DIVERSIFIED ROYALTY CORP (DIV.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:DIV - CA2553311002 - Common Stock
3.86 CAD
-0.03 (-0.77%)
Taking everything into account, DIV scores 4 out of 10 in our fundamental rating. DIV was compared to 19 industry peers in the Specialty Retail industry. While DIV is still in line with the averages on profitability rating, there are concerns on its financial health. DIV is quite expensive at the moment. It does show a decent growth rate. Finally DIV also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- In the past year DIV was profitable.
- In the past year DIV had a positive cash flow from operations.
- Of the past 5 years DIV 4 years were profitable.
- Each year in the past 5 years DIV had a positive operating cash flow.
1.2 Ratios
- Looking at the Return On Assets, with a value of 4.81%, DIV is in line with its industry, outperforming 57.89% of the companies in the same industry.
- DIV's Return On Equity of 10.24% is fine compared to the rest of the industry. DIV outperforms 63.16% of its industry peers.
- With a Return On Invested Capital value of 7.36%, DIV perfoms like the industry average, outperforming 57.89% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for DIV is below the industry average of 11.04%.
- The 3 year average ROIC (6.80%) for DIV is below the current ROIC(7.36%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.81% | ||
| ROE | 10.24% | ||
| ROIC | 7.36% |
ROA(3y)4.53%
ROA(5y)3.46%
ROE(3y)9.75%
ROE(5y)7.37%
ROIC(3y)6.8%
ROIC(5y)6.65%
1.3 Margins
- DIV has a better Profit Margin (43.18%) than 100.00% of its industry peers.
- DIV's Profit Margin has declined in the last couple of years.
- With an excellent Operating Margin value of 89.81%, DIV belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
- DIV's Operating Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 89.81% | ||
| PM (TTM) | 43.18% | ||
| GM | N/A |
OM growth 3Y0.39%
OM growth 5Y0.76%
PM growth 3Y-13.41%
PM growth 5Y-2.33%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so DIV is destroying value.
- The number of shares outstanding for DIV has been increased compared to 1 year ago.
- The number of shares outstanding for DIV has been increased compared to 5 years ago.
- Compared to 1 year ago, DIV has an improved debt to assets ratio.
2.2 Solvency
- Based on the Altman-Z score of 1.45, we must say that DIV is in the distress zone and has some risk of bankruptcy.
- Looking at the Altman-Z score, with a value of 1.45, DIV is in line with its industry, outperforming 42.11% of the companies in the same industry.
- DIV has a Debt/Equity ratio of 0.98. This is a neutral value indicating DIV is somewhat dependend on debt financing.
- With a Debt to Equity ratio value of 0.98, DIV perfoms like the industry average, outperforming 42.11% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.98 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.45 |
ROIC/WACC0.87
WACC8.46%
2.3 Liquidity
- DIV has a Current Ratio of 0.79. This is a bad value and indicates that DIV is not financially healthy enough and could expect problems in meeting its short term obligations.
- DIV's Current ratio of 0.79 is on the low side compared to the rest of the industry. DIV is outperformed by 84.21% of its industry peers.
- DIV has a Quick Ratio of 0.79. This is a bad value and indicates that DIV is not financially healthy enough and could expect problems in meeting its short term obligations.
- DIV's Quick ratio of 0.79 is in line compared to the rest of the industry. DIV outperforms 57.89% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.79 | ||
| Quick Ratio | 0.79 |
3. Growth
3.1 Past
- DIV shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -15.00%.
- The Earnings Per Share has been growing slightly by 2.71% on average over the past years.
- Looking at the last year, DIV shows a small growth in Revenue. The Revenue has grown by 6.88% in the last year.
- Measured over the past years, DIV shows a quite strong growth in Revenue. The Revenue has been growing by 16.37% on average per year.
EPS 1Y (TTM)-15%
EPS 3Y-3.85%
EPS 5Y2.71%
EPS Q2Q%25%
Revenue 1Y (TTM)6.88%
Revenue growth 3Y20.35%
Revenue growth 5Y16.37%
Sales Q2Q%13.44%
3.2 Future
- The Earnings Per Share is expected to grow by 12.54% on average over the next years. This is quite good.
- The Revenue is expected to grow by 2.94% on average over the next years.
EPS Next Y26.57%
EPS Next 2Y18.03%
EPS Next 3Y12.54%
EPS Next 5YN/A
Revenue Next Year10.39%
Revenue Next 2Y9.72%
Revenue Next 3Y8.59%
Revenue Next 5Y2.94%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- DIV is valuated rather expensively with a Price/Earnings ratio of 22.71.
- Based on the Price/Earnings ratio, DIV is valued a bit cheaper than 63.16% of the companies in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 27.21, DIV is valued at the same level.
- Based on the Price/Forward Earnings ratio of 17.32, the valuation of DIV can be described as rather expensive.
- 68.42% of the companies in the same industry are more expensive than DIV, based on the Price/Forward Earnings ratio.
- DIV is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 24.26, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.71 | ||
| Fwd PE | 17.32 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DIV is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 15.38 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- DIV's earnings are expected to grow with 12.54% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.85
PEG (5Y)8.39
EPS Next 2Y18.03%
EPS Next 3Y12.54%
5. Dividend
5.1 Amount
- DIV has a Yearly Dividend Yield of 7.44%, which is a nice return.
- Compared to an average industry Dividend Yield of 2.33, DIV pays a better dividend. On top of this DIV pays more dividend than 89.47% of the companies listed in the same industry.
- DIV's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.44% |
5.2 History
- The dividend of DIV has a limited annual growth rate of 4.62%.
- DIV has paid a dividend for at least 10 years, which is a reliable track record.
- DIV has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)4.62%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
- DIV pays out 125.97% of its income as dividend. This is not a sustainable payout ratio.
- DIV's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP125.97%
EPS Next 2Y18.03%
EPS Next 3Y12.54%
DIVERSIFIED ROYALTY CORP / DIV.CA FAQ
What is the fundamental rating for DIV stock?
ChartMill assigns a fundamental rating of 4 / 10 to DIV.CA.
Can you provide the valuation status for DIVERSIFIED ROYALTY CORP?
ChartMill assigns a valuation rating of 3 / 10 to DIVERSIFIED ROYALTY CORP (DIV.CA). This can be considered as Overvalued.
How profitable is DIVERSIFIED ROYALTY CORP (DIV.CA) stock?
DIVERSIFIED ROYALTY CORP (DIV.CA) has a profitability rating of 5 / 10.
What is the financial health of DIVERSIFIED ROYALTY CORP (DIV.CA) stock?
The financial health rating of DIVERSIFIED ROYALTY CORP (DIV.CA) is 1 / 10.
Can you provide the dividend sustainability for DIV stock?
The dividend rating of DIVERSIFIED ROYALTY CORP (DIV.CA) is 7 / 10 and the dividend payout ratio is 125.97%.