Daily Stock Analysis: Cass Information Systems

A new portfolio of stocks I started building September 8, at a one stock per week pace for the next year, is named Vista. I will select its seventh stock this coming weekend. Vista is the sixth portfolio I've built (at a one dividend dog per-week pace) since 2014. Six portfolios = VI for Vista!

Vista is planned to Look Ahead for Outstanding, Proven, Dividend Winners. (Like Aristocrats)

Today we'll review the third of five technology sector stock candidates vying to be that seventh selection for the Vista portfolio.

My subject today is a small information systems company, Cass Information Systems Inc. Its trading ticker symbol is CASS. This is my first report on Cass Information Systems Inc for this Vista dog of the week portfolio. Previously I reviewed it for the Volio portfolio.  

Cass Information Systems Inc is a provider of payment and information processing services to large manufacturing, distribution, and retail enterprises across the United States. 

The company provides transportation invoice rating, payment processing, auditing, accounting, and transportation information. It is also a processor and payer of energy invoices, including electricity, gas, waste, and other facility-related expenses. 

It operates in two segments: Information Services and Banking Services. The firm generates maximum revenue from the Information Services segment.

The company was formerly known as Cass Commercial Corporation and changed its name to Cass Information Systems, Inc. in January 2001. 

Cass Information Systems, Inc. was founded in 1906 and is headquartered in St. Louis, Missouri.

I use three key data points to gauge dividend equities or funds like Cass Information Systems Inc:

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether a company has made, is making, and will make money. 

CASS Price

Cass's price per share closed at $41.08 yesterday. A year ago its price was $51.72. Price fell $10.64 or just about 20.6% last year.

If Cass's stock trades in the range of $30 to $50 this next year, its recent $41.80 price might rise by $2.42 to reach $43.50 by October 21, 2021. 

CASS Dividends

Cass's most recently declared quarterly dividend was $0.27 paid on September 15th. Dividends are estimated to total $1.08 per share annually and yield 2.63% at yesterday's $41.08 closing price.

CASS Gains?

Adding the $1.08 annual anticipated dividend to my $2.42 optimistic estimate of Cass's price upside shows a $3.50 potential gross gain, per share, to be reduced by any costs to trade the shares.  

Put little under $1,000.00 today in Cass Information Systems Inc at $41.08, and we would buy 24 shares of CASS stock.

A $10 broker fee paid half at purchase and half at sale would cost us about $0.42 per share.

Subtract that $0.42 brokerage cost from my estimated $3.50 gross gain per share results in a net gain of $3.08 X 24 shares = $73.92 for a 7.4% net gain on a $985.92 investment.

So it goes that  Cass Information Systems Inc shows a possible 7.4% net gain including a 2.63% dividend yield. It could be more, it could be less. 

All of the estimates above are speculation based on the past history of Cass Information Systems Inc. Only time and money invested in this stock will determine its worth.

Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, ...

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Comments

William K. 3 years ago Member's comment

Another description of the "due diligence" examination of an organization prior to it's inclusion in another portfolio. Good work, it seems.