price to sales ratio
PEPSICO INC. $94 (New York symbol PEP; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 1.5 billion; Market cap: $141.0 billion; Price-to-sales ratio: 2.2; Dividend yield: 2.8%; TSINetwork Rating: Above Average; www.pepsico.com) has launched Pepsi True, a new cola that has 30% less sugar than regular Pepsi.
This new drink uses stevia, an all-natural sweetener without the calories or health drawbacks of sugar. Pepsi True will also contain no artificial sweeteners or high-fructose corn syrup.
The launch follows a nine-year decline in U.S. soft drink sales as a result of increased health concerns spurred by research linking these drinks to obesity and other conditions.
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This new drink uses stevia, an all-natural sweetener without the calories or health drawbacks of sugar. Pepsi True will also contain no artificial sweeteners or high-fructose corn syrup.
The launch follows a nine-year decline in U.S. soft drink sales as a result of increased health concerns spurred by research linking these drinks to obesity and other conditions.
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FAIR ISAAC CORP. $56 (New York symbol FICO; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 32.2 million; Market cap: $1.8 billion; Price-to-sales ratio: 2.7; Dividend yield: 0.1%; TSINetwork Rating: Average; www.fico.com) makes FICO Scores, a computer program that helps businesses make better decisions about customer creditworthiness. It also makes software that helps credit card issuers control fraud and analyze their cardholders’spending patterns.
In its 2014 third quarter, which ended June 30, Fair Isaac earned $29.2 million, down 0.1% from $29.3 million a year earlier. Earnings per share rose 3.8%, to $0.83 from $0.80, on fewer shares outstanding.
Overall revenue gained 7.5%, to $197.6 million from $183.8 million. Revenue from its applications division (66% of the total) rose 12.9% on increased licensing fees from software that detects bank fraud.
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In its 2014 third quarter, which ended June 30, Fair Isaac earned $29.2 million, down 0.1% from $29.3 million a year earlier. Earnings per share rose 3.8%, to $0.83 from $0.80, on fewer shares outstanding.
Overall revenue gained 7.5%, to $197.6 million from $183.8 million. Revenue from its applications division (66% of the total) rose 12.9% on increased licensing fees from software that detects bank fraud.
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DUN & BRADSTREET CORP. $117 (New York symbol DNB; Conservative Growth Portfolio, Finance sector; Shares outstanding: 36.3 million; Market cap: $4.2 billion; Price-to-sales ratio: 2.7; Dividend yield: 1.5%; TSINetwork Rating: Average; www.dnb.com) provides credit reports on over 230 million companies. Its clients use this information to make lending and buying decisions.
Credit reports supply two thirds of Dun & Bradstreet’s revenue. The remaining third comes from other information products, including software that helps businesses manage websites and customer data.
In the quarter ended June 30, 2014, Dun & Bradstreet’s revenue rose 1.8%, to $393.0 million from $386.0 million a year earlier. Stronger demand for its credit reports and other products in North America (72% of total revenue) and Europe (16%) offset weaker sales in Asia (12%).
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Credit reports supply two thirds of Dun & Bradstreet’s revenue. The remaining third comes from other information products, including software that helps businesses manage websites and customer data.
In the quarter ended June 30, 2014, Dun & Bradstreet’s revenue rose 1.8%, to $393.0 million from $386.0 million a year earlier. Stronger demand for its credit reports and other products in North America (72% of total revenue) and Europe (16%) offset weaker sales in Asia (12%).
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BROADRIDGE FINANCIAL SERVICES INC. $42 (New York symbol BR; Aggressive Growth Portfolio, Finance sector; Shares outstanding: 119.5 million; Market cap: $5.0 billion; Price-to-sales ratio: 2.0; Dividend yield: 2.6%; TSINetwork Rating: Average; www.broadridge.com) serves the investment industry in three main areas: investor communications, securities processing and transaction clearing. The company processes 85% of all proxy votes in the U.S.
Without one-time items, Broadridge earned $144.6 million in its fiscal 2014 fourth quarter, which ended June 30, 2014. That’s up 1.5% from $142.4 million a year earlier. Earnings per share rose 0.9%, to $1.16 from $1.15, on more shares outstanding.
Overall revenue gained 2.4%, to $885.9 million from $865.1 million. Revenue from contracts that pay recurring fees rose 7% and accounted for two-thirds of the total. The remaining third comes from one-time events, such as notifications of special shareholder meetings and sending out information when mutual funds change managers.
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Without one-time items, Broadridge earned $144.6 million in its fiscal 2014 fourth quarter, which ended June 30, 2014. That’s up 1.5% from $142.4 million a year earlier. Earnings per share rose 0.9%, to $1.16 from $1.15, on more shares outstanding.
Overall revenue gained 2.4%, to $885.9 million from $865.1 million. Revenue from contracts that pay recurring fees rose 7% and accounted for two-thirds of the total. The remaining third comes from one-time events, such as notifications of special shareholder meetings and sending out information when mutual funds change managers.
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STATE STREET CORP. $68 (New York symbol STT; Aggressive Growth Portfolio, Finance sector; Shares outstanding: 423.5 million; Market cap: $28.8 billion; Price-to-sales ratio: 3.0; Dividend yield: 1.8%; TSINetwork Rating: Average; www.statestreet.com) sells accounting and administrative services to large institutional investors, like mutual funds and pension plans.
The company’s fee income rises and falls with the value of the mutual funds and other securities it administers. Thanks to improving stock markets and new contracts, its assets under custody and administration rose to $28.4 trillion as of June 30, 2014, up 10.3% from a year earlier.
These gains offset the lower interest income the company earned on bank deposits and certain securities. As a result, its overall revenue rose 3.7% in the three months ended June 30, 2014, to $2.7 billion from $2.6 billion a year earlier.
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The company’s fee income rises and falls with the value of the mutual funds and other securities it administers. Thanks to improving stock markets and new contracts, its assets under custody and administration rose to $28.4 trillion as of June 30, 2014, up 10.3% from a year earlier.
These gains offset the lower interest income the company earned on bank deposits and certain securities. As a result, its overall revenue rose 3.7% in the three months ended June 30, 2014, to $2.7 billion from $2.6 billion a year earlier.
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PROCTER & GAMBLE CO. $84 (New York symbol PG; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 2.7 billion; Market cap: $226.8 billion; Price-to-sales ratio: 2.9; Dividend yield: 3.1%; TSINetwork Rating: Above Average; www.pg.com) began operating in 1837 and is now one of the world’s largest makers of household and personal care products.
The company has five main business lines: fabric and home care products, such as Tide laundry detergent and Duracell batteries (32% of fiscal 2014 sales, 26% of earnings); baby and family care goods, including Pampers diapers (25%, 25%); beauty items like Olay cosmetics (24%, 23%); grooming products, including Gillette razors (10%, 17%); and health care items, such as Crest toothpaste (9%, 9%). Wal-Mart accounts for 14% of the company’s sales.
Procter’s sales rose 6.6%, from $78.9 billion in 2010 to $84.2 billion in 2013 (fiscal years end June 30). However, sales fell 1.3%, to $83.1 billion, in 2014. That’s because Procter sold 80% of its pet food business to Mars, Inc. for $2.9 billion. It expects to complete the sale of the remaining 20% in 2015.
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The company has five main business lines: fabric and home care products, such as Tide laundry detergent and Duracell batteries (32% of fiscal 2014 sales, 26% of earnings); baby and family care goods, including Pampers diapers (25%, 25%); beauty items like Olay cosmetics (24%, 23%); grooming products, including Gillette razors (10%, 17%); and health care items, such as Crest toothpaste (9%, 9%). Wal-Mart accounts for 14% of the company’s sales.
Procter’s sales rose 6.6%, from $78.9 billion in 2010 to $84.2 billion in 2013 (fiscal years end June 30). However, sales fell 1.3%, to $83.1 billion, in 2014. That’s because Procter sold 80% of its pet food business to Mars, Inc. for $2.9 billion. It expects to complete the sale of the remaining 20% in 2015.
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Ottawa continues to encourage the formation of a fourth national wireless carrier to compete with market leaders Rogers, Telus and BCE. As a result, regulators have restricted these three from buying new radio frequencies, or spectrum. They may also force them to lease space on their networks to smaller competitors at heavily discounted rates. We feel Telus’s ongoing network investments and new customer-friendly service plans will keep attracting wireless users, despite a potential new rival. That will help it offset falling demand for traditional phone services and give it more room for dividend hikes and share buybacks. TELUS CORP. $39 (Toronto symbol T; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 615.5 million; Market cap: $24.0 billion; Price-to-sales ratio: 2.1; Dividend yield: 3.9%; TSINetwork Rating: Above Average; www.telus.com) is Canada’s second-largest wireless carrier, after Rogers Communications, with 7.9 million subscribers. Wireless now supplies 54% of Telus’s revenue and 66% of its earnings....
FORTIS INC. $35 (Toronto symbol FTS; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 215.4 million; Market cap: $7.5 billion; Price-to-sales ratio: 1.6; Dividend yield 3.7%; TSINetwork Rating: Above Average; www.fortis.ca) is the main electricity supplier in Newfoundland and P.E.I. It also distributes natural gas in B.C. and operates power plants in other parts of Canada, the U.S. and the Caribbean. The company recently completed its purchase of UNS Energy Corp., which operates power plants and distributes electricity and natural gas to 657,000 customers in Arizona. Fortis paid $4.5 billion U.S., which includes assuming $2.0 billion U.S. of UNS’s debt. The new operations will add $1.5 billion U.S. to Fortis’s annual revenue of $4.7 billion (Canadian). The purchase also lowers Fortis’s reliance on Atlantic Canada....
These two telecom firms face the same regulatory hurdles as Telus (see page 101). But like Telus, they’re improving their services while keeping their operating costs down. That will let them both maintain their high dividend yields, but we prefer BCE for its greater geographic reach. BCE INC. $48 (Toronto symbol BCE; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 827.7 million; Market cap: $39.7 billion; Price-to-sales ratio: 1.8; Dividend yield: 5.1%; TSINetwork Rating: Above Average; www.bce.ca) is Canada’s largest provider of telephone services, with 5.0 million customers in Ontario and Quebec. It also has 2.2 million high-speed Internet customers and 2.3 million TV subscribers. BCE also sells wireless services to 7.8 million customers across Canada, and its Bell Media segment owns CTV Television, specialty channels and radio stations....
TRANSCANADA CORP. $56 (Toronto symbol TRP; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 707.9 million; Market cap: $39.6 billion; Price-to-sales ratio: 3.8; Dividend yield: 3.4%; TSINetwork Rating: Above Average; www.transcanada.com) recently completed the purchase of three more Ontario solar power plants from Canadian Solar Inc. (Nasdaq symbol CSIQ). TransCanada now owns seven of the nine solar farms it agreed to buy from Canadian Solar in 2011. It will probably take possession of the remaining two in 2015. In all, it will pay about $500 million. To put that in context, TransCanada earned $332 million, or $0.47 a share, in the three months ended June 30, 2014. The company has 20-year deals to sell the power from these solar farms, which cuts this investment’s risk....