Methanex Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Materials. Stock Price is cheap to reasonable. Some institutions are selling some of their shares as is the CEO. Shares have fallen some 13.8% this year. See my spreadsheet on Methanex Corp.

I do not own this stock of Methanex Corp (TSX-MX, NASDAQ-MEOH). I started a spreadsheet in November 2010 as I had read some good reports on the stock at that time. It is also got a solid “C” grade in a 2009 Money Sense review of stocks. Money Sense rated the top 100 Canadian Dividend Paying stocks. Money Sense was looking for stocks that provided generous income at reasonable prices.

When I was updating my spreadsheet, I noticed that earnings are volatile with not much growth over the past 10 years, but good growth over the past 5 years. Last 7 EPS were at $2.16; -$0.73; $3.46; $4.79; $2.21; -$0.14; and $3.64. We have two negative periods with some good earnings. The 5 year running average growth in EPS is 26.19% per year, but 10 year running average growth is only 1.66%. Also, over the past 2 years the CEO has been reducing his shares. However, he still has shares worth some $3.7M.

Dividend yields are moderate and the dividend growth is moderate to good. The current dividend is 2.66%, with 5, 10 and historical medians at 2.31%, 2.46% and 2.46% respectively. The growth in dividends is slower than it was when the company first started to pay dividends 15 years ago. Dividends are paid in US$.

They can afford their dividends. It is the long term Dividend Payout Ratios that really count. For this stock for 2017 the DPR for EPS is 26% with 5 year coverage at 38%. This is a good ratio. The DPR for CFPS is 375 with 5 year coverage at 18%.

The Long Term Debt/Market Cap Ratio is low and good at 0.29 in 2017. The Liquidity Ratio is good at 1.66 in 2017 with 5 year median at 1.77. The Debt Ratio is good at 1.61 in 2017 with 5 year median at 1.75. The Leverage Ratio is a little high at 3.19 for 2017 with 5 year median at a better 2.55. The Debt/Equity Ratio is fine at 1.91 in 2017 with 5 year median at 1.40.

The Total Return per year is shown below for years of 5 to 22 to the end of 2017 in CDN$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See charts below.

Years	Div. Gth	Tot Ret	Cap Gain	Div.
5	15.37%	21.96%	19.18%	2.79%
10	10.59%	12.83%	10.70%	2.13%
15	16.06%	14.93%	12.34%	2.59%
20		11.59%	9.99%	1.60%
22		11.08%	9.67%	1.41%

The Total Return per year is show below for years of 5 to 22 to date in CDN$. You will notice that the 5 and 10 year total return has changed, but the longer terms is pretty similar compared to return to 2017.

Years	Div. Gth	Tot Ret	Cap Gain	Div.
5	15.37%	3.15%	0.87%	2.28%
10	10.59%	20.63%	16.96%	3.68%
15	16.06%	13.33%	10.57%	2.76%
20		13.49%	11.09%	2.40%
22		9.50%	7.85%	1.65%

The Total Return per year is show below for years of 5 to 22 to the end of 2017 in US$. Here it is mostly the 5 year total return that is really different from the CDN$ return. This has to do with currency exchange.

Years	Div. Gth	Tot Ret	Cap Gain	Div.
5	10.14%	16.15%	13.70%	2.45%
10	7.99%	11.37%	9.21%	2.17%
15	17.85%	17.37%	14.09%	3.27%
20		12.51%	10.69%	1.82%
22		11.65%	10.09%	1.56%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 9.55, 13.68, and 16.83. The corresponding 10 year ratios are 9.91, 13.25 and 16.09. The corresponding historical ratios are 8.68, 10.79 and 14.94. The current P/E Ratio is 6.41 based on current stock price of $65.61 and 2018 EPS estimate of $10.24 ($7.61 US$). This testing is in CDN$. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $75.79 CDN$. The 10 year low, median, and high median Price/Graham Price Ratios are 0.96, 1.27 and 1.58 CDN$. The current P/GP Ratio is 0.87 CDN$ based on a stock price of $65.61 CDN$. This stock price testing suggests that the stock price is relatively cheap.

I get a 10 year median Price/Book Value per Share Ratio of 2.07 CDN$. The current P/B Ratio is 2.63 based on Book Value of $1,957M, Book Value per Share of $24.94 and a stock price of $65.61, all in CDN$. The current ratio is some 27.3% above the 10 year ratio. This stock price testing suggests that the stock price is relatively expensive.

I get an historical median dividend yield of 2.46% US$. The current dividend yield is 2.66% based on dividends of $1.32 and a stock price of $49.58 all in US$. The current dividend yield is 8.2% above the historical median yield. This stock price testing suggests that the stock price is relatively reasonable and below the median.

The 10 year median Price/Sales (Revenue) Ratio is 1.28 US$. The current ratio is 0.98 based on 2018 Revenue estimate of $3,982M, Revenue per Share of $50.76 and a stock price of $49.58 all in US$. The current P/S is some 23.7% below 10 year ratio. This stock price testing suggests that the stock price is relatively cheap.

The stock price testing outlying results is for the P/B Ratio and this is because the Book Value is growing a lot slower than earnings. Part of the reason is the dividends paid in shareholders. The other testing is showing the stock as cheap or reasonable and below the median. The P/E Ratio of 6.41 is a very low ratio. The P/B Ratio of 2.63 is a little high on an absolute basis.

When I look at analysts’ recommendations, I find Strong Buy (1), Buy (6), Hold (2) and Underperform (1). The consensus would be a Buy. The 12 month stock price is $73.35 US$ or $98.78 CDN$. This implies a total return of 53.26% with 2.71% from dividends and 50.55% from capital gains.

Peter Erickson on What’s on Thorold talks about Prudential PLC reducing their shares in this company. Troy Warner on MTL News talks about the strong downward momentum of this stock. Hazel Jackson on What’s on Thorold talks about Hillsdale selling of this this stock. Victoria Hetherington on Motley Fool thinks it is a good stock but overprice at present. See what analysts are saying about this stock on Stock Chase. Analysts like this stock.

Methanex Corp manufactures and sells methanol. Methanex's customers use methanol as a feedstock to produce end products including adhesives, foams, solvents, and windshield washer fluids. Its web site is here Methanex Corp.

The last stock I wrote about was about was Stantec Inc. (TSX-STN, NYSE-STN) ... learn more. The next stock I will write about will be Magna International Inc. (TSX-MG, NYSE-MGA) ... learn more on Monday, December 24, 2018 around 5 pm.

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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Stantec Inc

Sound bite for Twitter and StockTwits is: Dividend Growth Industrial. The stock price is probably reasonable and below the median. There is some insider buying. I see mostly green on my spreadsheet except for earnings. Unfortunately, for this stock, earnings can be volatile. See my spreadsheet on Stantec Inc.

I do not own this stock of Stantec Inc (TSX-STN, NYSE-STN) but I used to. I bought and sold this stock between 2008 and 2011 and did not make any money. It was a non-core holding. With their new policy of dividends, this stock has become more interesting.

When I was updating my spreadsheet, I noticed when updating the stock prices that the stock chart for this company just shows the price going up and down but not going anywhere. Price was higher in 2014 than later. Price had a plateau from 208 to 2012, then there was a sharp rise and then a plateau from 2013 to today.

Dividend yields are low and the dividen0d growth is moderate. The current dividend yield is 1.83%. The 5 year dividend yield is 1.25% and since 2013 is 1.31%. The 5 year dividend growth is 10.20% per year.

They can afford their dividends. The Dividend Payout Ratio for 2017 was 57% with 5 year coverage at 38%. The DPR for CFPS for 2017 was 2% with 5 year coverage at 2.7%.

The Long Term Debt/Market Cap Ratio for 2017 is low at 0.13. It has increased by the third quarter of 2018 to a still low value of 0.26. The Liquidity Ratio has varied and it is a bit low in 2017 at 1.39, but improves by the third quarter of 2018 to 1.67. The 5 year median is 1.51. The Debt Ratio has always been good with the 2017 ratio at 1.96 and 5 year median at 2.15. Leverage and Debt/Equity Ratios are also fine with ratios at 2017 at 2.04 and 1.04 respectively and 5 year medians at 2.05 and 1.05 respectively.

The Total Return per year is shown below for years of 5 to 23 to the end of 2017. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See charts below.

Years	Div. Gth	Tot Ret	Cap Gain	Div.
5	10.20%	13.70%	12.10%	1.60%
10		6.90%	6.11%	0.79%
15		16.18%	15.48%	0.70%
20		18.02%	17.47%	0.56%
23		17.55%	17.07%	0.48%

Doing long term total returns to date gives basically the same answer as above except for 5 year duration where in the last 5 years we have a negative total return. This is mainly because the stock price is down around 15% this year.

Years	Div. Gth	Tot Ret	Cap Gain	Div.
5	10.20%	-0.43%	-1.83%	1.40%
10		8.34%	7.13%	1.21%
15		12.89%	11.95%	0.94%
20		17.92%	17.08%	0.84%
23		18.71%	17.96%	0.75%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 17.66, 20.27 and 22.95. The corresponding 10 year Ratios are 16.59, 20.34 and 24.12. The historical median ratios are 12.38, 15.71 and 18.99. The current P/E Ratio is 26.33 based on a stock price of $30.02 and 2018 EPS estimate of 1.14. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $20.71. The 10 year low, median, and high median Price/Graham Price Ratios are 1.16, 1.47 and 1.74. The current P/GP Ratio is 1.45 based on a stock price of $30.02. This stock price testing suggests that the stock price is relatively reasonable but above the median. It is almost expensive.

I get a 10 year median Price/Book Value per Share Ratio of 2.10. The current P/B Ratio is 1.80 based on Book Value of $1902M, Book Value per Share of $16.72. and a stock price of $30.02. The current ratio is some 14.5% below the 10 year ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get an historical median dividend yield of 1.31%. The current yield is 1.83% based on dividends of $$0.55 and a stock price of $30.02. The current yield is 40% above historical one. This stock price testing suggests that the stock price is relatively cheap.

The 10 year median Price/Sales (Revenue) Ratio is 1.12. The current P/S Ratio is 0.97 based on 2018 Revenue estimate of $43,533M Revenue per share of $31.05 and a stock price of $30.02. The current P/S Ratio is some 14% below the 10 year ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

The P/E Ratio, which has never been my favourite measure, says the stock price is expensive as does the P/GP Ratio. Since they have only been paying dividends for 6 years, the dividend yield test may not be that good. Both the P/B Ratio and P/S Ratios have no negative aspects for this stock and they are quite good measurements. They both say the stock is relatively reasonable and below the median.

When I look at analysts’ recommendations, I find Strong Buy (1), Buy (5) and Hold (5). The consensus would be a Buy. The 12 month stock price consensus is $38.59 which implies a total return of 30.38% with 28.55% from capital gains and 1.83% from dividends.

Asher Wright on Simply Wall Street talk about this company’s ROE, which is currently low. David Hasegawa on Press Oracle talks about recently ratings for this company. Mary Kom on Fairfield Current talks about institutional investors. Andrew Button on Motley Fool suggests that you would be better off with a company with more upside. See what analysts are saying about this company on Stock Chase. They say good things about the company, but one analyst prefers Aecon.

Stantec Inc is a global engineering and construction firm. It designs buildings, energy and resource projects, and infrastructure developments. Stantec derives the substantial majority of its sales from the United States and Canada, and the company works in both the public and private sectors. Its web site is here Stantec Inc.

The last stock I wrote about was about was FirstService Corp (TSX-FSV, NASDAQ-FSV) ... learn more. The next stock I will write about will be Methanex Corp. (TSX-MX, NASDAQ-MEOH) ... learn more on Friday, December 21, 2018 around 5 pm. Tomorrow on my other blog I will write about Understanding Financial Statements.... learn more on December 20, 2018 around 5 pm.

Also, on my book blog I have put a review of the book Capital Compounders by Robin Speziale learn more...

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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

FirstService Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Real Estate. The ratios on this company are very high, so it would seem that it is relatively expensive. All analysts seem to be giving the company a Hold Rating. It has done well for shareholders since the split with Collier International. See my spreadsheet on FirstService Corp.

I do not own this stock of FirstService Corp (TSX-FSV, NASDAQ-FSV). I bought FirstService Corp in 2002 as it a good solid company that knows how to make money. At that time, I was still buying companies to earn capital gains. FSV was a non-dividend paying stock, but it had issued preferred shares to shareholders. Their way of paying dividends by issuing preferred shares was interesting. However, only if you held shares at the time of the special dividend of preferred shares would you get any dividends.

When I was updating my spreadsheet, I noticed Net Insider Selling was high at 2.2%. Generally, NIS is around 0.01%. It seems the Chairman and Founder was the insider selling. In the prior two years, NIS was at 0.015 and 0.02%, respectively. The other thing is that the stock price has really taken off. The capital gain over the past 5 years is 43.9% per year. This is high.

The company started to pay dividends in 2013. The dividends are paid in US$ and the yield has been low. The current dividend yield is just 0.71%. The 4 year median is 1.16%. The 4 year high is 2% and the low is 0.66%. The dividend growth is also low, with 4 year growth at 4.5% per year.

They can afford their dividends. The Dividend Payout Ratio for 2017 was 33% with 4 year coverage at 53%. The DPR for CFPS for 2017 is 145 with 4 year coverage at 16%.

The Debt Ratios on this company are generally good. The Long Term Debt/Market Cap Ratio for 2017 is low and good at just 0.11. For 2017 the Liquidity Ratio is 1.57 and the Debt Ratio is 1.62. These are good as I like them to be 1.50 or higher. The Leverage and Debt/Equity Ratio are fine at 2.61 and 1.61 respectively.

The Total Return per year is shown below for years of 5 to 22 to the end of 2017 in CDN$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See charts below.

The same total return if done to date is not much different except for the 5 and 10 year period where total returns are 34.08% and 28.89% per year respectively rather than 46.03% and 23.52% per year in the table below. So, the 5 year total return is lower and the 10 year total return is higher.

Years	Div. Gth	Tot Ret	Cap Gain	Div.
5	8.93%	46.03%	43.95%	2.08%
10		23.52%	22.85%	0.68%
15		22.71%	22.27%	0.44%
20		16.27%	16.00%	0.27%
22		22.20%	21.90%	0.30%

The Total Return per year is show below for years of 5 to 22 to the end of 2017 in US$. It is the same here where the 5 and 10 year total returns are different to date at 29.49% and 28.22% per year respectively rather than the ones of the table below of 38.735 and 20.29% per year respectively. As for CDN$, the 5 year total return is lower and the 10 year total return is higher.

Years	Div. Gth	Tot Ret	Cap Gain	Div.
5	4.53%	38.73%	37.32%	1.41%
10		20.29%	19.83%	0.45%
15		23.89%	23.56%	0.33%
20		16.94%	16.73%	0.21%
22		22.59%	22.37%	0.22%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 32.23, 42.62 and 50.41. The corresponding 10 year ratios are 21.01, 24.47 and 32.80. The historical ratios are 13.70, 18.48 and 23.12. The current ratio is 37.22 based on a stock price of $94.54 and 2018 EPS estimate of $2.84. These are all in CDN$. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $23.30 CDN$. The 10 year low, median, and high median Price/Graham Price Ratios are 2.21, 3.02 and 3.93 in CDN$. The current P/GP Ratio is 4.24 based on a stock price of $94.54 CDN$. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median Price/Book Value per Share Ratio of 8.88 CDN$. The current P/B Ratio is 10.86 CDN$ based on a stock price of $94.54 CDN$, Book Value of $313M CDN$ and Book Value per share of $8.70 CDN$. The current ratio is 22% above the 10 year ratio. This stock price testing suggests that the stock price is relatively expensive.

I get an historical median dividend yield of`1.16% CDN$. The current dividend yield is 0.76% based on dividends of $0.72 CDN$ and a stock price of $94.54. The current yield is some 34% lower. This stock price testing suggests that the stock price is relatively expensive.

The 10 year median Price/Sales (Revenue) Ratio is 0.47 CDN$. The current ratio is 1.36 based on 2018 Revenue estimate of $2,493M, Revenue per share of $69.30 and a stock price of $94.54, all in CDN$. The current ratio is some 188% above the 10 year ratio. This stock price testing suggests that the stock price is relatively expensive.

The very high P/E Ratio for the past 5 years show that the stock price has gone up much quicker than the EPS. The 5 and 10 year median ratios are more rational. The P/GP Ratios are also quite high considering that a good price on an absolute basis is a P/GP Ratio of 1.00. The P/B Ratio is extremely high at 8.88. The only reasonable ratio I see is the 10 year P/S Ratio at 0.47. Even with most median ratios being high, all the stock price testing shows the stock to be relatively expensive.

When I look at analysts’ recommendations, I find Hold (4) Recommendations. These are the only ones. The 12 month consensus stock price is $104.00. This implies a total return of 10.77% with 10.01% from capital gains and 0.76% from dividends.

Darrell McKinsey on Fairfield Current talks about brokerage firms giving this stock a Hold rating. Lisa Matthews on Fairfield Current talks about hedge funds buying shares in the company. Will Ashworth on Motley Fool talks about why the company split into 2 entities. . See what analysts are saying on Stock Chase. They generally like this company.

FirstService Corp operates in two business divisions: FirstService Residential and FirstService Brands. The company earns the majority of its revenue in the United States, with the remaining revenue generated in Canada. Its web site is here FirstService Corp.

The last stock I wrote about was about was Keg Royalties Income Fund (TSX-KEG.UN, OTC-KRIUF) ... learn more. The next stock I will write about will be Stantec Inc. (TSX-STN, NYSE-STN) ... learn more on Wednesday, December 19, 2018 around 5 pm. Tomorrow on my other blog I will write about How to Make Money in Value Stocks.... learn more on Tuesday, December 18, 2018 around 5 pm.

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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

The Keg Royalties Income Fund

Sound bite for Twitter and StockTwits is: Dividend Growth Consumer. This is a restaurant stock and it is showing up on testing with a reasonable to expensive stock price. They seem to be getting their Dividend Payout Ratio under control. This is a positive going forward. See my spreadsheet on The Keg Royalties Income Fund.

I do not own this stock of Keg Royalties Income Fund (TSX-KEG.UN, OTC-KRIUF). This was a stock suggested by one of my readers. I like dining at The Keg. I find the food very good. At stock forums I viewed, investors liked this company as it is guaranteed 4% of the sales at Keg restaurants as income to the fund. So, I decided to take a look at it.

When I was updating my spreadsheet, I noticed there is a big difference between the Basic and Diluted EPS. Basic for 2017 is $1.50 and the Diluted is $1.15. The difference is due to Exchange Partnership Units. Revenue and Assets depend on Keg Restaurants Ltd (KRL) for which there is no financial statements.

However, Keg Restaurant Ltd is now owned by Recipe Unlimited Corporation (TSX-RECP). Note that Recipe Unlimited Corporation used to be Cara Operations limited (TSX-CARA) which has recently changed its name. RECP is a publicly traded company for which there are financial statements. Still the company is still wholly dependent on KRL

The current dividend yield is high with dividend yield at 6.67%. The dividend has always been high because this used to be an income trust. The historical median dividend yield is 8.20%. The dividend yield since 2011 when it changed from an income trust is 5.83%. The 5 and 10 year median dividend yields are 5.57% and 6.62%.

The historical dividend growth record looks bad because dividends were cut in 2011 by some 25%, then they held steady for a couple of years before resuming growth. Dividend were cut when the stock was no longer an income trust. Dividends started to grow again in 2015 at just over 3% per year. The last increase was in 2017 and it was for 3.1%. Last year of 2017 was the first year that the dividends were below the EPS. The Dividend Payout Ratio for 2017 is 99% with 5 year coverage at 154%.

It is interesting that as far as taxes go, most of the current distribution is taxed as Eligible Dividends and a small portion as Return of Capital. In 2017 just over 99% was Eligible Dividends and just less than 1% as ROC.

The Debt Ratios for this stock are rather meaningless and the debt ratios that really count are those for KBL, which I do not have. There is nothing wrong with the Debt Ratios for the fund. The Long Term Debt/Market Cap Ratio is 0.63. The Liquidity Ratio is 1.91. The Debt Ratio is 1.55. The Leverage and Debt/Equity Ratios are 2.83 and 1.83. Nothing surprising here, but they are wholly dependent on KBL. Some 97% of their assets depend on KBL.

The Total Return per year is shown below for years of 5 to 16 to the end of 2017. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See charts below.

If you look at total return to date, the 5 and 10 year total returns are very different with total return for the past 5 years at just 7.09%, but total return for the past 10 years at 22.10%. The 10 year return is a lot higher because exactly 10 years ago there was a big drop in the stock price. The 5 year return is different because the stock has dropped almost 15% this year.

Years	Div. Gth	Tot Ret	Cap Gain	Div.
5	2.89%	12.92%	6.63%	6.29%
10	-0.75%	11.90%	4.52%	7.39%
15	4.90%	14.58%	5.27%	9.31%
16		12.60%	4.42%	8.18%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 23.55, 24.93 and 26.36. The corresponding 10 year ratios are 17.02. 18.98 and 20.93. The corresponding historical ratios are 10.98. 11.75 and 12.98. The current P/E Ratio is 14.66 based on a stock price of $17.01 and latest 12 month EPS of $1.16. I am using the latest 12 month EPS as no estimates are available. This stock price testing suggests that the stock price is probably relatively reasonable.

I get a Graham Price of $14.54. The 10 year low, median, and high median Price/Graham Price Ratios are 1.28, 1.43 and 1.57. These are rather high P/GP Ratios for this sort of company. The current P/GP Ratio is 1.17 based on a stock price of $17.01. This stock price testing suggests that the stock price is relatively cheap.

I get a 10 year median Price/Book Value per Share Ratio of 1.72. The current P/B Ratio is 2.10 based on Book Value of $91.9M, Book Value per Share of $8.10 and a stock price of $17.01. The current P/B Ratio is some 22% above the 10 year median. This stock price testing suggests that the stock price is relatively expensive.

I get an historical median dividend yield of 8.20%. The current dividend yield is 6.67% based on dividends of $1.135 and a stock price of $17.01. The current yield is some 18.6% below the historical yield. This stock price testing suggests that the stock price is relatively reasonable but above the median (and close to expensive.)

Because this stock used to be an income trust and income trusts have much higher yields than corporation, I will also do testing on median dividend yield since 2011. Since 2011 the median dividend yield is 5.83%. The current yield at 6.67% is some 14.5% lower. This stock price testing suggests that the stock price is relatively reasonable and below the median

The 10 year median Price/Sales (Revenue) Ratio is 7.36. The current P/S Ratio is 6.52 based on Revenue of 29.6M and Revenue per Share of $2.61 and a stock price of $17.01. The current P/S Ratio some 11% below the 10 year median ratio. This stock price testing suggests that the stock price is reasonable and below the median.

There is a big increase in this company’s P/E Ratios over time. Part of this probable is due to the fact that the company used to be an income trust. Analysts expected the stock price to rise and yields to drop on all income trusts when they because corporation. However, recent P/E Ratios are rather high for this sort of company. The current one on an absolute basis might be considered to be reasonable. I generally do not like the P/E test in any event.

I find that the P/GP Ratio of 1.17 rather high for showing a cheap price. However, I do admit that everything is relatively especially when it comes to stock price testing. I do not like the fact that the P/B Ratio is showing the stock as expensive. The current P/B Ratio of 2.10 is rather high. This is because the Book Value decreased from 2011 and 2015. This is not a good situation. This was due to the fact that they were paying in dividends more than they were earning.

The P/S Ratio testing shows that the stock price is reasonable and below the median. There is no problem with this test. There is also no problem with the P/B Ratio testing which is showing the stock as relatively expensive. On the other hand, situation where they were paying more than they are earning seems to be over, so the P/B Ratio should improve.

When I look at analysts’ recommendations, I find s Buy (1) recommendations. The 12 month stock price given is $23.00. This implies a total return of $41.88% with 35.21% from capital gains and 6.67% from dividends based on a current stock price of $17.01. Frankly, I have a hard time believing this.

Troy Warner on MTL News says that Williams Percent Range for this stock is -88.75 and so it is oversold. Joseph Solitro on Motley Fool that the stock was worth buying for the high yield. See what analysts are saying on Stock Chase. This stock is not well followed, but analysts in the past think it is a decent stock, but not much growth because it is in the restaurant business.

Keg Royalties Income Fund is a Canada based company. The organization works under the Restaurant business sector. The target market of this company is those people who want higher end casual dining experience. The business model of this company is that all Keg restaurants are placed under it, so the majority of its revenue is in the form of royalty income. Its web site is here The Keg Royalties Income Fund.

The last stock I wrote about was about was Stella-Jones Inc. (TSX-SJ, OTC- STLJF) ... learn more. The next stock I will write about will be FirstService Corp (TSX-FSV, NASDAQ-FSV) ... learn more on Monday, December 17, 2018 around 5 pm.

Also, on my book blog I have put a review of the book Enlightenment Now by Steven Pinker learn more...

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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Stella-Jones Inc

I have today bought some BCE stock but an odd lot. The trouble with BCE is that every time that do something, like spinning of a company, I am left with an odd number of shares. Of course, now with most trading done electronically, one is not penalized for trading odd lots of shares.

Sound bite for Twitter and StockTwits is: Dividend Growth Materials. Stock price testing suggests that the stock price is cheap to reasonable. Stella-Jones has done very well over the years, but they do seem to have slowed down recently. See my spreadsheet on Stella-Jones Inc.

I do not own this stock of Stella-Jones Inc (TSX-SJ, OTC-STLJF). I started a spreadsheet on this stock in mid-2009 because of a favorable report I read on this stock. It was considered to be a dividend growth stock and I am always on the lookout for dividend growth stocks.

When I was updating my spreadsheet, I noticed the company has great debt ratios. The first thing you notice is that all the ink is green. This company has done very well for its shareholders. Dividends have been growing faster than EPS and that maybe why the dividend growth has slowed. Over the past 5 year dividends have grown at 23.20% per year but the EPS has only grown at 16.40% per year.

For 2017 the Long Term Debt/Market Cap is just 0.13. The Liquidity Ratio is really high and great at 7.04 with 5 year median at 8.46. The Debt Ratio is high and good at 2.66 with 5 year median at 2.14. Leverage and Debt/Equity Ratios are low and good at 1.60 and 0.60 with 5 year median at 1.91 and 0.91. Good debt ratios help company get through bad times.

The yield is low and has always been low and has often been below 1%. The current dividend yield is 1.25%. The 5, 10 and historical median dividend yields are 0.89%, 0.83% and 1.02%. Dividend have increased by 23% and 22% per year over the past 5 and 10 years. However, the increases have slowed in the last two years with the increase for 2017 at 10% and the one for 2018 at 9.1%. See the chart below for dividend growth over the past 5 to 16 years.

I do not think that there is any question about the company being able to afford their dividends. The Dividend Payout ratio for 2017 for EPS is 20% with 5 year coverage at 18%. The DPR for CFPS for 2017 is 12% with 5 year coverage at 10%.

The Total Return per year is shown below for years of 5 to 23 to the end of 2017. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See charts below.

If you redo the Total Return to the current price, the most significant change is for the total return for the last 5 years, which would be 8.26% with capital gain at 7.05%. For other time periods the returns are similar. The stock price has fallen some 24% year to date.

Years	Div. Gth	Tot Ret	Cap Gain	Div.
5	23.20%	22.51%	21.39%	1.12%
10	22.05%	18.17%	17.29%	0.88%
15	23.98%	35.21%	33.17%	2.04%
16-20	22.33%	27.05%	25.96%	1.09%
23		33.37%	18.46%	14.91%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 16.95, 20.24 and 23.16. The 10 year corresponding Ratios are 12.31, 15.52 and 19.71. The corresponding historical ratios are 8.60, 11.30 and 14.04. The current P/E Ratio is 18.53 based on a stock price of $38.30 and 2018 EPS estimate of $2.09. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a Graham Price of $28.97. The 10 year low, median, and high median Price/Graham Price Ratios are 0.99, 1.32 and 1.67. The current P/GP Ratio is 1.32 based on a stock price of $38.30. This stock price testing suggests that the stock price is relatively reasonable and around the median.

I get a 10 year median Price/Book Value per Share Ratio of 2.51. The current P/B ratio is 2.15 based on a Book Value of $1,238M, Book Value per Share of $17.85 and stock price of $38.30. The current P/B Ratio is some 145 below the 10 year ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get an historical median dividend yield of 1.02%. The current dividend yield is 1.25% based on dividends of $0.48 and a stock price of $38.30. The current yield is some 23% above the historical median yield. This stock price testing suggests that the stock price is relatively cheap.

The 10 year median Price/Sales (Revenue) Ratio is 1.55. The current P/S Ratio is 1.25 based on Revenue estimate for 2018 of $2,123M, revenue per share of $30.61 and a stock price of $38.30. The current ratio is some 19% below the 10 year ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median and very close to cheap.

When I look at analysts’ recommendations, I find Buy (8) and Hold (1). The consensus would be a Buy. The 12 month stock price is $51.72. This implies a total return of 36.29% with 35.04% from capital gains and 1.25% from dividends based on a current price of $38.30.

LNR Staff at Lake Norman Review says the stock has a Williams Percent Range of -82.76. This means that the stock is oversold. Pam Parks on Simply Wall Street looks at ROE and debt. Kay Ng on Motley Fool likes this stock. See what analysts are saying about this company on Stock Chase. It is interesting that a couple of analysts recently give the stock a sell rating.

Stella-Jones Inc produces and sells lumber and wood products. The company sells products in five main customer categories. The railway ties category, which generates the most revenue of any category, sells pressure-treated lumber to the railway industry. The utility poles category, which contributes the next largest amount of revenue, sells utility poles for electrical transmission and communications infrastructure use. The other three categories are residential lumber for use in housing construction, industrial products for use in marine and building industries, and logs and lumber, which sells wood products to homebuilding markets. Its web site is here Stella-Jones Inc.

The last stock I wrote about was about was First Capital Realty (TSX-FCR, OTC-FCRGF) ... learn more. The next stock I will write about will be Keg Royalties Income Fund (TSX-KEG.UN, OTC-KRIUF) ... learn more on Friday, December 14, 2018 around 5 pm. Tomorrow on my other blog I will write about Markets Down, Dividends Up.... learn more on Thursday, December 13, 2018 around 5 pm.

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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

First Capital Realty

Sound bite for Twitter and StockTwits is: Dividend Growth Real Estate. Stock price is probably reasonable. I would worry about Liquidity Ratio if and when we get into the next recession. See my spreadsheet on First Capital Realty.

I do not own this stock of First Capital Realty (TSX-FCR, OTC-FCRGF). In 2011 a reader asked me to review this real estate stock. Also, the site Canadian Dividend Stock site mentions this company as a top Canadian REIT.

When I was updating my spreadsheet, I noticed is that the company has a very low Liquidity Ratio which is 0.54 in 2017 with 5 year median also at 0.54. Adding in cash flow after dividends just gets you to 0.64. You have to add back in the current portion of the long term debt to get a it over 1.00 at 1.24. If you then add the cash flow after dividends the ratio is 1.49. When this ratio is below 1.00, it means that current assets cannot cover current liabilities.

With this Real Estate company cash flow will not cover current liabilities. What you need to do is carefully read the debt section to make sure that the current portion of the long term debt has been taken care. My reading of the financial statements suggests this. However, this is a vulnerability for the company because in bad times they may have trouble dealing with the current portion of long term debt.

Dividends are good, but increases are very low. The current dividend yield is 4.29%, with 5, 10 and historical median yields at 4.61%, 4.61% and 5.20%. Dividend increases have varied a lot over time. They have not declined any year, but they have remained flat some year. Most recently the dividends have been flat since 2016.

Currently the Dividend Payout Ratio for EPS is good. The one for 2017 is 33.7% with 5 year coverage at 61.1%. The DPR for CFPS is a little high at 49% in 2017 with 5 year coverage at 47%. I prefer the DPR for CFPS to be 40% or less. Since this is a Real Estate company, they measure their DPR against Adjusted Cash Flow from Operations (AFFO) and Cash Flow from Operations (FFO). The DPR for AFFO for 2017 is 86% with 5 year average at 85%. The DPR for FFO for 2017 is 74% with 5 year average at 81%

The one I worry about is the Liquidity Ratio. Problem is that a very low one, especially one below 1.00, makes a company vulnerable in bad times. Bad times often hit suddenly. The other debt ratios are not a problem with the Long Term Debt/Market Cap Ratio at 0.77 and the Debt Ratio at 1.89. Leverage and Debt/Equity Ratios are not bad at 2.12 and 1.12 for 2017.

The Total Return per year is shown below for years of 5 to 23 to the end of 2017. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See charts below.

I also looked at the same periods but to the present date. Returns were very similar. This stock has only fall by 3.28% this year.

Years	Div. Gth	Tot Ret	Cap Gain	Div.
5	0.96%	6.31%	1.94%	4.37%
10	0.96%	8.31%	3.27%	5.03%
15	1.58%	14.45%	6.92%	7.53%
20	2.55%	7.69%	2.78%	4.91%
23	7.04%	13.27%	5.83%	7.44%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 16.38, 18.04 and 19.71. The 10 year corresponding ratios are 17.53, 18.97 and 20.41. The historical corresponding ratios are 17.53, 19.76 and 21.68. The current P/E ratio is 16.43 based on a stock price of $20.04 and EPS estimate for 2018 of $1.22. This stock price testing suggests that the stock price is relatively cheap.

Since this is a real estate company it is reporting Funds from Operations, so we should also look at P/FFO. The 5 year low, median, and high median P/FFO are 16.83, 18.46 and 19.82. The corresponding 10 year ratios are 16.03, 17.65 and 18.86. The current P/FFO is 16.29 based on a stock price of $20.04 and FFO estimate for 2018 of 1.23. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of 23.17. The 10 year low, median, and high median Price/Graham Price Ratios 0.90, 0.98 and 1.06. The current P/GP Ratio is 0.87 based on a stock price of $20.04. This stock price testing suggests that the stock price is relatively cheap.

I get a 10 year median Price/Book Value per Share Ratio of 1.18. The current P/B Ratio is 1.03 based on Book Value of $4982M, Book Value per Share of $19.55 and a stock price of $20.04. The current P/B Ratio is some 13% below the 10 year ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get an historical median dividend yield of 5.20%. The current dividend 4.29% based on dividends of $0.86 with a stock price of $20.04. The current dividend yield is some 17% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.

The 10 year median Price/Sales (Revenue) Ratio is 6.06. The current P/S Ratio is 6.93 based on 2018 revenue estimate of $737M, Revenue per Share of $2.89 and a stock price of $20.04. The current ratio is some 14% above the 10 year ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I think that P/E Ratio looks better because the EPS are increasing more rapidly than the revenue per share. This cannot go on so it will stop at some point. A problem with the EPS is that they do fluctuate a lot. I do not think the P/E Ratio testing is a good test anyways. The stock price would seem to be in the reasonable range, I just do not think it is cheap.

When I look at analysts’ recommendations, I find Strong Buy (1), Buy (4) and Hold (2). The consensus would be a Buy. The 12 month stock price estimate is 22.36. This implies a total return of 15.87% with 11.385 from capital gains and 4.29% from dividends.

In this News Wire bulletin, the company says that Chaim Katzman is now a director of the company. An Herdon Staff Writer onHerdon Gazette says that the company has a Piotroski F-Score of 6 which means the balance sheets is relatively strong. Daniel Johnson on Stock Digest says that analysts have assigned a Buy rating on this stock. Will Ashworth of Motley Fool says that this is one of his favourite stock.. See what analysts are saying about this stock on Stock Chase. Analysts seem to like the company.

First Capital Realty Inc is a Canada-based owner, developer, and manager of grocery-anchored urban properties. Historically, revenue contributions have come from supermarkets, drugstores, banks, liquor stores, restaurants, fitness centers, medical and childcare facilities, and other personal services in target markets. Its web site is here First Capital Realty.

The last stock I wrote about was about was DHX Media Ltd (TSX-DHX, OTC-DHXMF) ... learn more. The next stock I will write about will be Stella-Jones Inc. (TSX-SJ, OTC- STLJF) ... learn more on Wednesday, December 12, 2018 around 5 pm. Tomorrow on my other blog I will write about Your Own Enemy when Investing.... learn more on Tuesday, December 11, 2018 around 5 pm.

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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

DHX Media Ltd

I have moved money from my RIF account, paid my taxes for 2018 and bought some stock of Richelieu Hardware Ltd. (TSX-RCH, OTC-RHUHF) and TFI International (TSX-TFII, OTC-TFIFF). I wanted stocks that I already own in my Trading Account of which I do not already have too much. Both these stocks have come off their highs. Richelieu has a current yield above 1%.

Sound bite for Twitter and StockTwits is: Consumer Stock. The stock price seems to be cheap. They have cancelled their dividends for this year so they are no longer a dividend paying stock. I do not know when they may resume dividends. They have a vulnerability in connection with their debt load. See my spreadsheet on DHX Media Ltd.

I do not own this stock of DHX Media Ltd (TSX-DHX, OTC-DHXMF). I took a look at the stock after reading a favorable report at CANTECH. There was also a favorable report from Global Maxfin Capital.

When I was updating my spreadsheet, I noticed a lot of insider buying. The NIB is 0.47% (of Market Cap). Generally, this is closer to 0.01% or 0.02%. The Long Term Debt/Market Cap Ratio is really high at 2.03 in 2018 and currently at 1.12. The Goodwill and Intangible/Market Cap Ratio is also very high at 1.62. These high ratios are mainly the result of the stock price crashing. Since 2014 stock is down 63%. It is down 21% this year and was down some 36% last year. This stock has a financial year ending at June 30 each year we are in the 2018 financial year.

There is not much point in talking about dividends as they were cancelled for this company for 2019. They could not cover the dividends with EPS over the past two years because of earning losses. They are not expected to earn a positive EPS for 2019. So, at the moment they cannot afford their dividends.

Long Term Debt increased 167% in 2018 and the stock price has been dropping like a stone. So, the Long Term Debt/Market Cap Ratio is high for 2018 at 2.13 but dropping, because debt decreased to a current ratio of 1.12. It is still too high.

The Liquidity Ratio has varied but is generally good with a ratio of 1.65 in 2018 with 5 year median at 1.83. The Debt Ratio has also varied, but it is at 1.37 for 2018 with 5 year median at 1.48. This is a low ratio. Leverage and Debt/Equity Ratios are a little high at 3.68 and 2.68 respectively for 2018 with better 5 year medians of 2.22 and 1.22, respectively.

The Total Return per year is shown below for years of 5 to 12. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See charts below.

I look at return to the end of the last year (2017) since this year has not be completed yet and this puts all stocks that I review on the same level. However, for this stock, the stock price has fallen some 21% in 2018. This really knocks out all the total return shown to the end of 2017

Years	Div. Gth	Tot Ret	Cap Gain	Div.
5	14.87%	23.82%	21.35%	2.47%
10		10.26%	9.30%	0.96%
12		6.71%	5.99%	0.73%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 27.36, -49.20, 43.36. The corresponding 10 year ratios are 26.52, 1.68 and 44.02. The corresponding historical ratios are 23.67, 35.17 and 43.36. The current P/E Ratio is a negative 89.23 and the P/E Ratio for 2020 is 357.00. I do not think any sensible testing is possible using the P/E Ratio.

I get a Graham Price of $1.00. The 10 year low, median, and high median Price/Graham Price Ratios are 1.42, 2.37 and 3.20. The current P/GP Ratio is 3.57 based on a stock price of $3.57. This stock price testing suggests that the stock price is relatively high.

I get a 10 year median Price/Book Value per Share Ratio of 1.50. The current P/B Ratio is 0.80 based on Book Value for $596M, Book Value per Share of $4.44 and a stock price of $3.57. The current ratio is some 46% below the 10 year ratio. This stock price testing suggests that the stock price is relatively cheap.

The 10 year median Price/Sales (Revenue) Ratio is 1.94. The current P/S Ratio is 1.08 based on 2019 Revenue estimate of $445M, Revenue per Share of $3.31 and a stock price of $3.57. The current ratio is some 44% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

The P/E Ratios make little sense. They are too high. There has been some very high negative P/E Ratios for this stock because of earning losses. So, we should disregard this test. The Graham Price has an EPS component so this is also probably not a good test. Dividends have been cut so there is no dividend yield test available. The P/S Ratio and P/B Ratio testing seem to have no problems.

When I look at analysts’ recommendations, I find Strong Buy (1). Buy (1), Hold (8) and Underperform (2). The consensus would be a Hold. The 12 month stock price is $2.63. This implies a total loss of 26.33% all capital loss as the dividend has been cancelled. This is based on a current stock price of $3.57. The P/B Ratio and P/S Ratio are good tests. It would seem that the stock is currently cheap.

Brandie Wetzel on Simply Wall Street talks about who owns this company. The company announces via Newswire the sale of Halifax Animation Studio. SH Staff Writer on Steele Herald says that the Piotroski F-Score is 4 and this denotes low financial strength. Ambrose O'Callaghan on Motley Fool says this is a speculative buy. See what analysts are saying on Stock Chase. Some are worried about their debt levels.

DHX Media Ltd is a children's content and brands company, recognized globally for properties such as Peanuts, Strawberry Shortcake, Caillou, Inspector Gadget and Degrassi franchise. The company owns the largest independent library of children's content. It licenses its content to broadcasters and streaming services worldwide and generates royalties through its global consumer products program. The company through its subsidiary operates one of the largest networks of children's channels on YouTube. Its web site is here DHX Media Ltd.

The last stock I wrote about was about was Northland Power Inc. (TSX-NPI, OTC-NPIFF) ... learn more. The next stock I will write about will be First Capital Realty (TSX-FCR, OTC-FCRGF) ... learn more on Monday, December 10, 2018 around 5 pm.

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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Northland Power Inc

Sound bite for Twitter and StockTwits is: Dividend Growth Utility. Price is probably cheap to reasonable. Debt Ratios are not what I like in a company. When debt ratios are not where they should be this will make a company vulnerable in bad times. See my spreadsheet on Northland Power Inc.

I do not own this stock of Northland Power Inc (TSX-NPI, OTC-NPIFF). This company is into generating electric power. I have a lot invested in pipelines and I would like to have more invested in electric power as part of my utility’s investments. I read a report on this stock that said it was a good defensive stock to buy. That is, it is a good stock to hold in a stock market correction. I can certainly see the logic of using utility stocks as defensive stocks.

When I was updating my spreadsheet, I noticed that debt ratios were bad. The Liquidity Ratio for 2017 was just 1.14 and the Debt Ratio for 2017 was 1.17. I like to see these at 1.50 or higher. The Leverage and Debt/Equity Ratios are also high at 7.05 and 6.05 respectively for 2017.

The Long Term Debt/Market Cap Ratio is very high at 1.53 for 2017 and at 1.63 for the third quarter of 2018. This means that the long term debt is higher than the market cap. This is not a good situation. Some analysts think that this ratio should be below 0.50 and other think at 1.00 is not so bad, but everyone thinks anything above 1.00 is bad.

The dividend yield is good. The current dividend yield is 5.37% with 5, 10 and historical yields at 6.37%, 6.45% and 7.73%. Dividends were decreased slightly in 2008 and then have been flat until this year. In 2018 they increased the dividends by 11%. Analysts think that they will also increase them in 2019 and 2020, but at a lower rate.

Until 2018 they could not afford their dividends. In 2017 the Dividend Payout Ratio was 127% for EPS with 5 year coverage at 331%. This is the lowest it has ever been. The DPR for CFPS for 2017 was better at 20% with 5 year coverage at 33%. Analysts the DPR for EPS to be around 765 in 2018.

The Long Term Debt/Market Cap Ratio is too high at 1.53 in 2017 and currently at 1.63. The Liquidity Ratio for 2017 is too low at 1.14, but if you add in cash flow after dividends it is 1.88. The current Liquidity Ratio is even lower at 1.11 with ratio after cash flow excluding dividend is 1.77. This means that the company depends on cash for to help cover the current liabilities sufficiently. The Debt Ratio is also lower than what I like at 1.17. I prefer this and the Liquidity Ratio to be 1.50 or higher. The Leverage and Debt/Equity Ratios are too high at 7.05 and 6.05 respectively.

The Total Return per year is shown below for years of 5 to 20. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See charts below.

There has not been much in dividend growth, but dividend yield has been good and shareholders have had good total returns over the years.

Years	Div. Gth	Tot Ret	Cap Gain	Div.
5	0.00%	9.90%	4.58%	5.32%
10	-0.16%	13.61%	6.67%	6.94%
15	0.65%	12.73%	5.15%	7.58%
20	2.98%	12.01%	4.33%	7.68%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 13.69, 16.42 and 19.15. The corresponding 10 year ratios are 11.55, 13.85 and 16.15. The corresponding historical ratios are 13.41, 15.83 and 18.26. The current P/E Ratio is 14.25 based on a stock price of $22.34 and 2018 EPS estimate of $1.57. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a Graham Price of $12.52. The 10 year low, median, and high median Price/Graham Price Ratios are 2.13, 2.50 and 2.69. The current P/GP Ratios is 1.78 based on a stock price of $22.34. This stock price testing suggests that the stock price is relatively cheap.

I get a 10 year median Price/Book Value per Share Ratio of 3.80. The current P/B Ratio is 5.03 based on Book Value of $787M, Book Value per Share of $4.44 and a stock price of $22.34. The current P/B Ratio is some 33% higher than the 10 year median. This stock price testing suggests that the stock price is expensive.

I get a median dividend yield of 6.39% since 2009 when the company changed from an income trust to a corporation. The current dividend yield is 5.37% based on dividends of $1.20 and a stock price of $22.34. The current yield is some 15.9% above the median yield since 2009. This stock price testing suggests that the stock price is relatively reasonable but above the median.

The 10 year median Price/Sales (Revenue) Ratio is 4.00. The current P/S Ratio is 2.54 based on 2018 Revenue estimate of $1,560M, Revenue per Share of $8.80 and a stock price of $22.34. The current ratio is some 37% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

The testing gives very different results because some of the value are high like the P/B Ratio where the10 year median is at 3.80 and current one is at 5.03. The Price/Graham Price Ratios are also very high over the past 10 years. This is because of the number of year of earnings losses. There were 4 in the last 7 years. The dividend yields are also very high because this company used to be an income trust.

The P/S Ratio is a good test and it is showing the stock as cheap. The company has had positive earnings the last two years and analysts think this will continue. The P/E Ratio is a reasonable one at 14.25 and the testing is showing this. Price is probably cheap to reasonable.

When I look at analysts’ recommendations, I find Strong Buy (1), Strong Buy (8), Hold (1) and Underperform (1) recommendations. The consensus would be a Buy. The 12 month stock price is $25.98. This implies a total return of $21.67% with 16.29% from capital gain and 5.37% from dividends.

Ricardo Crouch on Simply Wall Street talks about the ownership of this company. Caroline Biscotti on Hawthorn Caller says the company’s Piotroski Score of 5 on a sale from 0 to 9. A Lakeland Staff Writer on Lakeland Observer says that the Value Composite One (VC1) says that the stock is neither over or undervalued. Brad Macintosh on Motley Fool recommends this stock. See what analysts are saying on Stock Chase. Analysts seem to like this stock.

Northland Power Inc develops, builds, owns, and operates facilities that produce ‘clean’ (natural gas) and ‘green’ (wind, solar, and hydro) energy, providing sustainable long-term value to shareholders, stakeholders, and host communities. Its web site is here Northland Power Inc.

The last stock I wrote about was about was Chesswood Group Ltd. (TSX-CHW, OTC-CHWWF) ... learn more. The next stock I will write about will be DHX Media Ltd (TSX-DHX, OTC-DHXMF) ... learn more on December 7, 2018 around 5 pm. Tomorrow on my other blog I will write about Buy December 2018.... learn more on Thursday, December 6, 2018 around 5 pm.

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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Chesswood Group Ltd

Sound bite for Twitter and StockTwits is: Dividend Growth Financial. This is an interesting but risky stock. Great dividend yield that they can afford. See my spreadsheet on Chesswood Group Ltd.

I do not own this stock of Chesswood Group Ltd (TSX-CHW, OTC-CHWWF). A reader wrote me in 2012 that he was researching and found a company that he hoped I could give him a brief outlook on. He said that the company is Chesswood Group and they are basically a financial leasing company. From 2009 to 2012 they increased their dividends from 2.5 cents to 5.5 cents per month. This is a 120% increase.

When I was updating my spreadsheet, I noticed Revenue has not been growing well, but analysts expect better in the future. Reason for lack of growth has to do with dropping a line a business a few years ago. There is a big difference in cash flow and cash flow less working capital.

This company used to be an income trust. It changed to a corporation in 2009, but started to cut the dividends in 2008 by around 69%. Since then they have increased them some year but left them level for other years. At the end of 2016 the dividends were increase by 7.7% and then they have been flat in 2017 and 2018. There are few analysts following this stock and they make no comments on dividends.

The dividend yields are still quite high on this stock with the current yield at 7.94% and the yield since 2009 at 7.52%. Dividends reached a high of 56% in 2008 because the stock price crashed. Most old income trusts yields have come down and a lot are in the 4% to 5% range, but it depends on the business the companies were in.

The Dividend Payout Ratio for EPS has been coming down since 2012. The current one for 2017 is 61% with 5 year coverage of 69%. When I look at the DPR for CFPS (less WC), the DPR for 2017 is 16% with 5 year coverage of 22%. So as far as being able to pay their dividends I believe the answer is yes.

Since this is a financial company the Long Term Debt/Market Cap is not what you want to look at. You want to look at assets that cover long term debt. For this stock it is Finance Receivables to Long Term Debt and the ratio is 0.75 in 2017 rising to 0.81 in the third quarter of 2018. You might also like to look at the Cash Flow to Long Term Debt Ratio which basically tells you how long the company would need to pay off the debt if they used all their cash flow from operations. For this company in 2017, it is 4.86 and for the third quarter of 2018 it is 6.63.

The Liquidity Ratio on this company is low with the ratio for 2017 at 1.42 and the ratio for the third quarter of 2018 at 0.83. However, if you added in cash flow after dividends the ratios are 6.19 and 5.47, respectively. The Debt Ratio is also low for 2017 at 1.33 and for the third quarter of 2018 at 1.27. The Debt Ratios for financials tend to be much lower than other types of companies.

The Total Return per year is shown below for years of 5 to 11. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See charts below.

Shareholders have had some good returns in the past, but a lot was from dividends. This company used to be an income trust with very high dividend rates. As with all past income trust companies, the dividend portion of total return will be lower in the future.

Years	Div. Gth	Tot Ret	Cap Gain	Div.
5	5.76%	13.74%	4.99%	8.76%
10	-2.77%	22.69%	11.84%	10.85%
11	0.00%	12.37%	4.20%	8.17%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 8.25, 9.40 and 11.29. The corresponding 10 year ratios are 7.74, 9.38 and 11.60. The corresponding historical ones are 7.74, 99.38 and 11.60. The current 8.53 based on a stock price of $10.58 with 2018 EPS estimate of $1.24. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a Graham Price of $15.86. The 10 year low, median, and high median Price/Graham Price Ratios are 0.61, 0.75 and 0.87. The current P/GP Ratio is 0.67 based on a stock price of $10.58. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10 year median Price/Book Value per Share Ratio of 1.32. The current P/B Ratio is 1.17 based on a stock price of $10.58, Book Value of $148.22 and Book Value per Share of $9.02. The current ratio is 11% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get an historical median dividend yield of dividend yield since 2009 of 7.52%. The current dividend yield is 7.94% based on dividends of $0.84 and a stock price of $10.58. The current yield is some 5.58% above the median yield since 2009. This stock price testing suggests that the stock price is relatively reasonable and below the median.

The 10 year median Price/Sales (Revenue) Ratio is 1.17. the current P/S Ratio is 1.57 based on 2018 Revenue estimate of $111M, revenue per Share of $6.75 and a stock price of $10.58. The current ratio is some 34% above the 10 year. This stock price testing suggests that the stock price is relatively expensive.

The P/S Ratio is an important one and it is showing the stock as expensive. However, they did change their business in 2015 to be exclusively in financial. That year there was a 30% drop in revenue. However, revenue has been climbing since. All the other testing is showing this company’s price as reasonable and below the median and that is probably where it is.

When I look at analysts’ recommendations, I find Strong Buy (1) and Buy (1). The consensus would be a Buy. The 12 month stock price is $15.00. this implies a total return of 49.72% with 41.78% from capital gains and 7.94% from dividends.

Yahoo Finance quotes from a Simply Wall Street article. Well the charts are right but dividend increases have been limited. The company discusses its third quarterly results on News Wire. Gemma Cottrell on Fairfield Current talks about a recent analyst upgrade. See what analysts are saying on Stock Chase. Few analysts are following this stock and the most recent entry is rather negative.

Chesswood Group Ltd is a financial services company, which operates specialty finance industry. The company operates through two segments: U.S. Equipment Financing and Canada Equipment Financing. Its web site is here Chesswood Group Ltd.

The last stock I wrote about was about was about Quarterhill Inc. (TSX-QTRH, NASDAQ-QTRH) ... learn more. The next stock I will write about will be Northland Power Inc. (TSX-NPI, OTC-NPIFF) ... learn more on Wednesday, December 5, 2018 around 5 pm. Tomorrow on my other blog I will write about Dividend Stocks December 2018.... learn more on Tuesday, December 4, 2018 around 5 pm.

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. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

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