How Successful Investors Get RICH

Learn everything you need to know in 'The Canadian Guide on How to Invest in Stocks Successfully' for FREE from The Successful Investor.

How to Invest In Stocks Guide: Find 10 factors that make your investments safer and stronger.

 I consent to receiving information from The Successful Investor via email. I understand I can unsubscribe from these updates at any time.

Topic: How To Invest

LOBLAW COMPANIES $61.92 – Toronto symbol L

LOBLAW COMPANIES $61.92 (Toronto symbol L; Shares outstanding: 412.5 million; Market cap: $25.6 billion; TSINetwork Rating: Above Average; Dividend yield: 1.6%; www.loblaw.ca) is Canada’s largest food retailer, with about 1,200 stores. Its banners include Loblaws, Provigo, Fortinos, Real Canadian Superstore and No Frills. George Weston Ltd. owns 46% of the company.

In the three months ended January 3, 2015, Loblaw’s sales jumped 49.4%, to $11.4 billion from $7.6 billion a year earlier. The gain was mainly due to the 1,300-store Shoppers Drug Mart chain, which the company bought in March 2014. Same-store sales rose 3.3% at Loblaw’s supermarkets and 3.8% at Shoppers.

Excluding integration costs and other unusual items, Loblaw’s earnings jumped 146.0%, to $396 million from $161 million. Per-share profits gained 68.4%, to $0.96 from $0.57, on more shares outstanding.

The addition of Shoppers Drug Mart should increase Loblaw’s earnings to $3.40 a share for all of 2015, and the stock trades at 18.2 times that estimate. The company’s 2016 earnings should reach $4.00 a share, and it trades at a more reasonable 15.5 times that forecast.

Loblaw is a buy.

Comments

Tell Us What YOU Think

You must be logged in to post a comment.

Please be respectful with your comments and help us keep this an area that everyone can enjoy. If you believe a comment is abusive or otherwise violates our Terms of Use, please click here to report it to the administrator.