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.
Click here to read the full report for a detailed breakdown.