price to sales ratio
J.P. MORGAN CHASE & CO. $34 (New York symbol JPM; Income Portfolio, Finance sector; Shares outstanding: 3.8 billion; Market cap: $129.2 billion; Price-to-sales ratio: 1.3; Dividend yield: 3.5%; TSINetwork Rating: Average; www.jpmorganchase.com) recently announced a $2-billion loss on complex hedging contracts that it uses to cut the risk on corporate bonds it holds. This unexpected trading loss has prompted the bank to suspend its plan to repurchase $15 billion of its shares by March 31, 2013. However, it will continue to pay a quarterly dividend of $0.30 a share, for an annualized yield of 3.5%. J.P. Morgan Chase is still a hold.
APACHE CORP. $83 (New York symbol APA; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 390.8 million; Market cap: $32.4 billion; Price-to-sales ratio: 1.9; Dividend yield: 0.8%; TSINetwork Rating: Average; www.apachecorp.com) has been forced to write down the value of its Canadian properties by $390 million due to weak natural gas prices. Without this charge, Apache would have earned $1.2 billion in the three months ended March 31, 2012. That’s up 4.2% from $1.1 billion a year earlier. Earnings per share rose 3.4%, to $3.00 from $2.90, on more shares outstanding. Revenue rose 15.6%, to $4.5 billion from $3.9 billion. Production rose 5.1%, to 769,296 barrels of oil equivalent per day from 731,905 barrels. Half of Apache’s production is oil, which is helping it profit from high oil prices. Moreover, it gets 38% of its gas from outside North America, where gas prices rose an average of 17% in the quarter....
FRONTIER COMMUNICATIONS CORP. $3.50 (New York symbol FTR; Income Portfolio, Utilities sector; Shares outstanding: 998.5 million; Market cap: $1.2 billion; Price-to-sales ratio: 0.6; Dividend yield: 11.4%; TSINetwork Rating: Average; www.frontier.com) earned $52.5 million in three months ended March 31, 2012, down 4.0% from $54.7 million a year earlier. Earnings per share were unchanged at $0.05 on fewer shares outstanding. These figures exclude costs related to Frontier’s July 2010 purchase of traditional phone (or land line) accounts from Verizon. Revenue fell 5.8%, to $1.3 billion from $1.35 billion. That’s because Frontier continues to lose residential (down 9.2%) and business (down 5.7%) customers. However, the $0.10-a-share quarterly dividend still seems safe: the payout accounted for a moderate 39% of Frontier’s free cash flow (cash flow less capital expenditures) in the latest quarter. Frontier Communications is still a hold.
AGILENT TECHNOLOGIES INC. $41 (New York symbol A; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 348.0 million; Market cap: $14.3 billion; Price-to-sales ratio: 2.1; Dividend yield: 1.0%; TSINetwork Rating: Average; www.agilent.com) makes testing systems that help improve electronic products, such as cellphones and computer equipment. To cut its exposure to the cyclical electronics industry, Agilent is expanding its medical and drug-testing businesses, mainly through acquisitions. In May 2010, it paid $1.5 billion for Varian Inc., which makes testing equipment for medical research labs. As well, the company recently announced that it will pay $2.2 billion for Dako, a Denmark-based firm that makes equipment that detects cancers in blood and other tissue samples. Thanks to deals like these, medical- and chemical-testing equipment now supplies half of Agilent’s overall sales....
THOMSON REUTERS CORP. $30 (Toronto symbol TRI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 829.2 million; Market cap: $24.9 billion; Price-to-sales ratio: 1.7; Dividend yield: 4.3%; TSINetwork Rating: Above Average; www.thomsonreuters.com) gets 58% of its revenue and 48% of its earnings by selling news and information products to professionals in the banking industry and the legal (25%, 32%), accounting (10%, 11%) and scientific research (7%, 9%) fields.
Over 85% of the company’s revenue comes from products it sells under subscriptions and contracts. That gives it predictable revenue streams and cuts its risk. As well, more of its customers are switching from printed to electronic products; that’s lowering its printing and postage costs.
Thomson Reuters recently agreed to sell its health care business, which provides data and software that helps hospitals and clinics lower their costs and cut fraud. This business supplied 6% of the company’s revenue. Thomson Reuters will get $1.25 billion when the sale closes by the end of 2012 (all amounts except share price and market cap in U.S. dollars).
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Over 85% of the company’s revenue comes from products it sells under subscriptions and contracts. That gives it predictable revenue streams and cuts its risk. As well, more of its customers are switching from printed to electronic products; that’s lowering its printing and postage costs.
Thomson Reuters recently agreed to sell its health care business, which provides data and software that helps hospitals and clinics lower their costs and cut fraud. This business supplied 6% of the company’s revenue. Thomson Reuters will get $1.25 billion when the sale closes by the end of 2012 (all amounts except share price and market cap in U.S. dollars).
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HOME CAPITAL GROUP INC. $45 (Toronto symbol HCG; Aggressive Growth Portfolio, Finance sector; Shares outstanding: 34.8 million; Market cap; $1.6 billion; Price-to-sales ratio: 2.3; Dividend yield: 2.0%; TSINetwork Rating: Average; www.homecapital.com) offers mortgages and other loans to borrowers who don’t meet the stricter criteria of larger, traditional lenders.
The company is seeing higher demand for mortgages. That’s mainly because fears of higher interest rates and slowing housing prices have prompted Canada’s big banks to make fewer loans to riskier borrowers.
In the three months ended March 31, 2012, Home Capital’s revenue rose 16.3%, to $214.7 million from $184.6 million a year earlier. Earnings per share rose 16.0%, to $1.52 from $1.31.
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The company is seeing higher demand for mortgages. That’s mainly because fears of higher interest rates and slowing housing prices have prompted Canada’s big banks to make fewer loans to riskier borrowers.
In the three months ended March 31, 2012, Home Capital’s revenue rose 16.3%, to $214.7 million from $184.6 million a year earlier. Earnings per share rose 16.0%, to $1.52 from $1.31.
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CANADIAN TIRE CORP. $67 (Toronto symbol CTC.A; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 81.5 million; Market cap: $5.5 billion; Price-to-sales ratio: 0.5; Dividend yield: 1.8%; TSINetwork Rating: Above Average; www.canadiantire.ca) gets 90% of its revenue and 80% of its earnings from its various retail stores.
These outlets include 488 Canadian Tire stores, which specialize in automotive, household and sporting goods. The company owns these stores, but franchisees operate most of them. Canadian Tire also operates 289 gas stations and 87 PartSource auto parts stores.
The company has added a number of new product lines by purchasing other retailers. For example, in 2001 it bought the Mark’s Work Wearhouse chain of casual clothing stores. The company now has 385 Mark’s stores and carries a variety of Mark’s products in its main Canadian Tire stores.
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These outlets include 488 Canadian Tire stores, which specialize in automotive, household and sporting goods. The company owns these stores, but franchisees operate most of them. Canadian Tire also operates 289 gas stations and 87 PartSource auto parts stores.
The company has added a number of new product lines by purchasing other retailers. For example, in 2001 it bought the Mark’s Work Wearhouse chain of casual clothing stores. The company now has 385 Mark’s stores and carries a variety of Mark’s products in its main Canadian Tire stores.
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AGILENT TECHNOLOGIES INC. $41 (New York symbol A; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 348.0 million; Market cap: $14.3 billion; Price-to-sales ratio: 2.1; Dividend yield: 1.0%; TSINetwork Rating: Average; www.agilent.com) makes testing systems that help improve electronic products, such as cellphones and computer equipment.
To cut its exposure to the cyclical electronics industry, Agilent is expanding its medical and drug-testing businesses, mainly through acquisitions. In May 2010, it paid $1.5 billion for Varian Inc., which makes testing equipment for medical research labs.
As well, the company recently announced that it will pay $2.2 billion for Dako, a Denmark-based firm that makes equipment that detects cancers in blood and other tissue samples. Thanks to deals like these, medical- and chemical-testing equipment now supplies half of Agilent’s overall sales.
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To cut its exposure to the cyclical electronics industry, Agilent is expanding its medical and drug-testing businesses, mainly through acquisitions. In May 2010, it paid $1.5 billion for Varian Inc., which makes testing equipment for medical research labs.
As well, the company recently announced that it will pay $2.2 billion for Dako, a Denmark-based firm that makes equipment that detects cancers in blood and other tissue samples. Thanks to deals like these, medical- and chemical-testing equipment now supplies half of Agilent’s overall sales.
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FRONTIER COMMUNICATIONS CORP. $3.50 (New York symbol FTR; Income Portfolio, Utilities sector; Shares outstanding: 998.5 million; Market cap: $1.2 billion; Price-to-sales ratio: 0.6; Dividend yield: 11.4%; TSINetwork Rating: Average; www.frontier.com) earned $52.5 million in three months ended March 31, 2012, down 4.0% from $54.7 million a year earlier. Earnings per share were unchanged at $0.05 on fewer shares outstanding. These figures exclude costs related to Frontier’s July 2010 purchase of traditional phone (or land line) accounts from Verizon. Revenue fell 5.8%, to $1.3 billion from $1.35 billion. That’s because Frontier continues to lose residential (down 9.2%) and business (down 5.7%) customers.
However, the $0.10-a-share quarterly dividend still seems safe: the payout accounted for a moderate 39% of Frontier’s free cash flow (cash flow less capital expenditures) in the latest quarter.
Frontier Communications is still a hold.
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However, the $0.10-a-share quarterly dividend still seems safe: the payout accounted for a moderate 39% of Frontier’s free cash flow (cash flow less capital expenditures) in the latest quarter.
Frontier Communications is still a hold.
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KRAFT FOODS INC. $38 (New York symbol KFT; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 1.8 billion; Market cap: $64.8 billion; Price-to-sales ratio: 1.3; Dividend yield: 3.1%; TSINetwork Rating: Above Average; www.kraft.com) plans to break itself into two separate, publicly traded companies by the end of 2012.
One company, called Mondelez International, will sell snack foods, such as Oreo cookies and Cadbury chocolates. The other, called Kraft Foods Group, will consist of Kraft’s slower-growing grocery business.
Kraft hasn’t announced the details of the split, but the Internal Revenue Service has confirmed that the break-up will be a tax-free transaction: shareholders won’t have to pay capital gains taxes until they sell their new shares.
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One company, called Mondelez International, will sell snack foods, such as Oreo cookies and Cadbury chocolates. The other, called Kraft Foods Group, will consist of Kraft’s slower-growing grocery business.
Kraft hasn’t announced the details of the split, but the Internal Revenue Service has confirmed that the break-up will be a tax-free transaction: shareholders won’t have to pay capital gains taxes until they sell their new shares.
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