Chartwell Retirement Residences

Sound bite for Twitter and StockTwits is: Dividend Growth Health Care. Stock price is probably cheap. Debt Ratios are awful, especially the Liquidity Ratio. The Dividend Payout Ratios (DPR) are too high, but some are expected to be better in 2023 or 2024. The dividend yields are high with dividend growth low. See my spreadsheet on Chartwell Retirement Residences.

Is it a good company at a reasonable price? This is not my sort of stock. I would pick a lower yield for higher increases. I do not like the Liquidity Ratio at all. Very low Liquidity Ratios can cause companies to go bankrupt in recessionary times. The Liquidity Ratio does not even get to 1.00. Shareholders have not done very well in the past. I like a stock to have a total return of a average of 8% per year. I do not think the rewards for this stock are worth the risks. The stock price is reasonable and is testing as cheap.

I do not own this stock of Chartwell Retirement Residences (TSX-CSH.UN, OTC-CWSRF). I saw this stock on a dividend investing blog and looked it up on Stock Chase.

When I was updating my spreadsheet, I noticed this stock is classified as a Health Care, Consumer stock, but it is more a real estate company. That is why they talk about Adjusted Funds from Operations (AFFO) and Funds from Operations (FFO)

If you had invested in this company in December 2011, for $1,006.50 you would have bought 122 shares at $8.25 per share. In December 2021, after 10 years you would have received $695.70 in dividends. The stock would be worth $1,422.04. Your total return would have been $2,137.74.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$8.25	$1,006.50	122	10	$695.70	$1,442.04	$2,137.74

The dividend yields are high with dividend growth low. The current dividend yield is high (7% and above) at 7.48%. The 5, and 10 year dividend median yields are moderate (2% to 4% ranges) at 4.04%, and 4.80%. The historical median dividend yield is good (5% to 6% ranges) at 5.74%. The dividend increases are low with the dividend increasing at a rate of 1.8% per year over the past 5 years. The last dividend increase was in 2020 and it was for 2%.

The Dividend Payout Ratios (DPR) are too high, but some are expected to be better in 2023 or 2024. The DPR for EPS for 2021 is 1397% with 5 year coverage at 1108%. This is not expected to improve over the next while as analysts expect earning loses in 2022 and 2023. The DPR for AFFO for 2021 is 104% with 5 year coverage at 72%. DPR for AFFO is expected to go below 100% in 2023. The DPR for FFO for 2021 is 115% with 5 year coverage at 79%. This DPR is expected to go below 100% in 2024. The DPR for Free Cash Flow (FCF) for 2021 is 323% with 5 year coverage at 392%. This is not expected to go below 100% anytime soon.

Debt Ratios are awful, especially the Liquidity Ratio. The Long Term Debt/Market Cap for 2021 is 0.74. That is a good one. The Liquidity Ratio for 2021 is awful at 0.29. It has a history of being awful. Even if you add in cash flow after dividends it is 0.48. This means that current assets cannot cover current liabilities. This is an important ratio as in hard times it can help bankruptcy you. The Debt Ratio for 2021 is low at 1.32. I prefer both these ratios to be at 1.50 or higher. Leverage and Debt/Equity Ratios for 2021 are too high at 4.14 and 3.14. I prefer these to be under 3.00 and under 2.00.

The Total Return per year is shown below for years of 5 to 18 to the end of 2021. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2016	5	1.83%	0.21%	-4.20%	4.42%
2011	10	1.26%	9.60%	3.66%	5.94%
2006	15	-3.63%	4.07%	-0.90%	4.97%
2003	18	-3.25%	5.98%	-0.20%	6.18%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 230.43, 245.40 and 260.37. The corresponding 10 year ratios are 154.80, 172.18 and 200.59. These are very high because of very low EPS over the past while. The corresponding historical ratios are all negative and therefore not useable. The current P/E Ratio is negative and not useable. The next time a positive EPS is expected is 2014 and that P/E Ratio is 116.86. It is high because of a low EPS. It is lower than the low of the 10 year median ratios.

I have Funds from Operations (FFO) data. The 5-year low, median, and high median Price/FFO Ratios are 15.03, 16.48 and 18.21. The corresponding 10 year ratios are 13.21, 15.10 and 17.30. The current P/FFO ratio 14.61 based on a stock price of $18.18 and FFO estimate for 2022 of $0.56. This ratio is between the low and median ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I have Adjusted Funds from Operations (AFFO) data. The 5-year low, median, and high median Price/AFFO Ratios are 16.08, 17.55 and 19.28. The corresponding 10 year ratios are 14.20, 16.23 and 18.59. The current P/FFO ratio 16.69 based on a stock price of $18.18 and AFFO estimate for 2023 of $0.49. This ratio is between the median and high ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a Graham Price of $6.36. The 10-year low, median, and high median Price/Graham Price Ratios are 1.34, 1.51 and 1.72. The current P/GP Ratio is 1.29 based on a stock price of $18.18. The current ratio is below the low ratio of the 10 year median ratio. 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 3.30. The current P/B Ratio is 2.55 based on a stock price of $18.18, Book Value of $749M and Book Value per Share of $3.21. The current ratio is 23% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I get a 10-year median Price/Cash Flow per Share Ratio of 15.72. The current P/CF Ratio is 16.56 based on the Cash Flow of the last 12 months of $147M, Cash Flow per Share of $0.63 and a stock price of $18.18. the current ratio is 17% 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 5.74%. The current dividend yield is 7.48% based on a stock price of $18.18 and dividends of $0.612. The current dividend yield is 30% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

I get an historical median dividend yield of 4.80%. The current dividend yield is 7.48% based on a stock price of $18.18 and dividends of $0.612. The current dividend yield is 55% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

The 10-year median Price/Sales (Revenue) Ratio is 3.09. The current P/S Ratio is 1.87 based on Revenue estimate for 2022 of $1,023M, Revenue per Share of $4.38 and a stock price of $18.18. The current ratio is 39% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

Results of stock price testing is that the stock price is probably cheap. Both the dividend yield tests say this and it is confirmed by the P/S Ratio test. The rest of the testings says that the stock price is either reasonable or cheap.

When I look at analysts’ recommendations, I find Strong Buy (2), Buy (3) and Hold (1). The consensus would be a Buy. The 12 month stock price is $11.33. This implies a total return of $45.99%, with 38.51% from capital gains and 7.48% from dividends.

Most analysts on Stock Chase do not like this stock. Stock Chase gives this stock 5 stars out 5. It is not on the Money Sense list. Kay Ng on Motley Fool reviews this stock and Sienna. Thinks that there could be good future return for high risk investors. Ambrose O'Callaghan on Motley Fool thinks this is a good stock for passive income. The company put out a press release via newswire on their 2021 results. The company put out a press release via newswire on their third quarter of 2022.

Simply Wall Street reviews this stock via Yahoo Finance. Simply Wall Street gives this stock 3 stars out of 5. It lists 3 risks of interest payments are not well covered by earnings; dividend of 7.63% is not well covered by earnings or cash flows; and large one-off items impacting financial results.

Chartwell Retirement Residences is an unincorporated open-ended trust. The company is engaged in the ownership, operation, and management of retirement and long-term care communities in Canada. It operates its retirement and long-term care facilities separately. Its web site is here Chartwell Retirement Residences.

The last stock I wrote about was about was Richards Packaging Income Fund (TSX-RPI.UN, OTC-RPKIF) ... learn more. The next stock I will write about will be Sienna Senior Living Inc (TSX-SIA, OTC-LWSCF) ... learn more on Friday, December 16, 2022 around 5 pm. Tomorrow on my other blog I will write about Canadian Pipeline Companies .... learn more on Thursday, December 15, 2022 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.

Richards Packaging Income Fund

Sound bite for Twitter and StockTwits is: Dividend Paying Consumer. Debt Ratios are essentially fine, but the low Liquidity Ratio is not good. The Dividend Payout Ratios (DPR) seem fine. The dividend yields are moderate with dividend growth low and inconsistent. It might be considered as a dividend growth, but dividends are inconsistent. See my spreadsheet on Richards Packaging Income Fund.

Is it a good company at a reasonable price? The price is showing as expensive with the P/S Ratio test. However, others say it is cheap or reasonable. So maybe it could be considered reasonable but at the higher end of the range? It has delivered good returns to its shareholders, but going forward, dividend yields will be lower.

I do not own this stock of Richards Packaging Income Fund (TSX-RPI.UN, OTC-RPKIF). A member of one of my investment clubs suggested this stock.

When I was updating my spreadsheet, I noticed they had an earnings loss because the purchase of Clarion acquisition was subject to a contingent consideration.

If you had invested in this company in December 2011, for $1,005.00 you would have bought 134 shares at $7.50 per share. In December 2021, after 10 years you would have received $1,475.81 in dividends. The stock would be worth $8,275.84. Your total return would have been $9,751.65.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$7.50	$1,005.00	134	10	$1,475.81	$8,275.84	$9,751.65

The dividend yields are moderate with dividend growth low and inconsistent. The current dividend yield is moderate (2% to 4% ranges) at 2.86%. The 5 year and 10 year median dividend yields are also moderate at 3.24% and 4.94%. The historical median dividend yield is good (5% and 6% ranges) at 6.89%. The dividend growth is low (under 8% per year) at 3.68% per year over the past 5 years. Dividend increases are inconsistent. The last increase was in 2017 and it was for 18.28%. This stock used to be an income trust and as such, the original dividend yields were quite high.

The Dividend Payout Ratios (DPR) seem fine. The DPR for EPS for 2021 is non-calculable because of an earnings loss. The 5 year coverage at 67%. DPR for EPS is expected to be 61% in 2022. I have Adjusted Earnings per Share (AEPS) and its DPR for 2021 is 41% with 5 year coverage at 57%. The DPR for Cash Flow per Share (CFPS) for 2021 is 19% with 5 year coverage at 23.50%. The DPR for Free Cash Flow (FCF) for 2021 is 28% with 5 year coverage at 35%.

Debt Ratios are essentially fine, but the low Liquidity Ratio is not good. The Long Term Debt/Market Cap Ratio is low and good at 0.03. The Liquidity Ratio is low at 1.06. Even adding in Cash Flow after dividends, it is low at 1.29. I prefer this to be at 1.50 or high. It is an important ratio. The Debt Ratio is good at 1.58. The Leverage and Debt/Equity Ratios are fine at 2.73 and 1.73.

The Total Return per year is shown below for years of 5 to 17 to the end of 2021. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2016	5	3.68%	23.88%	20.03%	3.85%
2011	10	5.32%	29.81%	23.47%	6.34%
2006	15	1.09%	19.79%	14.23%	5.57%
2004	17	4.16%	15.67%	10.74%	4.93%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 14.10, 16.24 and 18.99. The corresponding 10 year ratios are 13.98, 16.47 and 19.38. The corresponding historical ratios are 13.20, 15.53 and 18.19. The current P/E Ratio is 13.94 based on a stock price of $46.15 and EPS estimate for 2022 of $3.31. The current ratio is below the low of the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I got Adjusted Earnings per Share data. The 5-year low, median, and high median Price/Earnings per Share Ratios are 15.46, 17.92 and 20.37. The corresponding 10 year ratios are 14.78, 17.31 and 20.07. The current P/AEPS Ratio is 13.94 based on a Stock Price of $46.15 and AEPS estimate for 2022 of $3.31. The current ratio is below the low of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $32.04. The 10-year low, median, and high median Price/Graham Price Ratios are 1.24, 1.59 and 1.89. The current P/GP Ratio is 1.44 based on a stock price of $46.15. The current ratio is between the low and median ratios of the 10 year median ratios. 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 3.09. The current P/B Ratio is 3.35 based on a stock price of $46.15, Book Value of $157.4M, and Book Value per Share of $13.79. The current ratio is 8% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a 10-year median Price/Cash Flow per Share Ratio of 9.92. The current P/CF Ratio is 11.06 based on a stock price of $46.15, last 12 months Cash Flow of $47.6M and Cash Flow per Share of $4.17. The current ratio is 12% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get an historical median dividend yield of 6.89%. The current dividend yield is 2.86% based on a stock price of $46.15 and dividends of $1.32. The current dividend yield is 58% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive. A problem is that this company used to be an income trust and income trust can pay higher dividends than corporations.

I get a 10 year median dividend yield of 4.94%. The current dividend yield is 2.86% based on a stock price of $46.15 and dividends of $1.32. The current dividend yield is 42% below the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively expensive. A problem is that this company used to be an income trust and income trust can pay higher dividends than corporations.

The 10-year median Price/Sales (Revenue) Ratio is 0.98. The current P/S Ratio is 1.18 based on Revenue estimate for 2022 of $448M, Revenue per Share of $39.24 and a stock price of $46.15. The current ratio is 20.3% above 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

Results of stock price testing is that the stock price is probably on the expensive side. The P/S Ratio test is showing this result. The dividend yield tests are saying expensive, but they are not very good tests because the company used to be an income trust. Also, most of the other tests say it is cheap or reasonable. So, perhaps the stock price could be considered reasonable.

When I look at analysts’ recommendations, I find Buy (2) recommendations. The consensus would be a Buy. The 12 month target price is $60.00. This implies a total return of 32.87% with 30.01% from capital gains and 2.86% from dividends based on a stock price of $46.15.

There is only one recommendation on Stock Chase for 2022 and it is a Buy. Stock Chase gives this stock 4 stars out of 5. Robin Brown on Motley Fool thinks this is a good stock to buy currently. Amy Legate-Wolfe on Motley Fool also likes this stock. The company put out a Press Release on Newswire about their 2021 results. The company put out a Press Release on Newswire about their third quarter of 2022.

Simply Wall Street via Yahoo Finance talk about insider buying at this company. Simply Wall Street has 3 warning signs for this company of has a high level of debt; large one-off items impacting financial results; and profit margins (4.1%) are lower than last year (9.2%).

Richards Packaging Income Fund is involved in packaging distribution businesses. The company principally distributes plastic and glass containers and associated closures. It is used in packaging for cosmetics, healthcare, food, beverage, and other products. Geographically, it derives most of the revenue from Canada. Its web site is here Richards Packaging Income Fund.

The last stock I wrote about was about was Magna International Inc (TSX-MG, NYSE-MGA) ... learn more. The next stock I will write about will be Chartwell Retirement Residences (TSX-CSH.UN, OTC-CWSRF) ... learn more on Wednesday, December 14, 2022 around 5 pm. Tomorrow on my other blog I will write about RIF and Year End .... learn more on Tuesday, December 13, 2022 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.

Magna International Inc

Sound bite for Twitter and StockTwits is: Dividend Growth Consumer. This stock is testing at the reasonable price level. Debt Ratios are fine. The Dividend Payout Ratios (DPR) are fine. The dividend yields are moderate with dividend growth moderate. See my spreadsheet on Magna International Inc .

Is it a good company at a reasonable price? The stock price is testing reasonable and it may even be cheap.

I do not own this stock of Magna International Inc (TSX-MG, NYSE-MGA). Magna is a stock I have tracked for some time. I have always liked Frank Stronach, the entrepreneur who used to run this company. Manufacturing firms are risky and it is not the sort of company I usually buy.

When I was updating my spreadsheet, I noticed that the EPS for 2021 increased basically in line with what happened. Analysts gave an EPS estimate of $4.54, an increase of 80% for 2021, and it came in at $5.00, and increase of 98%. However, last analyst thought that for EPS 2022 and 2023 would be $6.77 and $10.10 US$. However, the company has not done that well in the first 3 quarters of 2022 and EPS for 2022 and 2023 are now $4.03, and $6.21 US$.

If you had invested in this company in December 2011, for $1,003.00 CDN$ you would have bought 59 shares at $17.00 CDN$ per share. In December 2021, after 10 years you would have received $823.97 CDN$ in dividends. The stock would be worth $6,038.65 CDN$. Your total return would have been $6,862.62 CDN$.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$17.00	$1,003.00	59	10	$823.97	$6,038.65	$6,862.62

The dividend yields are moderate with dividend growth moderate. The current dividend yield is moderate (2% to 4% ranges) at 3.05%. The 5 and 10 year median dividend yields are also moderate at 2.47% and 2.28%. The historical median dividend yield is low (below 2%) at 1.90%. The dividend growth is moderate (8% to 14% ranges) at 11.5% per year over the past 5 years. The last dividend increase was in 2022 and it was for 4.7%.

The Dividend Payout Ratios (DPR) are fine. The DPR for EPS for 2021 is 34% with 5 year coverage at 28%. The DPR for Adjusted Earnings per Share (AEPS) for 2021 is 34% with 5 year coverage at 27%. The DPR for Cash Flow per Share for 2021 is 16% with 5 year coverage at 14%. The DPR for Free Cash Flow (FCF) for 2021 is 29% with 5 year coverage at 22%.

Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2021 is good and low at 0.15. The Liquidity Ratio for 2021 is low at 1.30, but if you had in cash flow after dividends, it is fine at 1.53. I prefer this to be at 1.50 or high. The Debt Ratio for 2021 is good at 1.73. Leverage and Debt/Equity Ratios for 2021 are fine at 2.46 and 1.42.

The Total Return per year is shown below for years of 5 to 33 to the end of 2021 in CDN$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2016	5	10.61%	14.41%	11.91%	2.50%
2011	10	16.04%	22.98%	19.66%	3.32%
2006	15	11.21%	12.11%	10.54%	1.57%
2001	20	7.21%	8.72%	7.36%	1.37%
1996	25	10.55%	8.51%	7.11%	1.40%
1991	30	13.41%	15.17%	12.27%	2.91%
1988	33	9.19%	13.88%	11.39%	2.49%

The Total Return per year is shown below for years of 5 to 33 to the end of 2021 in US$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2016	5	11.46%	15.83%	13.28%	2.56%
2011	10	13.15%	20.20%	17.13%	3.07%
2006	15	10.59%	11.48%	9.72%	1.76%
2001	20	8.44%	10.20%	8.49%	1.72%
1996	25	10.90%	9.54%	7.91%	1.63%
1991	30	13.06%	14.53%	11.85%	2.68%
1988	33	9.03%	13.59%	11.18%	2.42%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 7.97, 9.21 and 10.46. The corresponding 10 year ratios are 7.55, 9.37 and 10.69. The corresponding historical ratios are 8.13, 11.49 and 12.56. The current P/E Ratio is 14.62 based on a stock price of $79.36 and EPS estimate for 2022 of $5.43 ($4.03 US$). The current ratio is above the high of the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.

The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 6.64, 8.23 and 9.87. The corresponding 10 year ratios are 6.87, 9.20 and 11.16. The current P/AEPS ratio is 12.63 based on a stock price of $58.49 and AEPS estimate for 2022 of $4.63. This ratio is above the high ratio of the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$. You will get a similar result in CDN$.

I get a Graham Price of $77.50. The 10-year low, median, and high median Price/Graham Price Ratios are 0.64, 0.80 and 0.98. The current P/GP Ratio is 1.02 based on stock price of $79.36. The current ratio is above the high ratio of the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in CDN$.

I get a 10-year median Price/Book Value per Share Ratio of 1.57. The current ratio is 1.60 based on a Book Value of $10,441M, Book Value per Share of $36.52 and a stock price of $58.92. The current ratio is 2% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$ and you would have a similar result in CDN$.

I have an Book Value per Share estimate for 2022. That estimate is $39.50. The ratio would be 1.48 based on a stock price of $58.92 and Book Value of $11,293M. This ratio is below the 10 year median ratio of 1.57 by 5.5%. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$.

I get a 10-year median Price/Cash Flow per Share Ratio of 5.05. The current P/CF Ratio is 7.36 based on a Cash Flow per Share estimate for 2022 of $7.95, Cash Flow of $2,273M and a stock price of $58.92. The current ratio is 46% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$ and you will get a similar result in CDN$.

I get an historical median dividend yield of 1.98%. The current dividend yield is 3.08% based on dividends of $1.80 and a stock price of $58.92. The current dividend yield is 55% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$ and you would get a similar result in CDN$.

I get a 10 year median dividend yield of 2.33%. The current dividend yield is 3.08% based on dividends of $1.80 and a stock price of $58.92. The current dividend yield is 32% above the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$ and you would get a similar result in CDN$.

The 10-year median Price/Sales (Revenue) Ratio is 0.45. The current P/S Ratio is 0.44 based on Revenue estimate for 2022 of $37,767M, Revenue per Share of $132.10 and a stock price of $58.92. The current ratio is 0.7% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$ and you would get a similar result in CDN$.

Results of stock price testing is that the stock price is reasonable and it may even be cheap. The dividend yield tests say that the stock price is cheap. The P/S Ratio test say it is reasonable. Other tests vary from reasonable to expensive.

I look at the total return over several years. For P/S Ratio and P/E Ratio, the lower the ratio the cheaper the stock. For yield, the higher the yield, the cheaper the stock. In the chart below you can see that the current P/E Ratios for good returns are today sort of in the middle. For P/S Ratio, most are lower than today. Also, the beginning yields are mostly lower than today.

In the following chart the capital gains for the 10 years to December 31, 2021 is 22.98% per year. The beginning yield was at 2.90%, and the P/E Ratio and the P/S Ratio were at 7.96 and 0.27. Does this chart change my opinion of the stock price? No. Except for the 32 year Total Return, the current dividend yield is higher than any other period.

Years	Total Ret	Beg P/E	Beg P/S	Beg Yield
5	14.41%	8.41	0.46	2.26%
10	22.98%	7.96	0.27	2.90%
15	12.11%	16.69	0.36	1.90%
20	8.72%	10.24	0.50	2.14%
25	8.51%	24.62	1.37	0.95%
30	15.17%	22.03	0.22	1.54%
32	13.88%	16.97	0.27	4.04%
current		14.62	0.45	3.05%

When I look at analysts’ recommendations, I find Strong Buy (7), Buy (7), Hold (4) and Underperform (1). The consensus is a Buy. The 12 month stock price consensus is $108.66 ($80.68 US$). This implies a total return of $39.97% with 36.92% from capital gains and 3.05% from dividends based on a stock price of $79.36.

Most analyst on Stock Chase think this stock is a buy, but some do not. Stock Chase gives this stock 5 stars out of 5. Magna is on Money Sense list with a B rating. Chris MacDonald on Motley Fool reviews this stock. Joey Frenette on Motley Fool says dividend stocks make it worth your while to hold them in a recessionary year. The company put out a Press Release on their 2021 year results. The company put out a press release on Global Newswire about their third quarter of 2022.

Simply Wall Street on Yahoo Finance reviews this stock. It says the fair value is $158.07 CDN$. Simply Wall Street gives two risks of large one-off items impacting financial results and profit margins (2.6%) are lower than last year (4.7%). It is because of such things that large one-off items that we have AEPS.

Magna International automotive supplier's product groups include exteriors, interiors, seating, roof systems, body and chassis, powertrain, vision and electronic systems, closure systems, electric vehicle systems, tooling and engineering, and contracted vehicle assembly. Magna's revenue comes from North America and Europe. Its web site is here Magna International Inc .

The last stock I wrote about was about was Methanex Corp (TSX-MX, NASDAQ-MEOH) ... learn more. The next stock I will write about will be Richards Packaging Income Fund (TSX-RPI.UN, OTC-RPKIF) ... learn more on Monday, December 12, 2022 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.

Methanex Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Materials. Some Debt Ratios are problematic, but Liquidity Ratio, a very important ratio is good. The Dividend Payout Ratios (DPR) are fine. The dividend yields are low with dividend growth restarted. See my spreadsheet on Methanex Corp .

Is it a good company at a reasonable price? The stock price seems cheap. It is never a good sign when a company cuts their dividends. Although they have recently increased it, but still the dividends are 50% below where they were. It was taken off of Money Sense list of 100 Best Canadian Dividend Stocks. There is no real consensus by Analysts on this stock. It has not always produced at least an 8% return over a longer term. I would not be a stock that I would be currently interested in.

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 analyst expected a big jump in Revenue (63%) and they were right. Revenue jumped 66% between 2020 and 2021.

If you had invested in this company in December 2011, for $1,021.19 you would have bought 38 shares at $26.87 per share. In December 2021, after 10 years you would have received $446.26 in dividends. The stock would be worth $2,560.86.59. Your total return would have been $3,007.11.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$26.87	$1,021.19	38	10	$446.26	$2,560.86	$3,007.11

The dividend yields are low with dividend growth restarted. The current dividend yield is low (below 2%) at 1.83%. The 5, 10 and historical dividend yields are moderate (2% to 4% ranges) at 2.05%, 2.18% and 2.33%. Dividends hit a high in 2019 and then in 2020 they were cut 90%. They started to raise dividends again in 2021. The last dividend increase was in 2022 and it was for 20.7%. Dividends are still 50% lower in 2022 than they were in 2019.

The Dividend Payout Ratios (DPR) are fine. The DPR for EPS for 2021 is 4% with 5 year coverage at 30%. The DPR for 2022 is expected to be around 13% and rising to 22% in 2023. The DPR for Adjusted Earnings per Share (AEPS) for 2021 is 5% with 5 year coverage at 32%. The DPR for AEPS for 2022 is expected to be around 13%. The DPR for Cash Flow per Share (CFPS) is 2% with 5 year coverage at 9%. The DPR for Free Cash Flow (FCF) for 2021 is 14% with 5 year coverage at 21%.

Some Debt Ratios are problematic, but Liquidity Ratio, a very important ratio is good. The Long Term Debt/Market Cap Ratio for 2021 is 0.73. It is fine, if a bit high. The Liquidity Ratio for 2021 is good at 2.06. The Debt Ratio for 2021 is fine at 1.47. The Leverage and Debt/Equity Ratios are too high at 3.62 and 2.46. I prefer them to be below 3.00 and 2.00. A good thing is that they are lower than last year.

The Total Return per year is shown below for years of 5 to 26 to the end of 2021 in CDN$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2016	5	-22.53%	-1.00%	-3.20%	2.21%
2011	10	-4.83%	11.61%	7.93%	3.68%
2006	15	-2.08%	5.50%	3.05%	2.45%
2001	20	5.18%	13.03%	9.07%	3.97%
1996	25		7.85%	5.72%	2.13%
1995	26		8.55%	6.39%	2.16%

The Total Return per year is shown below for years of 5 to 26 to the end of 2021 in US$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2016	5	-21.64%	0.22%	-2.02%	2.24%
2011	10	-6.91%	8.95%	5.65%	3.30%
2006	15	-2.63%	4.99%	2.48%	2.50%
2001	20	6.40%	15.22%	10.33%	4.89%
1996	25		8.44%	6.10%	2.34%
1995	26		9.07%	6.71%	2.37%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 6.70, 8.96 and 11.23. The corresponding 10 year ratios are 7.69, 10.67 and 13.21. The corresponding historical ratios are 9.55, 10.01 and 15.19. The current P/E Ratio is 8.16 based on a stock price of $51.35 and EPS estimate for 2022 of $6.29 (4.61 US$). The current ratio is between the low and median ratios for the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in CDN$.

I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 6.70, 9.31 and 11.92. The corresponding 10 year ratios are 9.51, 12.40 and 15.51. The current P/AEPS Ratio is 8.00 based on AEPS estimate for 2022 of $4.71 and a stock price of $37.69. This ratio is between the low and median ratios for the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$. You will get a similar answer in CDN$.

I get a Graham Price of $76.96. The 10-year low, median, and high median Price/Graham Price Ratios are 0.89, 1.21 and 1.48. The current Ratio is 0.67 based on a stock price of $51.35. The current ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap. This testing is in CDN$.

I get a 10-year median Price/Book Value per Share Ratio of 2.53. The current P/B Ratio is 1.23 based on a stock price of $37.69, Book Value of $30.65 and a Book Value of $2,148M. The current ratio is 51% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$. You will get a similar answer in CDN$.

I also have an estimate for Book Value per Share for 2022. That Book Value per Share is $29.60 and gives a P/B Ratio of 1.27 based on a stock price of $37.69 and a Book Value of $2,074M. This ratio is 49% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$.

I get a 10-year median Price/Cash Flow per Share Ratio of 6.37. The current P/CF Ratio is 3.04 based on Cash Flow per Share estimate for 2022 of $12.40, Cash Flow $869M and a stock price of $37.69. The current ratio is 55% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$.

I get an historical median dividend yield of 2.33%. The current dividend yield is 1.86% based on dividends of $0.70 and a stock price of $37.69. The current yield is 20% below the historical median dividend yield. This stock price testing suggests that the stock price is expensive. This testing is in US$. The problem with this test is that this company used to be an income trust with very high yields and dividends have been cut recently.

I get an historical median dividend yield of 2.18%. The current dividend yield is 1.86% based on dividends of $0.70 and a stock price of $37.69. The current yield is 15% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$. The problem with this test is that dividends have been cut recently.

The 10-year median Price/Sales (Revenue) Ratio is 1.32. The current P/S Ratio is 0.62 based on Revenue estimate for 2022 of $4,247M, Revenue per Share of $60.61 and a stock price of $37.69. The current ratio is 53% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$ and you will get a similar result in CDN$.

Results of stock price testing is that the stock price is probably cheap. The P/S Ratio testing is showing this result. Most of the other tests are too, with a few says it is reasonable and below the median. The exceptions are the Dividend Yield Tests, but dividends have been cut and the company used to be an income trust.

When I look at analysts’ recommendations, I find Strong Buy (1), Buy (3), Hold (6), Underperform (1) and Sell (1). The consensus would be a Hold, but there is little consensus on this stock. The stock price consensus is $61.30 ($44.91 US$). This implies a total return of 21.25% with 19.37% from capital gains and 1.86% from dividends.

Some analysts on Stock Chase give a Sell recommendation. Stock Chase gives this stock 3 stars out of 5. Christopher Liew on Motley Fool talks about this stock in June 2022, although it has fallen since then. Christopher Liew on Motley Fool thinks this stock will rise from obscurity. The company put out a Press Release on their fourth quarter of 2021 results. The company put out a Press Release on their third quarter of 2022.

Simply Wall Street on Yahoo Finance talks about this stock. Simply Wall Street puts out 3 warnings on this stock of earnings are forecast to decline by an average of 34.9% per year for the next 3 years, has a high level of debt and unstable dividend track record.

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. Methanex distributes its products through a global supply chain that includes the operation of port terminals, tankers, barges, rail cars, trucks, and pipelines. China generates the most revenue of any geographical segment. 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 Friday, December 9, 2022 around 5 pm. Tomorrow on my other blog I will write about Something to Buy December 2022.... learn more on Thursday, December 08, 2022 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 currently seems on the expensive side. Debt Ratios are fine. The Dividend Payout Ratios (DPR) are fine. The dividend yields are low with dividend growth low, but close to moderate. See my spreadsheet on Stantec Inc.

Is it a good company at a reasonable price? I think that this is a good company. It certainly has done well for its shareholders over the long term. However, the price seems to be currently expensive.

I do not own this stock of Stantec Inc (TSX-STN, NYSE-STN). I bought this stock in April of 2008 to make some capital gains. It was a non-dividend paying stock at that point. I lot of people were recommending it as a great stock. The reason it was recommend is that it is in the infrastructure business. There are many that think this company will profit from government money promised for infrastructure building. I sold because I decided to go for Dividend Growth stocks almost wholly. This stock was not paying dividends at that time.

When I was updating my spreadsheet, I noticed from the chart below that Stock price has been growing strongly over the past 5 and 10 years.

Year	Item	Growth
5	Revenue Growth	17.36%
5	EPS Growth	47.54%
5	Net Income Growth	53.74%
5	Cash Flow Growth	38.96%
5	Dividend Growth	46.89%
5	Stock Price Growth	109.52%
10	Revenue Growth	163.76%
10	EPS Growth	1185.71%
10	Net Income Growth	1485.06%
10	Cash Flow Growth	246.46%
9	Dividend Growth	116.67%
10	Stock Price Growth	415.56%

If you had invested in this company in December 2011, for $1,006.31 you would have bought 73 shares at $13.79 per share. In December 2021, after 10 years you would have received $341.46 in dividends. The stock would be worth $5,188.11. Your total return would have been $5,529.57.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$13.79	$1,006.31	73	10	$341.46	$5,188.11	$5,529.57

The dividend yields are low with dividend growth low, but close to moderate. The current dividend yield is low (below 2%) at 1.08%. The 5, 10 and historical dividend yields are also low at 1.59%, 1.41% and 1.41%. The dividend growth is low (under 8%) at 7.99% per year over the past 5 years. The last increase was in the moderate range (8% to 14% ranges) at 9.09% and it was done in 2022.

The Dividend Payout Ratios (DPR) are fine. The DPR for EPS for 2021 is 36% with 5 year coverage at 45%. I also have DPRs for Adjusted Earnings per Share (AEPS). The DPR for AEPS for 2021 is 27% with 5 year coverage at 28%. The DPR for Cash Flow per Share (CFPS) for 2021 is 14% with 5 year coverage at 4%. The DPR for Free Cash Flow (FCF) for 2021 is probably 21% with 5 year coverage at 20% (as there is disagreement on what the FCF is).

Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2021 is 0.15 (although debt went up by 88% this year). This is low and good. The Liquidity Ratio for 2021 is fine at 1.41 and especially when you add in cash flow after dividends, it is good at 1.69. The Debt Ratio for 2021 is good at 1.62. The Leverage and Debt/Equity Ratios are fine at 2.61 and 1.61.

The Total Return per year is shown below for years of 5 to 27 to the end of 2021. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2016	5	7.99%	17.19%	15.94%	1.25%
2011	10	8.97%	19.44%	17.82%	1.62%
2006	15		13.12%	12.32%	0.79%
2001	20		17.47%	16.73%	0.74%
1996	25		20.34%	19.66%	0.68%
1994	27		14.33%	13.84%	0.48%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 22.79, 31.51, 40.23. The corresponding 10 year ratios are 19.09, 22.46 and 25.87. The corresponding historical ratios are 15.52, 16.56 and 22.88. The current P/E Ratio is 31.59 based on a stock price of $66.65 and EPS estimate for 2022 of $2.11. The current ratio is above the high ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive.

I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 16.18, 18.16 and 20.14. The corresponding 10 year ratios are 14.99, 17.91 and 20.53. The current P/AEPS Ratio is 22.14 based on a stock price of $66.65 and AEPS estimate for 2022 of $3.01. The current ratio is above the high ratios of 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $30.68. The 10-year low, median, and high median Price/Graham Price Ratios are 1.28, 1.49 and 1.79. The current ratio is 2.17 based on a stock price of $66.65. This ratio is above the high of the 10 year median ratios. 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 2.15. The current P/B Ratio is 3.36 based on a Book Value of $2,196M, Book Value per Share of $19.83 and a stock price of $66.65. The current ratio is 56% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

I get a 10-year median Price/Cash Flow per Share Ratio of 12.93. The current P/CF Ratio is 19.55 based on a Cash Flow per Share estimate for 2022 of $3.61, Cash Flow of $378M and a stock price of $66.65. The current P/CF Ratio is 51% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

I get an historical median dividend yield of 1.41%. The current dividend yield is 1.08% based on a stock price of $66.65 and dividends of $0.72. The current dividend yield is 23% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive.

I get a 9 median dividend yield also of 1.41%. The current dividend yield is 1.08% based on a stock price of $66.65 and dividends of $0.72. The current dividend yield is 23% above the 9 year median dividend yield. This stock price testing suggests that the stock price is relatively expensive. (Dividends have only been paid for 9 years.)

The 10-year median Price/Sales (Revenue) Ratio is 1.16. The current P/S Ratio is 1.66 based on a stock price of $66.65, Revenue estimate for 2022 of $4,434M, and Revenue per Share of $40.04. The current ratio is 43% above the 10 year median ratio.

Results of stock price testing is that the stock price is probably expensive. The dividend yield tests show this. It is confirmed by the P/S Ratio test. All the other tests were good tests and they all said that the stock price is expensive.

I look at the total return over several years. For P/S Ratio and P/E Ratio, the lower the ratio the cheaper the stock. For yield, the higher the yield, the cheaper the stock. In the chart below you can see that the beginning P/E Ratios for good returns are mostly lower than today. For the P/S Ratio the past ratios are lower than today.

In the following chart the capital gains for the 15 years to December 31, 2021 is 13.12% per year. The beginning yield P/E Ratio and the P/S Ratio were at 18.99 and 1.59. Does this chart change my opinion of the stock price? No.

Year	Total Ret	Gap. Gain	Start P/E	Start P/S	Yield
5	17.19%	15.94%	27.80	1.25	1.30%
10	19.44%	17.82%	98.46	0.91
15	13.12%	12.32%	18.99	1.59
20	17.47%	16.73%	14.47	0.73
25	20.34%	19.66%	8.77	0.48
	current		31.59	1.66	1.06%

When I look at analysts’ recommendations, I find Strong Buy (4), Buy (6) and Hold (1). The consensus would be a Strong Buy. The 12 month stock price consensus is $76.91. This implies a total return of 16.47% with 1.08% from dividends and 15.39% from capital gains.

Analysts like this stock on Stock Chase, but one analyst thinks it is overpriced. Ambrose O'Callaghan on Motley Fool in August thought this was a good stock to buy and hold for the next 3 years. Adam Othman on Motley Fool thinks this stock has exceptional fundamentals for long-term growth. The company put out a Press Release on their results for the year end of 2021. The company put out a Press Release on their third quarter of 2022 results.

This stock is reviewed by Simply Wall Street on Yahoo Finance. Simply Wall Street put out one warning sign for this stock of debt is not well covered by operating cash flow.

Stantec Inc is a sustainable engineering, architecture, and environmental consulting company. The company is geographically diversified in three regional operating units namely Canada, the United States and Global, offering similar services across all regions. Its web site is here Stantec Inc.

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 Methanex Corp (TSX-MX, NASDAQ-MEOH) ... learn more on Wednesday, December 7, 2022 around 5 pm. Tomorrow on my other blog I will write about Dividend Stocks December 2022 .... learn more on Tuesday, December 6, 2022 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.

Keg Royalties Income Fund

To replace my sale of Home Capital Group (TSX-HCG, OTC-HMCBF), I bought stock in Atrium Mortgage Investment Corp (TSX-AI, OTC-AMIVF), Emera Inc (TSX-EMA, OTC-EMRAF) and Hardwoods Distribution Inc (TSX-HDI, OTC-HDIUF).

Sound bite for Twitter and StockTwits is: Dividend Growth Consumer. The stock price is probably cheap. Debt Ratios are fine for the Income Fund. The dividend yields are high with dividend growth restarting and back to 2019. The Dividend Payout Ratios (DPR) are probably fine as they can basically pay out all that the Keg passes to them. See my spreadsheet on Keg Royalties Income Fund.

Is it a good company at a reasonable price? The stock price is probably cheap. It is not well followed and again this year, I could not find estimates. It is never a good sign when analysts and sites lose interest in a stock. Also, I can find out about this stock is the Keg Revenue (for the Royalty Pool), the stock price of this Keg Royalties Income Fund, and Recipe Unlimited Corp owns lost of this company (around 47%). Because there seems to be no information on how financially health the Keg Restaurant Ltd (KLR) is, I do not know what their ability to pay royalties are. Bye the way, I enjoy eating at the Keg.

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 dinning 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 that the Keg site does not work when it comes to downloading annual reports. They are shown on the site as PDFs, but the site cannot find them. I basically relied on the Press Releases. Generally, WSJ has financials on stocks, but not this one. It is not well followed and again this year, I could not find estimates. It is never a good sign when analysts and sites lose interest in a stock.

The company cut the dividends for the years of 2020 and 2021. In 2022, they increased the dividends back to what they were in 2019. I have a spreadsheet on this stock, but I am not confident that I can do a proper analysis on what financial information I find available. The only information I feel confident about is the stock price and the Dividend Distribution.

If you had invested in this company in December 2000, for $1,003.30 you would have bought 79 shares at $12.70 per share. In December 2021, after 10 years you would have received $777.53 in dividends. The stock would be worth $1,155.77. Your total return would have been $1,933.30.

Cost	Tot. Cost	Shares	Years	Dividends	Stock Val	Tot Ret
$12.70	$1,003.30	79	10	$777.53	$1,155.77	$1,933.30

The dividend yields are high with dividend growth restarting and back to 2019. The current dividend yield is high (7% and higher) at 7.17%. The 5 year, 10 year, and historical median dividend yields are good (5% to 6%) at 5.95%, 5.89% and 6.92%. Dividends were cut in 2019 by 43%. They increased them in 2021 and this year 2022, they are back to the 2019 level. Over the past 19 years, there has been 3 years of dividend declines and 11 years of dividend increase.

The Dividend Payout Ratios (DPR) are probably fine as they can basically pay out all that the Keg passes to them. The DPR for EPS 2021 cannot be calculated because an earnings loss. The 5 year coverage is 135%. The DPR for Distributable Cash for 2021 is 122%. The DPR for Cash Flow per Share (CFPS) for 2021 is 18% with 5 year coverage at 53%. The DPR for Free Cash Flow (FCF) for 2021 is 99% with 5 year coverage at 98%. Because the only income is Royalties, the company can pay out most of the Royalties in dividends.

Debt Ratios are fine for the Income Fund. The Long Term Debt/Market Cap for 2021 is 0.88. It is fine because this is a flow through entity. The Liquidity Ratio for 2021 is good at 1.75. The Debt Ratio is good at 1.68. The Leverage and Debt/Equity Ratios for 2021 are fine at 2.47 and 1.47. However, the Debt Ratios that really count are for the Keg Restaurant that produces the royalty payments and we do not know them.

The Total Return per year is shown below for years of 5 to 20 to the end of 2021. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.

From	Years	Div. Gth	Tot Ret	Cap Gain	Div.
2016	5	-7.60%	-1.80%	-7.06%	5.26%
2011	10	-3.12%	8.83%	1.42%	7.40%
2006	15	-2.95%	10.08%	1.44%	8.64%
2001	20	1.52%	11.08%	1.92%	9.16%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 13.13, 15.18 and 17.23. The corresponding 10 year ratios are 17.02, 18.98 and 24.05. The corresponding historical ratios are 10.98. 13.11 and 14.31. The current ratio is 37.99 based on a stock price of $15.84 and EPS for the last 12 months of $0.42. This ratio is above the high of the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $6.05. The 10-year low, median, and high median Price/Graham Price Ratios are 1.30, 1.49 and 1.69. The current P/GP Ratio is 2.62 based on the stock price of $15.84. The current ratio is above the high of the 10 year median ratios. 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 1.95. The current P/B Ratio is 1.73 based a stock price of $15.84, Book Value of $104M and Book Value per Share of $9.14. 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 a 10-year median Price/Cash Flow per Share Ratio of 9.24. The current P/CF Ratio is 7.01 based on a stock price of $15.84, Cash Flow for the last 12 months of $25.7M and Cash Flow per Share of $2.26. The current ratio is 1.5% 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 6.92%. The current dividend yield is 7.17% based on dividends of $1.135 and a stock price of $15.84. The current dividend yield is 3.6% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10 year median dividend yield of 5.89%. The current dividend yield is 7.17% based on dividends of $1.135 and a stock price of $15.84. The current dividend yield is 22% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

The 10-year median Price/Sales (Revenue) Ratio is 0.36. The current P/S Ratio is 0.28 based on a stock price of $15.84 and Gross Sales KRL (Royalty Pool) Revenue for the last 12 months of 646M, Revenue per Share of $56.91 and a stock price of 15.84. The current ratio is 23% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

Results of stock price testing is that the stock price is probably cheap. The 10 year dividend yield test says this and it is confirmed by the P/S Ratio test. These are valid tests. We do know what the Royalty Pool value is and we do know what the dividend it. The rest of the tests, future values are based on what the Keg Restaurant and we have no figures on this outside their Revenue.

When I look at analysts’ recommendations, I find on Yahoo Finance, 1 Buy recommendation from November. That is all I can find.

The last analyst comment in 2016 Stock Chase the analysts said it was not well followed and not very liquid. This really has not changes. Andrew Walker on Motley Fool says the Keg has survived every economic downturn over the past 50 years. Ambrose O'Callaghan on Motley Fool says the company has big passive income. The company put out a Press Release on Globe Newswire about their fourth quarter of 2021. The company put out a Press Release on Globe Newswire about their third quarter of 2022. Simply Wall Street on Yahoo Finance looks at this company. They put out 3 warning signs of earnings have declined by 29% per year over past 5 years; interest payments are not well covered by earnings; and dividend of 7.12% is not well covered

The 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 a higher-end casual dining experience. Two main products of this company are High-quality steak and Prime-Rib. Its web site is here Keg Royalties Income Fund.

The last stock I wrote about was about was Waterloo Brewing Ltd (TSX-WBR, OTC-BIBLF) ... learn more. The next stock I will write about will be Stantec Inc (TSX-STN, NYSE-STN) ... learn more on Friday, December 5, 2022 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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