Validea’s pick of the week provides a detailed report on a company that scores well in the stock-screening service’s model portfolios. On Validea.ca, investors can analyze 1,000 Canadian stocks through 12 different guru-based models and get individual reports on each company. Globe Investor has a distribution agreement with Validea.ca. Try it. Until the end of March, Globe readers can get a limited-time 25-per-cent discount.
This week Validea looked at Canadian Oil Sands Limited, a company with a $10.4-billion market cap and a reasonable 40 per cent debt/equity ratio.
Recently upgraded in the Peter Lynch-based guru model, COS has 9.5 per cent long-term EPS growth rate (using average of 3, 4, and 5 year EPS growth rates), 10.5 P/E, and 6.6 per cent dividend yield, which makes for a solid yield-adjusted P/E-to-growth ratio of 0.66
It also gets strong interest from James O’Shaughnessy-based value model, thanks to size ($4.1-billion in annual sales), solid cash flow ($3.26 per share vs. market average of $1.24), and that strong dividend yield.
Canadian Oil Sands has averaged 24.1 per cent return on equity over past decade, and has 25 per cent profit margins.
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