Sound bite for Twitter and StockTwits is: Dividend Growth Consumer. Results of stock price testing is that the stock price could be reasonable. Debt Ratios shows that the company has too much debt with Intangible and Goodwill too high. The Dividend Payout Ratios (DPR) seem fine. The current dividend yield is moderate with dividend growth stopped. See my spreadsheet on Stingray Digital Group Inc.
Is it a good company at a reasonable price? This is an illiquid small cap Canadian stock. So, you should be cautious about investing in it and not invest money you cannot afford to lose. This is a small cap I have invested in and although it has not yet done well for me, I still have faith that it will do better in the future. The price seems to be still reasonable, but it could be at the top range of reasonableness.
I own this stock of Stingray Digital Group Inc (TSX-RAY.A, OTC-STGYF). I was following Newfoundland Capital Corp and Stingray Bought them out. Also, I read the blub on CEO, Eric Boyko. The site says he is an entrepreneur with nearly two decades of experience with start-ups. Mr. Boyko has extensive expertise in early stage business innovations. Note that the financial year ends at March 31 each year, so I am covering the March 31, 2024 year end.
When I was updating my spreadsheet, I noticed that I was buying into the stock as it was going down in 2022 and 2023. Last year I had a Total Loss of 7.32% with a capital loss of 11.49% and Dividends of 4.17%. This year I have a total return of 6.02% with 1.97% from capital gains and 4.05% from dividends. So, there is an improvement. They did not have any earnings because they did an impairment of goodwill (that is they wrote off some of their goodwill value). Their Intangible and Goodwill Ratio is still too high and they have a lot of debt.
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. Net Income is down over 5 years because they had a bad year in 2024. Stock price growth seems one of the lowest growths. It is expected to grow well this year though.
| Yr | Item | Tot. Gwth | Per Year | Gwth | Coverage |
|---|---|---|---|---|---|
| 5 | Revenue Growth | 62.44% | 10.19% | 1.65% | <-12 mths |
| 5 | AEPS Growth | 52.63% | 8.83% | 5.75% | <-12 mths |
| 5 | Net Income Growth | -14.62% | -3.11% | 7.89% | <-12 mths |
| 5 | Cash Flow Growth | 241.05% | 27.81% | ||
| 5 | Dividend Growth | 25.00% | 4.56% | 0.00% | <-12 mths |
| 5 | Stock Price Growth | 9.89% | 1.90% | 7.43% | <-12 mths |
| 10 | Revenue Growth | 475.50% | 19.13% | 7.37% | <-this year |
| 10 | AEPS Growth | 107.14% | 7.55% | 21.84% | <-this year |
| 10 | Net Income Growth | 163.25% | 10.16% | 479.01% | <-this year |
| 9 | Cash Flow Growth | 1096.27% | 31.75% | -2.33% | <-this year |
| 8 | Dividend Growth | 215.79% | 15.46% | 0.00% | <-this year |
| 9 | Stock Price Growth | 5.79% | 0.63% | 31.42% | <-this year |
If you had invested in this company in December 2014, for $1,000.50 you would have bought 138 shares at $7.25 per share. In December 2023, after 9 years you would have received $299.46 in dividends. The stock would be worth $836.28. Your total return would have been $1,135.74. This would be a total return of 1.58% per year with 1.97% from capital loss and 3.55% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $7.25 | $1,000.50 | 138 | 9 | $299.46 | $836.28 | $1,135.74 |
The current dividend yield is moderate with dividend growth stopped. The current dividend yield is moderate (2% to 4% ranges) at 3.64%. The 5 year median dividend yield is good (5% to 6% ranges) at 5.01%. The 8 and historical median dividend yields are moderate at 4.12%. Dividends have been flat since 2021 and no one seems to think that they will be raised in the near future.
The Dividend Payout Ratios (DPR) seem fine. The DPR for 2023 for Earnings per Share (EPS) is not calculable with 5 year coverage too high at 99%. The DPR for 2023 for Adjusted Earnings per Share (AEPS) is good at 34% with 5 year coverage at 28%. The DPR for 2023 for Adjusted Free Cash Flow (AFCF) is not calculable with 5 year coverage too high at 99%. The DPR for 2023 for Cash Flow per Share (CFPS) is good at 17% with 5 year coverage at 20%. The DPR for 2023 for Free Cash Flow (FCF) is good at 25% with 5 year coverage at 32%.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | n/c | 99.33% |
| AEPS | 34.48% | 36.63% |
| AFCF | n/c | 99.33% |
| CFPS | 16.57% | 20.16% |
| FCF | 24.51% | 32.19% |
Debt Ratios shows that the company has too much debt with Intangible and Goodwill too high. The Long Term Debt/Market Cap Ratio for 2023 is fine at 0.67 and currently at 0.66. The Intangible and Goodwill ratios for 2023 is 1.20 and currently 1.18. This ratio should be below 1.00 certainly. The Liquidity Ratio for 2023 is too low at 0.68 and 0.68 currently. If you added in Cash Flow after dividends, the ratios are fine at 1.64 and currently at 1.62. The Debt Ratio for 2023 is too low at 1.44 and 1.44 currently. I prefer this ratio to be at 1.50 or higher. The Leverage and Debt/Equity Ratios for 2023 are too high at 3.26 and 2.26 and currently at 3.26and 2.26. I prefer these ratios to be below 3.00 and 2.00.
| Type | Yr End | Ratio Curr |
|---|---|---|
| Lg Term R | 0.67 | 0.66 |
| Intang/GW | 1.20 | 1.18 |
| Int less BL | 0.68 | 0.68 |
| Liquidity | 0.91 | 0.91 |
| Liq. + CF | 1.64 | 1.62 |
| Debt Ratio | 1.44 | 1.44 |
| Leverage | 3.26 | 3.26 |
| D/E Ratio | 2.26 | 2.26 |
The Total Return per year is shown below for years of 5 to 9 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 | 4.56% | 2.44% | -2.13% | 4.57% |
| 2014 | 9 | 11.56% | 1.58% | -1.97% | 3.55% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 9.58, 13.22 and 16.86. The corresponding 9 year and historical ratios are 13.57, 15.51 and 17.45. The current P/E Ratio is 10.70 based on a stock price of $8.24 and EPS estimate for 2025 of $0.77. The current ratio is below the low ratio of the 9 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 3.65, 5.41 and 7.01. The corresponding 9 year and historical ratios are 5.02, 6.27 and 7.87. The current P/AEPS Ratio is 7.57 based on a stock price of $8.24 and AEPS estimate for 2025 of $1.09. The current ratio is between the median and high ratios of the 9 year median ratios. This stock price testing suggests that the stock price is relatively reasonable but above the median.
I get a Graham Price of $9.25. The 9-year low, median, and high median Price/Graham Price Ratios are 0.78, 0.89 and 1.01. The current P/GP Ratio is 0.89 based on a stock price of 8.24. The current ratio is at the median ratio of the 9 year median ratios. This stock price testing suggests that the stock price is relatively reasonable and at the median.
I get a 9-year median Price/Book Value per Share Ratio of 1.80. The current P/B Ratio is 2.30 based on a stock price of $8.24, Book Value of $248.6M and Book Value per Share of $3.59. The current ratio is 28% above the 9 year median ratios. This stock price testing suggests that the stock price is relatively expensive.
I also have a Book Value per Share estimate for 2025 of $4.08. This implies a Book Value of $282.8M and a Ratio of 2.02 based on a stock price of $8.24. This ratio is 12% above the 9 year median ratio of 1.80. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get a 9-year median Price/Cash Flow per Share Ratio of 8.41. The current P/CF Ratio is 4.93 based on Cash Flow per Share estimate for 2025 of $1.67, Cash Flow of $115.8M and a stock price of $8.24. The current ratio is 9.8% below the 9 year median ratio. This stock price testing suggests that the stock price is relatively reasonable and below the median.
I get an 8 year and historical median dividend yield of 4.12%. The current dividend yield is 3.64% based on a dividend of $0.30 and a stock price of $8.24. The current ratio is 11.6% below the 8 year median ratio. This stock price testing suggests that the stock price is relatively reasonable but above the median. There is a problem because this test works best when dividends are being raised. However, dividends going flat is not a good sign either.
The 9-year median Price/Sales (Revenue) Ratio is 1.80. The current P/S Ratio is 1.54 based on a stock price of $8.24, Revenue estimate for 2025 of $370.9M and Revenue per Share of $5.35. This ratio is 14.5% below the 9 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 could be reasonable. The dividend yield test says the stock price is reasonable and above the median. The P/S Ratio test says that the stock price is reasonable and below the median. A number of tests say that the stock price is reasonable and above or below the median and one say it is expensive and one says it is cheap.
When I look at analysts’ recommendations, I find Strong Buy (1), Buy (4). The consensus would be a Strong buy. The 12 month stock price consensus is $10.08 with a high of $11.00 and a low of $9.50. The consensus stock price of $10.08 implies a total return of 25.97% with 22.23% from capital gains and 3.64% fromDividends based on a current stock price of $8.24.
There is only one report in 2023 on Stock Chase and it was given a watch rating. He saw the company is profitable, but illiquid. Stock Chase gives this stock 1 star out of 5. Christopher Liew on Motley Fool that this stock will overcome headwinds and beat the market. Aditya Raghunath on Motley Fool reviews this company and says stock is cheap and gives a good dividend. The company put out a Press Release amount their fourth quarter of 2024..
Simply Wall Street via Yahoo Financial reviews this stock. Simply Wall Street has 3 warnings out on this stock of shares are highly illiquid; dividend of 3.7% is not well covered by earnings; and has a high level of debt.
Stingray Group Inc is a provider of multi-platform music services. It broadcasts music and video content on several platforms including radio stations, premium television channels, digital TV, satellite TV, IPTV, the Internet, mobile devices, and game consoles. Geographically, the company derives its key revenue from Canada and the rest from the United States and other countries. Its web site is here Stingray Digital Group Inc.
The last stock I wrote about was about was Loblaw Companies Ltd (TSX-L, OTC-LBLCF) ... learn more. The next stock I will write about will be BlackBerry Ltd (TSX-BB, NYSE-BB) ... learn more on Friday, August 2, 2024 around 5 pm. Tomorrow on my other blog I will write about BCE .... learn more on Thursday, August 1, 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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