A portfolio of stocks I'm building, named Ivy, holds 52 dividend dogs. Ivy is the fourth portfolio I've built (at a one dividend dog per week pace) since 2014. Four portfolios = IV!
Today I'm reviewing the fifth of five materials sector stocks this week striving to become the ninth of nine from that sector to join the Ivy folio. This is the last pick for Ivy!
This materials sector includes thirteen industries all related to mining, making, and delivering essential commodities. They are: agricultural inputs; aluminum; building materials; chemicals; coal; copper; industrial metals; steel; paper; silver; specialty chemicals; gold.
Today I'm reviewing a small-cap building materials company named CSR Ltd. Their trading ticker symbol is CSRLF. I last reported on this company nearly over a year ago on January 23, 2018.
- CSR Ltd is one of Australia's leading building materials companies; it produces plasterboard, bricks, roof tiles, insulation, glass, fiber cement, and aerated autoclaved concrete.
- Founded as Colonial Sugar Refining Co. in 1855, CSR started producing building materials in 1942 and is behind recognized brands such as Gyprock plasterboard.
- CSR sold the last of its sugar assets in 2010 to focus primarily on building products. CSR retains a 25% effective interest in the Tomago aluminum smelter and periodically advances surplus industrial land to property developers.
The company was founded in 1855 and is headquartered in North Ryde, Australia.
I use three key data points to gauge dividend-paying equities or funds like CSR Ltd:
(1) Price
(2) Dividends
(3) Returns
Besides those three, several other keys will finally unlock an equity or fund in which to invest or not.
Those three basic keys, however, best tell whether a company has made, is making, and will make money.
CSRLF Price
CSR's price per share closed at $2.78 Friday. A year ago its price was $2.63. In a year its price rose $0.15 or 5.7%.
Assuming CSR's stock trades in the range of $2.00 to $4.00 this year, CSR's recent $2.78 price could rise by $0.22 and go to $3.00 by August 2020.
CSRLF Dividends
CSR's latest declared semi-annual dividend was $0.0899 paid July 2nd.
That $0.899 Q payout combined with the previous one generates an annual payout of $0.18 yielding 6.74% based on Friday's $2.78 closing price.
CSRLF Gains?
Adding the $.18 annual estimated dividend to my $0.22 estimate of CSR's price upside shows a $0.40 potential gross gain, per share, which will be reduced by costs to trade these shares.
Say we put a little over $1,000.00 today at the $2.78 recent stock price, we'd buy 360 CSR Ltd shares.
A $10 broker fee paid half at purchase and half at sale will cost us $0.03 per share.
Subtract that $0.03 brokerage cost from the estimated $0.40 gross estimated gain leaves a net gain of $0.37 X 360 shares = ($133.20) or a 13.25% net gain on a $1,000.80 investment.
Therefore, CSR Ltd whose trading ticker symbol is CSRLF now shows a possible net gain of 13.25% including a 3.74% dividend yield. It could be more, it could be less.
The above speculation is based on past year performance. The actual results remain to be seen to learn if CSR Ltd. is worth your time and money.
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