Canadian Pacific Railway

Sound bite for Twitter and StockTwits is: Dividend Growth Industrial. I think that this stock price is currently expensive. I also do not buy any stock which has a yield less than 1%. It has done well for its shareholders over time. DPRs are good. See my spreadsheet on Canadian Pacific Railway.

I do not own this stock of Canadian Pacific Railway (TSX-CP, NYSE-CP). It is a stock I held from 1987 to 1999 so I am following it. I also held it 2006 to 2011. I decided in 2011 to have only one railway stock and chose CN as my railway stock.

When I was updating my spreadsheet, I noticed that the stock price on this company has really taken off, especially from 2016. Dividend increases has also been high since 2016.

The dividend yields are low with dividend growth good. The current dividend yield is quite low at just 0.92%. The 5, 10 and historical dividend yields also low at 0.96%, 1.02% and 1.53%. The current dividend increases are good (15% and above) at 16.2% per year over the past 5 years. Historically the growth in dividends went from low to moderate to the good current range.

The Dividend Payout Ratios (DPR) are good. The DPR for EPS for 2019 is 17%, with 5 year coverage at 16%. The DPR for CFPS for 2019 is 13% with 5 year coverage at 12%. The DPR for Free Cash Flow for 2019 is 31% with 5 year coverage at 30%. Dividend Coverage Ratio for 2019 is 3.26 with a 5 year ratio of 3.35. The three sites I looked at agree on FCF amounts over the years.

Debt Ratios are fine. The Long Term Debt Market Cap Ratio for 2019 is 0.18 and is low and therefore good. The Liquidity Ratio for 2019 is 0.53. If you add cash flow after dividends it is a good one at 1.66. The Debt Ratio for 2019 is a little low at 1.46. This ratio has always been low. I prefer the last two ratios to be 1.50 or higher. The Leverage and Debt/Equity Ratios for 2019 are 3.16 and 2.16 and are a bit high and I prefer them to be under 3.00 and under 2.00. This have been high for sometime with 5 year ratios at 3.08 and 2.08.

The Total Return per year is shown below for years of 5 to 31 to the end of 2019. 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.
2014	5	16.15%	62.63%	59.87%	2.76%
2009	10	11.57%	20.59%	19.28%	1.31%
2004	15	12.29%	16.20%	14.98%	1.22%
1999	20	12.51%	17.52%	16.00%	1.52%
1994	25	12.38%	16.26%	14.83%	1.43%
1989	30	6.73%	12.60%	11.51%	1.09%
1988	31	7.23%	13.16%	11.88%	1.27%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 14.10, 16.78 and 19.46. The corresponding 10 year ratios are 14.98, 17.90 and 20.94. The corresponding historical ratios are 11.11, 13.94 and 15.50. The current P/E Ratio is 24.24 based on a stock price of $412.11 and EPS estimate for 2020 of $17.00. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $144.37. The 10 year low, median, and high median Price/Graham Price Ratios are 1.63, 2.01 and 2.37. The current P/GP Ratio is 2.85 based on a stock price of $412.11. 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 5.05. The current P/B Ratio is 7.56 based on a Book Value of $7,465M, Book Value per Share of $54.49 and stock price of $412.11. The current ratio is 50% 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 13.09. The current P/CF Ratio is 18.00 based on Cash Flow per Share estimate for 2020 of $22.90, Cash Flow of $3,137M and a stock price of $412.11. The current ratio is 38% above 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.

I get an historical median dividend yield of 1.53%. The current dividend yield is 0.92% based on dividends of $3.80 and a stock price of $412.11. The current dividend yield is 40% below the historical dividend yield. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median dividend yield of 1.02%. The current dividend yield is 0.92% based on dividends of $3.80 and a stock price of $412.11. The current dividend yield is 10% below the 10 year dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.

The 10 year median Price/Sales (Revenue) Ratio is 4.55. The current P/S Ratio is 7.42 based on Revenue estimate for 2020 of $7,609M, Revenue per Share of $55.54 and a stock price of $412.11. The current ratio is 63% above the 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 expensive. One of the dividends yield tests (historical) says the stock is expensive and the other (10 year) says reasonable but above the median. However, the P/S Ratio test does not confirm the second test results and says the stock price is expensive. All the other rest says the stock price is expensive.

Is it a good company at a reasonable price? I think that it is a good company and it has done well for its shareholders. If I was holding it, I would not sell, but I think it is expensive, so I would not buy anymore at this time.

When I look at analysts’ recommendations, I find Strong Buy (11), Buy (8), Hold (9), Underperform (1) and Sell (1). The consensus would be a Buy. The 12 month stock price consensus is $396.05. This implies a total loss of 2.97% with a capital loss of $3.90% and dividends of $0.92%.

Analyst like this stock on Stock Chase. Site give it 5 stars out of 5. Jed Lloren on Motley Fool thinks this stock provides an excellent investment opportunity. A writer on Simply Wall Street thought in July 2020 that the P/E of 19.7 was too high. A writer on Simply Wall Street talks about the dividends being well covered by earnings and cash flow. The blogger Dividend Earner has written a blog on this company.

Canadian Pacific Railway Limited, together with its subsidiaries, owns and operates a transcontinental freight railway in Canada and the United States. Its web site is here Canadian Pacific Railway.

The last stock I wrote about was about was Trigon Metals Inc (TSX-TM, OTC-PNTZF) ... learn more. The next stock I will write about will be Medtronic PLC (NYSE-MDT) ... learn more on Wednesday, October 14, 2020 around 5 pm. Today on my other blog I will write about RioCan REIT.... learn more on Tuesday, October 13, 2020 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.

Trigon Metals Inc

Sound bite for Twitter and StockTwits is: Materials Sector Stock. See my spreadsheet on Trigon Metals Inc.

I own this stock of Trigon Metals Inc (TSX-TM, OTC-PNTZF). I originally brought this stock in 2000 as Tathacus Resources Ltd. because it was doing interesting things. It was part of a basket of small caps that I was buying at that time. There was a reverse takeover (RTO) of this company on April 28, 2011 by Pan Terra Industries Inc. Symbol PNT. On May 2, 2012 there was a name change from Pan Terra Industries (PNT) to Kombat Copper Inc. (KBT). September 2016 there was a name change to Trigon Metals Inc.

When I was updating my spreadsheet, I noticed that they have been selling shares by private placement. Outstanding shares have grown by 44% per year over the past 5 years. This stock still has no revenue, earnings, or cash flow. Any green on my spreadsheet just shows the results that are less bad, not that they are good.

This stock does not pay a dividend.

Debt Ratios are currently good. The Long Term Debt/Market Cap Ratio is low at just 0.05. The Liquidity Ratio is good at 2.68. The Debt Ratio is good at 3.09 and this is a good improvement on the last few years when the Debt Ratio was below 1.00. The Leverage and Debt/Equity Ratios are also currently goo at 1.48 and 0.48. The debt ratios have varied a lot over time.

The Total Return per year is shown below for years of 5 to 22 to the end of 2019. 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.
2014	5	0.00%	-21.99%	-21.99%	0.00%
2009	10	0.00%	-12.60%	-12.60%	0.00%
2004	15	0.00%	-26.24%	-26.24%	0.00%
1999	20	0.00%	-26.56%	-26.56%	0.00%
1997	22	0.00%	-15.29%	-15.29%	0.00%

The 5 year low, median, and high median Price/Earnings per Share Ratios are negative. The corresponding 10 year ratios are negative. The corresponding historical ratios are negative. The current P/E Ratio is negative. So, there is no way a test can be done for this stock.

I estimate a Graham Price of $0.07. The estimated 10 year low, median, and high median Price/Graham Price Ratios are 6.12, 6.72 and 10.60. The current P/GP Ratio is 5.67 based on a stock price of $0.33. 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 4.80. The current P/B Ratio is 19.57 based on a Book Value of $1,710M, Book Value per Share of $0.02 and a stock price of $0.33. The current ratio is 308% higher than 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 that is negative. The current P/FC Ratio is negative. This test cannot be done. There is not dividend and there is no revenue, so these tests cannot be done.

Results of stock price testing is that the stock price is anyone’s guess. The P/GP Ratio test says cheap and the P/B Ratio test says expensive. The P/GP Ratio is just an estimate but the book value has been going down by 23% per year over the past 5 years.

Is it a good company at a reasonable price? I do not sell this because it is worth less than $10. There has been two consolidations and I have ended up with just 6 shares from an initial 300 shares. I still track this stock because I am interested in how everything will turn out.

When I look at analysts’ recommendations, I find no analyst following this stock. This is hardly surprising.

There are no entries on Stock Chase, but this is not a surprise as this is a penny mining stock. There is an executive overview on Simply Wall Street. It is given two stars out of five. An announcement on Junior Mining talks about Eric Sprott buying shares through a private placement. A writer on Simply Wall Street talks about insider buying at this company. A writer on Simply Wall Street talks about who owns shares in this company.

Trigon Metals Inc together with its subsidiaries engages in the acquisition, exploration, development, and maintenance of mines and mineral properties in the African country of Namibia. Its web site is here Trigon Metals Inc.

The last stock I wrote about was about was Logistec Corp (TSX-LGT.B, OTC-LTKBF) ... learn more. The next stock I will write about will be Canadian Pacific Railway (TSX-CP, NYSE-CP) ... learn more on Tuesday, October 13, 2020 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.

Logistec Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Industrial. See my spreadsheet on Logistec Corp.

I do not own this stock of Logistec Corp (TSX-LGT.B, OTC-LTKBF). I got this stock from Dividend Growth Investing and Retirement blogger’s all-star spreadsheet for March 2017.

When I was updating my spreadsheet, I noticed that the accounting is somewhat complicated because they are giving some separate account for their Class A and Class B shares. Class A common shares have 30 votes each and Class B common shares have 1 vote each. The company is controlled by the Paquin family.

The dividend yields are low with dividend growth moderate but the increases seem to have stop currently. The current dividend is low (under 2%) at 1.18%. The 5, 10 and historical dividends are also low at 0.85%, 0.91% and 1.92%. The dividend increases for the last 5 years have been moderate (8% to 14% ranges) at 10.68% per year over the past 5 years. However, the last dividend increase was low at just 3.1% and it was for 2019. There has yet to be a dividend increase this year and it is usually done in October. It does not look like there will be one this year.

The Dividend Payout Ratios (DPR) are good. The DPR for EPS for 2019 is low at 19% with 5 year coverage at 17.5%. The DPR for CFPS is14% for 2019 with 5 year coverage at 12%. The DPR for 2019 for Free Cash Flow is 13% with 5 year coverage at 18%. The Dividend Coverage Ratio for 2019 is 7.44 with 5 year ratio at 5.41.

Debt Ratios are fine. The Long Term Debt/Market Cap Ratio is low and good at 0.33. The Liquidity Ratio is good at 1.85 as is the Debt Ratio at 1.62. The Leverage and Debt/Equity Ratios are fine at 2.62 and 1.62.

The Total Return per year is shown below for years of 5 to 23 to the end of 2019. 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.
2014	5	10.68%	0.36%	-0.49%	0.85%
2009	10	8.96%	22.40%	19.93%	2.48%
2004	15	8.34%	17.33%	14.44%	2.89%
1999	20	6.57%	12.09%	10.18%	1.91%
1996	23	6.04%	14.92%	11.17%	3.74%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 17.65, 19.70 and 21.75. The corresponding 10 year ratios are 12.00. 15.05 and 18.11. The corresponding historical 9.33, 10.83 and 12.57. The current P/E Ratio is 15.98 based on a stock price of $34.90 and latest 12 month EPS $2.18. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a Graham Price of $32.85. The 10 year low, median, and high median Price/Graham Price Ratios are 1.07, 1.32 and 1.47. The current P/GP Ratio is 1.06 based on a stock price of $34.90. This stock price testing suggests that the stock price is relatively cheap.

I get a 10 year median Price/Book Value per Share Ratio of 2.10. The current P/B Ratio is 1.59 based on a Book Value of $278M, Book Value per Share of $21.95 and a stock price of $34.90. The current ratio is 24% 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 9.80. The current P/CF Ratio is 4.33 based on latest 12 months Cash Flow of $99.4M, Cash Flow per Share of $7.85 and a stock price of $34.90. The current ratio is 56% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I get an historical median dividend yield of 1.92%. The current dividend yield is 1.18% based on dividend of $0.4116 and a stock price of $34.90. The current dividend yield is 39% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median dividend yield of 0.91%. The current dividend yield is 1.18% based on dividend of $0.4116 and a stock price of $34.90. The current dividend yield is 29% above the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

The 10 year median Price/Sales (Revenue) Ratio is 0.94. The current P/S Ratio is 0.73 based on a stock price of $34.90, latest Revenue of $602M and Revenue per Share of $47.53. The current P/S Ratio is 22% 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 relatively cheap. The 10 year dividend yield test is showing the stock as relatively cheap and the P/S Ratio test confirms this. I know that the historical dividend yield test shows it as expensive but, it appears that the stock price is rising faster the dividend increases. Most of the test are showing the stock as relative cheap. With the P/E Ratio test, a P/E Ratio of 15.98 is not high.

Is it a good company at a reasonable price? The stock price seems relatively cheap so the price is good. It has returned value to shareholders over the long term. The negative is the complicated structure and the company is controlled by the Paquin family. I know that the dividends were not raised in 2020, but a lot of companies are being cautious because of Covid.

When I look at analysts’ recommendations, I find only one analysts’ recommendation and it is a Hold. I cannot find any estimates or any 12 month stock price consensus.

There are no recent entries on Stock Chase and the site gives this stock one star out of 5 . Nikhil Kumar on Motley Fool reviewed this stock in November 2019 saying it is a profitable company that pays dividends. There is an executive overview on Simply Wall Street. A writer on Simply Wall Street thinks the stock has positive factors but is concerned with the lack of earnings growth. Stephen Takacsy's Top Picks on BNN recently includes Logistec (starting at 2.26 minutes in).

Logistec Corp provides specialized cargo handling and other services to a wide variety of marine, industrial and municipal customers. It has cargo-handling facilities in eastern North America, short-line rail transportation services, and marine agency services to foreign shipowners and operators serving the Canadian market. Its web site is here Logistec Corp.

The last stock I wrote about was about Teck Resources Ltd (TSX-TECK.B, NYSE-TECK) ... learn more. The next stock I will write about will be Trigon Metals Inc (TSX-TM, OTC-PNTZF) ... learn more on Friday, October 09, 2020 around 5 pm. Tomorrow on my other blog I will write about Something to Buy October 2020.... learn more on Thursday, October 08, 2020 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.

Teck Resources Ltd

Sound bite for Twitter and StockTwits is: Dividend Paying Materials. The stock price is cheap to reasonable. Insiders where buying between $9 and $14 recently. This stock has good debt ratios. Dividends are inconsistent. See my spreadsheet on Teck Resources Ltd.

I do not own this stock of Teck Resources Ltd (TSX-TECK.B, NYSE-TECK). The time to buy this stock is when it cuts its dividend. For example, I bought this stock in 2008 and sold in 2009. I bought this stock because the company purchased Fording Canadian Coal Trust at exactly the wrong time and got into financial difficulties and the stock price dropped off a cliff as they had to cut dividends. When the stock recovered somewhat in 2009, I sold for a profit.

When I was updating my spreadsheet, I noticed insiders were buying when the stock was dropping from $14.00 to $9.00 and then stopped buying when it went up again.

The dividend yields are low with dividend growth currently non-existent. The dividend yields have been mostly low (under 2%) with the current dividend yield at 1.09%. The 5, 10 and historical dividend yields are also low at 0.74%, 1.06% and 1.50%

The Dividend Payout Ratios (DPR) are fine. The DPR for 2019 for EPS is non -calculable because of earning loss, but the 5 year coverage is low at 30%. The DPR for CFPS for 2019 is 3% with 5 year coverage at 6%. The DPR for Free Cash Flow for 2019 using figures from Morningstar is 693% with 5 year coverage at 19%. Morningstar and Market Screener agree on FCF, but Wall Street Journal does not.

Debt Ratios are good. The Long Term Debt/Market Cap Ratio for 2019 is 0.43 and is fine. The Liquidity Ratio for 2019 is 1.62. The Debt Ratio for 2019 is 2.28. The Leverage and Debt/Equity Ratios for 2019 are 1.78 and 0.78.

The Total Return per year is shown below for years of 5 to 26 to the end of 2019. 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.
2014	5	-25.98%	4.03%	1.81%	2.22%
2009	10	0.00%	-5.30%	-7.24%	1.93%
2004	15	1.94%	2.86%	-0.40%	3.27%
1999	20	3.53%	8.98%	4.84%	4.14%
1994	25	2.81%	3.81%	1.41%	2.41%
1993	26	2.70%	4.01%	1.62%	2.39%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 2.19, 5.91 and 7.23. The corresponding 10 year ratios are 5.49, 10.63 and 16.97. The corresponding historical ratios are 6.53, 11.11 and 14.28. The current P/E Ratio is negative, so I cannot do this stock price test.

However, the P/E Ratio for 2021 is positive and it is 8.92 based on a stock price of $18.37 and 2021 EPS estimate of $2.06. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get an estimated Graham Price of $42.62. The 10 year low, median, and high median Price/Graham Price Ratios are 0.44, 0.73 and 1.05. The current P/GP Ratio is 0.43. 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 0.79. The current P/B Ratio is 0.47 based on a stock price of $18.37, Book Value of $20,814M and a Book Value per Share of $39.20. The current P/B Ratio is 41% 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 4.68. The current P/CF Ratio is 6.10 based on Cash Flow per Share estimate for 2020 of $3.01, Cash Flow of $1,598M and a stock price of $18.37. The current ratio is some 30% above the 10 year ratio. This stock price testing suggests that the stock price is relatively expensive.

I get an historical median dividend yield of 1.50%. The current dividend yield is 1.09% based on dividends of $0.20 and a stock price of $18.37. The current dividend yield is 27% below the historical dividend yield. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median dividend yield of 1.06%. The current dividend yield is 1.09% based on dividends of $0.20 and a stock price of $18.37. The current dividend yield is 2.83% above the historical dividend yield. This stock price testing suggests that the stock price is relatively reasonable and below the median.

The 10 year median Price/Sales (Revenue) Ratio is 1.42. The current P/S Ratio is 1.09 based on Revenue estimate for 2020 of $8,910, Revenue per Share of $16.78 and a stock price of $18.37. The current ratio is some 23% below the 10 year 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 to reasonable. I like the dividend yield test, but it does not work well on companies that cut their dividends, especially if the dividend cuts are recent. Dividends are down by 26% per year over the past 5 years. The next one I like is the P/S Ratio test and this test says the stock price is relatively cheap. The P/B Ratio tests shows this also. It is a good test as it is not based on any estimates.

The problem with the P/CF Ratio test is that analysts expect a big drop in cash flow in 2020. A problem with the P/GP Ratio test is that the Graham Price is an estimate because of negative earnings.

Is it a good company at a reasonable price? This is a material sector stock and so is risky. I do not consider material sector stocks to be long term investments, but you can make money in the short term. They tend to be cyclical so if the stock is low you can make a capital gain if the stock price goes up. I have bought this for short terms in the past, but do not consider it a long term investment.

When I look at analysts’ recommendations, I find Strong Buy (7), Buy (8) and Hold (5). The consensus would be a Buy. The 12 month consensus stock price is $22.54. This implies a total return of 23.79% with 22.70% from capital gains and 1.09% from dividends.

Analysts do not seem to like mining companies at present on Stock Chase. Jitendra Parashar on Motley Fool thinks a second wave of Covid will stop the current rally in this stock. This report from a writer on Simply Wall Street in February 2020 says that the ROCE for this company is better than for similar companies. Dan Healing on the National Observer talks about the CEO defending strategy as investors criticize performance.

Teck is a diversified miner with coal, copper, zinc, and oil sands operations in Canada, the United States, Chile, and Peru. Its web site is here Teck Resources Ltd.

The last stock I wrote about was about was Linamar Corporation (TSX-LNR, OTC-LIMAF) ... learn more. The next stock I will write about will be Logistec Corp (TSX-LGT.B, OTC-LTKBF) ... learn more on Wednesday, October 07, 2020 around 5 pm. Tomorrow on my other blog I will write about Dividend Stocks October 2020.... learn more on Tuesday, October 6, 2020 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.

Linamar Corporation

Sound bite for Twitter and StockTwits is: Dividend Growth Consumer. The stock price is reasonable and below the median. It has recently cut its dividend, but I am confident that it will grow it again in the future. There is insider buying. See my spreadsheet on Linamar Corporation.

I do not own this stock of Linamar Corporation (TSX-LNR, OTC-LIMAF). I looked at this stock back in 2000 and it was not a stock I thought fit my investment philosophy. In 2008 I read an article that recommended this company as a dividend stock with good value. This stock used to be on the Investment reporter portfolio stock list as an average risk stock. However, it has now been taken off this list.

When I was updating my spreadsheet, I noticed there was a lot of insider buying. Net Insider Buying as a percentage of the market cap is 0.31%, where you would expect this percentage to be closer to 0.01%. This stock has delivered good returns to shareholders over a long period of time.

However, it is not a great dividend stock. They have declared dividends for the last 24 years and in that time, dividends have been increased on 9 times and they were decreased once. Although the one time it did decrease its dividend, it was back to the old amount in one year’s time. The dividend yield has often been under 1%.

The dividend yields are low with dividend growth currently averaging low. The current dividend yield is low (under 1%) at 0.60%. The 5 and 10 year and historical median dividend yields are also low at 0.71%, 0.88% and 1.20%. Dividends are growth is low (under 8%) at 3.71% per year over the past 5 years. This year the dividends were cut by 50%. This company has few, but large dividend increases.

The Dividend Payout Ratios (DPR) are good. The DPR for 2019 for EPS is low at just 7.3% with 5 year coverage at 6%. The DPR for CFPS for 2019 is 3.5% with 5 year coverage at 3%. The DPR for Free Cash Flow for 2019 is 5.1% with 5 year coverage at 8%.

Debt Ratios are good. The Long Term Debt/Market Cap Ratio for 2019 is good at 0.58. The Liquidity Ratio for 2019 is good at 1.85 as is the Debt Ratio at 2.14 for 2019. However, the interim Liquidity Ratio for the second quarter is low at just 1.24. The Leverage and Debt/Equity Ratios for 2019 are 1.88 and 0.88.

The Total Return per year is shown below for years of 5 to 31 to the end of 2019. 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.
2014	5	3.71%	-6.35%	-7.09%	0.74%
2009	10	14.87%	14.99%	13.43%	1.56%
2004	15	7.60%	9.24%	8.04%	1.19%
1999	20	5.65%	7.87%	6.79%	1.08%
1994	25	7.06%	9.33%	8.45%	0.89%
1989	30		17.62%	14.86%	2.76%
1988	31		15.70%	13.54%	2.16%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 5.60, 7.37 and 9.33. The corresponding 10 year ratios are 6.55, 8.93 and 11.44. The corresponding historical ratios are 8.34, 11.60 and 15.56. The current P/E Ratio is 14.48 based on a stock price of $40.10 and EPS estimate for 2020 of $2.77. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $62.45. The 10 year low, median, and high median Price/Graham Price Ratios are 0.57, 0.77, and 0.96. The current P/GP Ratio is 0.64 based on a stock price of $40.10. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10 year median Price/Book Value per Share Ratio of 1.41. The current P/B Ratio is 0.64 based on a stock price of $41.10, Book Value of $4,083M and a Book Value per Share of $62.58. The current ratio is 54% 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 5.40. The current P/CF Ratio is 2.69 based on a stock price of $40.10, Cash Flow per Share estimate for 2020 of 14.90 and Cash Flow of $972M. The current ratio is 50% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I get an historical median dividend yield of 1.20%. The current dividend yield is 0.60% based on a stock price of $40.10 and dividends of $0.24. The current dividend yield is 50% below the historical dividend yield. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median dividend yield of 0.88%. The current dividend yield is 0.60% based on a stock price of $40.10 and dividends of $0.24. The current dividend yield is 32% below the historical dividend yield. This stock price testing suggests that the stock price is relatively expensive.

The 10 year median Price/Sales (Revenue) Ratio is 0.57. The current P/S Ratio is 0.47 based on Revenue estimate for 2020 of $5,625M, Revenue per Share of $86.22 and a stock price of $40.10. The current ratio is 18% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

Results of stock price testing is that the stock price is probably reasonable. The problem with the dividend yield tests is that the company has recently reduced dividends. If they had not, the results of testing against the historical dividend yield would be reasonable and at the median and for the 10 year dividend yield test the dividend yield would point to a cheap price. The P/S Ratio testing is showing the stock price as reasonable and below the median.

Other testing is pointing to a reasonable to cheap stock price. The P/E Ratio test is not, but the 2020 EPS is expected to be low at $2.77. The EPS is expected to recover in 2021 at $5.05. In 2021, the P/E Ratio is 7.94 and this would give us a stock price that is relatively reasonable and below the median.

Is it a good company at a reasonable price? The stock price would seem to be reasonable. I think that his is a good company for the long term. It is better for people building a portfolio rather than for people like me who live on their dividends. This is because of the very low dividend rate.

When I look at analysts’ recommendations, I find Strong Buy (1), Buy (2) and Hold (3). The consensus is a Buy. The 12 month consensus stock price is $48.67. This implies a total return of $21.97% with 0.60% from dividend and 21.37% from capital gains.

Analysts on Stock Chase like this company. Some have recently made it their top pick. Cindy Dye on Motley Fool picks this stock as her top stock for August 2020. A writer on Simply Wall Street thinks the market retains some optimism around long term earnings stability. A writer on Simply Wall Street is concerned about the company’s short term debt but find other debt ratios good. Jacqueline Thorpe reporting on Automotive New Canada talks about the CEO saying Linamar is past the worst after the coronavirus pandemic.

Linamar Corp makes powertrains and drivelines for vehicle and power generation markets and operates under two business segments: Transportation and Industrial. The three largest customers account for nearly half of total revenue. Its web site is here Linamar Corporation.

The last stock I wrote about was about was K-Bro Linen Inc (TSX-KBL, OTC-KBRLF) ... learn more. The next stock I will write about will Teck Resources Ltd (TSX-TECK.B, NYSE-TECK) ... learn more on Monday, October 5, 2020 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.

K-Bro Linen Inc

Sound bite for Twitter and StockTwits is: Dividend Paying Consumer. The stock price seems to be currently cheap. I would worry about a dividend cut as they cannot afford their dividends and it does not look like this situation will improve in the short term. However, analyst do not seem to think that the dividends will be cut. They have good debt ratios. Insiders are selling. See my spreadsheet on K-Bro Linen Inc.

I do not own this stock of K-Bro Linen Inc (TSX-KBL, OTC-KBRLF). People were talking about this stock at the 2009 Toronto Money Show. This was one income trust being touted as currently a good buy with very good yield. It was also recommended by Aaron Dunn who is the Senior Equity Analyst for Keystone Publishing Corp, a publisher of Canadian investment newsletters.

When I was updating my spreadsheet, I noticed this company had hit a high in 2015 and was recovering up to 2019, but has been hit again this year. Analysts expect the revenue and earnings to go down in 2020 including an earnings loss, but then the company is expected to do better in 2021. This stock used to be an income trust and as such now has a hard time getting the dividends in line with earnings. They should have cut the dividends in line with earnings on becoming a corporation.

The dividend yields are moderate with dividend growth non-existent. The current dividend yield is moderate (2% to 4% ranges) at 4.34%. The 5, 10 and historical dividend yields are also moderate at 2.90%, 3.25% and 4.47%. The dividends have been flat since 2015 and analysts do not expect this change in the near future. Analysts do not expect a dividend cut in the near future either.

The Dividend Payout Ratios (DPR) need improving for EPS. The DPR for EPS for 2019 is 117% with 5 year coverage at 115%. Because an earnings loss is expected in 2020, the dividend will not be covered in 2020. The 5 year coverage is e expected to move up to 164%. When there is an earnings loss, DPR for EPS cannot be calculated. The DPR for CFPS for 2019 is 30% with 5 year coverage at 40%. The DPR for Free Cash Flow for 2019 is 43%. The 5 year coverage cannot be calculated because of past negative FCF.

Debt Ratios are good. The Long Term Debt/Market Cap Ratio for 2019 is 0.14. It is low and good. The liquidity Ratio for 2019 is good at 1.78. The Debt Ratio is good at 2.26. The Leverage and Debt/Equity Ratios are good and low at 1.80 and 0.80.

The Total Return per year is shown below for years of 5 to 15 to the end of 2019. 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.
2014	5	0.00%	0.87%	-1.83%	2.70%
2009	10	0.87%	17.74%	12.05%	5.69%
2004	15	1.09%	15.01%	8.92%	6.10%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 31.30, 36.12 and 40.93. The corresponding 10 year ratios are 23.62, 27.61 and 31.60. The corresponding 10 year ratios are 18.82, 19.68 and 21.32. The current P/E Ratio is negative, so a stock price test cannot be done on it. The P/E Ratio for 2021is 67.49 based on a stock price of $27.67 and EPS estimate for 2020 of $0.41. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $12.77. The 10 year low, median, and high median Price/Graham Price Ratios are 1.59, 1.86 and 2.13. The current P/GP Ratio is 2.17 based on a stock price of $27.67. 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 2.46. The current P/B Ratio is 1.57 based on a stock price of $27.67, Book Value of $187M and Book Value per Share of $17.68. The current ratio is 36% 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 13.40. The current P/CF Ratio is 7.58 based on a stock price of $27.67, Cash Flow per Share estimate for 2020 of $3.65 and Cash Flow of $38.7M. The current ratio is 43% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I get an historical median dividend yield of 4.47%. The current dividend yield is 4.34% based on dividends of $1.20 and a stock price of $27.67. The current yield is 3% below the historical dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get an historical median dividend yield of 3.25%. The current dividend yield is 4.34% based on dividends of $1.20 and a stock price of $27.67. The current yield is 33% above the historical dividend yield. This stock price testing suggests that the stock price is relatively cheap.

The 10 year median Price/Sales (Revenue) Ratio is 1.73. The current P/S Ratio is 1.50 based on Revenue estimate for 2020 of $195M, Revenue per Share of $18.39, and a stock price of $27.67. The current ratio is 13% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

Results of stock price testing is that the stock price is probably reasonable. The dividend yield tests show different results with the historical dividend yield test showing the stock price above the median and the 10 year dividend yield test showing the stock price as cheap. The reasonableness of the dividend tests is confirmed by the P/S Ratio test which says the stock price is relatively reasonable and below the median.

Is it a good company at a reasonable price? The stock price seems to be reasonable and below the median. The good thing is that Revenue is growing. The bad thing is that earnings are not growing and they cannot cover their dividend with earnings and will not be able to in the next couple of years either. Coverage by Cash Flow is getting high. I would think that the dividend is at risk. To me, this is not a dividend growth company and I would not be interested in it at the present time.

When I look at analysts’ recommendations, I find Strong Buy (2) and Buy (4). The consensus would be a Buy. The 12 month stock price is $39.00. This implies a total return of 45.28% with 4.34% from dividends and 40.95% from capital gains.

There are no recent entries by analysts on Stock Chase. The analysts lost interest in 2018. Daniel Da Costa on Motley Fool thinks this company is in a strong position to weather the current environment. A writer on Simply Wall Street says this stock is trading above it intrinsic value of $20.96. A writer on Simply Wall Street says that although this company is paying out more than it is earning, the dividends are covered by its Free Cash Flow.

K-Bro Linen Inc is a healthcare and hospitality laundry and linen processor in Canada. It operates around 15 facilities in major cities across Canada, and two distribution centers, providing management services and laundry processing of hospitality, healthcare, and specialty linens. It operates through two divisions such as the Canadian division and the UK division. Its web site is here K-Bro Linen Inc.

The last stock I wrote about was about was Le Chateau Inc (TSX-CTU, OTC-LCUAF) ... learn more. The next stock I will write about will be Linamar Corporation (TSX-LNR, OTC-LIMAF) ... learn more on Friday, October 02, 2020 around 5 pm. Tomorrow on my other blog I will write about Best Stocks I Follow.... learn more on Thursday, October 01, 2020 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.

Le Chateau Inc

Sound bite for Twitter and StockTwits is: Consumer Sector Stock. The stock price is relatively cheap. However, it stopped paying dividends in 2011. The company continues to lose money and sales are declining. They are putting some blame on Covid lockdown, but Sales have been declining since 2011. Currently the Book Value is negative. See my spreadsheet on Le Chateau Inc.

I do not own this stock of Le Chateau Inc (TSX-CTU, OTC-LCUAF). In June 10, 2012 I started spreadsheet because of a request from Blog reader. It was also on my list of dividend and special dividend paying stocks. Jennifer Dowty wrote a column on Dividend Paying stocks in 2010. Jennifer is now an investor reporter for the Globe and Mail. The title of the article in Investor’s Digest was Dividend Stocks: Buy, Hold and Collect. The Investor’s Digest is a publication of MPL Communications.

When I was updating my spreadsheet, I noticed this company continues to lose money and the revenue is still declining. They started to have earnings losses from 2011. It was in deep trouble before the Covid Lockdowns and I would think that the lockdowns will be very hard on this company.

It is interesting that shareholders that have held this stock for a very long time have made money but just because dividends were paid. Shareholders who have held this stock for 20 plus year have a Total Return that is positive (example 13.49% per year for 20 year holders), but stock price is lower than what it was then and even what it was 27 years ago.

This stock no longer pays any dividend. They were suspended in 2011. They had to cut their because they paid out too much of their earnings in 2010 and then had an earnings loss in 2011. They have had earnings losses since 2011 and so they will not be paying any dividends anytime soon.

The company cannot afford to pay dividends so there are no Dividend Payout Ratios (DPR).

Debt Ratios are awful. The Long Term Debt/Market Cap Ratio was very high since 2015, but now all their long term debt is on their balance sheet as the current portion of the long term debt as they are due within one year. The Liquidity Ratio for 2019 is 0.64 and with cash flow is 0.88. They do not say how they will cover the debt due in one year. The Debt Ratio is 0.66. This means that the book value (or breakup value) of the company is negative. Leverage and Debt/Equity Ratios cannot be calculated when the book value is negative.

The Total Return per year is shown below for years of 5 to 27 to the end of 2019. 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.
2014	5	0.00%	-45.07%	-45.07%	0.00%
2009	10	0.00%	-42.75%	-44.19%	1.44%
2004	15	0.00%	-6.20%	-28.40%	22.19%
1999	20	0.00%	13.49%	-17.35%	30.84%
1994	25	0.00%	6.13%	-15.42%	21.54%
1992	27	0.00%	8.10%	-13.29%	21.39%

The 5 year low, median, and high median Price/Earnings per Share Ratios are negative and therefore useless. The corresponding 10 year ratios are also negative and useless. The corresponding historical ratios are 4.55, 6.54 and 8.49. They are low because of recent earnings losses. The current P/E Ratio is negative and so I cannot do this testing. Also, analysts expect the EPS to be negative in 2021.

I calculate a Graham Price of $0.20, but this is just an estimate. The 10 year low, median, and high median Price/Graham Price Ratios are 0.39, 0.91 and 1.33. The current P/GP Ratio is 0.20 based on a stock price of $0.03. 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 0.87. The book value has turned negative so I cannot do this stock price test.

I get a 10 year median Price/Cash Flow per Share Ratio that is negative. So, I cannot do this stock price test. However, the current P/CF Ratio is very low at just 0.06 currently.

The dividends have been cancelled so I can do no stock price testing using dividend yields.

The 10 year median Price/Sales (Revenue) Ratio is 0.17. The current P/S Ratio is 0.01 based on last 12 months revenue of $122.5M, Revenue per Share of $4.05 and a stock price of $0.03. The current ratio is 94% 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 relatively cheap. There is only one good test and that is the P/S Ratio test, although the P/GP Ratio test is probably acceptable.

Is it a good company at a reasonable price? The stock price is relatively cheap. However, being cheap does not make a stock a good buy. Who knows if this firms will recover? The management has hope, but talk about the impact of the lockdown. They have a 60 year history and a 5 year strategic plan. They also have a negative book value, which means there is no meaningful breakup value.

When I look at analysts’ recommendations, I find only one recommendation and it is a Sell (1). The consensus would be a Sell.

Analysts on this site of Stock Chase where saying do not buy in 2011, the last year of any posting. The last report mentioning this stock on Motley Fool was in 2017 and it said Reitman’s were doing better. The Executive Summary on Simply Wall Street says the company is trading at 100% below its estimated fair value, but it lists a number of risk factors. A recent report on Simply Wall Street looks at who owns shares in this company. A report about this company’s second quarter of 2020 is posted on Yahoo Finance.

Le Chateau Inc is a Canadian brand in specialty retailing, offering a broad array of contemporary fashion apparel, accessories, and footwear for style-conscious women and men. The firm offers tops, sweaters, cardigans, pants, skirts, shirts, ties and blazers, among others for women and men. Its web site is here Le Chateau Inc.

The last stock I wrote about was about was Granite REIT (TSX-GRT.UN, NYSE-GRP.U) ... learn more. The next stock I will write about will be K-Bro Linen Inc (TSX-KBL, OTC-KBRLF) ... learn more on Wednesday, September 30, 2020 around 5 pm. Tomorrow on my other blog I will write about Losing Investments.... learn more on Tuesday, September 29, 2020 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.

Granite REIT

Sound bite for Twitter and StockTwits is: Dividend Growth REIT. Stock Price is relatively expensive. Its DPRs are fine and the Debt Ratios are good. See my spreadsheet on Granite REIT.

I do not own this stock of Granite REIT (TSX-GRT.UN, NYSE-GRP.U), but I used to. I first bought some of this stock in 2003 when it was called MI Developments (TSX-MIM.A). It was a company connected with Frank Stronach and Magna. TD bank also had an Action Buy Call (Strong Buy) on this stock. By the December 2006, it was doing well and my stock was up some 15% per year. I bought some more. The year of 2006 was the last time I did well on this stock. It kept going down and I sold it in 2009; being discourage it would ever do well again.

In 2012 it changed its name to Granite REIT. This company because a very different company in 2012. It disconnected from Magna (but still has Magna as major tenant) and it switched the reporting and dividend currency from US$ to CDN$. It also increased the dividend for 144%.

When I was updating my spreadsheet, I noticed the stock price is higher than it was before the drop in March. It reached a high of $74.86 in February 2020, dropped to $41.12 and it now at $76.19 after hitting a high of $79.65 in August 2020.

The dividend yields are moderate. The current dividend yield is moderate (2% to 4%) at 3.79%. The 5, 10 and historical dividend yields are good 5% and 6% ranges) at 5.44%, 5.47% and 5.15%. There was a big dividend increase (of 144%) when this company was rebranded as Granite REIT in 2012. The median yields went up at that time from a 2% range to a 5% range.

The dividend growth is low. The current dividend growth is 4.95% per year over the past 5 years. The last dividend increase was in 2020 and it was for 3.90. This company has been paying dividends for 16 years. They have increased the dividend in 12 of those years and decreased them in 4 of those years. The last decrease was in 2010.

The Dividend Payout Ratios (DPR) are mostly fine. The DPR for 2019 is 36% with 5 year coverage at 38%. The DPR for CFPS is very high at 69% with 5 year coverage at 70%. The Free Cash Flow has been negative for a few years so the DPR for FCF cannot be calculated for 2019 or for 5 year coverage. Since this is a REIT, we need to looks at the DPR for Adjusted Funds from Operations (AFFO), and Funds from Operations (FFO). The DPR for AFFO for 2019 is 77%, with 5 year coverage at 75%. The DPR for FFO for 2019 is 79% with 5 year coverage at 81%.

Debt Ratios are very good. The Long Term Debt/Market Cap Ratio is good and low at 0.33 for 2019. The Liquidity Ratio for 2019 is very good at 3.78 as is the Debt Ratio for 2019 at 2.90. The Leverage and Debt/Equity Ratios for 2019 are good and low at 1.53 and 0.53.

The Total Return per year is shown below for years of 5 to 17 to the end of 2019 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.
2014	5	4.95%	15.38%	9.84%	5.53%
2009	10	16.07%	25.09%	17.75%	7.34%
2004	15	13.23%	7.13%	4.11%	3.02%
2002	17	11.86%	8.49%	5.44%	3.05%

The Total Return per year is shown below for years of 5 to 17 to the end of 2019 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.
2014	5	2.61%	12.41%	7.35%	5.07%
2009	10	13.63%	22.54%	15.23%	7.31%
2004	15	12.66%	6.70%	3.51%	3.19%
2002	17	11.83%	10.30%	6.65%	3.65%

The 5 year low, median, and high median Price/Earnings per Share Ratios are 6.08, 6.84 and 7.60. The corresponding 10 year ratios are 7.09, 8.24 and 9.38. The corresponding historical ratios are 6.89, 7.87 and 8.85. The current P/E Ratio is 10.26 based on a stock price of $76.60 and last 12 months of EPS of $7.47. This stock price testing suggests that the stock price is relatively expensive.

Because this is an REIT, we also need to look at the Price/Funds from Operations per Share Ratios. The 5 year low, median, and high median P/FFO Ratios are 13.09, 14.33 and 15.57. The corresponding 10 year ratios are 11.49, 13.31 and 15.33. The current P/FFO Ratio is 19.69 based on FFO estimate for 2020 of $3.89 and a stock price of $76.60. This stock price testing suggests that the stock price is relatively expensive.

Because this is an REIT, we also need to look at the Price/Adjusted Funds from Operations per Share Ratios. The 5 year low, median, and high median P/AFFO Ratios are 14.16, 15.49, and 16.82. The corresponding 10 year ratios are 14.16, 15.49 and 16.82. The current P/AFFO Ratio is 19.69 based on AFFO estimate for 2020 of $3.52 and a stock price of $76.60. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $73.79. The 10 year low, median, and high median Price/Graham Price Ratios are 0.72, 0.78 and 0.86. The current P/GP Ratio is 1.04 based on a stock price of $76.60. 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 1.05. The current P/B Ratio is 1.23 based on a stock price of $76.60, Book Value of $3,598M, and a Book Value per Share of $62.20. The current ratio is 18% 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 13.84. The current P/CF Ratio is 20.83 based on last 12 months Cash Flow of $213M, Cash Flow per Share of $3.68 and a stock price of $76.60. The current ratio is 51% above the 10 year ratio. This stock price testing suggests that the stock price is relatively expensive.

I get an historical median dividend yield of 4.56%. The current dividend yield is 3.79% based on dividends of $2.90 and a stock price of $76.60. The current ratio is 17% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a 10 year median dividend yield of 5.47%. The current dividend yield is 3.79% based on dividends of $2.90 and a stock price of $76.60. The current ratio is 31% below the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively expensive.

The 10 year median Price/Sales (Revenue) Ratio is 9.20. The current P/S Ratio is 13.69 based on a stock price of $76.60, Revenue estimate for 2020 of $250M, and Revenue per Share of $4.33. The current ratio is 49% above the 10 year 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 relatively expensive. A lot of this testing is showing the stock price as expensive. I am going by the 10 year dividend yield testing as the company did change a lot after 2012. This is using by favourite tests of P/S Ratio and Dividend Yield. The outlier is the P/B Ratio test and the historical dividend yield test. The Book Value has grown nicely lately. Dividend yields got higher after rebranding in 2012.

Is it a good company at a reasonable price? This company certainly has done well since it was rebranded as Granite REIT. There has been better returns and higher yields. This stock is higher now than it was at the end of last year. It would seem that it is a worthwhile REIT to own. Unfortunately, it would seem to be on the expensive side at the moment.

When I look at analysts’ recommendations, I find Strong Buy (3), Buy (4) and Hold (1). The consensus would be a Buy. The 12 month stock price consensus is $81.34. This implies a total return of $9.98% withy 6.19% from capital gains and 3.79% from dividends.

Analysts on Stock Chase like this stock. This stock is one of the top 10 for August 2020 picked by Motley Fool Staff . A writer on Simply Wall Street talks about FFO and REITs. A writer on Simply Wall Street talks about insider buying. The blogger The Dividend Guy calls this REIT, the Rock Solid REIT.

Granite Real Estate Investment Trust, or Granite, is a real estate investment trust engaged in the acquisition, development, and management of primarily industrial properties in North America and Europe. Granite's portfolio comprises various manufacturing, corporate office, warehouse and logistics, and product engineering facilities. The vast majority of the company's assets are logistics and distribution warehouses and multipurpose buildings split fairly evenly amongst Canadian, Austrian, and U.S. locations. Its web site is here Granite REIT.

The last stock I wrote about was about was Alcanna Inc (TSX-CLIQ, OTC-LQSIF) ... learn more. The next stock I will write about will be Le Chateau Inc (TSX-CTU, OTC-LCUAF) ... learn more on Monday, September 28, 2020 around 5 pm.

Also, on my book blog I have put a review of the book Heart, Breath, Mind by Leah Lagos learn more...

This blog is meant for educational purposes only and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

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

Alcanna Inc

Sound bite for Twitter and StockTwits is: Consumer Sector Stock. The stock price is relatively cheap. However, the lack of profits and the dive in book value makes this stock a very risky investment. There has been some deterioration in debt ratios. Current shareholder’s value will also deteriorate with the current selling of new shares to raise money. See my spreadsheet on Alcanna Inc.

I do not own this stock of Alcanna Inc (TSX-CLIQ, OTC-LQSIF). The idea of following this stock came from a reader of my blog.

When I was updating my spreadsheet, I noticed that the revenue has been going up and down, but for the last 3 years they have had earning losses. I note that the sales only went up in 2019 by 6%, but the cost of sales went up by 24%. For this stock, shareholders have not done well and now the dividend has been suspended.

This is another stock that has suspended their dividends. Dividends were suspended in 2018. They had earning losses for the past 3 years to 2019. However, analysts expect this company to make money this year. (But they have said that before.) They could not continue to pay dividends when there are multiple years of earning losses. The 5 year coverage for Cash Flow for 2019 was 87%, but the 5 yar coverage in 2018, the last year of dividends was 109%.

Some Debt Ratios have deteriorated. The Long Term Debt/Market Cap Ratio for 2019 is 0.32 and this is a good number. The Liquidity Ratio for 2019 at 2.10 is a good number. The Debt Ratio at 1.17 is low and it is better if it is 1.50 or above. It used to be a lot better, for example last year it was 2.24 and has a 5 year median of 2.19. The Leverage and Debt/Equity Ratios have also deteriorated and for 2019 they are 6.82 and 5.82 and much too high. It is better if they were under 3.00 and 2.00. They used to be. In 2018 these ratios were 1.81 and 0.81 and the 5 year medians are 1.81 and 0.81 which are good ratios.

The Total Return per year is shown below for years of 5 to 15 to the end of 2019. 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.
2014	5	0.00%	-17.92%	-21.99%	4.06%
2009	10	0.00%	-3.26%	-11.82%	8.56%
2004	15	0.00%	3.85%	-7.59%	11.44%

The 5 year low, median, and high median Price/Earnings per Share Ratios are negative and so not useable. The corresponding 10 year ratios are 13.44, 14.91 and 16.38. The corresponding historical ratios are 13.18, 16.22 and 18.46. The current P/E Ratio is 13.59 based on a stock price of $4.35 and EPS estimate for 2020 of $0.32. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a Graham Price of $3.47. The 10 year low, median, and high median Price/Graham Price Ratios are 0.90, 1.24 and 1.55. The current P/GP Ratio is 1.25 based on a stock price of $4.35. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a 10 year median Price/Book Value per Share Ratio of 1.25. The current P/B Ratio is 2.60 based on a stock price of $4.35, Book Value of $66.9M and a Book Value per Share of $1.67. The current ratio is 108% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. The reason for the stock showing expensive on this test is because the book value has been declining. It has declined by 32% per year over the past 5 years. This is a very bad sign.

I get a 10 year median Price/Cash Flow per Share Ratio of 9.86. The current P/CF Ratio is 3.85 based on a stock price of $4.35, Cash Flow for the last 12 months of $43.3M and Cash Flow per Share of $1.13. The current ratio is 61% below the 10 year ratio. This stock price testing suggests that the stock price is relatively cheap.

I cannot do dividend yield tests because the dividends have been suspended.

The 10 year median Price/Sales (Revenue) Ratio 0.48. The current P/S Ratio is 0.22 based on Revenue estimate for 2020 of $805M, Revenue per Share of $20.10 and a stock price of $4.35. The current ratio is 55% 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 P/S Ratio is pointing at a cheap price. The problem is with the P/B Ratio test. It is testing as expensive because of the big decline in book value. This points out that the stock is probably very risky.

Is it a good company at a reasonable price? The price is probably cheap. However, this would be a very risky investment. I know that it is into selling cannabis, but companies selling cannabis have not proven that they can make money at it yet. Certainly, this company has not proven that they can make a profit.

When I look at analysts’ recommendations, I find Strong Buy (2), Buy (1) and Hold (1). The consensus would be a Buy. The 12 month stock price $6.31. This implies a total return of 45.06% all from capital gains.

The last analysts’ remarks were in 2019 on Stock Chase. It is always a bad sign when analysts lose interest in a stock. Nelson Smith on Motley Fool thinks this stock is a bargain. He points out that it is also selling cannabis as well as liquor. A writer on Simply Wall Street points out that not only is this company not making a profit, the revenue is growing very slowly. The company announced on Newswire a bought deal for common shares. This will dilute the shares of current shareholders. A writer on Cannin thinks that the stock price is likely to improve in the long term.

Alcanna Inc is a private sector retailer of beer, wine and spirits in North America and Canada operating approximately 231 locations under the Wine and Beyond, Ace Liquor Discounters and Liquor Depot banners in Alberta and British Columbia. The company also operates Nova Cannabis retail stores in Alberta and in Toronto, Ontario. Its web site is here Alcanna Inc.

The last stock I wrote about was about was Great-West Lifeco Inc (TSX-GWO, OTC-GWLIF) ... learn more. The next stock I will write about will be Granite REIT (TSX-GRT.UN, NYSE-GRP.U) ... learn more on Friday, September 25, 2020 around 5 pm. Tomorrow on my other blog I will write about My Stock Reports .... learn more on Thursday, September 24, 2020 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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