Wednesday, March 27, 2024

AltaGas Ltd

Sound bite for Twitter and StockTwits is: Dividend Growth Utility. Results of stock price testing is that the stock price is probably reasonable, striking a value between the dividend yield and P/S Ratio tests and looking at other tests. Debt Ratios are fine, but the company does have a high debt level. The Dividend Payout Ratios (DPR) are fine. The current dividend yield is moderate with dividend growth restarting after dividend cuts. See my spreadsheet on AltaGas Ltd .

Is it a good company at a reasonable price? I do not like the debt level, but utilities tend to have high debt levels. It is never a good sign when a company cuts dividends, but the dividends were high because the company used to be an income trust and income trusts can pay higher dividends than corporations. Eventually, all old income trusts had to lower dividends one way or another. I have not intentions of selling my shares in this company. The stock price is probably reasonable, but it may even be cheap as the P/S Ratio tests says.

I own this stock of AltaGas Ltd (TSX-ALA, OTC-ATGFF). When I bought this stock in 2009 it was on many dividend growth stock lists. In 2009, I saw that this stock also had good growth in Revenues, Earnings, Dividends, and Stock Prices over the last 5 and 10 years. The stock had a fairly strong balance sheet. I took a small position in this stock, and planned to wait and see how things go with this stock before buying more. I bought more in 2010 and 2012.

When I was updating my spreadsheet, I noticed that the people who bought this stock 10 years ago have faired badly. See charts on below. When you buy stocks for the long term, companies can go through some tough times. I kept this stock as I did not lose faith in it.

If you had invested in this company in December 2013, for $1,019.25 you would have bought 25 shares at $40.77 per share. In December 2023, after 10 years you would have received $375.95 in dividends. The stock would be worth $695.50. Your total return would have been $4,071.45. This would be a total return of 0.61% per year with 3.75% from capital loss and 4.36% from dividends.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$40.77 $1,019.25 25 10 $375.95 $695.50 $1,071.45

The current dividend yield is moderate with dividend growth restarting after dividend cuts. The current dividend yield is moderate (2% to 4% ranges) at 4.04%. The 5 year median dividend yield is moderate at 4.81%. The 10 year and historical median dividend yields are good (5% to 6% ranges) at 5.25% and 5.62%. Dividends were cut 56% in 2019. Dividends were raised again in 2021, but dividends are still 46% below the dividends of 2018. Dividends over the past 5 years have been decreased by 13% per year, and they are up 24% over the past 3 years.

The Dividend Payout Ratios (DPR) are fine. The DPR for 2023 for Earnings per Share (EPS) is fine at 50% with 5 year coverage at 58%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is fine at 59% with 5 year coverage at 64%. The DPR for 2023 for Cash Flow per Share (CFPS) is good at 38% with 5 year coverage at 28%. The DPR for 2023 for Free Cash Flow (FCF) is too high at 178% with 5 year coverage negative.

Item Cur 5 Years
EPS 49.56% 57.59%
AEPS 59.26% 63.92%
CFPS 32.35% 28.31%
FCF 177.53% -131.29%

Debt Ratios are fine, but the company does have a high debt level. The Long Term Debt/Market Cap Ratio for 2023 is fine, but high at 0.92 and currently at 0.87. The Long Term Debt/Covering Assets for 2023 is fine, but high at 0.89 and currently at 0.56. The Liquidity Ratio for 2023 is low at 0.89. If you added in Cash Flow after dividends, the ratios are still low fine at 1.12 and currently at 1.13. If you also add back the current portion of the long term debt, the ratios are fine at 1.59 and currently at 1.60. The Debt Ratio for 2023 is good at 1.50. The Leverage and Debt/Equity Ratios for 2023 are fine at 2.98 and 1.98.

Type Year End Ratio Curr
Lg Term R 0.92 0.87
Lg Term R+A 0.89 0.56
Intang/GW 0.66 0.62
Liquidity 0.89 0.89
Liq. + CF 1.12 1.13
Liq. + CF + D 1.59 1.60
Debt Ratio 1.50 1.50
Leverage 2.98 2.98
D/E Ratio 1.98 1.98

The Total Return per year is shown below for years of 5 to 24 to the end of 2023. 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.
2018 5 -12.55% 20.64% 14.89% 5.75%
2013 10 -2.81% 0.61% -3.75% 4.36%
2008 15 -4.16% 11.21% 3.26% 7.95%
2003 20 5.66% 12.57% 3.03% 9.54%
1999 24 9.57% 17.85% 6.60% 11.25%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 9.49, 10.31 and 12.97. The corresponding 10 year ratios are 19.49, 23.55 and 27.61. The corresponding historical ratios are 12.74, 15.60 and 18.61. The current P/E Ratio is 13.76 based on a stock price of $29.48 and EPS estimate for 2024 of $2.14. The current ratios are below the low ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Earnings per Share Ratios are 11.34, 13.11 and 15.94. The corresponding 10 year ratios are 12.84, 19.10 and 23.51. The current ratio is 13.71 based on a stock price of $29.48 and AEPS estimate for 2024 of $2.15. The current ratio is between the low and median ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I have Funds from Operations (FFO) data. The 5-year low, median, and high median Price/ Funds from Operations Ratios are 4.44, 5.40 and 6.37. The corresponding 10 year ratios are 5.28, 6.61 and 8.46. The current P/FFO Ratio is 7.37 based on a stock price of $29.48 and FFO for last 12 months of $4.00. This ratio is between the median and high ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I have Funds from Operations (FFO) data. The 5-year low, median, and high median Price/Adjusted Funds from Operations Ratios are 5.06, 6.17 and 7.19. The corresponding 10 year ratios are 5.99, 7.34 and 5.99. The current P/AFFO Ratio is 7.43 based on a stock price of $29.48 and AFFO estimate for 2024 of $3.97. This ratio is between the median and high ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a Graham Price of $34.66. The 10-year low, median, and high median Price/Graham Price Ratios are 0.68, 0.93 and 1.21. The current P/GP Ratio is 0.85 based on a stock price of $29.48. The current ratio is between the low and median ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10-year median Price/Book Value per Share Ratio of 1.10. The current P/B Ratio is 1.19 based on a Book Value of $7,322, Book Value per Share of $24.83 and a stock price of $29.48. The current ratio is 8% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I also have a Book Value per Share estimate for 2024 of $25.08. This Book Value per Share estimate is calculated differently than I calculate it and the corresponding 10 year ratio is 0.97. The Book Value per Share estimate of $25.08 implies a ratio of 1.18 and Book Value of $7,396 with a stock price of $29.48. This ratio is 21% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This estimate assumes that the book value will decrease in 2024 by 6%, but it has been going up lately. The estimates then assumes that the book value will climb by 8% in 2025. I do wonder about these estimates

I get a 10-year median Price/Cash Flow per Share Ratio of 9.39. The current P/CF Ratio is 7.37 based on a stock price of $29.48, Cash Flow per Share estimate for 2024 of $4.00 and Cash Flow of $1,180M. The current ratio is 22% below the 10 year median ratio. his stock price testing suggests that the stock price is relatively cheap.

I get an historical median dividend yield of 5.62%. The current dividend yield is 4.04% based on dividends of $1.19 and a stock price of $29.48. The current ratio is 28% below the historical median dividend yield. his stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median dividend yield of 5.25%. The current dividend yield is 4.04% based on dividends of $1.19 and a stock price of $29.48. The current ratio is 23% below the historical median dividend yield. his stock price testing suggests that the stock price is relatively expensive.

The 10-year median Price/Sales (Revenue) Ratio is 1.10. The current P/S Ratio is 0.84 based on Revenue estimate for 2024 of $13,659M, Revenue per Share of $46.32 and a stock price of $29.48. The current P/S Ratio is 42% 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 reasonable, striking a value between the dividend yield and P/S Ratio tests and looking at other tests. The problem with the dividend yield tests is that the dividends have decreased and this test is good for increasing dividends. However, when a company decreases the dividends or keeps them flat, that is not a good sign. The P/S Ratio test says that the stock price is cheap and the dividend tests say it is expensive. Most of the other testings suggests that the stock price is reasonable and above or below the median.

When I look at analysts’ recommendations, I find Strong Buy (5), Buy (7) and Hold (1). The consensus would be a Strong Buy. The 12 month stock price consensus is $33.38 with a high of $36.00 and low of $30.00. The consensus price of $33.38 implies a total return of 17.27% with 13.23% from capital gains and 4.04% from dividends.

There are 7 buy recommendations on Stock Chase for 2024. Stock Chase gives this stock 5 stars out of 5. Brian Paradza on Motley Fool thinks this stock is a buy on attractive terms. Rajiv Nanjapla on Motley Fool thinks this is a good dividend stock to have in your portfolio. The company put out a Press Release about their fourth quarter of 2023.

Simply Wall Street via Yahoo Finance reviews this stock. Simply Wall Street has 4 warnings for this stock of interest payments are not well covered by earnings; dividend of 4.04% is not well covered by cash flows; shareholders have been diluted in the past year; and large one-off items impacting financial results. Simply Wall Street gives this stock 3 and one half stars out of 5.

AltaGas Ltd owns and operates a diversified basket of energy infrastructure businesses. Business is conducted through given segments: Midstream, Utilities and Corporate/other. Revenue is derived from customers in both Canada and the United States, with Canadian customers contributing the most. Its web site is here AltaGas Ltd .

The last stock I wrote about was about was TC Energy Corp (TSX-TRP, NYSE-TRP) ... learn more. The next stock I will write about will be Hydro One Ltd (TSX-H, OTC-HRNNF) ... learn more on Friday, March 29, 2024 around 5 pm. Tomorrow on my other blog I will write about Bitcoin and other Digital Currency.... learn more on Thursday, March 28, 2024 around 5 pm.

This blog is meant for educational purposes only and is not to provide investment advice. I am not a licensed professional investment advisor. 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 site for an index to these blog entries and for stocks followed. 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. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Monday, March 25, 2024

TC Energy Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Utility. Results of stock price testing is that the stock price is probably reasonable and may even be cheap. Debt Ratios of Liquidity and Leverage are a problem as the company has too much debt. The Dividend Payout Ratios (DPR) are fine because of DPR for FFO and AEPS. The current dividend yield is high with dividend growth low. See my spreadsheet on TC Energy Corp.

Is it a good company at a reasonable price? This is a utility stock and has produced at or close to 8% per year. Most of the return is from dividends and this is quite common with utility stocks. I own this stock and plan to hold on to the share that I own. The price is certainly reasonable with the dividend yield tests showing the stock as cheap. Insider buying is certainly a good sign. The debt level is high which is a concern, but high debt levels also come with utilities.

I own this stock of TC Energy Corp (TSX-TRP, NYSE-TRP). I bought the stock in 2000 at an opportune time. The company had been cutting their dividend payments in order to re-organize and get the company into shape for long term profitability. This company’s stock fell hard because of this. People who depend on dividends for their income can be an unforgiving lot and can get really upset at company when a trusted company cuts its dividends. When I bought this stock, it was on Mike Higgs' Canadian Dividend Growth Stock list and the other dividend lists that I followed.

When I was updating my spreadsheet, I noticed that all the insiders I follow have bought shares over the past years. This includes the CEO, CFO, Officer, 3 Directors and the Chairman. This is very positive sign.

I have done well with this stock. I think a total return of 8% or above is what is acceptable. My total return is 9.21% with 3.36% from dividends and 5.85% from capital gains. It is typical of a utility to have a good portion of the total return from dividends. I have had this stock for 24 years.

If you had invested in this company in December 2013, for $1,019.34 you would have bought 21 shares at $48.54 per share. In December 2023, after 10 years you would have received $590.84 in dividends. The stock would be worth $1,086.96. Your total return would have been $1,677.80. This would be a total return of 6.09% per year with 0.64% from capital gain and 5.44% from dividends.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$48.54 $1,019.34 21 10 $590.84 $1,086.96 $1,677.80

The current dividend yield is high with dividend growth low. The current dividend yield is high (7% and higher) at 6.97%. The 5 year median dividend yield is good (5% to 6% ranges) at 5.59%. The 10 year and historical median dividend yields are moderate (2% to 4% ranges) at 4.97% and 4.34%. The dividend increases are low (below 8% per year) at 6.5% per year over the past 5 years.

The Dividend Payout Ratios (DPR) are fine because of DPR for FFO and AEPS. The DPR for 2023 for Earnings per Share (EPS) is too higher at 134% with 5 year coverage at 118% however, the FFO and AEPS are more important The DPR for 2023 for Funds from Operations (FFO) is good at 48% with 5 year coverage at 43%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is fine at 81% with 5 year coverage at 78%. The DPR for 2023 for Cash Flow per Share (CFPS) is fine at 54% with 5 year coverage at 47%. The DPR for 2023 for Free Cash Flow 1 and 2 (FCF) are negative and FCF is negative.

Item Cur 5 Years
EPS 134.18% 117.81%
FFO 47.63% 43.92%
AEPS 81.64% 78.36%
CFPS 54.22% 46.53%
FCF 1 -362.32% -592.72%
FCF 2 -445.81% 972.21%

Debt Ratios of Liquidity and Leverage are a problem as the company has too much debt. The Long Term Debt/Market Cap Ratio for 2023 is fine at 0.93 and currently at 0.88. The Liquidity Ratio for 2023 is a low at 0.96. If you added in Cash Flow after dividends, the ratios are even lower at 0.75 and better currently at 1.27. For utilities you can add back the current portion of the debt to get another value, but always check that the debt can be rolled over, and with the current portion of the debt the current Liquidity Ratio would be 3.39 and 3.19 which are good. The Debt Ratio for 2023 is fine at 1.45. The Leverage and Debt/Equity Ratios for 2023 are too high at 3.21 and 2.21 and even higher currently at 4.58 and 3.58. I prefer these ratios below 3.00 and below 2.00.

Type Year End Ratio Curr
Lg Term R 0.93 0.88
Intang/GW 0.23 0.22
Liquidity 0.96 0.96
Liq. + CF 0.75 1.27
Liq. + CF + D 3.39 3.19
Debt Ratio 1.45 1.28
Leverage 3.21 4.58
D/E Ratio 2.21 3.58

The Total Return per year is shown below for years of 5 to 35 to the end of 2023. 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.
2018 5 6.49% 7.89% 1.21% 6.88%
2013 10 7.32% 6.09% 0.64% 5.44%
2008 15 6.47% 8.56% 3.01% 5.55%
2003 20 6.34% 8.32% 3.14% 5.17%
1998 25 4.67% 8.25% 3.33% 4.92%
1993 30 4.97% 8.08% 3.20% 4.88%
1988 35 4.95% 9.21% 3.86% 5.35%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 16.45, 18.81 and 21.16. The corresponding 10 year ratios are 16.93, 18.46 and 19.99. The corresponding historical ratios are 12.33, 14.06 and 16.15. The current P/E Ratio is 13.04 based on a stock price of $55.13 and EPS estimate for 2024 of $4.23. The current ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 11.75, 14.35 and 16.95. The corresponding 10 year ratios are 12.51, 14.84 and 17.67. The current ratio is 13.19 based on AEPS estimate for 2024 of $4.18 and a stock price of $55.13. The current ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I get a Graham Price of $49.52. The 10-year low, median, and high median Price/Graham Price Ratios are 0.98, 1.18 and 1.41. The current P/GP Ratio is 1.11 based on a stock price of $55.13. This ratio is between the low and median ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10-year median Price/Book Value per Share Ratio of 2.11. The current Ratio is also 2.11 based on a Book Value of $27,054M, Book Value per Share of $26.08 and a stock price of $55.13. The current ratio is the same as the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and at the median.

I also have a Book Value per Share estimate for 2024 of $26.90. This estimate is based on a different way of calculating the Book Value and this way, the 10 year median ratio is 1.87. The estimate of $26.90 implies a ratio of 2.05 with a Book Value of $27,908M and a stock price of $55.13. This analysis expects the book value to go down over the next year. The ratio of 2.05 is 10% above the 10 year median ratio of 1.87. 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 8.53. The current P/CF Ratio is 7.53 based on Cash Flow per Share estimate for 2024 of $7.32, Cash Flow of $7,594M and a stock price of $55.13. The current ratio is 12% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get an historical median dividend yield of 4.34%. The current dividend yield is 6.97% based on dividends of $3.81 and a stock price of $55.13. The current dividend yield is 60% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

I get a 10 year median dividend yield of 4.97%. The current dividend yield is 6.97% based on dividends of $3.81 and a stock price of $55.13. The current dividend yield is 40% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

The 10-year median Price/Sales (Revenue) Ratio is 3.93. The current P/S Ratio is 3.51 based on Revenue estimate for 2024 of $16,315M, Revenue per Share of $15.73 and a stock price of $55.13. The current ratio is 11% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

Results of stock price testing is that the stock price is probably reasonable and may even be cheap. The dividend yield testing is showing the stock price as cheap. The P/S Ratio test says that the stock price is reasonable. The rest of the testing is showing the stock price as either cheap or reasonable.

When I look at analysts’ recommendations, I find Strong Buy (4), Buy (5), Hold (12), Underperform (1) and Sell (1). The consensus would be a Buy. The 12 month stock price is $56.17 with a high of $63.00 and low of $44.00. The current consensus of $56.17 implies a total return of 8.85% with 1.89% from capital gains and 6.97% from dividends.

There are 14 recommendations on this stock on Stock Chase with 11 buys, 2 Holds and 1 Do Not Buy. The Do Not Buy says there are better stocks in this space. Stock Chase gives this company 5 stars out of 5. Rajiv Nanjapla on Motley Fool says this is a top dividend stock to buy. Puja Tayal on Motley Fool says you can lock in a 7% dividend if you invest in this stock now. The company put out a Press Rele about their fourth quarter of 2023 results.

Simply Wall Street via Yahoo Finance reviews this stock. They think that the dividend is not probably covered. They give this company 2 and one half stars out of 5. They list 4 warnings signs of dividend of 7.03% is not well covered by earnings or cash flows; interest payments are not well covered by earnings; large one-off items impacting financial results.

TC Energy operates natural gas, oil, and power generation assets in Canada and the United States. The firm operates more than 60,000 miles of oil and gas pipelines, more than 650 billion cubic feet of natural gas storage, and about 4,300 megawatts of electric power. Its web site is here TC Energy Corp.

The last stock I wrote about was about was TransAlta Corp (TSX-TA, NSYE-TAC) ... learn more. The next stock I will write about will be AltaGas Ltd (TSX-ALA, OTC-ATGFF) ... learn more on Wednesday, March 27, 2024 around 5 pm. Tomorrow on my other blog I will write about How I Invest My Own Money.... learn more on Tuesday, March 26, 2024 around 5 pm.

This blog is meant for educational purposes only and is not to provide investment advice. I am not a licensed professional investment advisor. 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 site for an index to these blog entries and for stocks followed. 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. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Friday, March 22, 2024

TransAlta Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Utility. Results of stock price testing is that the stock price is probably reasonable, but maybe relatively cheap. Debt Ratios shows that this company has a lot of debt. The Dividend Payout Ratios (DPR) are good. The current dividend yield is moderate with dividend growth currently increasing at a low rate. See my spreadsheet on TransAlta Corp.

Is it a good company at a reasonable price? The company, again, seems to be recovering. They have been increasing their dividends since 2020. However, I do not think that I would buy this utility company again. It does not have a great history with its dividends. Most long term investors have not done particularly well. It is possible that the stock price is rather cheap, but for a cheap Utility company, the dividend yield is low.

I do not own this stock of TransAlta Corp (TSX-TA, NSYE-TAC). I bought this stock in 1987. It was a utility stock and utility stocks were considered to be good investments. I sold some in 2000 as the stock price was below what I had paid for it. I bought some more in February 2009 because it was relatively cheap and it seemed to be recovering. I sold more in August 2012 as this company was doing poorly again. By September 2019, I had finally had enough and saw no hope in this stock doing better. I noticed that MPL Communications had given up hope in 2014.

When I was updating my spreadsheet, I noticed when updating my spreadsheet that I am still not enamored with this stock or company. You can see the from 5 and 10 year total returns below, that long term investors are still losing. Also, you would have to be invested in this stock for over 30 years to get a 5.5% total return. After that, total return is lousy.

If you had invested in this company in December 2013, for $1,011.00 you would have bought 75 shares at $13.48 per share. In December 2023, after 10 years you would have received $232.13 in dividends. The stock would be worth $826.50. Your total return would have been $1,058.63. This would be a total return of 0.53% per year with 1.99% from capital loss and 2.53% from dividends.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$13.48 $1,011.00 75 10 $232.13 $826.50 $1,058.63

If you had invested in this company in December 2018, for $1,000.61 you would have bought 179 shares at $5.59 per share. In December 2023, after 5 years you would have received $165.58 in dividends. The stock would be worth $1,972.58. Your total return would have been $2,138.16. This would be a total return of 17.06% per year with 14.54% from capital gain 2.52% from dividends.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$5.59 $1,000.61 179 5 $165.58 $1,972.58 $2,138.16

The current dividend yield is moderate with dividend growth currently increasing at a low rate. The current dividend yield is moderate (2% to 4% ranges) at 2.71%. The 5 yea median dividend yield is low (below 2%) at 1.82%. The 10 year median dividend yield is moderate at 2.07%. The historical median dividend yield is good (5% to 6% ranges) at 5.35%. The dividends have increased at a low rate (less than 8% per year) by 6.6% per year over the past 5 years. Dividend were decreasing from 2014 to 2014. In 2020, they were increasing again. They are still 80% below the dividends of 2013.

The Dividend Payout Ratios (DPR) are good. The DPR for 2023 for Earnings per Share (EPS) is good at 9% with 5 year coverage not calculable because of earning losses. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is good at 7% with 5 year coverage at 8%. The DPR for 2023 for Cash Flow per Share (CFPS) is good at 5% with 5 year coverage at 6%. The DPR for 2023 for Free Cash Flow 1 (FCF) is non calculable because of negative FCF with 5 year coverage at 15%. The DPR for 2023 for Free Cash Flow 1 (FCF) 7% with 5 year coverage at 8%.

Item Cur 5 Years
EPS 9.44% N/C
AFFO 6.69% 7.87%
FFO 4.02% 4.95%
CFPS 5.07% 5.52%
FCF 1 N/C 14.68%
FCF 2 6.52% 7.86%

Debt Ratios shows that this company has a lot of debt. The Long Term Debt/Market Cap Ratio for 2023 is fine at 0.86 and currently too high at 1.09. The Liquidity Ratio for 2023 is too low at 0.91. If you added in Cash Flow after dividends, the ratios are good at 1.71 and currently a bit low at 1.40. The Debt Ratio for 2023 is low at 1.24. I prefer this to be at 1.50 or higher. The Leverage and Debt/Equity Ratios for 2023 are far too high at 5.20 and 4.20.

Type Year End Ratio Curr
Lg Term R 0.86 1.09
Intang/GW 0.20 0.26
Liquidity 0.91 0.91
Liq. + CF 1.71 1.40
Debt Ratio 1.24 1.24
Leverage 5.20 5.20
D/E Ratio 4.20 4.20

The Total Return per year is shown below for years of 5 to 36 to the end of 2023. 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.
2018 5 6.58% 17.06% 14.54% 2.52%
2013 10 -15.43% 0.53% -1.99% 2.53%
2008 15 -10.06% -1.81% -5.14% 3.33%
2003 20 -7.29% 2.45% -2.56% 5.02%
1998 25 -5.84% 1.94% -2.83% 4.77%
1993 30 -4.86% 5.53% -1.08% 6.61%
1988 35 -4.12% 6.58% -0.66% 7.23%
1987 36 -3.90% 6.32% -0.74% 7.05%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 4.36, 5.18 and 6.00. The corresponding 10 year ratios are all negative and so useless. The corresponding historical ratios are 14.85, 14.23 and 18.39. The current P/E Ratio is 24.36. This is a rather high ratio according to the above other ratios. It is a high ratio for a P/E Ratio for a utility stock also. This ratio is based on a stock price of $8.85 and EPS estimate for 2024 of $0.36. This stock price testing suggests that the stock price is relatively expensive.

I have Funds from Operations (FFO) data. The 5-year low, median, and high median Price/Earnings per Share Ratios are 2.16, 2.92 and 3.74. The corresponding 10 year ratios are 2.13, 2.83 and 3.39. The current P/FFO Ratio is 3.28 based on FFO estimate for 2024 of $2.70 and a stock price of $8.85. The current ratio is between the median and high ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I have Adjusted Funds from Operations (AFFO) data. The 5-year low, median, and high median Price/Earnings per Share Ratios are 3.63, 5.06 and 6.49. The corresponding 10 year ratios are 3.94, 5.63 and 7.10. The current P/FFO Ratio is 4.86 based on FFO estimate for 2024 of $1.82 and a stock price of $8.85. The current ratio is between the low and median ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a Graham Price of $10.82. The 10-year low, median, and high median Price/Graham Price Ratios are 0.31, 0.43 and 0.60. The current P/GP Ratio is 0.82 based on a stock price of $8.85. This ratio is above the high ratio for the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive.

I get a 10-year median Price/Book Value per Share Ratio of 1.30. The current P/B Ratio is 4.59 based on a Book Value of $595M, Book Value per Share of $1.93 and a stock price of $8.85. The current P/B Ratio is 253% 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 3.25. The current P/CF Ratio is 2.94 based on Cash Flow per Share estimate for 2024 of $3.01, Cash Flow of $928.9M, and a stock price of $8.85. The current ratio is 9.5% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get an historical median dividend yield of 5.35%. The current dividend yield is 2.71% based on dividends of $0.24 and a stock price of $8.85. The current dividend is 49% 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 2.08%. The current dividend yield is 2.71% based on dividends of $0.24 and a stock price of $8.85. The current dividend is 31% 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 1.05. The current P/S ratio is 0.99 based on Revenue estimate for 2024 of $7,760M, Revenue per Share of $8.94 and a stock price of $8.85. The current ratio is 6% 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, but maybe relatively cheap. The 10 dividend yield tests say that the stock price is relatively cheap. The P/S Ratio testing is saying the stock price is reasonable. The historical dividend yield test says the stock price is expensive and it is not the only tests that say the stock price is expensive as the P/GP Ratio and P/B Ratio tests say the same thing. On the other hand, there are tests that say the stock price is reasonable such as the P/AFFO Ratio and the P/CF Ratio tests. It is a mixed bag.

When I look at analysts’ recommendations, I find Strong Buy (3), Buy (4), Hold (1) and Sell (1). The consensus recommendation would be a Buy. The 12 month stock price consensus is $13.78, with a high of $18.50 and low of $9.00. The consensus stock price of $13.78 implies a total return of 58.42% with 55.71% from capital gains and 2.71% from dividends.

There is only one entry on Stock Chase for 2024 and it is a Do Not Buy. However, entries for 2023 had a mix of Buy and Sell and Hold recommendations. Stock Chase gives this stock 3 stars out of 5. This stock is only the Globe All Stars dividend list. Amy Legate-Wolfe on Motley Fool thinks this is a screaming buy. Christopher Liew on Motley Fool thinks the stock price is depressed and is due for a rebound. The company put out a Press Release on their four quarter of 2023.

Simply Wall Street via Yahoo Finance reviews this stock. Simply Wall Street gives this stock 2 and one half stars out of 5. Simply Wall Street puts out 4 warnings on this stock of earnings are forecast to decline by an average of 125.7% per year for the next 3 years; unstable dividend track record; shareholders have been diluted in the past year; and has a high level of debt.

TransAlta Corp is an independent power producer based in Alberta, Canada. The company operates a diverse and growing fleet of electrical power generation assets in Canada, the United States, and Australia. The company has six reportable segments namely, hydro, wind & solar, Energy Marketing, gas, and energy transition segment. The company generates the majority of its revenue from the gas segment. Its web site is here TransAlta Corp.

The last stock I wrote about was about was Enbridge Inc (TSX-ENB, NYSE-ENB) ... learn more. The next stock I will write about will be TC Energy Corp (TSX-TRP, NYSE-TRP) ... learn more on Monday, March 25, 2024 around 5 pm.

This blog is meant for educational purposes only and is not to provide investment advice. I am not a licensed professional investment advisor. 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 site for an index to these blog entries and for stocks followed. 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. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Wednesday, March 20, 2024

Enbridge Inc

Sound bite for Twitter and StockTwits is: Dividend Growth Utility. Results of stock price testing is that the stock price is probably reasonable and maybe cheap. Debt Ratios should be fine, but Liquidity Ratio is low The Dividend Payout Ratios (DPR) are too high. The current dividend yield is high with dividend growth low. See my spreadsheet on Enbridge Inc.

Is it a good company at a reasonable price? I do not think that this stock will do as well in the future, certainly the near future, as it has done in the past. Dividend increases has slowed and will be slow until DPRs are better. It is a utility stock and utility stocks tend to have lots of debt and so will not do well in a raising interest rate environment. However, I believe it is a solid stock for my portfolio, so I will continue to hold this stock.

I own this stock of Enbridge Inc (TSX-ENB, NYSE-ENB). I first bought this stock in 2005 and then bought more in 2008 and 2009. This stock was on the Dividend Achievers, the Dividend Aristocrats list and also on Mike Higgs’ list of Canadian Dividend Growth stocks. Enbridge is considered to be a low risk stock.

When I was updating my spreadsheet, I noticed I have done well with this stock. I have it for over 18 years and have made a total return of 11.62% per year with 5.57% from capital gains and 6.05% from dividends. This is basically what you expect from a utility stock, with capital gains and dividends fairly even for a total return.

I noticed that the Liquidity Ratio is better in 2023 than it has been for years. It has been under 1.00 where ideally it should be 1.50 or better. For 2023 it is 1.21. Utilities have a lot of debt. Generally, I look at the current portion of the debt and make sure it is being rolled over, and if so, add back the current portion of the debt to get a reasonable Liquidity Ratio.

If you had invested in this company in December 2013, for $1,021.02 you would have bought 22 shares at $46.41 per share. In December 2023, after 10 years you would have received $593.98 in dividends. The stock would be worth $1,049.40. Your total return would have been $1,643.38. This would be a total return of 5.79% per year with 0.27% from capital gain and 5.52% from dividends.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$46.41 $1,021.02 22 10 $593.98 $1,049.40 $1,643.38

The current dividend yield is high with dividend growth low. The current dividend yield is high (7% or over) at 7.54%. The 5 and 10 year median dividend yield is good (5% to 6% ranges) at 6.98%, and 5.93%. The historical median dividend yield is moderate (2% to 4% ranges) at 3.67%. The dividend increases are currently low with dividend increases at 5.6% per year over the past 5 years. The last dividend increase was in 2024 and it was for 3.1%.

The Dividend Payout Ratios (DPR) are too high. The DPR for 2023 for Earnings per Share (EPS) is too high at 125% with 5 year coverage at 149%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is too high at 127% with 5 year coverage at 123%. The DPR for 2023 for Cash Flow per Share (CFPS) is too high at 76% with 5 year coverage at 76%. The DPR for 2023 for Free Cash Flow 1 (FCF) is fine at 78% with 5 year coverage too high at 135%. The DPR for 2023 for Free Cash Flow 2 (FCF) is fine at 78% with 5 year coverage too high at 124%.

Item Cur 5 Years
EPS 125.00% 148.85%
AEPS 127.24% 123.21%
CFPS 76.26% 75.71%
FCF 1 78.03% 135.45%
FCF 2 78.03% 124.58%

Debt Ratios should be fine, but Liquidity Ratio is low. The Long Term Debt/Market Cap Ratio for 2023 is fine at 0.74 and currently at 0.72. The Liquidity Ratio for 2023 is too low at 1.0.83. If you added in Cash Flow after dividends, the ratios are still too low at 1.21 and currently at 1.07. I prefer these to be at 1.50 or higher. The Debt Ratio for 2023 is fine at 1.56. The Leverage and Debt/Equity Ratios for 2023 are fine at 2.80 and 1.80.

Type Year End Ratio Curr
Lg Term R 0.74 0.72
Intang/GW 0.04 0.03
Liquidity 0.83 0.83
Liq. + CF 1.21 1.07
Debt Ratio 1.56 1.56
Leverage 2.80 2.80
D/E Ratio 1.80 1.80

The Total Return per year is shown below for years of 5 to 33 to the end of 2023. 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.
2018 5 5.75% 9.78% 2.38% 7.40%
2013 10 10.91% 5.79% 0.27% 5.52%
2008 15 11.87% 12.17% 6.04% 6.13%
2003 20 11.33% 11.98% 6.54% 5.45%
1998 25 10.69% 12.18% 7.08% 5.10%
1993 30 9.25% 14.45% 8.56% 5.89%
1990 33 8.37% 10.81% 6.48% 4.33%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 16.13, 17.96 and 19.80. The corresponding 10 year ratios are 22.20, 28.40 and 32.91. The corresponding historical ratios are 18.01, 18.66 and 23.04. The current P/E Ratio is 17.11 based on a stock price of $48.55 and EPS estimate for 2024 of $2.84. The current ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 15.46m 17.83 and 20.09. The corresponding 10 year ratios are 16.77, 19.10 and 22.76. The current P/AEPS Ratio is 17.34 based on a stock price of $48.55 and AEPS estimate for 2024 of $2.80. This ratio is between the low and median ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a Graham Price of $39.90. The 10-year low, median, and high median Price/Graham Price Ratios are 1.12, 1.29 and 1.49. The current ratio is 1.22 based on a stock price of $48.55. This ratio is between the low and median ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10-year median Price/Book Value per Share Ratio of 1.88. The current P/B Ratio is 1.92 based on a Book Value of $53,707M, Book Value per Share of $25.27 and a stock price of $48.55. The current ratio is 2% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I also have a Book Value per Share estimate for 2024 of $26.30 but the analyst calculates the Book Value differently than I do and their 10 year median ratio is 1.65. The Book Value per Share estimate of $26.30 implies a P/B of 1.85 with a stock price of $48.55 and Book Value of $55,888M. The current ratio is 12% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a 10-year median Price/Cash Flow per Share Ratio of 9.98. The current P/CF Ratio is 8.56 based on a Cash Flow per Share estimate for 2024 of $5.67, Cash Flow of $12,049M and a stock price of $48.55. The current ratio is 14% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get an historical median dividend yield of 3.67%. The current dividend yield is 7.54% based on a stock price of $48.55 and dividend of $3.66. The current dividend yield is 105% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

I get a 10 year median dividend yield of 5.93%. The current dividend yield is 7.54% based on a stock price of $48.55 and dividend of $3.66. The current dividend yield is 27% 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 1.94. The current ratio is 2.27 based on Revenue estimate for 2024 of $45,397M, Revenue per Share of $21.36 and a stock price of $48.55. The current ratio is 17% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median.

Results of stock price testing is that the stock price is probably reasonable and maybe cheap. The dividend yield tests says that the stock price is cheap but that is not confirmed by the P/S Ratio test which says that the stock price is reasonable and above the median. Other tests range from cheap to reasonable, above and below the median.

When I look at analysts’ recommendations, I find Strong Buy (7), Buy (5), Hold (8) and Sell (2). This is quite a wide range. The consensus would be a Buy. The 12 month stock price consensus is $52.13 with a high of $60. and low of $35.00. The consensus price of $52.13 implies a total return of 14.91% with 7.37% from capital gains and 7.54% from dividends.

There are 12 recommendations on Stock Chase for 2024, with two Do Not Buy, two Holds and the rest Buys. It is on two of the 3 dividends stock lists I follow. MoneySense does not have this stock on their latest list. With the Do Not Buys, the analysts like another utility better. Stock Chase gives this stock 5 stars out of 5. Puja Tayal on Motley Fool says buy for passive income. Rajiv Nanjapla on Motley Fool says Enbridge is a no-brainer buy. The company put out a press release via Newswire about this company’s fourth quarter of 2023.

Simply Wall Street via Yahoo Finance says dividend increases will probably be restrained in the future because the company is not covering their dividends well. They are not the only ones to say this. Simply Wall Street has three warnings of interest payments are not well covered by earnings; dividend of 7.55% is not well covered by earnings; and shareholders have been diluted in the past year. Simply Wall Street gives this stock 3 and one half stars out of 5.

Enbridge owns extensive midstream assets that transport hydrocarbons across the U.S. and Canada. Its pipeline network consists of the Canadian Mainline system, regional oil sands pipelines, and natural gas pipelines. The company also owns and operates a regulated natural gas utility and Canada's largest natural gas distribution company. The firm has a small renewables portfolio primarily focused on onshore and offshore wind projects. Its web site is here Enbridge Inc.

The last stock I wrote about was about was Canadian Tire Corp (TSX-CTC.A, OTC-CDNAF) ... learn more. The next stock I will write about will be TransAlta Corp (TSX-TA, NSYE-TAC) ... learn more on Friday, March 22, 2024 around 5 pm. Tomorrow on my other blog I will write about Passive Investing and Markets.... learn more on Thursday, March 20, 2024 around 5 pm.

This blog is meant for educational purposes only and is not to provide investment advice. I am not a licensed professional investment advisor. 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 site for an index to these blog entries and for stocks followed. 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. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

Monday, March 18, 2024

Canadian Tire Corp

Sound bite for Twitter and StockTwits is: Dividend Growth Consumer. Results of stock price testing is that the stock price is relatively cheap. Debt Ratios show that the company currently has too much debt and some ratios need to be improved. The Dividend Payout Ratios (DPR) are good, but 2023 being an off year. The current dividend yield is good with dividend growth moderate. See my spreadsheet on Canadian Tire Corp.

Is it a good company at a reasonable price? I have done well with this company and I think it is a good it a good consumer stock to own. MoneySense gives it a C rating. Analysts seem to only have strong buys when a stock has a climbing stock price, not when a stock price is down. I think you should buy a stock when it is down. Unfortunately, I am generally fully invested so I do not have much money for new purchases. The results of my stock price testings says that the stock price on this stock is relatively cheap.

I own this stock of Canadian Tire Corp (TSX-CTC.A, OTC-CDNAF). In 2000 when I first bought this stock, it was on the Investment Reporter's list of conservative Canadian stocks. I bought stock for my trading account in 2009 because I have done well with it in my Pension Account and it was a consumer stock.

When I was updating my spreadsheet, I noticed I have had this stock for just over 24 years and I have made a number of purchases since my first buy in 2000. I have made a total return of 11.28% per year with 8.69% from capital gains and 2.59% from dividends.

The company said that sales and profit was down due to softening of consumer demand and unseasonable weather in Q4. They are a consumer stock and they have had an off year. It happens. The company still increased their dividends in 2024, but at a minimal amount of 1.45%. Doing this keeps a company on the Dividend Aristocrat list.

In the chart below, I am showing 5 and 10 year total growth and per year growth in columns 3 and 4. Column 5 shows growth expected over 12 months to the first quarter in 2024 and expected growth over the next year. This chart shows that they had a bad year for net income in 2023, but net income is expected to growth this year.

Year Item Tot. Gwth Per Year Gwth Coverage
5 Revenue Growth 18.48% 3.45% -1.08% <-12 mths
5 AEPS Growth -13.22% -2.80% -3.18% <-12 mths
5 Net Income Growth -69.18% -20.98% 10.85% <-12 mths
5 Cash Flow Growth 67.66% 10.89%
5 CF Growth excl WC 51.50% 8.66%
5 Dividend Growth 91.67% 13.90% 1.45% <-12 mths
5 Stock Price Growth -1.42% -0.28% -3.11% <-12 mths
10 Revenue Growth 41.33% 3.52% 0.77% <-this year
10 AEPS Growth 47.72% 3.98% 8.00% <-this year
10 Net Income Growth -61.99% -9.22% 238.96% <-this year
10 Cash Flow Growth 51.56% 4.25% 20.80% <-this year
10 CF Growth excl WC 49.66% 4.11% -8.75% <-this year
10 Dividend Growth 392.86% 17.29% 1.99% <-this year
10 Stock Price Growth 41.44% 3.53% -3.11% <-this year


The current dividend yield is good with dividend growth moderate. The current dividend yield is good (5% to 6% ranges) at 5.37%. The 5 and 10 year median dividend yields are moderate (2% to 4% ranges) at 3.53% and 2.37%. The historical dividend yield is low (below 2%) at 1.70%. The dividend growth is moderate (8% to 14% per year) at 13.9% per year over the past 5 years. The last dividend increase was in 2024 and it was for only 1.45%.

The Dividend Payout Ratios (DPR) are good, but 2023 being an off year. The DPR for 2023 for Earnings per Share (EPS) are too high for at 183% with 5 year coverage at good at 41%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is fine at 54% with 5 year coverage is good at 31%. The DPR for 2023 for Cash Flow per Share (CFPS) is good at 21% with 5 year coverage at 15%. The DPR for 2023 for Free Cash Flow (FCF) is fine at 53% with 5 year coverage good at 37%.

Item Cur 5 Years
EPS 182.54% 40.53%
AEPS 54.18% 30.83%
CFPS 21.42% 14.50%
FCF 52.67% 37.21%


Debt Ratios show that the company currently has too much debt and some ratios need to be improved. The Long Term Debt/Market Cap Ratio for 2023 is fine at 0.60 and currently at 0.62. The Liquidity Ratio for 2023 is good at 1.77. The Debt Ratio for 2023 is too low at 1.41 and I would prefer it to be 1.50 or higher. The Leverage and Debt/Equity Ratios for 2023 are too high at 3.41 and 2.41. I prefer them to be below 3.00 and 2.00.

Type Year End Ratio Curr
Lg Term R 0.60 0.62
Intang/GW 0.27 0.28
Liquidity 1.77 1.77
Liq. + CF 1.92 1.96
Debt Ratio 1.41 1.41
Leverage 3.41 3.41
D/E Ratio 2.41 2.41


The Total Return per year is shown below for years of 5 to 35 to the end of 2023. 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.
2018 5 13.90% 3.37% -0.28% 3.66%
2013 10 17.29% 6.65% 3.53% 3.12%
2008 15 15.07% 11.34% 8.15% 3.19%
2003 20 15.30% 9.05% 6.57% 2.48%
1998 25 12.07% 6.97% 5.06% 1.91%
1993 30 9.96% 11.26% 8.55% 2.71%
1988 35 10.07% 8.25% 6.25% 2.01%


The 5-year low, median, and high median Price/Earnings per Share Ratios are 8.86, 10.22 and 12.30. The corresponding 10 year ratios are 11.80, 13.66 and 15.25. The corresponding historical ratios are 10.45, 13.06 and 14.84. The current P/E Ratio is 8.55 based on a stock price of $130.43 and EPS estimate for 2024 of $15.26. The current ratio is below the low ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap.

I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 8.61, 9.93 and 11.65. The corresponding 10 year ratios are 11.40, 13.21 and 15.03. The current P/AEPS Ratio is 11.65 based on AEPS estimate for 2024 of $11.20 and a stock price of $130.43. The current ratio is between the low and median ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a Graham Price of $158.54. The 10-year low, median, and high median Price/Graham Price Ratios are 0.88, 1.02 and 1.17. The current P/GP Ratio is 0.82 based on a stock price of $130.43. The current ratio is below the low ratio of the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I get a 10-year median Price/Book Value per Share Ratio of 1.80. The current P/B Ratio is 1.31 based on Book Value of $5,548M, Book Value per Share of $99.75 and a stock price of $130.43. The current ratio is 27% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I also have a Book Value per Share estimate for 2024 of $102.00. This BVPS implies a ratio of 1.28 with a stock price of $130.43 and Book Value of $5,573M. This ratio is 29% 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 8.96. The current P/CF Ratio is 4.44 based on Cash Flow per Share estimate for 2024 of $29.40, Cash Flow of $1,653M and a stock price of $130.43. 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 1.70%. The current dividend yield is 5.37% based on dividends of $7.00 and a stock price of $130.43. The current yield is 216% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

I get a 10 year median dividend yield of 2.37%. The current dividend yield is 5.37% based on dividends of $7.00 and a stock price of $130.43. The current yield is 126% 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 0.68. The current P/S Ratio is 0.43 based on Revenue estimate for 2024 of $16,784M, Revenue per Share of $301.76 and a stock price of $130.43. The current ratio is 37% 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 relatively cheap. Both the historical and 10 year dividend yield tests say that the stock price is cheap. It is confirmed by the P/S Ratio test that says the stock price is relatively cheap. Most of the rest of the testing is saying that the stock price is relatively cheap.

When I look at analysts’ recommendations, I find Strong Buy (1), Buy (4), Hold (5), and Underperform (1). The 12 month stock price consensus is $155.50, with a high of 195.00 and low of $130.00. The consensus stock price of $155.50 implies a total return of 20.79% with 15.43% from capital gains and 5.37% from dividends.

For 2024 on Stock Chase there is a buy recommendation and a Do Not Buy recommendation. The second analysts does not like consumer stocks. Stock Chase gives this stock 3 stars out of 5. It is on the dividend lists that I follow. Demetris Afxentiou on Motley Fool says this is a great stock selling at a discount. Daniel Da Costa on Motley Fool says buy for long term growth. The company put out a Press Release about its fourth quarter results for 2023.

Simply Wall Street via Yahoo Finance review this stock. Simply Wall Street is showing 4 warnings of debt is not well covered by operating cash flow; profit margins (1.3%) are lower than last year (5.9%); dividend of 5.31% is not well covered by earnings; and large one-off items impacting financial results. Simply Wall Street gives this stock 3 and one half stars out of 5.

Canadian Tire sells home goods, sporting equipment, apparel, footwear, automotive parts and accessories, and vehicle fuel through a roughly 1,700-store network of company, dealer, and franchisee-operated locations across Canada. Aside from the namesake banner, stores operate primarily under the Mark's, SportChek, Party City, Atmosphere, and PartSource monikers. Additionally, the company owns Helly Hansen, a Norwegian sportswear and workwear brand, and also operates and holds majority ownership of a financing arm (Canadian Tire Financial Services; 20% owned by Scotiabank) and a REIT (CT REIT; Canadian Tire owns about 70%). Its web site is here Canadian Tire Corp.

The last stock I wrote about was about was H & R Real Estate Trust (TSX-HR.UN, OTC-HRUFF) ... learn more. The next stock I will write about will be Enbridge Inc (TSX-ENB, NYSE-ENB) ... learn more on Wednesday, March 20, 2024 around 5 pm. Tomorrow on my other blog I will write about Globe’s Dividend All-Stars.... learn more on Tuesday, March 19, 2024 around 5 pm.

This blog is meant for educational purposes only and is not to provide investment advice. I am not a licensed professional investment advisor. 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 site for an index to these blog entries and for stocks followed. 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. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.