price to sales ratio
QUAKER CHEMICAL CORP. $57 (New York symbol KWR; Income Portfolio, Manufacturing & Industry sector; Shares outstanding: 13.1 million; Market cap: $746.7 million; Price-to-sales ratio: 1.1; Dividend yield: 1.7%; TSINetwork Rating: Average; www.quakerchem.com) makes lubricants and chemicals that keep mechanical parts from rusting.
Quaker has bought five other companies in the past two years. Expanding by acquisition adds risk, but these were all smaller firms that added to Quaker’s technical expertise. They also expanded its overseas operations, which now supply 65% of its revenue.
For example, in July 2012, Quaker paid $2.7 million for Italy-based NP Coil Dexter Industries, which makes chemicals that carmakers and other industrial clients use to prepare metal surfaces before applying paint or other coatings. This helps paint form a stronger bond, which prevents rust. NP Coil Dexter will add $11 million to Quaker’s annual revenue.
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Quaker has bought five other companies in the past two years. Expanding by acquisition adds risk, but these were all smaller firms that added to Quaker’s technical expertise. They also expanded its overseas operations, which now supply 65% of its revenue.
For example, in July 2012, Quaker paid $2.7 million for Italy-based NP Coil Dexter Industries, which makes chemicals that carmakers and other industrial clients use to prepare metal surfaces before applying paint or other coatings. This helps paint form a stronger bond, which prevents rust. NP Coil Dexter will add $11 million to Quaker’s annual revenue.
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TENNANT CORP. $47 (New York symbol TNC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 18.5 million; Market cap: $869.5 million; Price-to-sales ratio: 1.2; Dividend yield: 1.5%; TSINetwork Rating: Average; www.tennantco.com) makes industrial floor-cleaning equipment, including scrubbers, sweepers and polishers. It also manufactures cleaning gear for garages, stadiums, parking lots and city streets.
The company continues to develop floor cleaners and related products that use its ec-H2O technology, which uses electricity to make tap water act like a detergent. That eliminates the need for soaps and cleaning agents, and lowers the machine’s operating costs.
Even so, Tennant’s sales fell 2.0% in 2012, to $739.0 million from $754.0 million in 2011. Overseas markets supply around 35% of Tennant’s sales, and the high U.S. dollar hurts the contribution of its foreign operations. On a constant-currency basis, sales were flat. The company sold $141 million worth of ec-H20 scrubbers in 2012 (or 19.1% of total sales). That’s up 0.7% from $140 million (18.6% of sales) in 2011.
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The company continues to develop floor cleaners and related products that use its ec-H2O technology, which uses electricity to make tap water act like a detergent. That eliminates the need for soaps and cleaning agents, and lowers the machine’s operating costs.
Even so, Tennant’s sales fell 2.0% in 2012, to $739.0 million from $754.0 million in 2011. Overseas markets supply around 35% of Tennant’s sales, and the high U.S. dollar hurts the contribution of its foreign operations. On a constant-currency basis, sales were flat. The company sold $141 million worth of ec-H20 scrubbers in 2012 (or 19.1% of total sales). That’s up 0.7% from $140 million (18.6% of sales) in 2011.
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YUM! BRANDS INC. $65 (New York symbol YUM; Aggressive Growth Portfolio; Consumer sector; Shares outstanding: 451.0 million; Market cap: $29.3 billion; Price-to-sales ratio: 2.2; Dividend yield: 2.1%; TSINetwork Rating: Above Average; www.yum- .com) was the first fast-food chain to enter China, in 1987. Its 5,726 restaurants in China, including its KFC and Pizza Hut chains, now supply 50% of its sales and 45% of its earnings.
The company’s huge success in China is the main reason why the stock has jumped 448% in the past 10 years. However, recent allegations that Yum’s KFC outlets in that country bought raw chicken with higherthan- permitted levels of antibiotics have hurt its Chinese sales.
Following an investigation, Chinese regulators did not charge the company with violating food-safety standards.
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The company’s huge success in China is the main reason why the stock has jumped 448% in the past 10 years. However, recent allegations that Yum’s KFC outlets in that country bought raw chicken with higherthan- permitted levels of antibiotics have hurt its Chinese sales.
Following an investigation, Chinese regulators did not charge the company with violating food-safety standards.
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MCDONALD’S CORP. $94 (New York symbol MCD; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 1.0 billion; Market cap: $94.0 billion; Price-to-sales ratio: 3.4; Dividend yield: 3.3%; TSINetwork Rating: Above Average; www.mcdonalds.com) operated 34,480 fast food restaurants in 119 countries at the end of 2012. These outlets serve a wide variety of foods, including items tailored to local tastes, but they are best known for their hamburgers and french fries.
The company’s biggest market is now Europe, which provides 39% of its revenue and 37% of its earnings. McDonald’s other main markets are the U.S. (32% of revenue and 44% of earnings); Asia- Pacific (23%, 18%); and other countries, mainly Canada and Latin America (6%, 1%).
McDonald’s growing international operations increase its exposure to foreign exchange rates, which at times can fluctuate wildly. Unfavourable currency rates cut its revenue by 3.3%, from $23.5 billion in 2008 to $22.7 billion in 2009. However, revenue rebounded and rose 21.2%, to $27.6 billion, in 2012.
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The company’s biggest market is now Europe, which provides 39% of its revenue and 37% of its earnings. McDonald’s other main markets are the U.S. (32% of revenue and 44% of earnings); Asia- Pacific (23%, 18%); and other countries, mainly Canada and Latin America (6%, 1%).
McDonald’s growing international operations increase its exposure to foreign exchange rates, which at times can fluctuate wildly. Unfavourable currency rates cut its revenue by 3.3%, from $23.5 billion in 2008 to $22.7 billion in 2009. However, revenue rebounded and rose 21.2%, to $27.6 billion, in 2012.
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GENUINE PARTS CO. $69 (New York symbol GPC; Conservative Growth Portfolio, Manufacturing sector; Shares outstanding: 155.1 million; Market cap: $10.7 billion; Price-to-sales ratio: 0.8; Dividend yield: 3.1%; TSINetwork Rating: Average; www.genpt.com) gets 49% of its sales and 50% of its earnings by selling auto parts. The company operates 1,300 of its own outlets under the NAPA banner, and its distribution business serves 4,750 independent stores across North America.
Genuine also distributes industrial parts (34% of sales, 33% of earnings), office furniture (13%, 12%) and electrical equipment (4%, 5%).
The company’s sales rose 4.5% in 2012, to $13.0 billion from $12.5 billion in 2011. Sales of auto parts rose 4%, partly due to an acquisition, while sales at the industrial products division gained 7%. Electrical equipment sales rose 5%. Sales of office products were flat.
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Genuine also distributes industrial parts (34% of sales, 33% of earnings), office furniture (13%, 12%) and electrical equipment (4%, 5%).
The company’s sales rose 4.5% in 2012, to $13.0 billion from $12.5 billion in 2011. Sales of auto parts rose 4%, partly due to an acquisition, while sales at the industrial products division gained 7%. Electrical equipment sales rose 5%. Sales of office products were flat.
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Both Loblaw and Metro have moved up sharply in the past few months. That’s mainly because they are taking steps to unlock some of their hidden value, including selling real estate and other investments.
The companies will likely use the cash from the sales to keep improving their stores and other operations....
The companies will likely use the cash from the sales to keep improving their stores and other operations....
CGI GROUP INC. $27 (Toronto symbol GIB.A; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 308.0 million; Market cap: $8.3 billion; Price-to-sales ratio: 1.3; No dividends paid; TSINetwork Rating: Extra Risk; www. cgi.com) continues to benefit from its $2.7-billion purchase of Logica plc in August 2012....
Hidden value is a key factor we look for in our stock recommendations. A good example of an underappreciated asset is a company’s brand name. Balance sheets often fail to assign any value to brands, even household names that have built up multitudes of loyal customers over the years.
These four companies own some of the best brands in their industries....
These four companies own some of the best brands in their industries....
RIOCAN REAL ESTATE INVESTMENT TRUST $27 (Toronto symbol REI.UN; Aggressive Growth Portfolio, Manufacturing & Industry sector; Units outstanding: 299.0 million; Market cap: $8.1 billion; Price-to-sales ratio: 5.3; Dividend yield: 5.2%; TSINetwork Rating: Average; www.riocan.com) has agreed to buy a mall in Oakville, Ontario, plus 50% of another mall in Burlington, Ontario....
TELUS CORP. (Toronto symbols T $68 and T.A $68; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 326.0 million; Market cap: $22.2 billion; Price-to-sales ratio: 2.0; Dividend yield: 3.6%; TSINetwork Rating: Above Average; www.telus.com) has received court approval for its plan to convert its 151 million non-voting class A shares into regular common shares (which have one vote each) on a one-for-one basis.
The company converted the shares in the U.S....
The company converted the shares in the U.S....