This month a few of my stocks have reported earnings:
- Caledonia Mining
- Artis Reit
- Intertape Polymer
While, most of them did well. I was extremely pleased with Intertape Polymer’s results. You may recall I purchased ITP just over a month ago when it was near its 52 week low.
Here is what I said in October:
“The business itself is boring, but it has paid and increased the dividend for over 5 years (yields 3.5%)in US dollars, has increased earnings year over year and was trading at a 30% discount to the 52 week high. I purchased 275 shares @ 19.08.”
The stock had been beat up for no apparent reason, and last week they reported EPS of 0.32 vs the analyst expected 0.29.
Here are some other notes from their earnings report:
- Revenue increased by almost 18% (mostly due to acquisitions)
- Net earnings increased from $13 to $19.2 million
- Adjusted EBITDA increased 15.9% to $32.4 million
- ITP repurchased/cancelled almost 500k shares
- Revenue in the fourth quarter is expected to be greater than last year
- Gross margin & adjusted EBITDA are expected to be greater in the 4th quarter than last year.
All in all, it was a great report, and it looks like the next quarter should be just as good if not better!
Here are a few notes from some other stocks I own that reported earnings over the last week or two.
This has been one of my favorite stocks for the last few years. It never seems to get the attention it deserves, but it continues to be well positioned financially, trades extremely cheaply and has a lot of cash on hand. I hope with their increased cash position & low stock price the company decides to buy back some shares.
- Increased gold production & gross & net profit
- Increased EPS
- Broke a record for most gold produced in a single quarter
- Increased their overall cash position – net cash now close to 12 million
- Plans to extend depth of the mine which should result in 4 extra years of production.
Artis is a REIT headquartered in my home town of Winnipeg. They own buildings all across Canada & the USA. The stock had been beat up the last couple of years due to a high % of their properties being in Alberta (when oil prices dropped, the Alberta economy tanked & a lot of the buildings lost value/became vacant). Over the last couple of years they have been selling off some Alberta properties and expanding in the US market. It looks like this move is starting to pay off.
- Net operating income from Alberta has been reduced from almost 40% to 25%
- Because a third of their income comes from USA when the Canadian dollar is weak, the returns are even stronger
- Reduced total debt to EBITDA
- Continuing to reduce retail exposure
- Reported FFO per unit of $0.36
- Dividend currently yielding a whopping 7.6%. The payout ratio is pretty high, but they should be able to continue to pay as they have been able to consistently reduce their debt.
Just a quick update on one of my favorite REIT’S:
Plaza Reit PLZ.UN just increased their dividend for the 15th consecutive year! Plaza is one of 2 REIT’S I currently own, and was the first REIT I ever purchased. Although the retail REIT’s are getting beat up pretty good with the Amazon/online threat, I still like Plaza for the medium to long term as they have a proven history of responsibly increasing their dividends/growing their business.
Some Highlights from the press release today:
- Increasing the monthly distribution from $0.0225 to $0.0233 a 3.7% increase
- Since 2003 the dividend has grown from 8 cents to 28 cents
- AFFO payout ratio dropped from 82.1% to 80.9%
- FFO and AFFO per unit increased by 3.4% and 6.5%, respectively
The dividend raise today gives me an extra $10.89 per year in dividends (which will be dripped into more shares).
Plaza is currently trading at $4.36 (very close to it’s 52 Week low) and has traded as high as 5.18 this year. I think Plaza is still undervalued and anytime the price is below 4.50 is a great buy. At the current price Plaza Yields 6.3%.
I’ve been on a roll this week. After no purchases in a couple of months – today I made my 3rd purchase in the last 2 days.
I picked up 268 shares of Chorus Aviation for 8.76. Chorus is one of those reasonably priced, profitable companies with a monthly dividend that yields over 5%. Even better RBC direct investing allows this one to drip – so even though I was only able to sccop up 268 shares I should be Dripping an extra share each month as well.
Chorus recently renewed a deal with Air Canada and although it will result in slightly less revenue per year – it guarantees them solid revenue until 2025. They have also expanded their aircraft leasing side of the business which should start generating more revenue. The dividend looks to be well covered by earnings as well.
I don’t foresee any other purchases for the next couple months (aside from the bi-weekly purchases into my funds). My portfolio now consists of 11 individual stocks -all Canadian and all owned in my TFSA & 5 funds (held in RRSP).
|Alimentation Couche Tard
|Chorus Aviation INC
|Intertape Polymer Group
|Canadian Western Bank
|US INDEX FUND (RRSP)
|RBC CANADIAN EQUITY INCOME FUND (RRSP)
|RBC Global Dividend Growth FUND (RRSP)
|GWL Advanced ContinuumFUND (RRSP)
|GWL Aggressive Continuum FUND (RRSP)
I did a customized stock screen last week where I looked at companies with a history of paying/increasing dividends, strong EPS growth and trading at reasonable P/E. My last post highlighted some of the companies I was torn between and finally today I pulled the trigger on two of them.
Alimentation Couche-Tard (ATD.B)
I’ve had my eye on Couche-Tard for over a year now, and with the recent price pull back – coupled with the fact I had some cash on hand I figured I had to jump in. I scooped up 125 shares @ $59.00 each. Although the dividend only yields 0.61% I think the long term capital growth potential and dividend growth potential will keep me happy for years to come. I am hopeful they will get into the soon to be legal Marijuana business as well.
The addition of these shares will boost my dividend income by $45.00
Intertape Polymer Group (ITP)
This was a stock I didn’t know much about a couple of weeks ago – but it showed up on my stock screen and after doing a bit more research I thought the price was too good to pass up. The business itself is boring, but it has paid and increased the dividend for over 5 years (yields 3.5%)in US dollars, has increased earnings year over year and was trading at a 30% discount to the 52 week high. I purchased 275 shares @ 19.08.
The addition of these shares will boost my dividend income by $192.50 (at current exchange rate).
Both purchases were made in our TFSA so all gains & dividends will be tax free.
I am still keeping my eye on Andrew Peller & Exco Technologies. Hopefully the next time I have some cash on the sideline they are in my buy range.
It feels like forever since I’ve been in a position to make a purchase. The house sale has officially closed, funds have been transferred, and I have a bit of cash to play around with in one of the TFSA Accounts.
I’ve spent the last couple days narrowing down my potential buy(s).
These are the stocks that have caught my eye:
XTC – Exco Technologies
- Current Price: $9.93
- Currently yields 3.22%
- Trading at almost 30% discount to 52 week high
- Have consecutively increased dividend 11 times
- Strong EPS growth
ADW.A- Andrew Peller
- Current Price: $11.65
- Currently yields 1.55%
- Trading at almost 12% discount to 52 week high
- Have consecutively increased dividend 11 times
- Payout ratio under 30%
- Strong earnings growth last 5 years
ATD.B – Alimentation Couche Tard
- Current Price: $58.69
- Currently yields 0.61%
- Trading at 16% discount to 52 week high
- Low Yield, but have raised it and lots of room to grow it
- Very low payout ratio
- Strong earnings growth last 5 years
ITP – Intertape Polymer
- Current Price: $19.19
- Currently yields 3.5%
- Trading at 35% discount to 52 week high
- Payout ratio creeping up
CAL -Caledonia Mining
- Current Price: $7.47
- Currently yields 4.70%
- Trading at 68% discount to 52 week high
- Profitable low cost producer
- Recently moved to NYSE – should get more exposure
Just a couple notes:
I’ve had my eye on Andrew Peller,Couche Tard & Exco for some time – they seem to finally be trading at reasonable prices.
I already own some Caledonia, and have been looking for point to increase my position.
I do not know much about ITP – however they kept showing up in my stock screen, so thought I’d dig a bit more into them.
My stocks are purchased via RBC direct investing. Not all stocks are eligible to be dripped via RBC. Of the 5 listed above only ATD.B is eligible to DRIP which is fairly annoying.
If you have any thoughts about any of the stocks listed above – I’d love to hear.