life Financial and its partners today have operations in key markets worldwide, including Canada, the United States, the United Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. Its web site is here Sun Life.
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 have not made much money, especially lately, under this company. I have made a total return of 3.8% per year, with 4.23% per year from dividends and a capital loss of 0.43% per year. Over the past 5 years the company's total return is a loss of 10.82% per year, with the dividends were at 3.07% per year and with a capital loss of 13.89% per year. Over the past 10 years it has done a bit better with a total return of 4.09% per year with dividends at 4.22% per year and a capital loss of 0.13% per year.
The dividends on this stock have not changed since 2008. The 5 and 10 year dividend growth is at 1.76% and 9.9% per year. However, in the current economic climate the dividend yield is quite good. Last year the dividend was averaging around 6.1%, and currently it seems to be running around 5.2%. Some analysts think that the company will raise their dividend in 2015.
The outstanding shares have not changed much over the past 5 and 10 years. The outstanding shares are up by 1.2% per year over the past 5 years and have declined by 0.3% per year over the past 10 years. Shares have increased due to stock options, DRIP and share issues. Shares have decreased due to share buy backs.
What I see is no or little growth in the last 5 and 10 years in revenue, earnings, cash flow and book value. I cannot see much changing until there is an economic improvement. On the other hand I do not think that the firm is in any financial difficulty. I think that the company is strong enough to survive the current economic problems.
Currently I am holding on to my insurance stock. I believe that I will do just fine in the long term. Of course, this all depends on how you look at things. To me, on this stock, I am earning a good dividend while I wait for the insurance sector to do better. It may be a while before the economy improves. The main problem is the low interest rates and lower interest rates will not last forever. (However, such situations can last longer than anyone believes possible.)
I am collecting my dividends and will wait for better times. See my spreadsheet at slf.htm.
Sun Life Financial is a leading international financial services organization providing a diverse range of protection and wealth accumulation products and services to individuals and corporate customers. Chartered in 1865, Sun Life Financial and its partners today have operations in key markets worldwide, including Canada, the United States, the United Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. Its web site is here Sun Life.
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, April 15, 2013
Barclays Bank PLC ADR 2
On my other blog I am today writing about my blog warning on investing ...continue...
I own this stock of Barclays Bank PLC ADR (UK-BARC, NYSE-BCS). This was one of my forays into international stock. I bought this stock in 2000 and today, I have 3.26% total return per year, with 5.45% per year from dividends and capital loss of 2.19% per year. This valuation is in US$. This stock was doing well until the 2008 crash.
According to the NASDAQ site, there was no insider trading over the past 12 months for this stock. I find it harder to find information on foreign stock. However, there seems to be insider ownership and outstanding share options. At the end of 2012 there were 820M outstanding options with strike prices ranging from £1.41 to £5.22 (or $2.14 and $7.94 US).
The 5 year low, median and high median Price/Earnings Ratios are 2.19, 9.66 and 12.95. (This is quite a spread in P/E Ratios.) The current P/E Ratios is 9.12 basic on stock price of $17.76 and 2013 EPS of $1.95. I get a Graham Price of $34.46 and 10 year Price/Graham Price Ratios of 0.54, 0.71 and 0.95. The current P/GP Ratios is 0.52. So the first test says the stock price is reasonable, but a bit high and the second says it is cheap.
The 10 year Price/Book Value per Share Ratio is 1.05. The current ratio is 0.67. This current ratio is only 63% of the 10 year ratios and says the stock is cheap. Also, if the P/B Ratio is below 1.00, this says the stock is cheap on an absolute basis. (Same story when the P/GP Ratio is below 1.00.)
The current dividend yield is 2.49%. The 5 year median dividend yield is some 7.7% lower at the 2.31%. This test says the stock price is reasonable and on the low side. (This may be a useful test as the dividends were dropped 4 years ago.) So it would seem that the stock price is reasonable and probably on the low side.
There is only one analyst following this stock as a US ADR. However, there are 30 analysts following this stock as a UK Bank. The analysts' recommendations are Strong Buy, Buy, Hold, Underperform and Sell. However, there is only 1 each of the last two recommendations. The consensus recommendation would be a Buy.
The 12 month stock price is £3.57 or $21.71 US$. This implies a total return of 24.69% with 2.49% from dividends and 22.2% from capital gains. (Of course, this is rather optimistic as the US stock exchanges seemed to have gone south strongly today.)
The Insider Monkey site says that Hedge funds are dropping this stock. On AOL today is a recent positive report from The Motley Fool. Goldman Sachs is less favorable and has downgraded Barclays PLC recently.
Personally, I will hold on to my shares. However, I feel that the bank has still a long way to go to recover and I am not tempted to buy more at present. See my spreadsheet at bcs.htm.
One of the largest financial services groups in the United Kingdom, Barclays is engaged in banking, investment banking and asset management worldwide. Its web site is here Barclays.
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 Barclays Bank PLC ADR (UK-BARC, NYSE-BCS). This was one of my forays into international stock. I bought this stock in 2000 and today, I have 3.26% total return per year, with 5.45% per year from dividends and capital loss of 2.19% per year. This valuation is in US$. This stock was doing well until the 2008 crash.
According to the NASDAQ site, there was no insider trading over the past 12 months for this stock. I find it harder to find information on foreign stock. However, there seems to be insider ownership and outstanding share options. At the end of 2012 there were 820M outstanding options with strike prices ranging from £1.41 to £5.22 (or $2.14 and $7.94 US).
The 5 year low, median and high median Price/Earnings Ratios are 2.19, 9.66 and 12.95. (This is quite a spread in P/E Ratios.) The current P/E Ratios is 9.12 basic on stock price of $17.76 and 2013 EPS of $1.95. I get a Graham Price of $34.46 and 10 year Price/Graham Price Ratios of 0.54, 0.71 and 0.95. The current P/GP Ratios is 0.52. So the first test says the stock price is reasonable, but a bit high and the second says it is cheap.
The 10 year Price/Book Value per Share Ratio is 1.05. The current ratio is 0.67. This current ratio is only 63% of the 10 year ratios and says the stock is cheap. Also, if the P/B Ratio is below 1.00, this says the stock is cheap on an absolute basis. (Same story when the P/GP Ratio is below 1.00.)
The current dividend yield is 2.49%. The 5 year median dividend yield is some 7.7% lower at the 2.31%. This test says the stock price is reasonable and on the low side. (This may be a useful test as the dividends were dropped 4 years ago.) So it would seem that the stock price is reasonable and probably on the low side.
There is only one analyst following this stock as a US ADR. However, there are 30 analysts following this stock as a UK Bank. The analysts' recommendations are Strong Buy, Buy, Hold, Underperform and Sell. However, there is only 1 each of the last two recommendations. The consensus recommendation would be a Buy.
The 12 month stock price is £3.57 or $21.71 US$. This implies a total return of 24.69% with 2.49% from dividends and 22.2% from capital gains. (Of course, this is rather optimistic as the US stock exchanges seemed to have gone south strongly today.)
The Insider Monkey site says that Hedge funds are dropping this stock. On AOL today is a recent positive report from The Motley Fool. Goldman Sachs is less favorable and has downgraded Barclays PLC recently.
Personally, I will hold on to my shares. However, I feel that the bank has still a long way to go to recover and I am not tempted to buy more at present. See my spreadsheet at bcs.htm.
One of the largest financial services groups in the United Kingdom, Barclays is engaged in banking, investment banking and asset management worldwide. Its web site is here Barclays.
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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