5/06/2013

Value Based Canadian Stocks Listed on the "Pink Sheets"


I started a search for value based pink sheet listed Canadian stocks. Many attractive Canadian stocks trade on the pink sheets. Hopefully I can find useful market inefficiencies existing on the pink sheet for all countries, exchanges and market size.

A market maker must be willing to trade the stock to obtain a pink sheet listing. Some companies want to be traded on the pink sheets to gain exposure to U.S. investors. There are many benefits to the company. This dual listing on the pinks allows US investors to purchase shares without going to the Canadian exchanges. Many online brokers like Ameritrade don’t execute trades on foreign exchanges. So using the pink sheets may allow some exposure to quality Canadian, other countries or US based looking to avoid excessive regulation costs. Today I want to get my feet wet by introducing some value using the balance sheet and focusing on Canada. I believe there are so many more opportunities but this journey will take more time and effort. As you know, just remember with all transaction on the pink sheets you must use limit orders.

Once again I will have to update the post slowly. Additional input for tomorrow and likely the day after.  I wanted to get started today. Nothing too exciting at first glance but I guess value looks boring. 3 stocks for tonight that will be updated tomorrow are IDGBF,DLTOF,ADFJF



IDGBF
: (IDG Toronto exchange)Indigo Books & Music Inc was founded in 1940 and is headquartered in Toronto, Canada. Indigo is “an e-commerce retail destination that sells books, gifts, toys, DVDs, and music. It also operates seasonal kiosks and year-round stores in shopping malls, which sell calendars, games, and gifts. As of March 31, 2012, the company operated 97 superstores under the Chapters, Indigo, and the World?s Biggest Bookstore banners; and 143 small format stores under the Coles, Indigo, Indigospirit, SmithBooks, The Book Company, and Pistachio banners.”

Negative enterprise value and 3.96% current dividend yield.
Value was created with increase in equity, reduced debt, stable share count, from 2008 to the current period.  

Market Cap:281.70M , Enterprise Value: -51.72M   


Price/Sales: 0.29 Price/Book:0.73

Revenue: 920.82M , Revenue Per Share:36.46

Qtrly Revenue Growth:-4.90% ,EBITDA:19.87M

Total Cash:320.72M
Total Cash Per Share (mrq):12.68 ,Book Value Per Share (mrq):14.55

Price on 05/06/13 = 11.14 , 52-Week Change:28.19%

52-Week High (May 6, 2013):11.14 , 52-Week Low (Aug 13, 2012):7.52
                      
ADFJF:(DRX Toronto Exchange) ADFJF was founded in 1956 and provides fabrication of complex structural steel and heavy built-up steel components for the non residential construction industry.

Equity per share continues to compound with equity per share value of 2.57 for 2008 to the most recent quarterly balance of 2.83. Annual profits have reduced total liabilities from 2009 balance of 29.59M to the MRQ 15.24M. Total share count was also reduced from 2009 balance of 36.20M shares outstanding to the MRQ balance of 32.45M.

Market Cap: 41.43M , Enterprise Value: 17.61M
Price/Sales: 0.98,  Price/Book:  0.44
Enterprise Value/Revenue: 0.42 ,Enterprise Value/EBITDA: 14.15
Qtrly Revenue Growth:-1.90%
Book Value Per Share: 2.87, 52-Week High:1.38 , 52-Week Low:1.12 
Total Cash:27.66M, Cash Per Share: 0.85
Total Debt:3.73M, Total Debt/Equity:  4.01
Current Ratio:3.51, Book Value Per Share: 2.87
The stock was 1.30 Canadian dollars on 12/31/2008 today the price was 1.42 Canadian dollars. 
They continue to aggressively buyback shares. On December 6,2012 "the company will repurchase up to 1,552,731 subordinate voting shares, representing 8.57% of the shares outstanding and 10% of the public float”

Price 05/06/13 = 1.25USD 

DLTOF: (DDL Toronto Exchange) Danier Leather designs, manufactures, distributes and retails leather apparel and accessories. Danier’s products are sold at its 89 shopping mall stores, street-front stores and large format power centers. Founded in 1972

The stock trades near its 52 week high.
They have done a good job of posting profits, reducing debt, building equity and keeping share count stable. But the stock 52 week price change is +18.46%.


2.38 CND December 31, 2008 to the current price of 12.51CND. So the stock price has moved this and prior years.


Market Cap: 48.71M, Enterprise Value: 24.77M
Price/Sales: 0.31,  Price/Book: 0.81 ,Enterprise Value/Revenue: 0.16
Enterprise Value/EBITDA: 4.29, Qtrly Revenue Growth: -4.40%
Total Cash: 23.93M , Cash Per Share: 6.21
Current Ratio: 4.36 Book Value Per Share: 15.61


Additional updates tomorrow

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