CJR Investment Analysis Report & Stock Research, Corus Entertainment, Inc. CL B

Ockham's Rating/Recommendation Summary

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CJR Revenue

Cash earnings is the most important factor in our analysis, but it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company's stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 10 years. For, CJR the high and low end of the Price to Sales per share ratios are 2.86x and 1.70x respectively.

Notice that CJR's current Price to Sales per share ratio is 2.13x, which is somewhat below its historical weighted average by 7%. Given this level of sales per share, we suggest a neutral share price forecast. To the extent there is a further drop in the Price to Sales ratio from current levels, which would occur through some combination of increased sales per share or a decline in share price, we would only become more positive about the Price to Sales ratio outlook.

CJR Cash Earnings

Cash Earnings is always one of the most important factors to review for a company and, more importantly, an investment in a stock. CJR is above its historical average multiple of Cash Earnings. Looking at the last 10 years we can get a good understanding of what investors have grown to expect from CJR. For example, CJR's Cash Earnings ratio per share has fluctuated between 5.48 and 9.54 over this historical timeframe. This range is based upon a proprietary weighted methodology at Ockham, but can clearly show an investor where CJR is with respect to prior business periods.

So, again, with a current Price to Cash Earnings per share ratio of 8.52, CJR is presently above its historical range. Ockham Research is always focused upon the value that investors have placed upon a given metric in the past. In other words, how much would an investor pay for a particular level of Cash Earnings in terms of stock price, and how does that relate to today. Naturally, we utilize proprietary methods to accomplish this, but the basic premise holds true and is simple to understand. For CJR, we are a bit negative on the Cash Earnings level given its higher than historical norm.

CJR Dividends

A strong dividend payment history is looked upon as a favorable characteristic on a company’s future and potentially can receive a positive Ockham rating. That being said, we don't require dividend payments for company's whose management has elected to forgo them entirely.