The Company in a Nutshell
- As it evolves in a highly fragmented industry, ATD is growing through acquisitions at an impressive rate.
- After all its acquisitions, ATD balance sheet remains healthy with a net debt to capital ratio around 41%.
- The table is set for ATD to continue its growth-by-acquisition strategy.
- Download PDF format (Last reviewed: Oct 7th 2019)
|PRO Rating||4||Dividend Yield||0.76%|
|Dividend Safety||4||Dividend Growth Since||2018|
|DDM Valuation||3.56%||Dividend Frequency||Quarterly|
Alimentation Couche-Tard is the largest convenience store operator in Canada and 2nd largest in North America. While constantly expanding its presence in the US and Europe, it successfully built a convenience store including daily use products. Many stores are also combined with fuel service stations. ATD operates 12,081 stores (7,863 in North America, 2,708 in Europe and 1,510 internationally). Instead of simply selling chips and beers, ATD focuses on a superior offer including fresh food, private labels and strong product concept offerings.
|General Information||GE Data|
|Expected Earnings Date||N/A|
|Next ex-dvd date||N/A|
An investment in ATD is definitely not for an income producing stock. However, if you are looking at the long-term horizon, your dividend payouts will grow in the double digit for a while and you will enjoy a strong stock price growth. ATD potential is directly linked to its capacity to swallow and integrate more convenience stores. Management has often proven its ability to pay the right price and generate synergy for each deal. ATD shows a perfect combination of the dividend triangle: revenue, EPS and dividend strong growth.
|5-Yr Rev. Growth:||14.12%|
|5-Yr EPS Growth:||23.09%|
|5-Yr Div Growth:||28.62%|
Growers by acquisitions are all vulnerable to making a bad purchase. While ATD methodology to acquire and integrate more convenience stores has been proven, it is important to not grow too fast or become too greedy and overpay in the name of growth. Still, it doesn’t seem like an issue with the current management team. As interest rate rises, cost of future acquisitions will increase accordingly.
|Financial Debt to EBITDA (TTM)||1.64|
|Current Ratio (Quarterly)||1.21|
|Free Cash Flow (Quarterly)($B)||0.483|
Dividend Growth Perspective
The mediocre 0.59% dividend yield is so low ATD shouldn’t even be considered as a dividend grower. However, the dividend paid has surged in the past 5 years (+174%) and the stock price jumped by over125%. The only reason why the dividend yield is so low is because ATD is on a fast track for growth. ATD will continue increasing steadily its payout while providing stock value appreciation to shareholders.
|Payout Ratio (%)||10.16%|
|Cash Payout Ratio (%)||10.84%|
|Enter Expected Dividend Growth Rate Years 1-10:||15.00%|
|Enter Expected Terminal Dividend Growth Rate:||7.50%|
|Calculated Intrinsic Value OUTPUT 15-Cell Matrix||Metric2||Metric3||Metric4|
|Discount Rate (Horizontal)||Discount Rate (Horizontal)||Discount Rate (Horizontal)|
|Margin of Safety||8.00%||9.00%||10.00%|
|Market Cap ($)||38B|
|Price to Book Ratio||2.87|
- Data by Ycharts or Google Finance
- Dividend triangle chart is updated every 6 months.
- All other metrics are updated every 5 minutes (price) or weekly.
- The PDF format includes only comments (no metrics) and are reviewed every 6 months.