Shoppers Drug Mart Looks Like Pretty Good Value
The Moneygardener submits:
Well, back in the summer I exclaimed Shoppers Drug Mart should increase their dividend. They did just that Thursday as they hiked their payout 5%. Apparently this was in line with their earnings growth this year and makes their payout ratio of 33% ‘sector leading’. That is a higher payout ratio than US chain Walgreen (WAG), which we own, at 27%, however WAG increased their dividend by 22% in 2009.
Shoppers Drug Mart’s earnings growth has been slowing over the past few years however I fully expect them to return to double digit earnings growth in the next few years. They run an excellent business, their new stores are very well located and laid out, and they are in the sweet spot of demographic trends in Canada.
Investing, Long Term Investment, stock market | admin February 12, 2010
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