Tuesday, March 14, 2017

Recent Buy CMP

I was able to add a share of CMP today at 69.50. This brought my overall cost basis down from 71.07 per share to 70.55. In this market I'll take a 14.5 P/E ratio for a 4.15 percent yield. Most of what you look for in a dividend growth stock is here. It has 14 years of dividend increases and just recently increased it's dividend this quarter from .695 per share to .72 per share. That's a 3.60 percent increase. The one thing that it's missing is a good payout ratio. At 84% the payout ratio is high. But not enough to keep me away. Morningstar currently rates Compass Minerals International as a 4 Star Stock with a fair value estimate of $91. This is a company that produces minerals including  salt, fertilizer and sulfates. The salts they produce are used in road deicing and swimming pools. They've been around since 1993 and I think there will be a need for the minerals they produce going forward. One reason for the low price for Compass minerals is the mild winters have cut into profits. I don't think we've seen the end of snow.

1 comment:

  1. I was just looking at CMP recently after some selling has been going on recently. Could be an opportunity here, they should be selling move salt this year than last. Last year very very warm in north america with lower snow storms than usual. This year I looks like it could be a better year for CMP. As you mention though I don't particularly like the payout ratio that high.

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