Monday, January 30, 2017

Canadian Imperial Bank of Commerce

Sound bite for Twitter and StockTwits is: Dividend Growth stock. Basically the stock price testing shows that the stock price is reasonable and below the median. See my spreadsheet on Canadian Imperial Bank of Commerce.

I do not own this stock of Canadian Imperial Bank of Commerce (TSX-CM, NYSE-CM). This was the only major Canadian Bank I was not following. I think it is about time I did. The only reason I would not buy this bank is because I already hold 3 Canadian Banks.

The dividend yields are good and the dividend growth is low. The Current dividend is 4.38% with a 5 year median of 4.67% and an historical median of 4.25%. The Dividends have grown at 6.2% and 5.6% per year over the past 5 and 10 years. The last dividend increase was in this financial year and it was for 2.5%. This bank often increases the dividends more than once a year. In the last financial year it raised the dividends 3 times and the total increase for the financial year was 11.24%.

The Dividend Payout Ratio for CIBC for the last financial year for EPS was 44.4%. (The bank's financial year end October 31 each year.) The 5 year DPR for EPS was 46.9%. Both these are within the 40% to 50% range for Canadian Banks. No one seems to care about cash flows on banks so I will not do DPR for CFPS for this stock.

The Debt Ratio is a bit low at 1.05 for this bank. Yes, I know that this ratio used to be acceptable at 1.04. However, since 2008 this ratio has moved up and other banks are moving higher except for the National Bank. The next lowest is the Royal Bank with the others at 1.07. See chart below.

Bank TSX Symbol Other Symbol Debt Ratio
Bank of Montreal TSX BMO NYSE BMO 1.07
Bank of Nova Scotia TSX BNS NYSE BNS 1.07
CIBC TSX CM NYSE CM 1.05
National Bank of Canada TSX NA OTC NTIOF 1.05
Royal Bank TSX RY NYSE RY 1.06
Toronto Dominion Bank TSX TD NYSE TD 1.07

Revenue has been low to moderate in growth. For example, the Revenue per Share is up by 4.4% and 1.2% per year over the past 5 and 10 years. Growth in earnings is better with the 5 and 10 years growth at 7.9% and 3.7% per year. However, the 5 year running average growth over the past 5 and 10 years is better at 17.8% and 8.6% per year. This implies that the last 5 and 10 years were better than the previous 5 and 10 years for earnings.

Total growth has been moderate to good. The total growth over the past 5 and 10 years is at 12.93% and 4.68% per year. The portion of this total return attributable to dividends is at 4.71% and 3.59% per year. The portion of this total return attributable to capital gain is at 8.23% and 1.09% per year.

The 5 year low, median and high median Price/Earnings per Share Ratios are 9.00, 9.89 and 10.78. The 10 year ratios are 9.36, 10.50 and 11.64. The historical ratios are 8.72, 9.76 and 11.59. The current P/E Ratio is 10.99 based on a stock price of $113.16 and 2017 EPS estimate of $10.30. This stock price testing suggests that the stock price is reasonable but above the median.

I get a Graham Price of $114.52. The 10 year low, median and high median Price/Graham Price Ratio is 0.88, 1.04 and 1.16. The current P/GP Ratio is 0.99 based on a stock price of $113.16. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10 year Price/Book Value per Share Ratio of 2.03. The current P/B Ratio is 2.00 based on BVPS of $56.59 and a stock price of $113.16. The current P/B ratio is 1.7% lower than the 10 year median. This stock price testing suggests that the stock price is relatively reasonable and below the median.

The current dividend yield is 4.38% based on dividends of $4.96 and a stock price of $113.16. The historical median dividend yield is 4.25%. The current dividend yield is 3% higher than the historical median. This stock price testing suggests that the stock price is relatively reasonable and below the median.

When I look at analysts' recommendations I find Strong Buy, Buy, Hold and Underperform Recommendations as I have on all the banks. Most of the recommendations are either a Hold or an Underperform. The consensus would be a Hold. The 12 month stock price consensus is $113.81. This implies a total return of 4.96% with 0.57% from capital gain and 4.38% from dividends.

Karl Utermohlen of Motley Fool likes this stock. He talks about their announcement that they will hire 500 workers with disabilities in 2017. He also talks about their remittances program. Staff at Equity Focus talk about the good dividend of this bank and that volatility cannot be evaded, but it can be diminished with dividends. See what analysts are saying at Stock Chase.

The last stock I wrote about was about was Enghouse Systems Ltd. (TSX-ESL, OTC-EGHSF)... learn more . The next stock I will write about will The next stock I will write about will be Valener Inc. (TSX-VNR, OTC-VNRCF)... learn more on Wednesday, February 01, 2017 around 5 pm. Tomorrow on my other blog I will write about Banks and Ratios... learn more on Tuesday, January 31, 2017 around 5 pm.

Canadian Imperial Bank of Commerce (CIBC) is a global financial institution. The Company provides a range of financial products and services to individual, small business, commercial, corporate and institutional clients in Canada and around the world. Its web site is here Canadian Imperial Bank of Commerce.

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.

Friday, January 27, 2017

Enghouse Systems Ltd

Sound bite for Twitter and StockTwits is: Dividend Growth Tech. Price seems relatively expensive and stock price has lost momentum. Not a good buy spot. The company has good growth. In all my growth figures I just see green. I mark most growth figures of 8% and up in green. See Color Coding on my Spreadsheets. See my spreadsheet on Enghouse Systems Ltd.

I do not own this stock of Enghouse Systems Ltd (TSX-ENGH, OTC-EGHSF). Note the change in the TSX symbol. This stock has been recommended by Keystone Financial Publishing as a good Small Cap tech stock with dividend.

You would buy this stock for diversification. You should expect volatility. Dividends are low and the Dividend Payout Ratios are low to moderate. You do not want them to payout much in dividends as the company needs to retain earnings for future reinvestments. This is a dividend growth stock. This would be a good stock when building a portfolio.

Dividends are low with a moderated Dividend Payout Ratio and good growth in dividends. The current dividend is just 1.08% based on dividends of $0.56 and a stock price of $51.88. Dividends have grown at 23.6% and 22.9% per year over the past 5 and 10 years. The last dividend increase was made last year and it was for 16.7%.

The Dividend Payout Ratio EPS for the financial year ending in October 2016 is 29.9%. The 5 year DPR is 32.1%. The DPR for CFPS is 16.1% with the 5 year payout at 16.9%. This is also a good payout rate.

The have almost no long term debt. The Liquidity Ratio for 2016 is low at 1.40 but the 5 year median is 1.53. This ratio has been declining lately so this should be watched. The Debt Ratio for 2016 is 2.78 and this is good. Leverage and Debt/Equity Ratios are also good at 1.56 and 0.56 respectively.

The 5 year low, median and high median Price/Earnings per Share Ratios are 24.47, 29.34 and 34.22. The corresponding values for 10 years are 17.65, 24.54 and 32.21. The corresponding historical values are 15.99, 20.53 and 24.06. It would appear some the capital gain is due to higher P/E Ratios. However, Tech companies often have higher P/E Ratios than other companies. The current P/E Ratio is 33.04 based on 2017 EPS estimate of 1.57 and a stock price of $51.88. This stock price testing suggests that the stock price is relatively expensive.

One thing to look for in Tech companies is momentum. This stock had upwards momentum until the end of 2015 and since then the price has been going down and it is rather choppy and price is not going anywhere. Not the time to buy a Tech stock.

I get a Graham Price of $18.78. The 10 year low, median and high median Price/Graham Price Ratios are 1.13, 1.49 and 1.72. The current P/GP Ratio is 2.76 based on a stock price of $51.88. This stock price testing suggests that the stock price is relatively expensive.

The 10 year median Price/Book Value per Share Ratio is 1.93. The current P/B Ratio is 5.20 a value some 170% higher. The current P/B Ratio is based on BVPS of $9.98 and a stock price of $51.88. Problem is that stock price is increasing faster than BV. This stock price testing suggests that the stock price is relatively expensive.

This 9 year median dividend yield is 1.68%. The current dividend yield is 1.08% a value some 35% lower. The current dividend yield is based on dividends of $0.56 and a stock price of $51.88. This stock price testing suggests that the stock price is relatively expensive.

When I look at Analysts' Recommendations, I find only 3 analysts following this stock and they all rate it a Buy. The consensus recommendation is a Buy. The 12 month stock price is $67.00. This implies a total return of $30.22 with 29.24% from capital gains and 1.08% from dividends.

Brent Freeman says in a report at Simply Wall Street that this company got hit with the down turn badly because of lack of geographic diversification. Karen Cowles on Gilbert Daily says that this company has a Value Composite score of 61. This is using a scale from 0 to 100 where a lower score may indicate an undervalued company and a higher score would represent an expensive or possibly overvalued company. I think this is saying it is neither over nor undervalued. See what analysts say on Stock Chase. They mostly prefer other companies.

The last stock I wrote about was about was Transcontinental Inc. (TSX-TCL, OTC-TCLAF)... learn more . The next stock I will write about will be Canadian Imperial Bank of Commerce (TSX-CM, NYSE-CM)... learn more on Monday, January 30, 2017 around 5 pm.

Enghouse Systems Limited is a global provider of enterprise software solutions serving a variety of distinct vertical markets. Its strategy is to build a large diverse enterprise software company through strategic acquisitions and managed growth. Its web site is here Enghouse Systems Ltd.

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.

Wednesday, January 25, 2017

Transcontinental Inc.

First I want to talk about my recent trades. I sold my Husky Energy (TSX-HSE, OTC-HUSKF) stock. It no longer pays a dividend. I lost half my investment in this stock. I do not see things improving anytime soon. On a go forward basis I feel I am better off with Canadian Utilities Ltd (TSX-CU, OTC-CDUAF) which I bought for my Registered Account. I only had 100 shares of Husky in my Trading Account and do not want to keep small amounts around and in any event I do not want investments in more stocks. In this account I replaced Husky with Evertz Technologies (TSX-ET, OTC-EVTZF), a stock I already own in this account.

Sound bite for Twitter and StockTwits is: Buy for Diversification. Price is relatively cheap to reasonable, but it has momentum. The problem for this company was it was into old style activities like printing and is trying to reposition itself into the new digital age and into packaging. See my spreadsheet on Transcontinental Inc.

I own this stock of Transcontinental Inc. (TSX-TCL, OTC-TCLAF). This is a dividend growth stock. It was on a number of dividend lists. However, it fell on hard times after 2008, but currently seems to be recovering. It is still on the Canadian Dividend Aristocrats Index.

This company has increased its dividends every year since 2002. Before that they were giving out dividend increases, but not every year. The dividend yield is low to moderate and the dividend growth is moderate. The current dividend is 3.32% based on dividends of $0.74 and a stock price $22.27. The 5 year, 10 year and historical median dividend yields are 4.10%, 3.72% and 1.30%. It is only in 2009 that the company's dividend move from low to moderate. The dividend growth for the past 5 and 10 years is 8.2% and 11.2% per year. The dividend growth over the past 15 and 20 years is 14% and 13.7% per year.

The Dividend Payout Ratio for the 2016 Financial Year is 38.6%. This is good. However, the 5 year DPR is 101% because the company had 2 years of EPS losses within the past 5 years. Analysts do not anticipate any further earning losses in the next couple of years. DPR is expected to be 29% in 2017. The DPR has been low for most of the history of this stock. They have never decreased the dividend, but it has been flat in some years.

Debt ratios are fine. The Liquidity Ratio for 2016 was 1.42 and the 5 year median is 1.08. For 2016 if you add in cash flow after dividends the ratio is 1.97. It has depended on cash flow to get a proper Liquidly Ratio in many years. The current Debt Ratio is 2.08. The 5 and 10 year medians are 1.78 and 1.85. This ratio has always been good.

Leverage and Debt/Equity Ratios are currently good, but have moved up and down over the years. The 10 year median ratios are 2.09 and 1.13 respectively. The long Term Debt to Market Cap Ratio is current at 0.25 and the Goodwill and Intangibles to Market Cap Ratio is 0.53. So these ratios are also good. You do not want these last two ratios to be close to or higher than 1.00.

This was my major purchase for the TFSA last year. I have made a return of 24.56% since then with 20.34% from capital gains and 4.22% from dividends. So this is pleasing. Growth in Revenue is non-existent. I would think I would like to see some before buying more of this stock. Growth in EPS is all over the place, but they give an Adjusted EPS that excludes lots of unusual items. Here growth is 4.8% and 5.3% per year over the past 5 and 10 years.

The 5 year low, median and high median Price/Earnings per Share Ratios are 4.33, 5.24 and 6.14. The corresponding 10 year values are 7.11, 8.31 and 9.50. The historical values are 10.21, 13.55 and 14.25. The ones for the past 5 and 10 years are really low as there were 3 EPS loss years in this 10 year period. The current P/E Ratio is 8.67. This is based on a stock price of $22.27 and 2017 EPS of 2.57. This stock price testing suggests that the stock might be relatively cheap.

I get a Graham Price of $28.34. The 10 year low, median and high median Price/Graham Price Ratios are 0.66, 0.82 and 0.96. The current P/GP Ratio is 0.79 based on a stock price of $22.27. This stock price testing suggests that the stock price is relatively reasonable and below the median. On an absolute basis any P/GP Ratio that is at or below 1.00 points to an undervalued stock.

The 10 year Price/Book Value per Share Ratio is 1.25. The current P/B Ratio is 1.60 a value some 28% higher. This P/B Ratio is based on BVPS of $13.89 and a stock price of $22.27. This stock price testing suggests that the stock price is relatively expensive. However, a P/B Ratio of 1.50 points to a good stock price on an absolute basis. The problem with this stock is that the Book Value has been traveling south lately until the last 3 years. This is because of earnings losses. However, the BVPS is up over 50% in the last 3 years. So this is an improvement.

The current Dividend Yield is 3.32% based on a stock price of $22.27 and dividends of $0.74. The historical median dividend yield is just 1.30% some 155% lower. The current dividend yield is lower than the 5 and 10 year median dividend yields of 4.10% and 3.72%. The dividend yield started to climb after the company had problems in 2008. This stock price testing suggests that the stock price is relatively cheap.

When I look at analysts' recommendations, I find Buy, Hold and Underperform Recommendations. Sometimes it depends on your point of view if a company is a good buy or not. Most of the recommendations are a Hold and the consensus recommendation is a Hold. The 12 months target price is $21.19 a value below the current stock price. This implies a total loss of 1.53% with a capital loss of 4.85% and dividends of 3.32%.

Staff writers on Rives Journal say that the 14-day Commodity Channel Index for this stock is a negative 70.64. For this indicator a positive of 100 represents overbought conditions (high stock price) and an indicator of negative 100 represents oversold conditions (low stock price). Renee Jackson of The Cerbat Gem says that Scotiabank just reaffirmed their sector perform rating on this company. By the way, Sector Perform is a Hold rating. (See my blog for information on Analyst Ratings .) See what analysts are saying on Stock Chase. Many like it for how it is handling the shift away from printing.

The last stock I wrote about was about was National Bank of Canada (TSX-NA, OTC-NTIOF)... learn more . The next stock I will write about will be Enghouse Systems Ltd. (TSX-ESL, OTC-EGHSF)... learn more on Friday, January 27, 2017 around 5 pm. Tomorrow on my other blog I will write about Rethinking Retirement... learn more on Thursday, January 26, 2017 around 5 pm.

Transcontinental creates marketing products and services that allow businesses to attract, reach and retain their target customers. The Corporation is the largest printer in Canada and the third-largest in North America. Its web site is here Transcontinental Inc..

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.

Monday, January 23, 2017

National Bank of Canada

Sound bite for Twitter and StockTwits is: Buy for rising income/cap gains. The current stock price could be reasonable. It is testing from reasonable and below the median to reasonable and above the median. Because this is the smallest of the big Canadian Banks you might expect to do better than in the other banks, but this bank is riskier according to debt ratios. See my spreadsheet on National Bank of Canada.

I do not own this stock of National Bank of Canada (TSX-NA, OTC-NTIOF). I thought I should follow one of the smaller Canadian Banks. This seems like a good choice. I would expect dividends to be moderate to good with moderate dividend growth over the longer term. If I was looking for another bank, I would certainly consider this one. The only reason I do not own it is that I have enough bank stock with the 3 banks I own.

The dividend yield is good and the dividend growth is moderate. The current dividend is yield is 4.04% based on Dividends of $2.24 and a stock price of $55.38. The historical median dividend yield is 3.94% and 5 year median dividend yield is 4.16%. The 5 and 10 year dividend growth is at 10.2% and 8.5% per year over the past 5 and 10 years.

This stock tends to increase the dividend twice or more each year. The last increase was for 1.8% and it was done late last year. The dividend increase for 2016 was at 7.5% and dividends increase for this financial year ending in October 2017 is so far at 4.2%.

The Dividend Payout Ratio for the 2016 financial year was 65%. The 5 year median was much lower at 43%. The Dividend Payout Ratio range for Canadian banks is generally accepted at 40% to 55%. This bank sometimes goes higher than this range, but not often and for no longer than 1 year. The last time occurred in 2007.

The deposits (debt) as a ratio of the market cap are higher for this bank that the others I have reviewed at 8.64. This is compared to BMO at 8.59, BNS at 7.03, TD at 6.80 and Royal Bank at 6.09. (For this ratio lower is better.) The Debt Ratio is also the lowest at 1.05 compared to BMO at 1.07, BNS at 1.07, TD at 1.07and Royal Bank at 1.06. (For this ratio higher is better.) On the other hand, the dividend yield tends to be the highest on this bank compared to the other banks. This is the smallest of the big 6 banks of Canada.

The growth is EPS does not look good for the 5 and 10 year periods ending in the last financial year at negative 0.8% and 2.5% growth per year. However, if you look at the 5 year running averages for the past 5 and 10 years the growth is at 10.6% and 8% per year. This is because the EPS dropped by some 27% in 2016. The main reason seems to be an increase in provisions for credit losses and higher administration costs. EPS for 2017 is expected to be up by 53.5% over 2016 and 12% over 2015.

The Total Return for the past 5 and 10 years to the end of 2016 is 11.55% and 7.62% per year. The portion of this total return attributable to dividends is 1.81% and 2.45% per year. The portion of this total return attributable to capital gains is 9.74% and 5.18% per year.

The 5 year low, median and high median Price/Earnings per Share Ratios are 9.04, 10.62 and 12.21. The corresponding 10 year values are 9.15, 10.47 and 12.05. The corresponding historical values are 8.71, 10.05 and 11.88. The current P/E Ratio is 10.97 based on a current stock price of $55.38 and 2017 EPS of $5.05. This stock price testing suggests that the stock price is relatively reasonable and around the median.

I get a Graham Price of $56.93. The 10 year low, median and high median Price/Graham Price Ratios are 0.77, 0.88 and 1.03. The current P/GP Ratio is 0.97 based on a stock price of $55.38. This stock price testing suggests that the stock price is relatively reasonable but above the median.

The 10 year median Price/Book Value per Share Ratio is 1.74. The current P/B Ratio is 1.94 a values some 11.8% higher. The current P/B Ratio is based on a stock price of $55.38 and Book Value per Share of $28.52. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a current Dividend Yield of 4.04% based on a stock price of $55.38 and dividends of $2.24. The historical median dividend yield is 3.94%. This stock price testing suggests that the stock price is relatively reasonable and below the median.

When I look at analysts' recommendations, I find Strong Buy, Buy, Hold and Underperform Recommendations. Most of the recommendations are a Hold and the consensus is a Hold. The 12 months stock price consensus is $56.54. This implies a total return of 6.14% with 4.04% from dividends and 2.09% from capital gains.

Jonathan Ratner in the Financial Post talks about this bank making Citigroup's list of globally ranked stocks. This was a surprise that this bank made it and other big Canadian banks did not. Wayne Landers on Sports Perspective says that CSFB downgraded NA's shares from Neutral to Underperform, but raised the 12 month stock price from $51.00 to $54.00. See what analysts are saying about this bank at Stock Chase.

The last stock I wrote about was about was Bank of Nova Scotia (TSX-BNS, NYSE-BNS)... learn more . The next stock I will write about will be Transcontinental Inc. (TSX-TCL, OTC-TCLAF)... learn more on Wednesday, January 25, 2017 around 5 pm. Tomorrow on my other blog I will write about Buying Bonds... learn more on Tuesday, January 24, 2017 around 5 pm.

National Bank of Canada provides financial services to consumers, small and medium-sized enterprises, and large corporations & has branches in every province in Canada. It is also represented in the U.S. and Europe through its subsidiaries and alliances. Its web site is here National Bank of Canada.

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.

Friday, January 20, 2017

Bank of Nova Scotia

Sound bite for Twitter and StockTwits is: Buy for rising income/cap gains. Price is reasonable to expensive. As with other banks, the recommendations are all over the place and analysts collectively do not see much further gains for banks stock within the year. See my spreadsheet on Bank of Nova Scotia.

I do not own this stock of Bank of Nova Scotia (TSX-BNS, NYSE-BNS). This is one of the big banks of Canada. All our big banks are dividend growth companies. My son owns shares in this bank. I would expect dividends to be moderate to good with moderate dividend growth over the longer term. This is a dividend growth stock.

The dividend yield on this stock is moderate to good. The dividend growth is low to moderate. The current dividend yield is 3.86%. The historical median dividend yield is 3.92% and the 5 and 10 year median dividend yields are 4.12% and 4.11% respectively. The dividend growth over the past 5, 10 and 15 years is 7.04%, 6.74% and 10.78% per year. This bank only stopped dividend growth in one year, 2010, because of the 2008 recession.

If you had bought this stock 5, 10 or 15 years ago and paid a median price, you would be earning 5.6%, 5.8% or 12% on your original purchase price. If you purchase this stock at today's price of $67.64 and increases continued at 7% per year, then in 5, 10 or 15 years you could be earning 5.42%, 7.60% or 10.66% dividend yield on your purchase price.

Generally Canadian banks have Dividend Payout Ratios of 40% to 55% of EPS. This company in 2016 had a Dividend Payout Ratio of 49.9% and the 5 year average is 46.4%. So this bank's DPR is within normal parameters.

Shareholders have done fine over the past 5 and 10 years in total return. The 5 and 10 year total return to the end of 2016 is at 10.79% and 7.43% per year. The portion of this total return attributable to dividends is 4.25% and 3.73% per year. The portion of this total return attributable to capital gains is 6.53% and 3.70% per year.

The 5 year low, median and high median Price/Earnings per Share Ratios are 10.29, 11.32 and 12.50. The 10 year corresponding values are 10.65, 11.75 and 13.15. The corresponding historical values are 10.29, 11.32 and 13.20. The current P/E Ratio is 12.15 based on a stock price of $76.64 and 2016 EPS estimate of $6.31. This stock price testing suggest that the stock price is relatively reasonable, but above the median.

I get a Graham Price of $64.37. The 10 year low, median and high median Price/Graham Price Ratios are 0.86, 0.96 and 1.13. The current P/GP Ratio is 1.19 based on a stock price of $76.64. This stock price testing suggests that the stock price is relatively expensive.

I get a 10 year median Price/Book Value per Share Ratios of 1.95. The current P/B Ratio is 2.63 based on a stock price of $76.64 and BVPS of $29.18. This stock price testing suggests that the stock price is relatively expensive.

I get a historical dividend yield of 3.92%. This is just 1.5% higher than the current dividend yield of 3.86% based on dividends of $2.96 and a stock price of $76.64. This stock price testing suggest that the stock price is relatively reasonable, but (slightly) above the median.

When I look at analyst's recommendations they are very broad as there are Strong Buy, Buy, Hold and Underperform Recommendations. The consensus recommendation would be a Buy. The 12 months stock price consensus is $79.59. This implies a total return of 7.71% with 3.85% from capital gains and 3.86% from dividends.

Will Ashworth writes an interesting article in the Motley Fool about banks going more into insured mortgages at he believe the detriment of the Canadian public. Staff at Wall Street Beacon talk about institutions increasing their ownership in this bank. Don Majors on Sports Perspectives talk about recent analysts ratings on this bank. (This is a US site so some prices are in US$. Stock prices seem to be in US$, but earnings seem to be in CDN$). See what analysts are saying on Stock Chase.

The last stock I wrote about was about was Toronto Dominion Bank (TSX-TD, NYSE-TD)... learn more . The next stock I will write about will be National Bank of Canada (TSX-NA, OTC-NTIOF)... learn more on Monday, January 23, 2017 around 5 pm.

The Bank of Nova Scotia is a bank. They offer personal and corporate banking and wealth management services in Canada and US, which includes looking after banking, financing, investing, credit card and insurance needs. They offer mortgages and mutual funds and they offer full service and on-line brokerage services. It is an international bank having banking in Canada and some 40 other countries around the world in the geographic regions of the Caribbean and Central America, Mexico, Latin America and Asia. Its web site is here Bank of Nova Scotia.

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.

Wednesday, January 18, 2017

Toronto Dominion Bank

Sound bite for Twitter and StockTwits is: Buy for income/cap gains. This has been a great dividend growth stock for me. I note that analysts do not expect much more increase in the stock price over the next year. Analysts' recommendations are really all over the place. Price seems a little high, but not unduly high. Dividend yield is still good. See my spreadsheet on Toronto Dominion Bank.

I own this stock of Toronto Dominion Bank (TSX-TD, NYSE-TD). This stock, as all banks, was on Mike Higgs' Canadian Dividend Growth Stock list and the other dividend lists that I followed. The banks were taken off the Canadian Dividend Aristocrats Index when dividend growth stalled in 2009/10, but most are back on this list except for BMO. When I sold some Metro in 2009, I bought this stock. It is the 3rd bank stock I bought after BMO and RY.

This bank did fairly well out of the 2008 recession where it only stopped dividend growth for one year in 2010. Dividend growth picked up after that. The last dividend increase was in 2016 and it was for 7.8%. The total dividend increase between 2015 and 2016 was 8%. The 5, 10 and 15 dividend growth is at 10.60%, 9.27% and 9.62% per year.

For this stock the dividend yield is moderate as is the dividend growth. The dividend yield currently is at 3.31%, the historical median dividend yield is 3.48% and the 5 year median dividend yield is 3.75%. The dividend yield is after 5, 10 and 15 years for this stock at 5.7%, 6.3% and 12.5% respectively based on an original median stock price. If dividends increase in the future at 10.6%, then in 5, 10 or 15 years, the dividend yields could be 5.48%, 9.06% and 15.00% based on the current stock price of $66.48.

The Dividend Payout Ratios are good for this stock. Canadian Banks stock should have DPR of between 40% and 55% of EPS. This stock's DPR for EPS for 2016 is 46.3%. The 5 year running average is 45.7%.

Shareholders have been making money from this stock. The 5 and 10 year total return to the end of 2016 is 15.44% and 9.77% per year. The portion of this total return attributable to dividends is 3.78% and 3.14% per year for the past 5 and 10 years. The portion of this total return attributable to capital gain is 11.66% and 6.63% per year for the past 5 and 10 years.

I see nothing that particularly sticks out on this bank. The debt ratios are with normal parameters for a bank. This bank has generally produced good returns for its shareholders and has provided shareholders with a nice and growing dividend. It is a dividend growth stock.

The 5 year low, median and high median Price/Earnings per Share Ratios are 11.40, 12.63 and 13.69. The corresponding 10 year values are 11.41, 12.68 and 13.88. The historical values are 11.40, 10.89 and 13.92. These are all pretty consistent. The current P/E Ratio is 12.88 based on a stock price of $66.48 and 2017 EPS estimate of $5.16. This stock price test suggests that the stock price is relatively reasonable but above the median.

I get a Graham Price of $64.70. The 10 year low, median and high median Price/Graham Price Ratios are $0.86, 0.98 and 1.08. The current P/GP Ratio is 1.03 based on a stock price of $66.48. This stock price test suggests that the stock price is relatively reasonable but above the median.

The 10 year median Price/Book Value per Share Ratios is 1.61. The current P/B Ratio is 1.81 a value some 12.4% higher. The current P/B Ratio is based on BVPS of $36.69 and a stock price of $66.48. This stock price test suggests that the stock price is relatively reasonable but above the median.

The current dividend yield is 3.31% based on dividends of $2.20 and a stock price of $66.48. The historical median dividend yield is 3.48% a value some 4.9% higher. This stock price test suggests that the stock price is relatively reasonable but above the median.

When I look at analysts' recommendations, I find Strong Buy, Buy, Hold and Underperform Recommendations. Most of the recommendations are a Buy or Hold and the consensus is a Buy. The 12 month stock price is $67.02. This implies a total return of 4.12% with 3.31% from dividends and 0.81% from capital gains. This is based on a current stock price of $66.48.

Wayne Landers on Sports Perspectives talks about CSFB raising their 12 month stock target price from $69.00 to $72.00 for this bank. Will Ashworth of Motley Fool does not think that TD Bank deserves the Outperform Rating from Macquarie Research analyst Jason Bilodeau. Staff writers on Wall Street Beacon talk about TD bank beating earnings consensus for the October 2016 quarter. See what analysts are saying about this bank at Stock Chase.

The last stock I wrote about was about was Sylogist Ltd (TSX-SYZ, OTC-SYZLF)...learn more . The next stock I will write about will be Bank of Nova Scotia (TSX-BNS, NYSE-BNS)... learn more on Friday, January 20, 2017 around 5 pm. Tomorrow on my other blog I will write about Bond Market Bear... learn more on Thursday, January 19, 2017 around 5 pm.

The TD bank is a bank with a full range of financial products and services for individuals and corporations in Canada, USA and internationally. Financial products and services include Canadian Personal and Commercial Banking; Wealth Management; U.S. Personal and Commercial Banking; and Wholesale banking products. Its web site is here Toronto Dominion Bank.

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.

Monday, January 16, 2017

Sylogist Ltd

Sound bite for Twitter and StockTwits is: Lost Momentum. This tech stock seems to have lost momentum lately and seems to have a comparatively high price. There has been insider buying this year, but most insider bought stock around $9.00. See my spreadsheet on Sylogist Ltd.

I do not own this stock of Sylogist Ltd (TSX-SYZ, OTC-SYZLF). I learned about this stock from the newsletter I subscribe to. This is a small cap stock that I have not reviewed before.

This is a relatively small Tech company that is growing fast. They are currently worth some $237M, but just 10 years ago the company was worth just $12M. This stock also pays a dividend. It started to pay dividends in 2007 and has a done a good job of increasing the dividends each year. Dividends have grown at 22.7% per year over the past 5 years. The last dividend increase was for 13.7% and it was made in 2016.

The dividends are moderate with current good growth in dividends as discussed above. The current dividend is 2.71% based on dividends of $0.28 and a stock price of $10.35. The 5 year median dividend yield is 2.91%. However, dividend yield has been much higher as it topped out in 2012 at 7.84%.

The dividend growth has slowed down. Probably because they were paying out too much in regards to earnings. The Dividend Payout Ratio for 2016 is 89%, but the 5 year coverage DPR is 118%. The DPR for CFPS is also a bit high at 44% with 5 year coverage at 61.6%. Basically it is preferred that DPR for EPS be at or under 80% and for CFPS at or under 40%. (Note the financial year ends in September each year.)

In 2012, CEO Jim Wilson says the company's practice is to pay out, over the year, less than one-half of its expected annual operating cash flow. However, over the last 3 years they have been paying out 85.95%, 70.23% and 53.56% of the annual operation cash flow. Maybe the expected cash flow was less than expected.

Even with this high dividend payout, the company is in quite good shape. It has cash on hand of $1.24 per share which is some 15.7% of the stocks' price. It also has some very good debt ratios. The Liquidity Ratio for 2016 is 2.61 with a 5 year median of 3.49. The Debt Ratio for 2016 is 3.57 with a 5 year median ratio of 3.97. The Leverage and Debt/Equity Ratios for 2016 are 1.39 and 0.39 with 5 year median ratios of 1.34 and 0.34 respectively. Whichever way you look at this stock, they have very little debt.

This stock has certainly been rewarding its investors. The total return over the past 5 and 10 years to the end of December 2016 is 40.38% and 28.94% per year. The portion of this return attributable to dividends is 5.96% and 3.04% per year. The portion of this return attributable to capital gains is 34.42% and 25.83% per year.

The 5 year low, median and high median Price/Earnings per Share Ratios are 22.07, 31.30 and 40.54. The corresponding 10 year ratios are 14.63, 22.63 and 29.17. It would seem that the stock price rise has a lot to do with increasing P/E Ratios. If we use the EPS for 2016 of $0.28 and the current price of $10.35, then the P/E Ratio is 39.96. This would appear to be a rather high P/E Ratio.

I get a Graham Price of $3.49. The 10 year low, median and high median Price/Graham Price Ratios are 1.16, 1.64 and 2.11. The current P/GP Ratio is 2.97 based on a stock price of $10.35. 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 2.68. The current P/B Ratios is 5.36 a value 100% higher. The current P/B Ratio is based on BVPS of $1.93 and a stock price of $10.35. The problem is that the stock price is rising faster than Book Value. This stock price testing suggests that the stock price is relatively expensive.

The 5 year and 7 year median dividend yields are 2.85% and 2.91%. They are some 5% and 7% higher than the current dividend yield of 2.71%. The current dividend yield is based on dividends $0.28 and a stock price of $10.35. This stock price testing suggests that the stock price is relatively reasonable but above the median.

Generally the time to buy fact rising tech stocks is when they have rising momentum. This stock seems to have lost its momentum in August 2016 and has been mucking about since then. You can often make money on tech stocks with very high P/E Ratios if they have momentum.

I cannot find any analysts that follow this stock so there are no recommendations. However, Stephen Groff on Stock Chase gave it a Buy Rating in December 2016 at $10.25.

Nick Waddell of CanTech talked about this stock in 2012 and said it reminds some of a junior version of Constellation Software. Staff at Stock Newsweek say that the Value Composite score for this stock is 66. This is using a scale from 0 to 100 where a lower score may indicate an undervalued company and a higher score would represent an expensive or possibly overvalued company. Some analysts at Stock Chase like this company. The Catalyst Tree has an interesting post on Seeking Alpha. He says that Sylogist buy backs have been funded by issuing shares.

The last stock I wrote about was about was Calian Technologies Ltd. (TSX-CTY, OTC- CLNFF)... learn more . The next stock I will write about will be Toronto Dominion Bank (TSX-TD, NYSE-TD)... learn more on Wednesday, January 18, 2017 around 5 pm. Tomorrow on my other blog I will write about Dividend Payout Ratios... learn more on Tuesday, January 17, 2017 around 5 pm.

Sylogist Ltd. is a technology innovation and licensing company, which, through strategic acquisitions, investments and operations management, provides intellectual property solutions to a range of public and private sector customers. Its web site is here Sylogist Ltd.

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.

Friday, January 13, 2017

Calian Group Ltd

Sound bite for Twitter and StockTwits is: Good dividend, no debt. This stock is probably at the high end of the buy range or into the expensive range. It is still a health company and his no debt. See my spreadsheet on Calian Group Ltd.

I own this stock of Calian Group Ltd. (TSX-CGY, OTC-CLNFF). In 2011 this looked like an interesting stock with a very nice dividend so I did a spreadsheet on it and decided to buy. This stock came up on a Globe Investor site. The Globe Investor Number Cruncher is an investment column about screening for stocks and funds. They did one on companies with little to no debt. I also noted that the Financial Blogger has this stock on his Top Ten Canadian Dividend Stocks list.

From the time they started to pay dividends in 2003 until 2013 they had a good record of dividend increases. However, since 2013 their dividend has been flat. Their Dividend Payout Ratio for EPS was rather high in 2015 at 84%, but it was lower at 61% in 2016 and it is expected to be lower still in 2017. However, analysts (there seems to be 2 following this stock) do not think that they will raise the dividend in the near future. They probably want to get the Dividend Payout Ratio back to the 30 to 40% range.

I did buy some more of this stock this year, but will not purchase anymore until they again start to raise the dividends again. The dividend yield on this stock is still in the good range at 4.40% based on dividends of $1.12 and a stock price of $24.45. This is below the historical median dividend yield of 4.67% and the 5 year median dividend yield of 5.69%.

This stock is doing better lately as the stock price moved up some 52% in 2016 and is up almost 4% so far this year. The Total Return to the end of 2016 over the past 5 and 10 years is 12.81% and 13.17%. The portion of this return attributable to dividends is 5.68% and 6.29% over the past 5 and 10 years. The portion of this return attributable to capital gain is 7.13% and 6.88% over the past 5 and 10 years.

This company has no debt. The Liquidity Ratio is 2.51 with a 5 year median value of 2.51. The Debt Ratio is 2.99 with a 5 year median of 3.04. Leverage and Debt/Equity Ratios are 1.50 and 0.50 with 5 year median also of 1.50 and 0.50, respectively.

The 5 year low, median and high median Price/Earnings per Share Ratios are 10.43, 11.57 and 12.58. The 10 year values are 10.45, 10.91 and 13.39. The historical values are 9.03, 10.76 and 12.62. The current P/E Ratio is 13.32 based on a stock price of $25.45 and 2017 EPS of $1.91. This stock price testing suggests the stock price is relatively expensive.

I get a Graham Price of $21.21. The 10 year low, median and high median Price/Graham Price Ratios are 0.93, 1.02 and 1.13. The current P/GP Ratio is 1.20 based on a stock price of $24.45. This stock price testing suggests the stock price is relatively expensive.

The 10 year Price/Book Value per Share Ratio is 2.05. The current P/B Ratio is 2.43, a values some 19% higher. The current P/B Ratio is based on a stock price of $24.45 and BVPS of $10.47. The problem is that the stock price is going up quicker than the book value. The book value is going up slow because of the high dividends being paid relative to earnings. This stock price testing suggests the stock price is relatively expensive.

The current dividend yield is 4.40%. The historical median dividend yield is 4.67% a value some 5.8% higher. The current dividend yield is based on a stock price of $24.45 and dividends of $1.12. This stock price testing suggests that the stock price is relatively reasonable but above the median.

When I look at analysts' recommendations, I find (2) Buy Recommendations on this stock. The consensus recommendations would be a Buy. The 12 month consensus stock price is $27.70. This implies a total return of 13.24% with 8.84% from capital gains and 4.40% from dividends.

Darlene McCollum at Daily Quint talks about analysts at Desjardins reducing they FY2014 earnings estimates to $1.90 from $2.00. There is sponsored information on Caligan's success story with Canadian Military in the Ottawa Business Journal. This stock is mentioned in Stock Chase but it is not well covered or well known. There is some analysis of this company on Capital Cube. Brendan Caldwell has this as a top pick on BNN.

The last stock I wrote about was about was Rogers Sugar Inc. (TSX-RSI, OTC- RSGUF)... learn more . The next stock I will write about will be Sylogist Ltd (TSX-SYZ, OTC-SYZLF)...learn more on January 16, 2017 around 5 pm.

Calian Ltd. is a leading program delivery partner for both government and industry customers. The Company operates through two divisions: Systems Engineering Division (SED), and the Business and Technology Services Division (BTS). Its web site is here Calian Group Ltd.

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.

Wednesday, January 11, 2017

Rogers Sugar Inc.

Sound bite for Twitter and StockTwits is: Buy for yield. Bearish. This stock has a very good yield and it does not take a very long time to cover the cost of your stock purchase. In a lot of 10 year periods cost coverage was around 100%. A drawback is with the low dividend growth, you do not see that much dividend growth. Price seems to be relatively high. It is an interest commodity stock. See my spreadsheet on Rogers Sugar Inc.

I do not own this stock of Rogers Sugar Inc. (TSX-RSI, OTC-RSGUF). This stock was brought to my attention by Dividend Ninja. This company used to be an Income Trust (TSX-RSI.UN) but it has been converted to a corporation. On its change to a corporation, it lowered its dividend.

You would expect this stock to provide a nice dividend yield and little in the way of capital gains. The dividends would be good, but dividend growth would be expected at the rate of inflation. This is similar to expectations from Real Estate. You would buy this stock for diversification purposes.

The current dividend yield is 5.33%. The dividend growth is 2.17% over the past 5 years and is a negative 1.11% over the past 10 years. These hide a number of things. First this company used to be an income trust and when it ceased to be one it lowered its dividend by just under 30%. They then started to raise the dividend by 6.7% and 4.4% in 2012 and 2013. Since then the dividend has been flat.

The dividend has been flat because they raised the dividends to much too soon and put themselves in the position of not being able to afford their dividends. Their Dividend Payout Ratio was 184% in 2013. It has been traveling south ever since. They would have been better off if they just raised the dividend by 2% or so each year. Note that the financial year ends in September each year.

The Dividend Payout Ratio for 2016 reasonable at 56%. It is expected to be around 80% in 2017 and then fall again in 2018. The DPR for CFPS for 2016 is at 30% and this is also an acceptable ratio. The 5 year DPR for CFPS is 55% and this is too high. It needs to be 40% or less.

Book Value has declined over the past 5 and 10 years by 3% and 0.1%. A declining book value is never a good sign. The book value is fall basically because they are paying out more in dividends that they have earned.

The 5 year Low, Median and High Median Price/Earnings per Share Ratios are 14.49, 16.21 and 18.52. The corresponding 10 year values are 9.53. 10.62 and 11.89. The corresponding historical values are 8.79, 9.82 and 11.10. So it would appear that part of the capital gain for this stock is due to rising P/E Ratios. This is not uncommon for small caps. In 1999 it was worth $290M and today it is worth around $633M.

The current P/E Ratio is 15.00 based on a stock price of $6.75 and 2017 EPS estimate of $0.45. This testing suggests that the stock price might be relatively reasonable. This is based on 5 year P/E Ratios. If you look longer term, the stock is relatively expensive.

I get a Graham Price of $5.34. The 10 year low, median and high median Price/Graham Price Ratios are 0.76, 0.88 and 1.02. The current P/GP Ratio is 1.26. This stock price testing suggests that the stock price might be relatively expensive. For this sort of stock, I would suggest that on an absolute basis, the price is not good if the P/GP Ratio is above 1.00.

The problem in testing the stock price is that the Book Value per Share is declining. The 10 year median Price/Book Value per Share Ratio is 1.67. The current P/B Ratio is 2.40 a value some 43% higher. I also think that for this sort of stock the P/B Ratio of 2.40 is too high. This stock price testing suggests that the stock price is relatively expensive.

The last thing to look at is the dividend yield. This is a hard test to do on this stock because the dividends were reduced after the company became a corporation. It was expected that this sorts of stocks would end up with dividend yield in the 4 to 5% range. The stock did this as the current dividend yield is 5.33%.

Since dividend yield is not a great test, I should probably also look at P/S Ratio. The 10 year median value is 0.83. The current P/S Ratio is 0.95 a value some 14% higher. The current P/S Ratio is based on 2017 Revenue estimate of $670 or $7.14 per share. This stock price testing suggests that the stock price is relatively reasonable, but above the median.

When I look at analysts' recommendations, I find 4 analysts following this stock and all give it a Hold recommendation. The 12 month stock price is $6.56. This is 3% below the current stock price of $6.75. The total return would be 2.52% with 5.33% from dividends and a capital loss of $2.81%.

Donald Swayze on Daily Quint says that TD Securities has raised the target of this stock of $6.50 recently. Rogers has put out a Press Release of their fourth quarterly results. )...The staff at Wall Street Confidential say this stock as a Relative Strength Index of 59.15. An RSI reading over 70 would be considered overbought, and a reading under 30 would indicate oversold conditions. A level of 50 would indicate neutral market momentum. )...See what analysts are saying at Stock Chase

The last stock I wrote about was about was Royal Bank of Canada (TSX-RY, NYSE-RY)...learn more . The next stock I will write about will be Calian Group Ltd. (TSX-CGY, OTC-CLNFF)... learn more on Friday, January 13, 2017 around 5 pm. Tomorrow on my other blog I will write about Year 2016... learn more on Thursday, January 12, 2017 around 5 pm.

Rogers Sugar Inc. was established to hold all of the common shares and notes of Lantic Inc. Lantic Inc. is a refiner, processor, distributor and marketer of sugar products in Canada. Its web site is here Rogers Sugar Inc.

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.

Monday, January 9, 2017

Royal Bank of Canada

Sound bite for Twitter and StockTwits is: Buy for dividends/growth. This stock is good for both dividends and growth. It is a bit expensive at present, so I am rather neutral on this stock. See my spreadsheet on Royal Bank of Canada.

I own this stock of Royal Bank of Canada (TSX-RY, NYSE-RY). At the time I bought this stock it was on Mike Higgs' list of Canadian Dividend Growth Stocks and on the dividend lists I followed as were all the banks. In 1995 I bought this stock and this is the second bank stock that I have bought.

Banks can be good money makers. They tend to have good yields and moderate dividend growth. Dividends grow very well over time. I have had this stock for almost 21 years and I am making a yield of 45.7% on the original cost of my stock. This is almost the same as BMO but over less time. Also the dividends received have paid for my stock 440% or in other words over 4 times.

This stock has a dividend yield that is moderate to almost good and dividend growth that is moderate. The current dividend is 3.58% based on dividends of $3.32 and a stock price of $92.72. The historical median dividend yield is 3.92% and the 5 and 10 year median dividend yields are 3.92% and 3.93%, respectively. I think that any dividend above 4% is a good dividend, but this stock does not quite make that good category.

For me dividend growth has been at 11.4% per year over the past 21 years. Dividends growth has slowed lately. The 5 and 10 year dividend growth is at 9% and 8.9% per year. However, this is not unusual. We had a period of no dividend growth in 2009 and 2010. There was also a period from 1991 to 1994 inclusive when this stock had no dividend growth. Dividend growth will vary over time for any stock.

I have made a total return of 17.99% per year since I bought this stock. This is composed of capital gain at 13.34% per year and dividends at 4.65% per year. Growth over the past 5 and 10 years is not as good as it is at 16.02% and 8.85% per year. The portion of this growth attributable to dividends is at 4.52% and 3.64% per year. The portion of this growth attributable to capital gains is at 11.82% and 5.05% per year.

This bank has kept the Dividend Payout Ratio for EPS with the generally accepted range for banks of between 40 and 55%. The DPR for the financial year ending in October 2016 is 47.20%. For the past 5 years the DPR for this bank is 45.83%.

The 5 year low, median and high median Price/Earnings per Share Ratios are 9.98, 11.33 and 12.46. The 10 year values are 10.93, 12.90 and 14.21. The historical values are 10.29, 12.58 and 14.21. P/E Ratios have been lower in the past 5 years than historically. The current P/E Ratio is 13.26 based on a stock price of $92.72 and 2017 EPS estimate of $6.99. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a Graham price of $82.55. The 10 year low, median and high median Price/Earnings per Share Ratio are 0.95, 1.14 and 1.32. The current P/GP Ratio is 1.12 based on a stock price of $92.72. This stock price testing suggests that the stock price is relative reasonable and below the median.

I get a 10 year Price/Book Value per Share Ratio of 2.06. The current P/B Ratio is 2.14 a values some 3.7% higher. This current P/B Ratio is based on a stock price of $92.72 and BVPS of $43.32. This stock price testing suggests that the stock price is relatively reasonable, but above the median.

I get a current dividend yield of 3.58% based on dividends of $3.32 and a stock price of $92.72. The historical median dividend yield is 3.92% a value some 8.7% higher. This stock price testing suggests that the stock price is relatively reasonable but above the median.

When I look at analysts' recommendations, I find Strong Buy, Buy, Hold and Underperform recommendations. The most are in the Buy and Hold Categories. The consensus would be a Hold. The 12 month stock price is $90.98. This implies a total return of 1.70% with a capital loss of 1.88% and dividends of 3.58%.

Alexander John Tun in a late December post on Motley Fool asks if Royal Bank or TD Bank is a better buy and comes up with no clear winner. The staff at Wall Street Confidential Report says the stock has a Williams Percent Range of -28.87 where values can range from 0 to -100. A reading between -80 to -100 may be typically viewed as strong oversold territory. A value between 0 to -20 would represent a strong overbought condition. So it is neither overbought nor oversold but closer to overbought. See what analysts are saying about this bank at Stock Chase . Barry Schwartz says to wait for a pull back before buying Canadian Banks.

The last stock I wrote about was about was Bank of Montreal (TSX-BMO, NYSE-BMO)... learn more . The next stock I will write about will be Rogers Sugar Inc. (TSX-RSI, OTC- RSGUF)... learn more on Wednesday, January 11, 2017 around 5 pm. Tomorrow on my other blog I will write about Yield and Cost Coverage... learn more on Tuesday, January 10, 2017 around 5 pm.

Royal Bank of Canada and its subsidiaries operate under the master brand name RBC. They are one of Canada's largest banks as measured by assets and market capitalization, and are among the largest banks in the world, based on market capitalization. They provide diversified financial services companies, and provide personal and commercial banking, wealth management services, insurance, corporate and investment banking and transaction processing services on a global basis. They have personal, business, public sector and institutional clients through offices in Canada, the U.S. and 56 other countries. Its web site is here Royal Bank of Canada.

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.

Friday, January 6, 2017

Bank of Montreal

Sound bite for Twitter and StockTwits is: Buy for income/cap gains. This stock is showing as relatively expensive with the Dividend Yield test. The rest of the test show it is relatively reasonable but above the median. Now may not be the time to buy this stock. See my spreadsheet on Bank of Montreal.

I own this stock of Bank of Montreal (TSX-BMO, NYSE-BMO). When I bought this stock in 1983, I thought it was the best bank stock to buy at that time. You would buy for income and some capital gains.

Dividend growth stock can deliver great returns over the longer term. For this stock which I bought in 1983 some 34 years ago, I am making a dividend yield of 47.8% on my original purchase price. Since 1983 dividends on this stock has grown at an average of 6% per year or a total of 618%. Dividend growth lately has been lower. Since dividends have restarted in 2013, 4 years ago, the average growth is 4.7% per year.

My quicken data is only from 1987. After my original purchase in 1983 I bought more stock under DRIP. I also purchase more shares in 2008 and 2013. So with quicken I can look at the stock I held in 1987 plus my other purchase. If I look at all the dividends I have received since 1987 and my cost of my three purchases, I have covered my purchase price of my shares by 173%.

Both these sets of data are important. Investors seldom just buy a stock once. Stocks are usually bought over a number of years like I bought BMO for my trading account.

This stock has a dividend yield that is moderate to good and dividend growth that is low. The current dividend is 3.60% based on dividends of $3.52 and a stock price of $97.81. This historical median dividend yield is 4.52% and the 5 and 10 year median dividend yields are 4.29% and 4.58%, respectively. Any dividend above 4% is a good dividend.

The long term dividend growth is at 6% as stated above. The growth of dividends over the past 5 and 10 years is at 3.7% and 4.1% per year. Part of the reason for the lower growth over the past 5 and 10 years is that dividends were level 2008 to 2012, inclusive. However for 2016 the dividends only grew by 4.35%. Good dividends with low growth can produce very good yields on your original purchase price over time.

This bank has kept the Dividend Payout Ratio for EPS with the generally accepted range for banks of between 40 and 55%. The DPR for the financial year ending in October 2016 is 48.55%. For the past 5 years the DPR for this bank is 47.48%.

The 5 year low, median and high median Price/Earnings per Share Ratios are 10.05, 11.33 and 12.61. The corresponding 10 year values are 10.06, 11.63 and 12.97. The historical values are 10.51, 11.63 and 13.54. These are fairly stable. I get a current P/E Ratio of 12.90 based on a stock price of $97.81 and 2017 EPS estimate of $7.58. This stock price testing suggests that while the stock price may be relatively reasonable it is above the median.

I get a Graham Price of $101.57. The 10 year low, median and high median Price/Graham Price Ratios are 0.73, 087 and 0.99. The current P/GP Ratio is 0.96 based on a stock price of $97.81. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a 10 year Price/Book Value per Share of $1.53. The current P/B Ratio is 1.62, a values some 5.4% higher. The current P/B Ratio is based on a stock price of $97.81 and BVPS of $60.49. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a Dividend Yield of $3.60%. The historical median dividend yield is 4.52% a value some 50.4% higher. This current dividend yield is based on dividends of $3.52 and a stock price of $97.81. This stock price testing suggests that the stock price is relatively expensive.

When I look at analysts' recommendations, I find Buy, Hold and Underperform recommendations. Almost all are Hold recommendations and the consensus recommendation is a Hold. The 12 months stock price is $96.02. This is below the current stock price of $97.81 and implies a total return of 1.77% with 3.60% from dividends and a capital loss of 1.83%.

The money reporter on Daily Buy and Sell Advisor says that this is one of the top Financial stocks to buy. If you want advice on investment income from a variety of sources from GICs to stocks, this is a good report to buy. Linda Roger talks about this stock on Frisco Fastball. Note prices are in US$. Also see what analysts are saying on Stock Chase. Demetris Afxentiou of Motley Fool likes this stock because it has been paying dividends since 1829.

The last stock I wrote about was about was Bird Construction Inc. (TSX-BDT, OTC-BIRDF)... learn more . The next stock I will write about will be Royal Bank of Canada (TSX-RY, NYSE-RY)...learn more on Monday January 9, 2017 around 5 pm. .

BMO is a bank. They offer personal and corporate banking and wealth management services in Canada and US, which includes looking after banking, financing, investing, credit card and insurance needs. They offer mortgages and mutual funds and they offer full service and on-line brokerage services. They are international bank having banking in Canada and US. They have clients, corporate, institutional and governmental, in UK, Europe, Asia and South America. Its web site is here Bank of Montreal.

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.

Wednesday, January 4, 2017

Bird Construction Inc.

Sound bite for Twitter and StockTwits is: Buy for diversification. The stock price testing shows stock price is relatively cheap to reasonable. The stock has vulnerabilities in its debt ratios and the non-growth in BVPS. See my spreadsheet on Bird Construction Inc.

I do not own this stock of Bird Construction Inc. (TSX-BDT, OTC-BIRDF). This was listed as a top stock in ETF of iShares S&P TSX Canadian Dividend Aristocrats Index. I had not heard of it before, so I decided to do a spreadsheet on this stock. It has been a year since I last reviewed this stock.

You would buy this stock for diversification purposes. Since this is an industrial stock, expect volatility in the short term, but expect to earn both capital gains and rising dividend income in the longer term. You should expect volatility especially concerning Earnings and Cash Flow.

This stock used to be an income trust. As such it had high dividends. When it changed to a corporation, it did not lower its dividends. In fact it continued to raise its dividends. However, the dividends have become unaffordable as of the last three years. They just recently decreased the dividends by 48.7% to make them more affordable. This is the proper decision for the company to make.

The financial statements are not yet in for 2016, but the Dividend Payout Ratio is likely to be around 127% and likely decreasing to 83% in 2017. These are still rather high as I would prefer to Dividend Payout Ratio to be at 60% or lower for this type of stock. The potential Dividend Payout Ratio for CFPS is likely to be around 46% in 2017 and declining to a much better rate of 27% in 2017. I prefer DPR for CFPS to be at 40% or less. Until DPRs improve, I believe that the dividend could still be at risk.

A weakness for this stock is the debt ratios. The Liquidity Ratio for 2015 is 1.24. Even when you added in cash flow less dividends it is still low at 1.32. The 5 year median values for these ratios are 1.28 and 1.32 respectively. I prefer to see this ratio for at 1.50 or above for safety's sake. The Debt Ratio is also low at just 1.30 in 2015 and a 5 year median at 1.30. This gives the stock vulnerability in bad times.

The Leverage and Debt/Equity Ratios are a little too high. The ratios for 2015 are 4.30 and 3.30 with 5 year median values at 3.75 and 2.75. Also, their accounts payable is rather high as regards to the market cap of this stock in 2016. It is true that the market cap is falling, probably due to the dividend cut, but this is vulnerability for the company.

The 5 year low, median and high median Price/Earnings per Share Ratios are 13.36, 15.71 and 18.49. The 10 year corresponding ratios are 8.67, 10.40 and 13.54. The corresponding historical ratios are 6.70, 9.93 and 11.22. The current P/E Ratio is 14.38 based on 2017 EPS of $0.63 and a stock price of $9.06. This Stock Price testing suggests that the stock price may be relatively reasonable.

I get a Graham Price of $7.26. The 10 year low, median and high median Price/Graham Price Ratios are 1.07, 1.40 and 1.67. The current Price/Graham Price Ratios is 1.25 based on a stock price of $9.06. This Stock Price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10 year Price/Book Value per Share Ratio of 3.07. The current P/B Ratio is 2.32 based on BVPS of $3.90 and a stock price of $9.06. The current P/B Ratio is some 24% lower than the 10 year median P/B Ratio. This stock price testing suggests that the stock price is relatively cheap. There are some problems here in that the P/B Ratio has been quite high in the past and growth in BVPS is less than 1% over the past 5 years. This shows more vulnerability for this company.

I cannot do any testing on dividend yield as this company has just decreased their dividends. However, the dividends have been rather high and the decrease brings this company's dividend yield more in line with other former income trust companies. The current dividend is 4.30% based on dividends of $0.39 and a stock price of $9.06.

The 10 year P/S Ratio is 0.41. The current P/S Ratio is 0.24 based on a stock price of $9.06 and 2016 Revenue estimate of $1,575.00 or $37.04 per share. The current P/S Ratio is some 40% lower than the 10 year median. This Stock Price testing suggests that the stock price is relatively cheap. A P/S Ratio below 1.00 normally shows a cheap stock price.

When I look at analysts' recommendations, I find Buy and Hold recommendations. Most recommendations are a Hold and the consensus recommendation would be a Hold. The 12 month stock price consensus is $10.00. This implies a total return of 14.68% with 10.38% from capital gains and 4.30% from dividends based on a current stock price of $9.06.

The company put out a Press Release about a new project on January 2, 2017. Staff writers on Wall Street Confidential have put out some technical statistics on this stock. The Williams Percent Range is -84.75. A reading between -80 to -100 may be typically viewed as strong oversold territory. This would indicate a low price. See what analysts are saying about this stock on Stock Chase.

The last stock I wrote about was about was Metro Inc. (TSX-MRU, OTC-MTRAF)... learn more . The next stock I will write about will be Bank of Montreal (TSX-BMO, NYSE-BMO)... learn more on Wednesday, January 4, 2017 around 5 pm. Tomorrow on my other blog I will write about Something to Buy January 2017... learn more on Thursday, January 5, 2017 around 5 pm.

The company operates from 12 offices across Canada serving the heavy industrial market in all provinces as well as serving the industrial, commercial and institutional (ICI) markets in all provinces with the exception of Quebec. The work of the company is split almost evenly between the heavy industrial market and the ICI sector. Its web site is here Bird Construction Inc.

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.

Tuesday, January 3, 2017

Metro Inc.

Sound bite for Twitter and StockTwits is: Buy for Dividend Growth. The stock price is relatively reasonable but above the median to relatively expensive. It has been having a great run. The company has been doing a lot of Buy Backs so EPS growth shows better than earnings are actually growing. See my spreadsheet on Metro Inc.

I own this stock of Metro Inc. (TSX-MRU, OTC-MTRAF). I bought this stock first at the end of 2001 because it is a good time to purchase as market is relatively low and Metro was on my hit list. I think that this is a solid dividend growth company and should be considered when looking at Consumer Staple stocks. This stock has an annual reporting date near September 30 each year.

Dividends are low and dividend growth is good. The current dividend is 1.39% based on dividends of $0.56 and a stock price of $40.16. The historical median dividend yield is 1.44% and the 5 year median dividend yield is 1.46%. The dividend growth over the past 5 and 10 years is at 17.3% and 14.5% per year. The last dividend increase was in 2016 and it was for 20%.

They can afford their dividends. The Dividend Payout Ratio for EPS for 2016 is 22.5% and the 5 year coverage is 19.3%. The DPR for CFPS is 13.4% with 5 year coverage at 12%.

I bought this stock 12 years ago for my Trading account. Dividends paid have covered 52.7% of my stock's cost and I am earning 9.51% on my original purchase price.

Since this is a consumer staple stock, it should add stability to your portfolio. You should expect low dividends and moderate to good dividend increase. You would buy for increasing dividends and capital gains.

Since this company has been buying back shares, the outstanding shares have been decreasing at 5% and 3.8% per year over the past 5 and 10 years. To me this means that you should look for growth by looking at Revenue, Earnings and Cash Flow and not at the per share growth values.

For example, Revenue has increased by 2.3% and 1.6% per year over the past 5 and 10 years. Revenue per Share has grown by 7.7% and 5.5% per year over the past 5 and 10 years. Also Net Income has grown by 8.2% and 8.5% per year over the past 5 and 10 years, but EPS is up by 14% and 12.6% per year over the past 5 and 10 years. The thing is that share buy backs can make EPS look better than it actually is.

This stock has been doing very well until this year in the capital gain department. The total return for this stock to the end of December 2016 is 18.95% and 13.51% per year over the past 5 and 10 years. The portion of this total return attributable to capital gains is 17.41% and 12.25% per year over the past 5 and 10 years. The portion of this total return attributable to dividends is 1.54% and 1.26% per year over the past 5 and 10 years.

The stock only appreciated between 2015 and 2016 by 3.7%. The stock appreciation for the previous two years was 43.76% and 24.57% for 2014 and 2015. You wonder if the company can keep up this high growth rate.

The last thing I want to mention is the Liquidity Ratio. This is low and the ratio for 2016 was just 1.12 with a 5 year median of 1.10. If you add in cash flow after dividends, the ratio becomes 1.66 with a 5 year medina of 1.43. The company does depend on cash flow to give adequate cover to their current liabilities.

The 5 year low, median and high median Price/Earnings per Share Ratios are 11.97, 13.28 and 14.58. The corresponding 10 year values are 10.38, 11.64 and 13.47. The corresponding historical values are 9.90, 11.62 and 13.77. The current P/E Ratio is 14.09 based on a stock price of $40.16 and 2017 EPS estimate of $2.85. This stock price testing suggests that the stock price is relatively expensive.

I get a Graham Price of $27.07. The 10 year low, median and high median Price/Graham Price Ratios are 0.88, 0.89 and 1.09. The current P/GP Ratio is 1.48 based on a stock price of $40.16. 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 2.06. The current P/B Ratio is 3.51 a value some 70% higher. The current P/B Ratio is based on BVPS of $11.43 and a stock price of $40.16. Problem is that stock price is growing much faster than Book Value. Book Value per Share only grew at 6.18% over the past 5 years. This stock price testing suggests that the stock price is relatively expensive.

The historical dividend yield is 1.44%. The current dividend yield is 1.39% based on dividends of $0.56 and a stock price of $40.16. The current dividend yield is some 3% lower than the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.

When I look at analysts' recommendations, I find Strong Buy, Buy, Hold and Underperform recommendations. Most of the recommendations are Buy and Hold. The consensus recommendation would be a Buy. The 12 month stock price consensus is $46.42. This implies a total return of 16.98% with 15.59% from capital gains and 1.39% from dividends.

Staff writers in this Wall Street Confidential Report says the stock has a Williams Percent Range of -62.99 where values can range from 0 to -100. A reading between -80 to -100 may be typically viewed as strong oversold territory. A value between 0 to -20 would represent a strong overbought condition. According to Alexander John Tun of Motley Fool this stock is one of Royal Bank's picks for 2017. See what analysts are saying about this stock on Stock Chase

The last stock I wrote about was about was Magna International Inc. (TSX-MG, NYSE-MGA)... learn more . The next stock I will write about will be Bird Construction Inc. (TSX-BDT, OTC-BIRDF)... learn more on Wednesday, January 04, 2017 around 5 pm. Today on my other blog I will write about Dividend Stocks January 2017... learn more on January 3, 2017 around 5 pm.

Metro is a leader in the food and pharmaceutical sectors. It operates a network of food stores under the banners Metro, Metro Plus, Super C, Adonis and Food Basics. It has 250 pharmacies under the banners Brunet, Clini Plus, Metro Pharmacy and Drug Basics. Its web site is here Metro Inc.

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.