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  5. CSW.A: Peter and His Wonder Team I have been following this stock for some time. [Corby Spirit and Wine Limited Unlimited Voting Common Shares]
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Investment Q&A

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Q: Peter and His Wonder Team
I have been following this stock for some time...The dividend is over 6% which could be a red flag. I am also wondering about it's valuation. What are your thoughts going forward long term. Do you think at this price it is a buying opportunity ...if not, all factors considered what would be a safer price range? Thanks as usual!
Asked by Ernest on December 22, 2023
5i Research Answer:

CSW.a’s share price has been in negative momentum recently and is now trading at 13x P/E. Growth in the last five years was around 1%-3%, and the company recently borrowed a large amount of debt and implemented a large acquisition of Ace Beverage Group (ABG). The balance sheet is slightly leveraged with a net debt of $112M (largely due to the acquisitions), and a net debt/EBITDA of 2.4x. Overall, CSW.B has been a consistent dividend payer over the years, the dividend is safe in the near term (the dividend was $24M compared to cash from operations of $35M in the trailing twelve months). It's a name investors tend to own for the dividend primarily but over the last five years you are essentially flat after dividends and over ten years, up only 26% vs the TSX which is up 109%. With rates potentally moving lower, it might see a bit of a reversion over the next year but it remains a name that is tough to get overly excited about.