Thursday, 18 February 2016

New Purchase - High Liner Foods

Not long ago, I purchased 300 shares of High Liner Foods (HLF) at an average cost of $15.01 and sold soon after at $15.39, plus $36 in dividends.

Today I reinitiated a position at a much lower price; 15.7% lower to be exact.

Number of shares purchased
150
Price per share
$12.90
Commission
$9.95
Total cost per share
$12.9663
Total cost
$1,944.95
Annual dividend per share
$0.48
Initial dividend yield
3.70%
Increase in forward 12-month dividends
$72

It’s a relatively small company with a market cap of roughly $400 million CAD. Using the adjusted diluted EPS for 2015 of $1.14 USD (this company reports earnings in USD so that's about $1.56 CAD), the PE is $12.85/$1.56 = 8.2. The dividend payout ratio is $0.48/$1.56 = 31%. I get a graham price of $17 and a CAPE of 12. I hope management's plan to address the issues works out.


With this purchase, my 12-month forward dividend income stands at $10,554 per year.

2 comments:

  1. Nice buy, have been looking at High Liner Food for a while now. Looks like a solid company.

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    1. There bottom line has been hit because of the drop in the Canadian dollar vs the USD. Management is in the process of implementing a cost cutting plan but i think they're a bit behind. On a positive note, I've read that senior management owns a lot of shares but i haven't looked up the specifics. The risk reward looks compelling.

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