First, if you are interested in a Margin Account with your broker, read this blog first. See Dividend Girl’s blog.
What I want to talk about today is all the companies in the Industrial sector that I follow. Since I follow some 28 Industrial sector stocks, I will talk about 14 of them today and the rest tomorrow. For all the stock I follow, I have shown the link to my blog entries.
The first blog entry should help you answer the questions of whether or not you might like to invest in the stock.
The 2nd blog entry deals with its stock price and you can compare the past median values to current ones to see if you would want to invest in it today. For example, you can compare current P/E Ratios from financial sites to the median P/E Ratios given in my blog. The G&M and Reuter can both give you current ratios. For Reuter, use TO after the stock symbol to find stock listings for Canadian companies. For Ag Growth International would be the symbol of “AFN.TO”.
For a dividend paying stock portfolio, you might want to buy Industrial stocks after you buy safer Utilities and financial stocks. See my site for information on setting up a portfolio. Also, Industrial stocks cover a wide field of endeavors. One definition is “in stock market vernacular, general, catch-all category including firms producing or distributing goods and services that are not classified as utility, consumer, or financial companies”.
Ag Growth International (TSX-AFN). This is a company that I recently bought after tracking it for a while. It changed from a unit trust company to a corporation in 2009. Dividend yield is good, and after the change, dividends have increased. DPRs are high, but I expect that to change. Growth has generally been good with dividend growth around 8% per year over the past 5 years. For my blog entries dated September 2011, click here or here.
Ballard Power Systems Inc. (TSX-BLD, NASDAQ-BLDP). This is a stock I used to own, but no longer do. It is not a dividend paying company. I liked its green story at one point, but it is not making money. For my blog entries dated October 2011, click here.
Bombardier Inc. (TSX-BBD.B). I have had this company since 1987. I have made a return on this company of 13% per year. The main reason for this is that I had it before the tech bubble of 2000. They stopped dividends for a while, but it is back paying them since 2009. Dividends are low at only 1.5% yield. DPRs are correspondingly low. Dividends had increased in the past, but have not increased since they were reinstated. DPRs are low, but increasing. They will have to start to earn more money for dividends to be increased. For my blog entries dated June 2011, click here or here.
Canadian Helicopters Group (TSX-CHL.A). I have just started tracking this company as it looked like an interesting investment. It used to be an income trust, but converted to a corporation at the end of 2010. Dividends are good at 4.7%, but they have been level since 2008. DPRs are reasonable. For my blog entries dated March 2011, click here or here.
Canadian National Railway (TSX-CNR). I own this stock. I bought it 2005, 2009 and 2011 and I have made a return of 16% per year. Dividends are low at 1.7% and DPRs are correspondently low Dividend growth rate over the past 5 years is around 16% per year. For my blog entries dated March 2011, click here or here.
Canadian Pacific Railway Ltd (TSX-CP). I used to own this stock, but sold it to consolidate my railway stock into one company, CNR. Dividends are low at 1.2% and DPRs are correspondently low. The 5 year Dividend growth rate is 12% per year. For my blog entries dated March 2011, click here or here or here.
Canam Group Inc. (TSX-CAM). I bought some of this stock because I thought it was oversold, but I do not expect to keep it for the long term. Dividends were decent, around 2%, before they were suspended this year. They are having a bad year in 2011. Although it is hard on investors who count on dividends for income, the company is being prudent. For my blog entries dated November 2011, click here or here.
CCL Industries Inc. (TSX-CCL.B). I do not own this stock, but I have been following it for a while. Dividends are on the low side at a 5 year median of 1.9%. DPRs are low. Increases are good with a 5 year growth just under 10% per year. For my blog entries dated November 2011, click here or here.
Finning International Inc. (TSX-FTT). I do not own this stock, but I have been following it for a while. Dividends are on the low side at a 5 year median of 1.9%. DPRs are low. They did not make a profit in 2010, but they have a 5 year dividend growth of 16% per year. For my blog entries dated November 2011, click here or here.
Genivar Inc. (TSX-GNV). I have bought this stock recently and have lost money on it, but I expect better in the long term. Dividends are on quite good with 5 year median of 5.1% and 5 year median of DPRs high, but manageable. They were an income trust which converted at the beginning of this year. They have not raised their dividends since 2009. For my blog entries dated November 2011, click here or here.
Gennum Corp (TSX-GND). I used to own this stock but sold it because I thought it was going nowhere. Dividends have not increased since 2006. 5 year median dividend yield is 1.7% and DPRs are low. For my blog entries dated November 2011, click here or here.
IBI Group (TSX-IBG). I have recently started to track this stock. It was until recently a partnership, but changed to a corporation recently. 5 year median dividend yield is 10.3%, but current one is lower at 7.7%. The company lowered its dividend by 40% on changed to a corporation. DPRs are getting better and seem to be in an acceptable range for 2012. For my blog entries dated June 2011, click here or here
Magna International Inc. (TSX-MG, NYSE- MGA). I have tracked this stock for a while. Both the dividend yield and the DPRs are very low. The 5 year median dividend yield is just 1.25%. Dividends are inconsistent and have been going down. For my blog entries dated November 2011, click here or here
McCoy Corp (TSX-MCB). This is a small cap I now own and I have tracked it for some time. Dividend yield is low with a 5 year median dividend yield of just 2%. Dividends are inconsistent and DPRs are good. For my blog entry dated May 2011, click here.
Tomorrow, I will talk about the other 14 industrial stock I follow.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Wednesday, November 30, 2011
Tuesday, November 29, 2011
Stella-Jones Inc 2
I want to finish talking about the stock Stella Jones Inc. (TSX-SJ) today. This is my last Industrial sector stock to talk about and tomorrow, I will summarize what Industrial stocks I do track. As to Stella-Jones, I do not own this stock (TSX-SJ), but maybe I should. Really, what is not to like about this stock? It has great growth, very good debt ratios, good ROE.
Over the past year, CEO, CFO, Officers and directors have done insider selling to the tune of $2.9M. There has been no insider buying. However, this selling is only worth just under ½ of 1% of the value of this company. Some 13 institutions own 16% of the shares of this company. Over the past 3 months there has been some buying and selling, with these institutions lowering their outstanding shares by less than 1%. Also, you should note that the company of Stella Jones International S.A. owns just over 51% of the shares of this company.
The 5 year low median Price/Earnings Ratio is 7.78 and the 5 year median high is 14.73. The current P/E Ratio of 11.83 is just below the 5 year median P/E Ratio of 12.00. This test shows that the stock price is a reasonable price.
The Graham Price is $39.13, so the current stock price of 39.52 is just 1% higher. The median difference between the Graham Price and the stock price is the stock price being 14% lower. The high difference between the Graham Price and the stock price is the stock price being 14% higher. So the current stock price is between the median and a relatively high stock price.
I get a 10 year median Price/Book Value Ratio of 1.55. The current P/B Ratio is higher by 25% at 1.94. This would point to relatively high stock price. The P/B Ratio tends to fluctuate a lot. The 5 year median P/B Ratio at 1.88 is closer to the current one, but it is still lower by around 3%.
The last test is with the dividend yield. The current dividend yield is 1.32% and the 5 year median dividend yield is 5% lower at 1.26%. This would suggest a current reasonable stock price. For all the tests, the stock price seems reasonable, expect for the P/B Ratio, where the stock price seems a bit high.
The analysts’ recommendations are Strong Buy, Buy and Hold. The consensus recommendation would be a Buy. The Buy recommendation comes with a 12 month stock price of 46.07, a price about 17% higher than today’s price. Also, note that Stella-Jones beat the last two quarterly EPS estimates. One analyst report dated 16 November 2011 says that Stella-Jones “remains a buy for long-term gains and rising dividends”.
There is a recent Globe and Mail article on Stella Jones called Stella-Jones forecasting growth despite uncertainty. There is also an article in Forest Talk on Stella Jones.
To me, this company looks like a good one. The price is probably reasonable. Based on today’s dividend yield, if purchased at $39.52 you could be earning just over 4% in 5 years’ time and 14% in 10 years’ time if dividends continue to increase by 30% a year less 3% assumed inflation.
Stella-Jones Inc. is a leading North American producer and marketer of industrial pressure treated wood products, specializing in the production of railway ties and timbers as well as wood poles supplied to electrical utilities and telecommunications companies. The Company also provides treated consumer lumber products and customized services to lumber retailers and wholesalers for outdoor applications. Other products include marine and foundation pilings, construction timbers, highway guardrail posts and treated wood for bridges. It has sales in Canada and US. Its web site is here Stella Jones. See my spreadsheet at sj.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Over the past year, CEO, CFO, Officers and directors have done insider selling to the tune of $2.9M. There has been no insider buying. However, this selling is only worth just under ½ of 1% of the value of this company. Some 13 institutions own 16% of the shares of this company. Over the past 3 months there has been some buying and selling, with these institutions lowering their outstanding shares by less than 1%. Also, you should note that the company of Stella Jones International S.A. owns just over 51% of the shares of this company.
The 5 year low median Price/Earnings Ratio is 7.78 and the 5 year median high is 14.73. The current P/E Ratio of 11.83 is just below the 5 year median P/E Ratio of 12.00. This test shows that the stock price is a reasonable price.
The Graham Price is $39.13, so the current stock price of 39.52 is just 1% higher. The median difference between the Graham Price and the stock price is the stock price being 14% lower. The high difference between the Graham Price and the stock price is the stock price being 14% higher. So the current stock price is between the median and a relatively high stock price.
I get a 10 year median Price/Book Value Ratio of 1.55. The current P/B Ratio is higher by 25% at 1.94. This would point to relatively high stock price. The P/B Ratio tends to fluctuate a lot. The 5 year median P/B Ratio at 1.88 is closer to the current one, but it is still lower by around 3%.
The last test is with the dividend yield. The current dividend yield is 1.32% and the 5 year median dividend yield is 5% lower at 1.26%. This would suggest a current reasonable stock price. For all the tests, the stock price seems reasonable, expect for the P/B Ratio, where the stock price seems a bit high.
The analysts’ recommendations are Strong Buy, Buy and Hold. The consensus recommendation would be a Buy. The Buy recommendation comes with a 12 month stock price of 46.07, a price about 17% higher than today’s price. Also, note that Stella-Jones beat the last two quarterly EPS estimates. One analyst report dated 16 November 2011 says that Stella-Jones “remains a buy for long-term gains and rising dividends”.
There is a recent Globe and Mail article on Stella Jones called Stella-Jones forecasting growth despite uncertainty. There is also an article in Forest Talk on Stella Jones.
To me, this company looks like a good one. The price is probably reasonable. Based on today’s dividend yield, if purchased at $39.52 you could be earning just over 4% in 5 years’ time and 14% in 10 years’ time if dividends continue to increase by 30% a year less 3% assumed inflation.
Stella-Jones Inc. is a leading North American producer and marketer of industrial pressure treated wood products, specializing in the production of railway ties and timbers as well as wood poles supplied to electrical utilities and telecommunications companies. The Company also provides treated consumer lumber products and customized services to lumber retailers and wholesalers for outdoor applications. Other products include marine and foundation pilings, construction timbers, highway guardrail posts and treated wood for bridges. It has sales in Canada and US. Its web site is here Stella Jones. See my spreadsheet at sj.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Monday, November 28, 2011
Stella-Jones Inc
First of all, I would like to point out a couple of recent blogs. The first one by My Own Advisor is called “My Favourite Takeaways – Millionaire Teacher and FREE book giveaway”. The second one is by Dividend Ninja and is called Millionaire Teacher Book Giveaway. If you are a novice at investing, this just might be the right blogs for you to read.
Now, let’s talk about the stock Stella Jones Inc (TSX-SJ). I do not own this stock (TSX-SJ), but maybe I should. Really, what is not to like about this stock? It has great growth, very good debt ratios, good ROE. The dividends are a little low at 1.32%, but the 5 and 10 year growth in dividends is 31% and 24% per year, respectively. The dividend Payout Ratios are also low, with the 5 year median payout of 15% for earnings and 11% for cash flow.
The median 5 and 10 year dividend yield on original cost is 4% and 14%. This is very good growth in dividends. Total return over the past 5 and 10 years is around 20% and 33% per year over the past 5 and 10 years. The dividend portion of this return is just under 2% per year. This would be a good stock when starting a portfolio as the dividends will grow very nicely as the portfolio ages.
The growth rate for the company is better than the growth rates per share. This is because of increasing number of shares outstanding, mostly for purchases of other companies for expansion purposes. For example, Revenues have increased over the past 5 and 10 years at 29% and 20% per year, respectively. However Revenues per Share have only increased by 20% and 14% per year, respectively. The median increase in shares is around 2% per year.
All growth rates are good on this company. The Earnings per Share has increased at the rate of 16% and 21% per year, over the past 5 and 10 years. Cash Flow has increased at the rate of 16% and 18% per year over the past 5 and 10 years. Book Value has increased at the rate of 24% and 17% per year over the past 5 and 10 years.
Debt ratios are very good also. Current Liquidity Ratio is higher than normal at 6.59. The 5 year median Liquidity Ratio is still a very good 2.56. The current Asset/Liability Ratio is very good at 2.19. The current Leverage and Debt/Equity Ratios are also good at 1.84 and 0.84.
The Return on Equity is also quite good on this company, with the ROE at the end of the 2010 financial year at 12.2% with a 5 year median ROE of 17.7%. The ROE for the 12 months ending in the third quarter of August 30, 2011 is also quite good at 16.3%.
This is a rather small company and being an industrial company is more risky that utility and finance companies are. (However, you may wonder how moderate the risk is for financials since many expect Sun Life to cut their dividends.) This company may not grow in the future as it has in the past, but it has still done very well and it has little debt, so it can survive hard times. The stock price certainly took a big hit with the recent recession, with the price plunging some 70% by early 2009. It has staged a nice recovery, but it is still not up to the highs it made in 2007.
It probably did not deserve the stock price plunge it took, but earnings and cash flow slowed and they slowed the dividends to just over 5% increases in 2009 and 2010. It would have been quite a scary time for shareholders. However, the total dividend increases for 2011 total just over 31%, with two nice dividend increases. This shows the company has confidence in the future. Also, analysts expect the EPS to grow very nicely for 2011.
Stella-Jones Inc. is a leading North American producer and marketer of industrial pressure treated wood products, specializing in the production of railway ties and timbers as well as wood poles supplied to electrical utilities and telecommunications companies. The Company also provides treated consumer lumber products and customized services to lumber retailers and wholesalers for outdoor applications. Other products include marine and foundation pilings, construction timbers, highway guardrail posts and treated wood for bridges. It has sales in Canada and US. Its web site is here Stella Jones. See my spreadsheet at sj.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Now, let’s talk about the stock Stella Jones Inc (TSX-SJ). I do not own this stock (TSX-SJ), but maybe I should. Really, what is not to like about this stock? It has great growth, very good debt ratios, good ROE. The dividends are a little low at 1.32%, but the 5 and 10 year growth in dividends is 31% and 24% per year, respectively. The dividend Payout Ratios are also low, with the 5 year median payout of 15% for earnings and 11% for cash flow.
The median 5 and 10 year dividend yield on original cost is 4% and 14%. This is very good growth in dividends. Total return over the past 5 and 10 years is around 20% and 33% per year over the past 5 and 10 years. The dividend portion of this return is just under 2% per year. This would be a good stock when starting a portfolio as the dividends will grow very nicely as the portfolio ages.
The growth rate for the company is better than the growth rates per share. This is because of increasing number of shares outstanding, mostly for purchases of other companies for expansion purposes. For example, Revenues have increased over the past 5 and 10 years at 29% and 20% per year, respectively. However Revenues per Share have only increased by 20% and 14% per year, respectively. The median increase in shares is around 2% per year.
All growth rates are good on this company. The Earnings per Share has increased at the rate of 16% and 21% per year, over the past 5 and 10 years. Cash Flow has increased at the rate of 16% and 18% per year over the past 5 and 10 years. Book Value has increased at the rate of 24% and 17% per year over the past 5 and 10 years.
Debt ratios are very good also. Current Liquidity Ratio is higher than normal at 6.59. The 5 year median Liquidity Ratio is still a very good 2.56. The current Asset/Liability Ratio is very good at 2.19. The current Leverage and Debt/Equity Ratios are also good at 1.84 and 0.84.
The Return on Equity is also quite good on this company, with the ROE at the end of the 2010 financial year at 12.2% with a 5 year median ROE of 17.7%. The ROE for the 12 months ending in the third quarter of August 30, 2011 is also quite good at 16.3%.
This is a rather small company and being an industrial company is more risky that utility and finance companies are. (However, you may wonder how moderate the risk is for financials since many expect Sun Life to cut their dividends.) This company may not grow in the future as it has in the past, but it has still done very well and it has little debt, so it can survive hard times. The stock price certainly took a big hit with the recent recession, with the price plunging some 70% by early 2009. It has staged a nice recovery, but it is still not up to the highs it made in 2007.
It probably did not deserve the stock price plunge it took, but earnings and cash flow slowed and they slowed the dividends to just over 5% increases in 2009 and 2010. It would have been quite a scary time for shareholders. However, the total dividend increases for 2011 total just over 31%, with two nice dividend increases. This shows the company has confidence in the future. Also, analysts expect the EPS to grow very nicely for 2011.
Stella-Jones Inc. is a leading North American producer and marketer of industrial pressure treated wood products, specializing in the production of railway ties and timbers as well as wood poles supplied to electrical utilities and telecommunications companies. The Company also provides treated consumer lumber products and customized services to lumber retailers and wholesalers for outdoor applications. Other products include marine and foundation pilings, construction timbers, highway guardrail posts and treated wood for bridges. It has sales in Canada and US. Its web site is here Stella Jones. See my spreadsheet at sj.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Friday, November 25, 2011
Gennum Corp 2
First of all I like to mention that Dividend Ninja has an current blog about Balance Sheets at his site. If you are going to invest, you should have familiarity with company statements like the Balance Sheet and also with how ratios are calculated. The Dividend Ninja has also reviewed the Income Statement previously on his site.
Now, on to the stock I want to review today. It is Gennum (TSX-GND), a stock I do not own this stock. This is another industrial stock that I follow. I did own this stock at one time. I held it between 1998 and 2006 and I made 5.5% per year total return. Of this total return 0.75% would be attributable to dividends. I sold because I did not see this company going anywhere anytime soon.
When I look at insider trading, I find $.3M of insider buying and no insider selling. It also looks like insiders are retaining the recent stock options that they have received. There are 9 institutions that hold 41% of this stock of this company. There has been a bit of buying and selling in the last 3 months with institutions increasing their shares by 1.7%.
There is a huge difference between the 5 and 10 year median Price/Earnings Ratios. The 5 year median P/E Ratio is 8.75 and the 10 year median is 27.02. The same is true for the 5 and 10 year median high and low P/E Ratios with the high being 13.13 and 33.8 and the low being 4.36 and 20.24 over the past 5 and 10 years.
This stock hit it’s a high in 2006 before the recent bear market of 2008. The change in P/E ratios shows the company moving from growth stock status that it had. It was also just after the time it did a restructuring from doing, mostly, digital pieces for hearing aids. The fact is that this company hasn’t done much since hitting a peak at the end of 1999. It traded in a band between $10 and $20 between 1999 and 2008, and then it dropped to lows it hadn’t seen since 1996.
The current P/E Ratio of 10.97 is on the low side for P/E Ratios, generally. I get a Graham Price of $7.77 and a current price of $5.70, which is 27% lower. This is a stock that spend most of it life way above the Graham Price. But the Graham Price is increasing and the stock price is not.
As far as the Price/Book Value Ratio goes, the current one is 1.10 compared to the 10 year median P/B Ratio of 3.75. That means that the current one is only 30% of the 10 year median ratio. The current dividend yield is 2.46 and the 5 year median dividend yield is much lower at 1.7%. All of this, of course, points to a rather low current stock price. The questions may be, however, is the stock cheap for what you are getting?
When I look at analysts’ recommendations, I find that they are all over the place. There are Strong Buy, Buy, Hold, Underperform and Sell recommendations. The consensus recommendation would be a Buy. (See my site for information on analyst ratings.) The consensus 12 months stock price is $7.71
One commentator says that “In the old days it was a hearing aid company that did very well. Now they have semiconductor products for video and data com markets. This company has been hard hit as a mini semiconductor company and earnings are way down. It has a good balance sheet and the business is stabilizing.”
Also, the company is restructuring again. It has done this several times. However, it does not seem capable, to me, of raising its earnings. I still think that this stock is going nowhere still.
Gennum Corporation designs innovative semiconductor solutions and intellectual property (IP) cores to serve the rising global demand for high-speed data transmission products in the broadcast, networking, storage and telecommunications markets. They sell in North America, Europe and Asia Pacific. Its web site is here Gennum Group. See my spreadsheet at gnd.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Now, on to the stock I want to review today. It is Gennum (TSX-GND), a stock I do not own this stock. This is another industrial stock that I follow. I did own this stock at one time. I held it between 1998 and 2006 and I made 5.5% per year total return. Of this total return 0.75% would be attributable to dividends. I sold because I did not see this company going anywhere anytime soon.
When I look at insider trading, I find $.3M of insider buying and no insider selling. It also looks like insiders are retaining the recent stock options that they have received. There are 9 institutions that hold 41% of this stock of this company. There has been a bit of buying and selling in the last 3 months with institutions increasing their shares by 1.7%.
There is a huge difference between the 5 and 10 year median Price/Earnings Ratios. The 5 year median P/E Ratio is 8.75 and the 10 year median is 27.02. The same is true for the 5 and 10 year median high and low P/E Ratios with the high being 13.13 and 33.8 and the low being 4.36 and 20.24 over the past 5 and 10 years.
This stock hit it’s a high in 2006 before the recent bear market of 2008. The change in P/E ratios shows the company moving from growth stock status that it had. It was also just after the time it did a restructuring from doing, mostly, digital pieces for hearing aids. The fact is that this company hasn’t done much since hitting a peak at the end of 1999. It traded in a band between $10 and $20 between 1999 and 2008, and then it dropped to lows it hadn’t seen since 1996.
The current P/E Ratio of 10.97 is on the low side for P/E Ratios, generally. I get a Graham Price of $7.77 and a current price of $5.70, which is 27% lower. This is a stock that spend most of it life way above the Graham Price. But the Graham Price is increasing and the stock price is not.
As far as the Price/Book Value Ratio goes, the current one is 1.10 compared to the 10 year median P/B Ratio of 3.75. That means that the current one is only 30% of the 10 year median ratio. The current dividend yield is 2.46 and the 5 year median dividend yield is much lower at 1.7%. All of this, of course, points to a rather low current stock price. The questions may be, however, is the stock cheap for what you are getting?
When I look at analysts’ recommendations, I find that they are all over the place. There are Strong Buy, Buy, Hold, Underperform and Sell recommendations. The consensus recommendation would be a Buy. (See my site for information on analyst ratings.) The consensus 12 months stock price is $7.71
One commentator says that “In the old days it was a hearing aid company that did very well. Now they have semiconductor products for video and data com markets. This company has been hard hit as a mini semiconductor company and earnings are way down. It has a good balance sheet and the business is stabilizing.”
Also, the company is restructuring again. It has done this several times. However, it does not seem capable, to me, of raising its earnings. I still think that this stock is going nowhere still.
Gennum Corporation designs innovative semiconductor solutions and intellectual property (IP) cores to serve the rising global demand for high-speed data transmission products in the broadcast, networking, storage and telecommunications markets. They sell in North America, Europe and Asia Pacific. Its web site is here Gennum Group. See my spreadsheet at gnd.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Thursday, November 24, 2011
Gennum Corp
I do not own this stock (TSX-GND). This is another industrial stock that I follow. I did own this stock at one time. I held it between 1998 and 2006 and I made 5.5% per year total return. Of this total return 0.75% would be attributable to dividends. I sold because I did not see this company going anywhere anytime soon.
This Canadian company changed the reporting currency to US$ in 2008, however, it left the dividends in CDN$. Certainly, there is little, if any growth for this stock over the past 5 and 10 years. The dividend growth is probably the best, with dividends growth at the rate of 3% and 2% per year over the past 5 and 10 years.
Certainly inflation has been low over the past 10 years, with Bank of Canada saying it has been running just below 2% over the past 5 and 10 years. This is for both core and total inflation rates. However, when you have very low dividend yield you expect to get much higher dividend growth. The 10 year median dividend yield is below 1%. The current dividend yield is 2.28%, but this is because the stock price has fallen quite far.
This company does not increase their dividends yearly at the best of times. However, there has been no increase in dividends since 2006. Dividend Payout Ratios are fine at a 5 year median rates of 14.9% for earnings and 22% for cash flow. This company is, supposedly, a growth company, so you would expect low DPRs.
The real bottom line is here that if you have invested in this company 10 years ago, you would have lost something like 6% per year. The dividend portion of this return would be around 1.3%. The stock price at the end of November 2010 was some 55% lower than at the beginning of this 10 year period. You would also be receiving a dividend yield, on your investment of around 1.08%.
There was no growth in revenue per share or earnings per share over the past 5 years. There was only minimal growth in these values over the past 10 years. However, there was only 2 years with negative earnings over the past 20 years.
Cash Flow growth is a bit better with 5 and 10 years growth in cash flow per share at 5% and 3.6% per year over the past 5 and 10 years. Over the past 10 years, there was only one year of negative cash flow. There has also been some growth in book value per share. Over the past 5 and 10 years, book value has growth at the rate of 4.6% and 6.9% per year, respectively.
When you look at debt ratios, all the ratios of this company are very good. The current Liquidity Ratio is 4.15 and the current Asset/Liability Ratio is 8.12. The current Leverage and Debt/Equity Ratios are also very good at 1.16 and 0.16.
Generally speaking the Return on Equity is also fine. The ROE for the financial year ending November 2010 was 11.2% with a 5 year median ROE also of 11.2%. The ROE for the 12 months ending August 2011 is lower at 9.2%. The ROE at November 2010 is a respectable ROE, the 12 months ending August 2011, not so much. (A respectable ROE is at least 10 %.)
There is an article on this company at Crunch Base.
I do not expect much to happen on this stock any time soon and it would appear from the estimates of the analysts that they feel the same way. Tomorrow, I will look at the current price to see how reasonable it is and also what analysts are saying about this stock.
Gennum Corporation designs innovative semiconductor solutions and intellectual property (IP) cores to serve the rising global demand for high-speed data transmission products in the broadcast, networking, storage and telecommunications markets. They sell in North America, Europe and Asia Pacific. Its web site is here Gennum Group. See my spreadsheet at gnd.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
This Canadian company changed the reporting currency to US$ in 2008, however, it left the dividends in CDN$. Certainly, there is little, if any growth for this stock over the past 5 and 10 years. The dividend growth is probably the best, with dividends growth at the rate of 3% and 2% per year over the past 5 and 10 years.
Certainly inflation has been low over the past 10 years, with Bank of Canada saying it has been running just below 2% over the past 5 and 10 years. This is for both core and total inflation rates. However, when you have very low dividend yield you expect to get much higher dividend growth. The 10 year median dividend yield is below 1%. The current dividend yield is 2.28%, but this is because the stock price has fallen quite far.
This company does not increase their dividends yearly at the best of times. However, there has been no increase in dividends since 2006. Dividend Payout Ratios are fine at a 5 year median rates of 14.9% for earnings and 22% for cash flow. This company is, supposedly, a growth company, so you would expect low DPRs.
The real bottom line is here that if you have invested in this company 10 years ago, you would have lost something like 6% per year. The dividend portion of this return would be around 1.3%. The stock price at the end of November 2010 was some 55% lower than at the beginning of this 10 year period. You would also be receiving a dividend yield, on your investment of around 1.08%.
There was no growth in revenue per share or earnings per share over the past 5 years. There was only minimal growth in these values over the past 10 years. However, there was only 2 years with negative earnings over the past 20 years.
Cash Flow growth is a bit better with 5 and 10 years growth in cash flow per share at 5% and 3.6% per year over the past 5 and 10 years. Over the past 10 years, there was only one year of negative cash flow. There has also been some growth in book value per share. Over the past 5 and 10 years, book value has growth at the rate of 4.6% and 6.9% per year, respectively.
When you look at debt ratios, all the ratios of this company are very good. The current Liquidity Ratio is 4.15 and the current Asset/Liability Ratio is 8.12. The current Leverage and Debt/Equity Ratios are also very good at 1.16 and 0.16.
Generally speaking the Return on Equity is also fine. The ROE for the financial year ending November 2010 was 11.2% with a 5 year median ROE also of 11.2%. The ROE for the 12 months ending August 2011 is lower at 9.2%. The ROE at November 2010 is a respectable ROE, the 12 months ending August 2011, not so much. (A respectable ROE is at least 10 %.)
There is an article on this company at Crunch Base.
I do not expect much to happen on this stock any time soon and it would appear from the estimates of the analysts that they feel the same way. Tomorrow, I will look at the current price to see how reasonable it is and also what analysts are saying about this stock.
Gennum Corporation designs innovative semiconductor solutions and intellectual property (IP) cores to serve the rising global demand for high-speed data transmission products in the broadcast, networking, storage and telecommunications markets. They sell in North America, Europe and Asia Pacific. Its web site is here Gennum Group. See my spreadsheet at gnd.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Wednesday, November 23, 2011
Mullen Group Ltd 2
I do not own this stock (TSX-MTL). This is another Industrial type stock. It has recently converted from a Unit Trust stock (2009). Around the time of conversion, the company reduced the dividend by 83%. Since then it has increased dividends by 233%, but the dividends are still some 44% lower than they were at the peak.
For Price/Earnings Ratios, I have 10 year median low of 10.20 and 10 year median high of 17.11. The current P/E Ratio of 13.84 on a stock price of $19.52 is a median P/E Ratio and shows a reasonable stock price.
The Price/Book Value ratio is not much help as the Book Value has just been degraded by a goodwill write off. The 10 year median P/B Ratio is 1.65. For the third quarter of 2011, the Book Value dropped some 44% and we are left with a P/B Ratio of 2.35, one that is some 42% above the 10 year medina Ratio.
The Graham Price I get is $16.23 for this year. The current stock price of $19.52 is some 20% higher. The median difference and higher difference between the Graham Price and stock price is the stock price being 11% and 38% higher. This test show a higher than median stock price. However, the Graham Price is also very much influenced by the Book Value, so you have to currently wonder about this test also.
The last thing to look at is dividend yield. The 5 year median dividend yield is 6.6% and the current dividend yield is lower at 5.1%. The problem with this test is that the dividends were cut by83% when the company changed from a unit trust company to a corporation. However, looking at the 10 year high dividend yield, it is only 3.8%. This put the current dividend yield in better light.
The stock price tests that I use have some problems on this stock. However, the results are probably that the price is reasonable one. Even with problems, no test show that the stock is overbought (that is that the stock price is too high).
One thing to note is that the insider trading report shows no insider selling and no insider buying. 59 Institutions hold 38% of the stocks of this company. Over the past 3 months, there has been buying and selling, but on a net basis, these institutions have increased their holdings by 4%.
As far as analysts’ recommendations go, I find Strong Buy, Buy and Hold recommendations. However, there are few Strong Buy and Buy recommendations and lots of Hold recommendations. The consensus recommendation would be a Hold. Although this company is not directly in the oil and gas business, it is certainly dependent on the oil and gas business. Even analysts that think this company is a buy, rate it as a high risk.
One analysts with a Buy recommendations said that the company beat 3 quarterly EPS estimates. Although the analyst gives a 12 month stock price of $26.00, he also rates the company has a high risk investment. A hold recommendation comes with a 12 month stock price of $24.00.
There is an article on this company at the Calgary Herald, and another article in the Oil Week Magazine.
Mullen Group Ltd. is a corporation that owns a network of independently operated businesses. Mullen is recognized as the largest provider of specialized transportation and related services to the oil and natural gas industry in western Canada and is one of the leading suppliers of trucking and logistics services in Canada - two sectors of the economy in which Mullen has strong business relationships and industry leadership. Its web site is here Mullen Group. See my spreadsheet at mtl.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
For Price/Earnings Ratios, I have 10 year median low of 10.20 and 10 year median high of 17.11. The current P/E Ratio of 13.84 on a stock price of $19.52 is a median P/E Ratio and shows a reasonable stock price.
The Price/Book Value ratio is not much help as the Book Value has just been degraded by a goodwill write off. The 10 year median P/B Ratio is 1.65. For the third quarter of 2011, the Book Value dropped some 44% and we are left with a P/B Ratio of 2.35, one that is some 42% above the 10 year medina Ratio.
The Graham Price I get is $16.23 for this year. The current stock price of $19.52 is some 20% higher. The median difference and higher difference between the Graham Price and stock price is the stock price being 11% and 38% higher. This test show a higher than median stock price. However, the Graham Price is also very much influenced by the Book Value, so you have to currently wonder about this test also.
The last thing to look at is dividend yield. The 5 year median dividend yield is 6.6% and the current dividend yield is lower at 5.1%. The problem with this test is that the dividends were cut by83% when the company changed from a unit trust company to a corporation. However, looking at the 10 year high dividend yield, it is only 3.8%. This put the current dividend yield in better light.
The stock price tests that I use have some problems on this stock. However, the results are probably that the price is reasonable one. Even with problems, no test show that the stock is overbought (that is that the stock price is too high).
One thing to note is that the insider trading report shows no insider selling and no insider buying. 59 Institutions hold 38% of the stocks of this company. Over the past 3 months, there has been buying and selling, but on a net basis, these institutions have increased their holdings by 4%.
As far as analysts’ recommendations go, I find Strong Buy, Buy and Hold recommendations. However, there are few Strong Buy and Buy recommendations and lots of Hold recommendations. The consensus recommendation would be a Hold. Although this company is not directly in the oil and gas business, it is certainly dependent on the oil and gas business. Even analysts that think this company is a buy, rate it as a high risk.
One analysts with a Buy recommendations said that the company beat 3 quarterly EPS estimates. Although the analyst gives a 12 month stock price of $26.00, he also rates the company has a high risk investment. A hold recommendation comes with a 12 month stock price of $24.00.
There is an article on this company at the Calgary Herald, and another article in the Oil Week Magazine.
Mullen Group Ltd. is a corporation that owns a network of independently operated businesses. Mullen is recognized as the largest provider of specialized transportation and related services to the oil and natural gas industry in western Canada and is one of the leading suppliers of trucking and logistics services in Canada - two sectors of the economy in which Mullen has strong business relationships and industry leadership. Its web site is here Mullen Group. See my spreadsheet at mtl.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Tuesday, November 22, 2011
Mullen Group Ltd
I do not own this stock (TSX-MTL). This is another Industrial type stock. It has recently converted from a Unit Trust stock (2009). Around the time of conversion, the company reduced the dividend by 83%. Since then it has increased dividends by 233%, but the dividends are still some 44% lower than they were at the peak.
The reduction in dividend brought the Dividend Payout Ratios down to a place that would allow for the company to begin growing again. At the height of their dividends, DPR was 129% for earnings and 59% for cash flow. The DPR for 2011 is expected to be 62% for earnings and 33% for CF.
This must have been hard to people who bought this stock for income purposes, but the company did act prudently, and the result is that they are growing dividends again. DPR are important and all companies that converted from Unit Trusts to corporation will have to get their DPRs under control. (See my site for information on Dividend Payout Ratios).
I must admit that when the dividends were lowered, the stock price did fall initially (by some 36%); however, it did recover fairly quickly. The other thing to note is that even though dividends are down some 5.8% over the last 5 years, they are up some 15.8% over the past 10 years.
When looking at growth for this company, there is not much, if any, over the past 5 years, but growth over the past 10 years is, generally, ok. If you have invested in this company 5 years ago, your total return would probably be a negative 2% per year. However, if you had invested in this company 10 years ago, your total return would probably be around 14% per year, with some 5.5% of this growth in income.
The next best growth is in revenues where growth is at 4.9% and 5.5% per year over the past 5 and 10 years. Growth in earnings and cash flow is not as good, as earnings are not up over the past 5 years, but are up some 3% over the past 10 years. Cash flow is similar with no growth in the past 5 years, but over the past 10 years, cash flow is up 7.8% per year.
There is a problem with growth in book value. Book value growth looks good until you see the book value for the 3rd quarter of 2011. This is because the company took a hit by writing off balance sheet good will and therefore damaged book value. The result of this is that book value is up only 4% over the past 5 years and (not bad) 8.2% over the past 10 years.
The other thing to note is that growth is expected to be quite good for 2011. For example, earnings are expected to be up some 44% from 2010. The 12 month earnings to the third quarter of 2011 are up some 33% over 2010. They seem to be on track to have a good year for 2011.
Looking at debt ratios, I find that they are fine. The current Liquidity Ratio is very good at 2.04 and the same can be said for the current Asset/Liability Ratio at 1.83. Both the Leverage and Debt/Equity Ratios are fine, with current ratios at 2.23 and 1.22.
The Return on Equity was very good for 2010 at 26.9%, with a 5 year median ROE a bit low at 9%. The ROE for the 9 months ending in September 2011 is very high at 62%, but this is because book value has gone down so far.
This company was damaged with the most recent recession, but seems to be recovering well. One thing that I like is that there are a number of insiders with millions of dollars in shares in the company. Insider own just over 6% of this company. I just started to follow this stock in June 2010 because it was recommended as a small cap stock to buy. I thought it would be an interesting one to follow.
Mullen Group Ltd. is a corporation that owns a network of independently operated businesses. Mullen is recognized as the largest provider of specialized transportation and related services to the oil and natural gas industry in western Canada and is one of the leading suppliers of trucking and logistics services in Canada - two sectors of the economy in which Mullen has strong business relationships and industry leadership. Its web site is here Mullen Group. See my spreadsheet at mtl.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
The reduction in dividend brought the Dividend Payout Ratios down to a place that would allow for the company to begin growing again. At the height of their dividends, DPR was 129% for earnings and 59% for cash flow. The DPR for 2011 is expected to be 62% for earnings and 33% for CF.
This must have been hard to people who bought this stock for income purposes, but the company did act prudently, and the result is that they are growing dividends again. DPR are important and all companies that converted from Unit Trusts to corporation will have to get their DPRs under control. (See my site for information on Dividend Payout Ratios).
I must admit that when the dividends were lowered, the stock price did fall initially (by some 36%); however, it did recover fairly quickly. The other thing to note is that even though dividends are down some 5.8% over the last 5 years, they are up some 15.8% over the past 10 years.
When looking at growth for this company, there is not much, if any, over the past 5 years, but growth over the past 10 years is, generally, ok. If you have invested in this company 5 years ago, your total return would probably be a negative 2% per year. However, if you had invested in this company 10 years ago, your total return would probably be around 14% per year, with some 5.5% of this growth in income.
The next best growth is in revenues where growth is at 4.9% and 5.5% per year over the past 5 and 10 years. Growth in earnings and cash flow is not as good, as earnings are not up over the past 5 years, but are up some 3% over the past 10 years. Cash flow is similar with no growth in the past 5 years, but over the past 10 years, cash flow is up 7.8% per year.
There is a problem with growth in book value. Book value growth looks good until you see the book value for the 3rd quarter of 2011. This is because the company took a hit by writing off balance sheet good will and therefore damaged book value. The result of this is that book value is up only 4% over the past 5 years and (not bad) 8.2% over the past 10 years.
The other thing to note is that growth is expected to be quite good for 2011. For example, earnings are expected to be up some 44% from 2010. The 12 month earnings to the third quarter of 2011 are up some 33% over 2010. They seem to be on track to have a good year for 2011.
Looking at debt ratios, I find that they are fine. The current Liquidity Ratio is very good at 2.04 and the same can be said for the current Asset/Liability Ratio at 1.83. Both the Leverage and Debt/Equity Ratios are fine, with current ratios at 2.23 and 1.22.
The Return on Equity was very good for 2010 at 26.9%, with a 5 year median ROE a bit low at 9%. The ROE for the 9 months ending in September 2011 is very high at 62%, but this is because book value has gone down so far.
This company was damaged with the most recent recession, but seems to be recovering well. One thing that I like is that there are a number of insiders with millions of dollars in shares in the company. Insider own just over 6% of this company. I just started to follow this stock in June 2010 because it was recommended as a small cap stock to buy. I thought it would be an interesting one to follow.
Mullen Group Ltd. is a corporation that owns a network of independently operated businesses. Mullen is recognized as the largest provider of specialized transportation and related services to the oil and natural gas industry in western Canada and is one of the leading suppliers of trucking and logistics services in Canada - two sectors of the economy in which Mullen has strong business relationships and industry leadership. Its web site is here Mullen Group. See my spreadsheet at mtl.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Monday, November 21, 2011
Methanex Corp 2
I do not own this stock (TSX-MX). I first talked about this stock a year ago. It is a Canadian company with a global reach. It is also traded on NASDAQ as MEOH and its annual reports are in US$. They also pay dividends in US$. Today, I want to look at the share price, insider trading and what analysts say about this stock.
When I looked Insider trading last year, there was a bit of insider buying but no insider selling. It is quite different this year, as there is around $14.9M of insider selling and marginal insider buying. Most of the insider selling is by officers of the company. As I remarked last year, all insiders, except directors have lots more options than shares. As far as I can see there are no institutional shareholders.
When I look at Price/Earnings Ratio history, I find a 10 year median low P/E Ratio of 10.71 and 10 year median high P/E Ratio of 16.88. The current P/E Ratio of 12.52 is just lower than the median P/E Ratio of 13.72. I get a Graham Price of $25.35 and the current stock price of $24.34 is just 4% lower. The 10 year median difference between the Graham Price and the stock price is the stock price at 4% lower. Both these tests show an average stock price.
I get a 10 Year median Price/Book Value Ratio of 1.89 and a current P/B Ratio of 1.66. The current one is some 87% of the 10 year median ratio. The current yield is 2.79% and the 5 year median yield is 2.38%. Also, the 10 year median high yield is at 2.78%. My first test shows a good stock price, and my second test shows a very good stock price.
While it is great to pick up a stock you want at a very cheap price, it is not generally possible. What you need to aim at is a median price. This stock is certainly at that. Also, note that some dividend investors feel that the only good test is the dividend yield test, and by this measure, the stock is at a very good price.
When I look at Analysts’ recommendations, I find Strong Buy, Buy and Hold Recommendations. The analysts seem rather evenly spread over these three types. The consensus recommendation would be a Buy. The Buy recommendation comes with a 12 month stock price of $33.25.
Recommendations seem to depend on what analysts feel will happen to the Global economy. A Hold recommendation is made because of the dependence of this stock on the Global economy. A buy recommendations comes with positive comments on US economy (that it will be slowly growing) and the
European Economy will only have a mild recession.
What I did not like on this stock is the lack of growth of revenues, earnings and cash flow. Analysts generally expect this company to do better this year than last year and then do even better in 2012. The 12 months values to September 30, 2011, the 3rd quarterly results would seem to support this. The good thing about this stock is that the debt ratios and Dividend Payout Ratios are good. So, I can see why some analysts think that the stock is currently a buy.
Would Warren Buffett be interested in this company? See article in G&M.
Methanex is the world's largest supplier of methanol to major international markets in North America, Asia Pacific, Europe and Latin America. Methanol is an important ingredient in many of the essential industrial and consumer products. Head Office is in Vancouver, B. C. Canada. Its web site is here Methanex. See my spreadsheet at mx.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
When I looked Insider trading last year, there was a bit of insider buying but no insider selling. It is quite different this year, as there is around $14.9M of insider selling and marginal insider buying. Most of the insider selling is by officers of the company. As I remarked last year, all insiders, except directors have lots more options than shares. As far as I can see there are no institutional shareholders.
When I look at Price/Earnings Ratio history, I find a 10 year median low P/E Ratio of 10.71 and 10 year median high P/E Ratio of 16.88. The current P/E Ratio of 12.52 is just lower than the median P/E Ratio of 13.72. I get a Graham Price of $25.35 and the current stock price of $24.34 is just 4% lower. The 10 year median difference between the Graham Price and the stock price is the stock price at 4% lower. Both these tests show an average stock price.
I get a 10 Year median Price/Book Value Ratio of 1.89 and a current P/B Ratio of 1.66. The current one is some 87% of the 10 year median ratio. The current yield is 2.79% and the 5 year median yield is 2.38%. Also, the 10 year median high yield is at 2.78%. My first test shows a good stock price, and my second test shows a very good stock price.
While it is great to pick up a stock you want at a very cheap price, it is not generally possible. What you need to aim at is a median price. This stock is certainly at that. Also, note that some dividend investors feel that the only good test is the dividend yield test, and by this measure, the stock is at a very good price.
When I look at Analysts’ recommendations, I find Strong Buy, Buy and Hold Recommendations. The analysts seem rather evenly spread over these three types. The consensus recommendation would be a Buy. The Buy recommendation comes with a 12 month stock price of $33.25.
Recommendations seem to depend on what analysts feel will happen to the Global economy. A Hold recommendation is made because of the dependence of this stock on the Global economy. A buy recommendations comes with positive comments on US economy (that it will be slowly growing) and the
European Economy will only have a mild recession.
What I did not like on this stock is the lack of growth of revenues, earnings and cash flow. Analysts generally expect this company to do better this year than last year and then do even better in 2012. The 12 months values to September 30, 2011, the 3rd quarterly results would seem to support this. The good thing about this stock is that the debt ratios and Dividend Payout Ratios are good. So, I can see why some analysts think that the stock is currently a buy.
Would Warren Buffett be interested in this company? See article in G&M.
Methanex is the world's largest supplier of methanol to major international markets in North America, Asia Pacific, Europe and Latin America. Methanol is an important ingredient in many of the essential industrial and consumer products. Head Office is in Vancouver, B. C. Canada. Its web site is here Methanex. See my spreadsheet at mx.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Friday, November 18, 2011
Methanex Corp
I do not own this stock (TSX-MX). I first talked about this stock a year ago. It is a Canadian company with a global reach. It is also traded on NASDAQ as MEOH and its annual reports are in US$. They also pay dividends in US$.
Because dividends are declared in US$, the dividends payable to Canadian stockholders can fluctuate with the exchange rate of currency. This can affect dividend payments and also dividend increases. For example, over the past 5 and 8 years the dividends, in US$ terms have increased by 8.6% and 25.6% per year. In CDN$ terms over the past 5 and 8 years, dividends have increased by only 4.4% and 18.6% per year. However, the only year dividends decreased for Canadian investors was in 2010, when the US$ dividend did not change.
The Dividend Payout Ratios for this stock started over quite low and then peaked in 2009 and 2010. The 5 year median DPR is 30% for earnings and 15% for cash flow. These ratios are expected to be 34% for earnings and 17% for cash flow in 2011.
What you notice for this company is that the per share growth is better than actual growth. This is because this company has been buying shares back for cancellation. (They also give out stock options.) Over the past 2 years shares have increased marginally because of stock options. Before that there were many years of stock repurchasing. Shares over the past 10 year have a median decline of 5.2% per year. The growth has also been better in US$ terms, because of the increased value of our Canadian dollar.
For example, revenue in US$ has grown over the past 5 and 10 years at the rate of 3.5% and 6.4% per year, respectively. In CDN$ terms, revenue has grown at the rate of only 0% and 2% per year, respectively. Revenue per share in CDN$ terms has grown at the rate of 4.5% and 7.7% per year over the past 5 and 10 years, respectively.
There is little if any growth in Earnings per Share. Over the past 10 years EPS has grown about 3% per year in US$ terms, but has gone down 1.5% per year in CDN$ terms. Over the past 5 years, there has been no growth in EPS in US$ term nor in CDN$ terms.
On the other hand, in Total Return, Canadian investors have made, over the past 5 and 10 years 11% and 8% per year. The portion of this return from dividends would be around 3% and 2.6% per year. I am sure it is needless to say that US investors would have made more.
As far as growth in Cash Flow is concerned, there isn’t any. Cash Flow has marginally increased over the past 10 years in US$ terms, but not in CDN$ terms. Over the past 10 years, when we exclude non-cash items from Cash Flow from Operations, there has been no increase in CDN$ terms over the past 10 years.
Book Value growth is not so dismal. In CDN$ terms, book value per share has increased 7% and 3% per year over the past 5 and 10 years. Total Book Value, in CDN$ terms has decreases marginally over the past 10 years. They have had no recent year of negative EPS, but 2009 came close with earnings of 1 cent.
The company’s debt ratios seem fine. The current Liquidity Ratio is good at 1.58, but is the lowest it has been for some time. This because of a current portion of the long term debt is included in current liabilities. The 5 year median Liquidity Ratio is 2.47. The Asset/Liability Ratio is still quite good at 1.92 and is close to the 5 year median of 1.95. Both the Leverage and Debt/Equity Ratios are fine, with current ratios at 2.38 and 1.24, respectively.
The Return on Equity for this year and last year were low at 8% and .1%, respectively. However, the ROE for the 12 months ending in September 2011 was much better at 13.8%. The 5 year median ROE is good at 13.1%.
This is also an industrial type stock. The good thing about it is that it is an international company, and we should all have international exposure in our portfolios. All Industrial type stocks have been hit by our recent recession. This company did its poorest in 2009. Things have picked up in 2010 and they are expected to do even better in 2011. The company certainly expects to, as they raised their dividend by 9.7% in 2011.
Methanex is the world's largest supplier of methanol to major international markets in North America, Asia Pacific, Europe and Latin America. Methanol is an important ingredient in many of the essential industrial and consumer products. Head Office is in Vancouver, B. C. Canada. Its web site is here Methanex. See my spreadsheet at mx.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Because dividends are declared in US$, the dividends payable to Canadian stockholders can fluctuate with the exchange rate of currency. This can affect dividend payments and also dividend increases. For example, over the past 5 and 8 years the dividends, in US$ terms have increased by 8.6% and 25.6% per year. In CDN$ terms over the past 5 and 8 years, dividends have increased by only 4.4% and 18.6% per year. However, the only year dividends decreased for Canadian investors was in 2010, when the US$ dividend did not change.
The Dividend Payout Ratios for this stock started over quite low and then peaked in 2009 and 2010. The 5 year median DPR is 30% for earnings and 15% for cash flow. These ratios are expected to be 34% for earnings and 17% for cash flow in 2011.
What you notice for this company is that the per share growth is better than actual growth. This is because this company has been buying shares back for cancellation. (They also give out stock options.) Over the past 2 years shares have increased marginally because of stock options. Before that there were many years of stock repurchasing. Shares over the past 10 year have a median decline of 5.2% per year. The growth has also been better in US$ terms, because of the increased value of our Canadian dollar.
For example, revenue in US$ has grown over the past 5 and 10 years at the rate of 3.5% and 6.4% per year, respectively. In CDN$ terms, revenue has grown at the rate of only 0% and 2% per year, respectively. Revenue per share in CDN$ terms has grown at the rate of 4.5% and 7.7% per year over the past 5 and 10 years, respectively.
There is little if any growth in Earnings per Share. Over the past 10 years EPS has grown about 3% per year in US$ terms, but has gone down 1.5% per year in CDN$ terms. Over the past 5 years, there has been no growth in EPS in US$ term nor in CDN$ terms.
On the other hand, in Total Return, Canadian investors have made, over the past 5 and 10 years 11% and 8% per year. The portion of this return from dividends would be around 3% and 2.6% per year. I am sure it is needless to say that US investors would have made more.
As far as growth in Cash Flow is concerned, there isn’t any. Cash Flow has marginally increased over the past 10 years in US$ terms, but not in CDN$ terms. Over the past 10 years, when we exclude non-cash items from Cash Flow from Operations, there has been no increase in CDN$ terms over the past 10 years.
Book Value growth is not so dismal. In CDN$ terms, book value per share has increased 7% and 3% per year over the past 5 and 10 years. Total Book Value, in CDN$ terms has decreases marginally over the past 10 years. They have had no recent year of negative EPS, but 2009 came close with earnings of 1 cent.
The company’s debt ratios seem fine. The current Liquidity Ratio is good at 1.58, but is the lowest it has been for some time. This because of a current portion of the long term debt is included in current liabilities. The 5 year median Liquidity Ratio is 2.47. The Asset/Liability Ratio is still quite good at 1.92 and is close to the 5 year median of 1.95. Both the Leverage and Debt/Equity Ratios are fine, with current ratios at 2.38 and 1.24, respectively.
The Return on Equity for this year and last year were low at 8% and .1%, respectively. However, the ROE for the 12 months ending in September 2011 was much better at 13.8%. The 5 year median ROE is good at 13.1%.
This is also an industrial type stock. The good thing about it is that it is an international company, and we should all have international exposure in our portfolios. All Industrial type stocks have been hit by our recent recession. This company did its poorest in 2009. Things have picked up in 2010 and they are expected to do even better in 2011. The company certainly expects to, as they raised their dividend by 9.7% in 2011.
Methanex is the world's largest supplier of methanol to major international markets in North America, Asia Pacific, Europe and Latin America. Methanol is an important ingredient in many of the essential industrial and consumer products. Head Office is in Vancouver, B. C. Canada. Its web site is here Methanex. See my spreadsheet at mx.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
Thursday, November 17, 2011
Magna International Inc 2
I do not own this stock. However, I did own it briefly between 2002 and 2006 and made a total return of 4.65% per year. I have followed this stock for a number of years, although I have only blogged about this stock once before.
When I look at insider trading, I find that there is some $925.6M of insider selling. The thing is that Frank Stronach has been selling his shares. A good sign is that there is some $31M of insider buying, which is probably a good sign. However, I must admit, I cannot figure out who is buying. Both the CEO and CFO have a few million in shares. This is good. The last thing to notice is that insiders, except for the directors, have lots more options than shares.
When you look at what institutions have been doing over the past 3 months, I find that 346 institutions own around 77% of this stock. There has been a lot of buying and selling within the last 3 months by institutions and they have, overall, reduced their investment in the company by 3.5%.
I get 5 year median low Price/Earnings Ratio of 13.85 and a 5 year high P/E Ratio of 16.75. By this test, the current P/E Ratio of 7.82 is rather low. Even the 10 year low median P/E is higher at 11.09. The current dividend yield is 2.88% and this higher than the 5 year median of 1.25%. Even in US$, current yield of 2.91% is higher than the 5 year median yield of 1.43%. Both these tests show a good current stock price.
I get a Graham Price of $60.03. The current stock price of $34.63 is some 42% lower. The difference between the Graham Price and the low stock price over the past 10 years is the stock price being only some 24% lower than the Graham Price.
The last test to look at today is the Price/Book Value Ratio. The 10 year median P/B Ratio is 1.19. The current P/B Ratio is just 0.96. The current one is 80% of the 10 year median and this low ratio points to a good current price. Also, a P/B ratio of below 1.00 points to a good current price, as the stock is selling below the book value of the stock.
All my tests points to this stock being beaten up. There would seem no reason for this except that people feel we are going into a recession. The company has good debt ratios and good Dividend Payout Ratios. (See my site for information on Dividend Payout Ratios and see my site for further information on Debt Ratios.)
The company seems optimistic as it has just raised dividends by 40%. In fact dividends payable in 2011 are up over 138% compared dividends paid in 2010. The earnings estimates for this year are higher than last year’s earnings. Cash Flow is not estimated to be higher, but it is expected to be better than in the recent past.
When I look at analysts’ recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus recommendation would a Buy. It would seem that analysts with Hold recommendations fear a double dip recession or a slowdown in the economy. The Buy and Strong Buy recommendations only talk about this stock being beaten down and the fact that it has a strong balance sheet.
This has been a strong company with Frank Stronach running it. However, is it past the time for automobile companies to make money? Will they do just as well without Frank Stronach? You have to wonder. Personally, this stock is not on my radar at present. I wonder if the world economy will do well until Europe starts to fix their problems. However, I must admit that the company does have a strong balance sheet and it is cheap.
Magna International is the most diversified global automotive supplier. They design, develop and manufacture technologically advanced automotive systems, assemblies, modules and components, and engineer and assemble complete vehicles, primarily for sale to original equipment manufacturers ("OEMs") of cars and light trucks. Their capabilities include the design, engineering, testing and manufacture of automotive interior systems; seating systems; closure systems; body and chassis systems; vision systems; electronic systems; exterior systems; powertrain systems; roof systems; hybrid and electric vehicles/systems; as well as complete vehicle engineering and assembly. Its web site is here Magna. See my spreadsheet at mg.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
When I look at insider trading, I find that there is some $925.6M of insider selling. The thing is that Frank Stronach has been selling his shares. A good sign is that there is some $31M of insider buying, which is probably a good sign. However, I must admit, I cannot figure out who is buying. Both the CEO and CFO have a few million in shares. This is good. The last thing to notice is that insiders, except for the directors, have lots more options than shares.
When you look at what institutions have been doing over the past 3 months, I find that 346 institutions own around 77% of this stock. There has been a lot of buying and selling within the last 3 months by institutions and they have, overall, reduced their investment in the company by 3.5%.
I get 5 year median low Price/Earnings Ratio of 13.85 and a 5 year high P/E Ratio of 16.75. By this test, the current P/E Ratio of 7.82 is rather low. Even the 10 year low median P/E is higher at 11.09. The current dividend yield is 2.88% and this higher than the 5 year median of 1.25%. Even in US$, current yield of 2.91% is higher than the 5 year median yield of 1.43%. Both these tests show a good current stock price.
I get a Graham Price of $60.03. The current stock price of $34.63 is some 42% lower. The difference between the Graham Price and the low stock price over the past 10 years is the stock price being only some 24% lower than the Graham Price.
The last test to look at today is the Price/Book Value Ratio. The 10 year median P/B Ratio is 1.19. The current P/B Ratio is just 0.96. The current one is 80% of the 10 year median and this low ratio points to a good current price. Also, a P/B ratio of below 1.00 points to a good current price, as the stock is selling below the book value of the stock.
All my tests points to this stock being beaten up. There would seem no reason for this except that people feel we are going into a recession. The company has good debt ratios and good Dividend Payout Ratios. (See my site for information on Dividend Payout Ratios and see my site for further information on Debt Ratios.)
The company seems optimistic as it has just raised dividends by 40%. In fact dividends payable in 2011 are up over 138% compared dividends paid in 2010. The earnings estimates for this year are higher than last year’s earnings. Cash Flow is not estimated to be higher, but it is expected to be better than in the recent past.
When I look at analysts’ recommendations, I find Strong Buy, Buy and Hold recommendations. The consensus recommendation would a Buy. It would seem that analysts with Hold recommendations fear a double dip recession or a slowdown in the economy. The Buy and Strong Buy recommendations only talk about this stock being beaten down and the fact that it has a strong balance sheet.
This has been a strong company with Frank Stronach running it. However, is it past the time for automobile companies to make money? Will they do just as well without Frank Stronach? You have to wonder. Personally, this stock is not on my radar at present. I wonder if the world economy will do well until Europe starts to fix their problems. However, I must admit that the company does have a strong balance sheet and it is cheap.
Magna International is the most diversified global automotive supplier. They design, develop and manufacture technologically advanced automotive systems, assemblies, modules and components, and engineer and assemble complete vehicles, primarily for sale to original equipment manufacturers ("OEMs") of cars and light trucks. Their capabilities include the design, engineering, testing and manufacture of automotive interior systems; seating systems; closure systems; body and chassis systems; vision systems; electronic systems; exterior systems; powertrain systems; roof systems; hybrid and electric vehicles/systems; as well as complete vehicle engineering and assembly. Its web site is here Magna. See my spreadsheet at mg.htm.
This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.
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