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.

Friday, March 15, 2024

H & R Real Estate Trust

Sound bite for Twitter and StockTwits is: Dividend Growth REIT. Results of stock price testing is that the stock price is reasonable and may be even cheap. Debt Ratios are mostly fine, but debt is high. The important Dividend Payout Ratios (DPR) for AFFO and FFO are current fine, but were recently too high. The current dividend yield is good with dividend growth restarting after a dividend cut. See my spreadsheet on H & R Real Estate Trust.

Is it a good company at a reasonable price? First, a lot of real estate companies are currently having problems and it will probably take a while for things to turn around. In the meantime, some REITs like this one is offering a very good yield. Since distributions are growing again, it would seem like the distributions are probably safe. The stock price is probably cheap as most of the testing is pointing that way.

I do not own this stock of H & R Real Estate Trust (TSX-HR.UN, OTC-HRUFF). Before I started blogging, I was following a number of REITs and this is one I had followed. It also used to be on a dividend list I followed.

When I was updating my spreadsheet, I noticed that this company has not been doing well lately, and it is not currently well followed as I was having a hard time getting estimates for 2024 and 2025. The only growth expected in the next 12 months is for Net Income to grow 433%, but since it collapsed 97% in 2023, it is still not that great.

Year Item Tot. Growth Per Year
5 Revenue Growth -28.00% -6.36%
5 AFFO Growth -20.98% -4.60%
5 Net Income Growth -81.74% -28.83%
5 Cash Flow Growth -36.25% -8.61%
5 Dividend Growth -56.83% -15.46%
5 Stock Price Growth -52.06% -13.67%
10 Revenue Growth -25.49% -2.90%
10 AFFO Growth -23.90% -2.69%
10 Net Income Growth -80.94% -15.27%
10 Cash Flow Growth -52.28% -7.13%
10 Dividend Growth -55.87% -7.85%
10 Stock Price Growth -53.74% -7.42%

If you had invested in this company in December 2013, for $1,005.80 you would have bought 47 shares at $21.40 per share. In December 2023, after 10 years you would have received $707.80 in dividends. The stock would be worth $465.30. Your total return would have been $1,173.10. This would be a total return of 2.13% per year with 7.42% from capital loss and 9.55% from dividends.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$21.40 $1,005.80 47 10 $707.80 $465.30 $1,173.10

The current dividend yield is good with dividend growth restarting after a dividend cut. The current dividends yield is good (5% to 6% ranges) at 6.91%. The 5, 10 and historical dividend yields are also good at 5.48%, 6.13% and 6.25%. Dividends were cut in 2020 and the company started to raise them again in 2023. The last dividend increase was in 2023 and it was for 9.2%. The dividend is still 56% below the dividends of 2019. This dividends on REITs are generally called Distributions.

The important Dividend Payout Ratios (DPR) for AFFO and FFO are current fine, but were recently too high. The DPR for 2023 for Earnings per Share (EPS) is high at 272% with 5 year coverage at 198%, but the important DPRs are those for AFFO and FFO. The DPR for 2023 for Adjusted Funds from Operations (AFFO) is good at 54% with 5 year coverage too high at 140%. The DPR for 2023 for Funds from Operations (FFO) is good at 45% with 5 year coverage too high at 111%. The DPR for 2023 for Cash Flow per Share (CFPS) is good at 32% with 5 year coverage high at 78%. The DPR for 2023 for Free Cash Flow (FCF) is high at 57% with 5 year coverage high at 74%.

Item Cur 5 Years
EPS 272.18% 198.28%
AFFO 53.63% 140.02%
FFO 44.97% 110.97%
CFPS 32.74% 77.74%
FCF 67.42% 74.02%

Debt Ratios are mostly fine, but debt is high. The Long Term Debt/Market Cap Ratio for 2023 is too high at 1.42 and currently at 1.62. The Liquidity Ratio for 2023 is too low at 1.17. If you added in Cash Flow after dividends, the ratios are fine at 1.64. The Debt Ratio for 2023 is good at 1.93. The Leverage and Debt/Equity Ratios for 2023 are fine at 2.08 and 1.08.

Type Year End Ratio Curr
Lg Term R 1.42 1.62
Intang/GW 0.00 0.00
Liquidity 1.17 1.17
Liq. + CF 1.64 1.64
Debt Ratio 1.93 1.93
Leverage 2.08 2.08
D/E Ratio 1.08 1.08

The Total Return per year is shown below for years of 5 to 27 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 -4.16% -3.11% -13.67% 10.56%
2013 10 -1.89% 2.13% -7.42% 9.55%
2008 15 -1.69% 16.18% 1.91% 14.26%
2003 20 -0.46% 7.18% -2.34% 9.52%
1998 25 0.32% 11.86% -0.12% 11.98%
1996 27 1.92% 11.38% -4.30% 15.69%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 6.02, 6.99 and 7.97. The corresponding 10 year ratios are 14.33, 15.95 and 17.57. The corresponding historical ratios are 12.92, 13.30 and 18.91. The current P/E Ratio is 7.48 based on a stock price of $8.68 and EPS estimate for 2024 of $1.16. This 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 have Funds from Operations (AFFO) data. The 5-year low, median, and high median Price/ Funds from Operations Ratios are 7.87, 9.14 and 12.23. The corresponding 10 year ratios are 9.93, 11.27 and 12.60. The current P/FFO Ratio is 7.48 based on a stock price of $8.68 and FFO estimate for 2024 of $1.16. 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 have Adjusted Funds from Operations (AFFO) data. The 5-year low, median, and high median Price/ Funds from Operations Ratios are 9.93, 11.55 and 14.52. The corresponding 10 year ratios are 12.63, 13.99 and 15.50. The current P/AFFO Ratio is 8.77 based on a stock price of $8.68 and AFFO estimate for 2024 of $0.99. 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 $22.75. The 10-year low, median, and high median Price/Graham Price Ratios are 0.58, 0.65 and 0.74. The current P/GP Ratio is 0.38 based on a stock price of $8.68. 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 10-year median Price/Book Value per Share Ratio of 0.85. The current P/B Ratio is 0.44 based on a stock price of $8.68, Book Value of $5,192M and Book Value per Share of $19.83. The current ratio is 49% below the 10 year median ratio. 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 10-year median Price/Cash Flow per Share Ratio of 11.18. The current P/CF Ratio is 7.71 based on Cash Flow for the last 12 months of $295M, Cash Flow per Share of $1.13 and a stock price of $8.68. The current ratio is 31% below the 10 year median ratio. 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 an historical median dividend yield of 6.25%. The current dividend yield is 6.91% based on Dividends of $0.60 and a stock price of $8.68. The current yield is 11% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10 year median dividend yield of 6.13%. The current dividend yield is 6.91% based on Dividends of $0.60 and a stock price of $8.68. The current yield is 13% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable and below the median.

The 10-year median Price/Sales (Revenue) Ratio is 4.95. The current P/S Ratio is 2.45 based on a stock price of $8.68, Revenue estimate for 2024 of $927M and Revenue per Share of $3.54. The current P/S Ratio is 50% 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 reasonable and may be even cheap. The dividend yield testing is showing the stock price as reasonable. However, these tests work best on stocks when dividends are growing and dividends were recently cut and then started on this stock. The P/S Ratio testing is saying that the stock price is cheap. The rest of the stock price testing is saying that the stock price is cheap.

When I look at analysts’ recommendations, I find Strong Buy (1), Buy (1) and Hold (3). The consensus would be a Buy. The 12 month stock price consensus is $11.00, with a high of $11.50 and low of $10.50. The consensus stock price of $11.00 implies a total return of 33.64% with 26.73% from capital gains and 6.91% from dividends.

The analysts’ recommendations on Stock Chase gives for 2023, 3 Buys, 1 Do Not Buy and 1 Hold. Stock Chase gives this stock 3 stars out of 5. Christopher Liew on Motley Fool says you can get great month income investing in this stock. Christopher Liew on Motley Fool says invest for its hefty yield and monthly payouts. The company put out a press release on Newswire about their fourth quarter of 2023.

Simply Wall Street via Yahoo Finance reports on this stock. They list 4 warnings of interest payments are not well covered by earnings; unstable dividend track record; large one-off items impacting financial results; and profit margins (6.8%) are lower than last year (95.3%). Simply Wall Street gives this stock 2 and one half stars out of 5.

H&R Real Estate Investment Trust is a real estate investment trust principally involved in the ownership of properties in Canada and the U.S. The REIT has four reportable operating segments- Residential, Industrial, Office and Retail, in two geographical locations -Canada and the United States. The operating segments derive their revenue from rental income from leases. The majority of this income is generated by its Canadian properties. Its web site is here H & R Real Estate Trust.

The last stock I wrote about was about was RioCan Real Estate (TSX-REI.UN, OTC-RIOCF) ... learn more. The next stock I will write about will be Canadian Tire Corp (TSX-CTC.A, OTC-CDNAF) ... learn more on Monday, March 18, 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 13, 2024

RioCan Real Estate

Sound bite for Twitter and StockTwits is: Dividend Growth REIT. Results of stock price testing is that the stock price is probably reasonable and may even be cheap. Debt Ratios are fine. The important Dividend Payout Ratios (DPR) for AFFO and FFO are fine. The current dividend yield is good with dividend growth back after declining distributions. See my spreadsheet on RioCan Real Estate.

Is it a good company at a reasonable price? I bought this stock for diversification purposes as I own no real estate. The problem with stocks that pay high yields is that the is not much growth in dividends, but you do get a good return of passive income. At this point, it might be a speculative buy as it does have office Real Estate and there are problems in office Real Estate at this point in time. I plan to keep my shares in the stock for the same reasons I bought it.

I own this stock of RioCan Real Estate (TSX-REI.UN, OTC-RIOCF). I first bought this stock in 1998 because I wanted to diversify my portfolio into REITs. It was a stock covered and recommended by MPL Communications in their Income Trust coverage. Over the years I have made several more purchases of this REIT.

When I was updating my spreadsheet, I noticed that the value of my shares is depressed, but my total return is fine. I have had this stock since 1998, so for 26 years. I have made a number of purchases over the years. My total return is 9.16% with a capital loss of $0.40% and dividends at 9.56%. A lot of real estate stocks are currently depressed. Normally I would expect such stock to have a capital gain around 3% a year and the rest from distributions.

If you had invested in this company in December 2013, for $1,015.57 you would have bought 41 shares at $24.77 per share. In December 2023, after 10 years you would have received $354.54.21 in dividends. The stock would be worth $763.42. Your total return would have been $1,297.96. This would be a total return of 3.16% per year with 2.81% from capital loss and 5.98% from dividends.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$24.77 $1,015.57 41 10 $534.54 $763.42 $1,297.96

The current dividend yield is good with dividend growth back after declining distributions. The dividend yield is good (5% to 6% ranges) at 6.15%. The 5, 10 and historical dividend yields are also good at 5.37%, 5.37% and 6.54%. The dividends have gone down over the past 5 years by 5.7% per year. After dividends were cut in 2021, the company started to raise them again in 2022. The last dividend increase was in 2024 and it was for 2.8%. The dividend payment is still 23% below payments made in 2020.

The important Dividend Payout Ratios (DPR) for AFFO and FFO are fine. The DPR for 2023 for Earnings per Share (EPS) is high at 823% with 5 year coverage at 117%, but the important DPRs is the AFFO and FFO. The DPR for 2023 for Adjusted Funds from Operations (AFFO) is fine at 70% with 5 year coverage at 79%. The DPR for 2023 for Funds from Operations (FFO) is fine at 60% with 5 year coverage at 70%. The DPR for 2023 for Cash Flow per Share (CFPS) is high at 65% with 5 year coverage at 74%. The DPR for 2023 for Free Cash Flow (FCF) 1 cannot be calculated because of negative FCF with 5 year coverage high at 913%. The DPR for 2023 for Free Cash Flow (FCF) 1 cannot be calculated because of negative FCF with 5 year coverage high at 90%. There are often differences in how different companies calculate the FCF.

Item Cur 5 Years
EPS 823.08% 116.63%
AFFO 69.93% 79.15%
FFO 60.45% 69.71%
CFPS 65.00% 74.24%
FCF 1 N/C 912.88%
FCF 2 N/C 90.17%

Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2023 is too high at 1.07 and currently at 1.09. The Liquidity Ratio for 2023 is good at 2.81. The Debt Ratio for 2023 is good at 2.00. The Leverage and Debt/Equity Ratios for 2023 are good at 2.00 and 1.00.

Type Year End Ratio Curr
Lg Term R 1.07 1.09
Intang/GW 0.00 0.00
Liquidity 2.81 2.81
Liq. + CF 3.29 3.21
Debt Ratio 2.00 2.00
Leverage 2.00 2.00
D/E Ratio 1.00 1.00

The Total Return per year is shown below for years of 5 to 30 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 -5.73% 0.73% -4.79% 5.52%
2013 10 -2.70% 3.16% -2.81% 5.98%
2008 15 -1.59% 11.03% 2.09% 8.95%
2003 20 -0.32% 9.11% 0.99% 8.13%
1998 25 0.48% 13.43% 2.77% 10.66%
1993 30 3.19% 13.80% 3.31% 10.49%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 9.38, 10.43 and 12.17. The corresponding 10 year ratios are 11.25, 12.06 and 12.87. The corresponding historical ratios are 13.73, 12.67, and 15.27. The current P/E Ratio is 10.26 based on a stock price of $18.05 and EPS estimate for 2024 of $1.76. 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 have Funds from Operations (AFFO) data. The 5-year low, median, and high median Price/ Funds from Operations Ratios are 10.26, 12.56 and 14.86. The corresponding 10 year ratios are 12.32, 13.46 and 15.14. The current P/FFO Ratio is 10.08 based on a stock price of $18.05 and FFO estimate for 2024 of $1.79. 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 have Adjusted Funds from Operations (AFFO) data. The 5-year low, median, and high median Price/ Adjusted Funds from Operations Ratios are 11.32, 14.48 and 16.25. The corresponding 10 year ratios are 13.41, 14.77 and 16.68. The current P/AFFO Ratio is 12.28 based on a stock price of $18.05 and AFFO estimate for 2024 of $1.47. 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 $28.61. The 10-year low, median, and high median Price/Graham Price Ratios are 0.75, 0.80 and 0.88. The current P/GP Ratio is 0.63 based on a stock price of $18.05. 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 10-year median Price/Book Value per Share Ratio of 0.94. The current P/B Ratio is 0.73 based on a Book Value of $7,438M, Book Value per Share of $24.76 and a stock price of $18.05. The current ratio is 22% 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 14.94. The current P/CF Ratio is 14.07 based on Cash Flow for the last 12 months of $386M, Cash Flow per Share of $1.28 and a stock price of $18.05. 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.

I get an historical median dividend yield of 6.54%. The current dividend yield is 6.15% based on dividends of $1.11. The current dividend yield is 6% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.

I get a 10 year median dividend yield of 5.37%. The current dividend yield is 6.15% based on dividends of $1.11. The current dividend yield is 15% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable and below the median.

The 10-year median Price/Sales (Revenue) Ratio is 6.32. The current P/S Ratio is 4.68 based on Revenue estimate for 2024 of $1,160M, Revenue per Share of $3.86 and a stock price of $18.05. The current ratio is 26% 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 and may even be cheap. The 10 year dividend yield is test is showing the stock price as reasonable and below the median. However, this test is best for dividend growth stocks and this stock has recently cut dividends. The P/S Ratio testing is showing the stock price as cheap. Most of the rest of the testing is showing the stock price as cheap.

When I look at analysts’ recommendations, I find Strong Buy (4), Buy (5) and Hold (1). The consensus would be a Strong Buy. The 12 month stock price consensus is $21.62, with a high of $24.00 and low of $19.00. The consensus price of $21.62 implies a total return of $25.93% with 19.78% from capital gains and 6.15% from dividends.

There are four recommendations onStock Chase for 2023, two are a Buy and two are Do Not Buy. Stock Chase gives this stock 3 stars out of 5. There is a problem in the Real Estate sector re Offices. Demetris Afxentiou on Motley Fool thinks this is a good stock for passive income. Aditya Raghunath on Motley Fool thinks this stock is a solid long term investment.. The company put out a Press Release for year-end 2023.

Vancouver Island Guy on Twitter talks about this stock. Simply Wall Street gives this stock 2 and one half stars out of 5. It lists 4 warnings of debt is not well covered by operating cash flow; profit margins (3.3%) are lower than last year (19.2%); unstable dividend track record; and large one-off items impacting financial results.

RioCan Real Estate Investment Trust is a Canadian real estate investment trust which owns, develops, and operates Canada's portfolio of retail-focused, increasingly mixed-use properties. The REIT's property portfolio includes shopping centers and mixed-use developments, with majority of its properties located in Ontario, Canada. RioCan’s tenants consist of grocery stores, supermarkets, restaurants, cinemas, pharmacies, and corporates. Its web site is here RioCan Real Estate.

The last stock I wrote about was about was Bombardier Inc (TSX-BBD.B, OTC-BDRBF) ... learn more. The next stock I will write about will be H & R Real Estate Trust (TSX-HR.UN, OTC-HRUFF) ... learn more on Friday, March 15, 2024 around 5 pm. Tomorrow on my other blog I will write about Canadian Banks .... learn more on Thursday, March 14, 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 11, 2024

Bombardier Inc

Sound bite for Twitter and StockTwits is: Industrial Sector Stock. Results of stock price testing is that the stock price is probably expensive. Debt Ratios are awful as it has a lot of debt and a negative book value. This stock currently does not current pay dividends, but it has in the past and may do so again. See my spreadsheet on Bombardier Inc.

Is it a good company at a reasonable price? The big negative for me is the negative book value. Personally, I would not buy a stock with a negative book value. I do not like the fact that a number of stock price testing cannot be done. The debt ratios are also not good. I would suggest that any purchase is highly speculative. Personally, I am not interested in this company at the present time.

I do not own this stock of Bombardier Inc (TSX-BBD.B, OTC-BDRBF) but I used to. The buying of this stock was part of my early foray into industrial stocks in 1987. Up until 2001, I was making some 35% return per annum on this stock. When the stock first dropped in 2002, I had still made some 28% return per annum on this stock. Even by the lowest point in 2005, I had made some 13% per annum on this stock. By that time, it seemed to be turning itself around, so I did not sell. I lost hope by 2017, so I sold. I made 11.08% per year.

When I was updating my spreadsheet, I noticed that this company still has a negative book value. This company is reporting in US$.

If you had invested in this company in December 2013, for $1,037.25 you would have bought 9 shares at $19.88 per share. In December 2023, after 10 years you would have received $23.21 in dividends. The stock would be worth $478.89. Your total return would have been $502.10. This would be a total loss of 7.21% per year with 7.44% from capital loss and 0.23% from dividends. This calculation takes into consideration stock consolidation, which means that the original cost is showing as higher because of this consolidation.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$115.25 $1,037.25 9 10 $23.21 $478.89 $502.10

This stock currently does not current pay dividends, but it has in the past and may do so again. However, analysts seem to feel that it could restart dividends this year. The last year that this stock paid a dividend was 2014

Debt Ratios are awful as it has a lot of debt and a negative book value. The Long Term Debt/Market Cap Ratio for 2023 is too high at 1.46 and currently at 1.49. This ratio should be under 1.00 and best at 0.50 or lower. The Liquidity Ratio for 2023 is too low at 1.00. If you added in Cash Flow after dividends, the ratios are still too low at 1.10 and currently at 1.12. I prefer this to be at 1.50 or higher. The Debt Ratio for 2023 is of course too low at 0.84 as the company has a negative book value. The Leverage and Debt/Equity Ratios for 2023 cannot be calculated because of a negative book value.

Type Year End Ratio Curr
Lg Term R 1.46 1.49
Intang/GW 0.02 0.02
Liquidity 1.00 1.00
Liq. + CF 1.10 1.12
Debt Ratio 0.84 0.84
Leverage -5.18 -5.18
D/E Ratio -6.18 -6.18

The Total Return per year is shown below for years of 5 to 37 to the end of 2023 in CDN$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.

From Years Div. Gth Tot Ret Cap Gain Div.
2018 5 0.00% 0.95% 0.95% 0.00%
2013 10 0.00% -7.21% -7.44% 0.23%
2008 15 0.00% -2.55% -3.79% 1.24%
2003 20 0.00% -4.23% -5.04% 0.81%
1998 25 0.00% -5.60% -6.44% 0.84%
1993 30 0.00% 1.75% -0.72% 2.47%
1988 35 0.00% 7.44% 2.69% 4.74%
1987 37 0.00% 9.96% 3.94% 6.02%

The Total Return per year is shown below for years of 5 to 34 to the end of 2023 in US$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.

From Years Div. Gth Tot Ret Cap Gain Div.
2018 5 0.00% 1.40% 1.40% 0.00%
2013 10 0.00% -9.45% -9.66% 0.21%
2008 15 0.00% -2.84% -4.34% 1.50%
2003 20 0.00% -4.12% -5.14% 1.02%
1998 25 0.00% -5.00% -6.02% 1.03%
1993 30 0.00% 1.77% -0.77% 2.54%
1890 34 0.00% 6.18% 1.99% 4.19%

The 5-year low, median, and high median Price/Earnings per Share Ratios are all negative, so I can do not test using them. The 10 year ratios are also all negative, and so cannot be used. The historical ratios are 9.39, 12.39 and 15.30. The current P/E Ratio is 9.47 based on a stock price of $52.72 and EPS estimate for 2024 of $5.57 (4.13 US$). This ratio is between the low and median ratios of the historical median ratios. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I also have Adjusted Earnings per Share (AEPS) Data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 5.08, 7.96 and 9.78. The current P/AEPS 9.44 based on a stock price of $39.08 and AEPS estimate for 2024 of $4.14. This ratio is between the median and high ratios of the 10 year median ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$ and you will get a similar result in CDN$.

I cannot do any Graham Price testing because of the negative book value. I cannot do any Price/Book Value per Share Ratio testing because of the negative book value. I cannot do any dividend yield testing because this company, at the current time, is not paying dividends.

I get a 10-year median Price/Cash Flow per Share Ratio of 7.18. The current P/CF Ratio is 5.32 based on a stock price of $39.08, Cash Flow per Share estimate for 2024 of $7.35 and a Cash Flow of $718M. The current ratio is 26% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$ and you will get a similar result in CDN$.

The 10-year median Price/Sales (Revenue) Ratio is 0.30. The current P/S Ratio is 0.45 based on Revenue estimate for 2024 of $8,506M, Revenue per Share of $87.10 and a stock price of $39.08. The current ratio is 50% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive. This testing is in US$ and you will get a similar result in CDN$.

Results of stock price testing is that the stock price is probably expensive. I am going with the P/S Ratio test here. This is the only one that says that the stock price is expensive. Other tests go from cheap to reasonable and above the median. One problem is that a number of tests cannot be done as the Book Value is negative.

When I look at analysts’ recommendations, I find Strong Buy (4), Buy (7), Hold (3), Underperform (2) and Sell (1). There is not much consensus here. The consensus based on Analysts’ Consensus score in a Buy. The 12 month stock price consensus is $77.94 ($57.86 US$) with a high of $100.01 ($74.24 US$) and low of $41.03 ($30.46 US$). The consensus stock price of $77.94 implies a total return of 47.84% with 47.84% from capital gains and 0% from dividends.

There are only entries on Stock Chase from 2023 and there are 4 Do Not Buy recommendations. However, the last recommendation was a Buy. Stock Chase gives this stock 3 stars out of 5. Christopher Liew on Motley Fool thinks this stock could rebound in 2024. Amy Legate-Wolfe on Motley Fool thinks this company has an uncertain future. The company put out a Press Release on their year-end results for 2023.

Simply Wall Street via Yahoo Finance looks at this stock. Simply Wall Street gives this stock 2 and one half stars. They have 4 warnings of negative shareholder’s equity; interest payments are not well covered by earnings; significant insider selling over the past 3 months; and shareholders have been diluted in the past year.

Bombardier designs, manufactures, markets, and provides parts and maintenance for its large, long-range Global and medium-to-large Challenger aircraft families of business jets. Most of the company's revenue is generated in North America, with operations in Europe, North America, Asia-Pacific, and other markets. Its web site is here Bombardier Inc.

The last stock I wrote about was about was be Emera Inc (TSX-EMA, OTC-EMRA) ... learn more. The next stock I will write about will be RioCan Real Estate (TSX-REI.UN, OTC-RIOCF) ... learn more on Wednesday, March 13, 2024 around 5 pm. Tomorrow on my other blog I will write about TFSA Calculator .... learn more on Tuesday, March 12, 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 8, 2024

Emera Inc

Sound bite for Twitter and StockTwits is: Dividend Growth Utility. Results of stock price testing is that the stock price is reasonable and may even be cheap. Debt Ratios are generally not good ones, with debt being too high. The Dividend Payout Ratios (DPR) are fine, especially when considering dividends paid in Cash. The current dividend yield is good with dividend growth low. See my spreadsheet on Emera Inc.

Is it a good company at a reasonable price? What I do not like about this stock is the debt level, but this is not the first time debt level has been very high for this company. Utilities tend to have a lot of debt, but the debt for the company is still unusually high. I wonder if this is a good idea for a utility stock at the current time. However, I do own this company and I do not intend to sell.

I own this stock of Emera Inc (TSX-EMA, OTC-EMRA). I first bought this stock in 2005, as I wanted to buy something for my Locked in RRSP. I think that this was an appropriate stock and has good value. I was using up excess cash in my account.

When I was updating my spreadsheet, I noticed I have done well with this stock. As of the end of February, I have earned 9.31% per year with 3.30% from capital gains and 6.01% from dividends. I have had this stock for almost 19 years, but my purchases have been spread out and my last purchase was in 2023. Generally, I have found buy stocks over time gives me a better return.

If you had invested in this company in December 2013, for $1,008.81 you would have bought 33 shares at $30.57 per share. In December 2023, after 10 years you would have received $740.44 in dividends. The stock would be worth $1,659.90. Your total return would have been $2,400.34. This would be a total return of 10.84% per year with 5.11% from capital gain and 5.73% from dividends.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$30.57 $1,008.81 33 10 $740.44 $1,659.90 $2,400.34

The current dividend yield is good with dividend growth low. The current dividend yield is good (5% to 6% ranges) at 5.89%. The 5, 10 and historical dividend yields are moderate (2% to 4% ranges) at 4.69%, 4.62% and 4.77%. The dividend increases are low (below 8% per year) at 4.1% per year over the past 5 years. The last dividend increase was in 2023.

The Dividend Payout Ratios (DPR) are fine, especially when considering dividends paid in Cash. The DPR for 2023 for Earnings per Share (EPS) is high at 78% with 5 year coverage at 82%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is high at 94% with 5 year coverage at 91%. The DPR for dividends paid in cash in 2023 is a lot lower at 47% with 5 year coverage at 53%. The DPR for 2023 for Cash Flow per Share (CFPS) is good at 34% with 5 year coverage at 43%.

The DPR for 2023 for Free Cash Flow 1 (FCF) is not calculable because of so many years of negative FCF with 5 year coverage at a negative 40%. The DPR for 2023 for Free Cash Flow 2 (FCF) is good at 32% with 5 year coverage at 57%. Problem is that there is disagreement on what the FCF is. This seems to be a typical problem for FCF.

Note that a lot of utility companies only pay a portion of their dividends in cash because shareholders can use their dividends to buy more shares rather than receive cash. This accounts for the Dividend Reinvestment Plan that shareholders use through registration of their shares with Emera. Note that also now, shareholders can reinvest their dividends via their brokers and the percentage above does not take this into consideration.

Item Cur 5 Years
EPS 78.08% 82.42%
AEPS 94.17% 90.52%
Div Pd Cash 46.70% 53.45%
CFPS 33.90% 43.21%
FCF 1 N/C -39.75%
FCF 2 31.79% 56.92%

Debt Ratios are generally not good ones, with debt being too high. The Long Term Debt/Market Cap Ratio for 2023 is far too high at 1.25 and currently at 1.29. The Liquidity Ratio for 2023 is far too low at 0.82 and 0.82 currently. If you added in Cash Flow after dividends, the ratios are too low at 1.13 and currently at 1.16. I prefer these ratios to be 1.50 or higher. The Debt Ratio for 2023 is low at 1.44. I also prefer this ratio to be 1.50 or higher. The Leverage and Debt/Equity Ratios for 2023 are too high 3.71 and 2.57. I prefer these ratios to be below 3.00 and 2.00.

Type Year End Ratio Curr
Lg Term R 1.25 1.29
Intang/GW 0.41 0.42
Liquidity 0.82 0.82
Liq. + CF 1.13 1.16
Debt Ratio 1.44 1.44
Leverage 3.71 3.71
D/E Ratio 2.57 2.57

The Total Return per year is shown below for years of 5 to 31 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 4.08% 8.41% 2.85% 5.56%
2013 10 7.03% 10.84% 5.11% 5.73%
2008 15 7.33% 11.14% 5.60% 5.53%
2003 20 6.06% 10.45% 5.32% 5.13%
1998 25 5.02% 8.66% 4.17% 4.49%
1993 30 4.47% 9.61% 4.61% 4.99%
1992 31 10.67% 5.10% 5.57%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 15.56, 17.25 and 18.23. The corresponding 10 year ratios are 14.95, 16.56 and 17.83. The corresponding historical ratios are 13.41, 15.36 and 17.08. The current P/E Ratio is 15.10 based on a stock price of $48.73 and EPS estimate for 2024 of $3.23. 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 also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Earnings per Share Ratios are 16.58, 19.25 and 22.54. The corresponding 10 year ratios are 16.23, 18.08 and 19.57. The current ratio is 15.18 based on a stock price of $48.73 and AEPS estimate for 2024 of $3.21. This 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 $52.04. The 10-year low, median, and high median Price/Graham Price Ratios are 1.00, 1.15 and 1.27. The current P/GP Ratio is 0.94 based on a stock price of $48.73. 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 10-year median Price/Book Value per Share Ratio of 1.62. The current P/B Ratio is 1.30 based on a stock price of $48.73, Book Value of $1,422 and Book Value per Share of $37.49. The current ratio is 19.6% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I have a Book Value per Share estimate for 2024 of $38.20, but this Book Value is calculated differently from how I do the calculation and with this calculation, the 10 year median ratio would be 1.44. With a Book Value per Share of $38.20, this implies a ratio of 1.28 with a stock price of $48.73 and Book Value of $10,853M. This ratio is 11% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10-year median Price/Cash Flow per Share Ratio of 8.24. The current P/CF Ratio is 5.95 based on Cash Flow per Share estimate for 2024 of $8.19, Cash Flow of $2,327M and a stock price of $48.73. The current ratio is 28% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap.

I get an historical median dividend yield of 4.77%. The current dividend yield is 5.89% based on dividends of $2.87 and a stock price of $48.73. The current ratio is 23% 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 4.62%. The current dividend yield is 5.89% based on dividends of $2.87 and a stock price of $48.73. The current ratio is 28% 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 2.09. The current ratio is 1.78 based on Revenue estimate for 2024 of $7,774M, Revenue per Share of $27.36 and a stock price of $48.73. The current ratio is 15% 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 reasonable and may even be cheap. The dividend yield tests are saying that the stock price is relatively cheap. The P/S Ratio test says that the stock price is reasonable and below the median. Other testing is saying the stock price is either reasonable or cheap.

When I look at analysts’ recommendations, I find Strong Buy (1), Buy (6), Hold (6), Underperform (1), and Sell (1). The consensus would be Hold. The 12 month stock price consensus is $52.64 with a High of $60.00 and Low of $44.00. The consensus price of $52.64 implies a total return of $13.91% with 8.02% from capital gains and 5.89% from dividends.

Mixed reviews on Stock Chase for 2024. There are two Buys, one Watch and one Do Not buy. Stock Chase gives this stock 4 stars out of 5. This stock is no longer on the Money Sense dividend list, but it is on others I follow. Amy Legate-Wolfe on Motley Fool thinks it is smart to buy utilities currently, especially Emera. Daniel Da Costa on Motley Fool thinks you should buy Emera for passive dividend income. Emera put out a Press Release on their fourth quarter of 2023.

Simply Wall Street via Yahoo Finance put out a report on this company. Simply Wall Street has 3 warnings of interest payments are not well covered by earnings; dividend of 5.94% is not well covered by cash flows; and shareholders have been diluted in the past year. Simply Wall Street gives this stock 3 and one half stars out of 5.

Emera is a geographically diverse energy and services company investing in electricity generation, transmission, and distribution as well as gas transmission and utility energy services. Emera has operations throughout North America and the Caribbean countries. Its web site is here Emera Inc.

The last stock I wrote about was about was IGM Financial Inc (TSX-IGM, OTC-IGIFF) ... learn more. The next stock I will write about will be Bombardier Inc (TSX-BBD.B, OTC-BDRBF) ... learn more on Monday, March 11, 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 6, 2024

IGM Financial Inc

Sound bite for Twitter and StockTwits is: Dividend Paying Financial. Results of stock price testing is that the stock price is relatively reasonable. Debt Ratios are fine. The Dividend Payout Ratios (DPR) are fine, but it would be nice if they were lower. The current dividend yield is good with dividend growth non-existent. See my spreadsheet on IGM Financial Inc.

Is it a good company at a reasonable price? Currently, I would think that the only reason to buy this company is because of the dividends which seem to be stable and sustainable and they are good. This is called passive income investing. Not what I like to do at the moment as I am into lower dividend yields, but dividend growth. However, it all depends on what you want in your investments. The results of the stock price testing is that the stock price is reasonable and below the median.

I do not own this stock of IGM Financial Inc (TSX-IGM, OTC-IGIFF). I am following this stock because I used to own this stock. The stock was on Mike Higgs' list of dividend growth stocks and on the other Dividend lists at that time. I owned this stock from 2006 to 2011. I sold because I decided to rationalizing my portfolio. Selling ones that did not make it into my core and buying ones that did of the same type.

When I was updating my spreadsheet, I noticed that they have not increased their dividend since 2015. Most of the return is from the dividends. Currently the dividend yield is rather good at 6.35%.

If you had invested in this company in December 2013, for $1,009.62 you would have bought 18 shares at $56.09 per share. In December 2023, after 10 years you would have received $403.18 in dividends. The stock would be worth $630.18. Your total return would have been $1,033.38. This would be a total return of 0.28% per year with 4.60% from capital loss and 4.89% from dividends.

Cost Tot. Cost Shares Years Dividends Stock Val Tot Ret
$56.09 $1,009.62 18 10 $403.20 $630.18 $1,033.38

The current dividend yield is good with dividend growth non-existent. The current dividend yield is good (5% to 6% ranges) at 6.35%. The 5 and 10 year median dividend yield is also good at 6.04% and 5.97%. The historical median dividend yield is moderate (2% to 4% ranges) at 4.34%. The dividends have not been increased since 2015. Analysts do not expect this to change in the near term.

The Dividend Payout Ratios (DPR) are fine, but it would be nice if they were lower. The DPR for 2023 for Earnings per Share (EPS) is good at 47% with 5 year coverage fine at 60%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is fine at 66% with 5 year coverage at 65%. The DPR for 2023 for Cash Flow per Share (CFPS) is fine at 67% with 5 year coverage at 68%. The DPR for 2023 for Free Cash Flow (FCF) is fine at 78% with 5 year coverage at 79%.

Item Cur 5 Years
EPS 46.68% 59.65%
AEPS 65.41% 64.76%
CFPS 66.93% 68.13%
FCF 78.28% 79.11%

Debt Ratios are fine. The Long Term Debt/Market Cap Ratio for 2023 is good at 0.29 and currently at 0.28. Because this is a financial, I am also looking at Long Term Debt/Covering Asset Ratio and there are good in 2023 at 0.72. The Liquidity Ratio for 2023 is good at 1.96. The Debt Ratio for 2023 is good at 1.56. The Leverage and Debt/Equity Ratios for 2023 are fine at 2.78 and 1.78.

Type Year End Ratio Curr
Lg Term R 0.29 0.28
Lg Term R A 0.72 0.72
Intang/GW 0.47 0.46
Liquidity 1.96 1.96
Liq. + CF 2.30 2.18
Debt Ratio 1.56 1.56
Leverage 2.78 2.78
D/E Ratio 1.78 1.78

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 0.00% 9.38% 2.44% 6.94%
2013 10 0.46% 0.28% -4.60% 4.89%
2008 15 0.79% 6.09% -0.08% 6.17%
2003 20 4.19% 6.53% 0.59% 5.94%
1998 25 7.37% 6.34% 1.14% 5.21%
1993 30 9.97% 9.66% 3.82% 5.85%
1990 33 9.89% 16.15% 7.53% 8.62%

The 5-year low, median, and high median Price/Earnings per Share Ratios are 8.31, 9.58 and 12.57. The corresponding 10 year ratios are 9.74, 11.33 and 13.01. The corresponding historical ratios are 9.96, 14.98, and 17.48. The current P/E Ratio is 9.76 based on a stock price of $35.44 and EPS estimate for 2024 of $3.63. 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 also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Earnings per Share Ratios are 8.92, 10.83 and 12.61. The corresponding 10 year ratios are 9.54, 11.38 and 9.54. The current ratio is 9.50 based on a stock price of $35.44 and AEPS estimate for 2023 of $3.73. 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 $48.67. The 10-year low, median, and high median Price/Graham Price Ratios are 0.84, 0.98 and 1.10. The current ratio is 0.73 based on a stock price of $35.44. 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 1.91. The current P/B Ratio is 1.26 based on a stock price of $35.44, Book Value of $6,700M and Book Value per Share of $28.22. The current ratio is 34% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.

I get a 10-year median Price/Cash Flow per Share Ratio of 11.78. The current P/CF Ratio is 11.54 based on Cash Flow per Share estimate for 2024 of $3.07, Cash Flow of $731M and a stock price of $35.44. The current P/CF Ratio is 2% 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 6.35% based on dividends of 2.25% and a stock price of $35.44. This dividend yield is 46% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively cheap.

I get an historical median dividend yield of 6.26%. The current dividend yield is 6.35% based on dividends of 2.25% and a stock price of $35.44. This dividend yield is 6% above the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable and below the median.

The 10-year median Price/Sales (Revenue) Ratio is 2.81. The current P/S Ratio is 2.55 based on Revenue estimate for 2023 of $3,305M, Revenue per Share of 13.88 and a stock price of $35.44. The current ratio is 9% 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 relatively reasonable. The 10 year median dividend yield test says this as does the P/S Ratio test. However, a lot of the tests suggest that the stock price is cheap.

When I look at analysts’ recommendations, I find Strong Buy (3) and Hold (5). The consensus would be a Buy. The 12 month stock price consensus is $41.71 with a high of $37 and low of $35.23. This implies a total return of 24.04% with 17.69% from capital gains and 6.35% from dividends.

On analyst thought this stock on Stock Chase was a buy in 2023, but the latest analyst’s recommendation is a Do Not Buy. Stock Chase gives this stock 4 stars out of 5. Joey Frenette on Motley Fool says to sell this stock as it does not have a lot going for it. This is unusual, as generally speaking, writers on Motley Fool are positive about the stocks they talk about. Adam Othman on Motley Fool thinks you should buy this stock for its dividends. The company put out a press release on Newswire about their fourth quarter of 2023 results.

Simply Wall Street via Yahoo Finance talks about buying this stock for its consistent and sustainable dividends. Simply Wall Street has one warnings of earnings are forecast to decline by an average of 2.3% per year for the next 3 years. Simply Wall Street gives this stock 4 stars out of 5.

IGM Financial is the largest non-bank-affiliated asset manager in Canada. The firm is part of the Power Financial group of companies. IGM has two main operating divisions of asset management (operated through Mackenzie Investments) and wealth management (via its Investors Group Wealth Management subsidiary) that provide investment management products and services. Its web site is here IGM Financial Inc.

The last stock I wrote about was about was TFI International Inc (TSX-TFII, OTC-TFIFF) ... learn more. The next stock I will write about will be Emera Inc (TSX-EMA, OTC-EMRA) ... learn more on Friday, March 8, 2024 around 5 pm. Tomorrow on my other blog I will write about Something to Buy March 2024 .... learn more on Thursday, March 7, 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.

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