CANON INC. ADRs $30 - New York symbol CAJ

CANON INC. ADRs $30 (New York symbol CAJ; Conservative Growth Portfolio, Manufacturing & Industry sector; ADRs outstanding: 1.1 billion; Market cap: $33.0 billion; Price-to-sales ratio: 1.0; Dividend yield: 4.3%; TSINetwork Rating: Above Average; www.canon.com) continues to see weak demand for printers and digital cameras. That’s because consumers are taking more photos with their smartphones. They’re also increasingly storing their pictures online instead of printing them.

As a result, Canon’s sales fell 6.0% in the three months ended June 30, 2014, to $9.2 billion from $9.8 billion a year earlier.

However, thanks to a successful cost-cutting plan, the company’s earnings jumped 19.2%, to $800.5 million from $671.7 million. Earnings per ADR rose 24.1%, to $0.72 from $0.58 (each American Depositary Receipt represents one common share), on fewer shares outstanding.

The company will likely earn $2.04 per ADR in 2014, up 6.8% from $1.91 in 2013. The stock trades at 14.7 times that figure. The $1.30 dividend yields 4.3%.

Canon is a hold.

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