Tuesday, May 12, 2015

Recent Purchase

     I used to own shares in Tim Hortons. Tim Hortons is a Canadian iconic brand in the fast food restaurant.  When there was an announcement that Burger King, led by 3G Capital, wanted to acquire Tim Hortons, I held on to my shares for a bit. I decided to sell the 100 shares for a capital gain of approximately $3000 dollars before the acquisition finalized.
      The new company is called Restaurant Brands International and is headquartered in Canada.  The company trades under the ticker symbol  QSR on both the NYSE and Toronto Stock Exchange (TSX). The company recently released its first quarter (1Q) results. They keep the businesses separate and therefore the earnings results are told for each separately.
First Quarter Highlights (Tim Hortons)
  • Global comparable sales of 5.3% , which was driven by continued strength in coffee and successful new product launches.
  • Net Restaurant Growth of 53 units, representing restaurant base growth of 4.4% on a trailing 12 month basis.
  • System wide sales increased 8.1% to 1.5 billion for the first quarter

 Tim Horton's has 3773 restaurants in Canada, 892 restaurants in 18 states in the United States and 59 restaurants in 5 international countries. Tim Horton's started in Canada in 1964, the United States in 1984 and 2011 for international stores. The stores of Tim Horton's can be walk-in only, walk-in and drive-thru, and inside fuel stations which is mostly drive thru customer based.

First Quarter Highlights (Burger King)
  • Global comparable sales of 4.6% with particular strength in United States and Canada
  • Net Restaurant Growth of 15 units representing restaurant base growth of 5.2% on a trailing 12 month basis
  • System-wide sales increased 9.6% to $4.0 billion for the first quarter
     During the webcast for earnings, they stated they don't have a time line to pay down the debt which was over $9 billion dollars. So that possible allows them to pay a dividend, although small and increase it over time.

      On May 12, 2015, I purchased 40 shares of Restaurant Brands International (QSR) on the Toronto Stock Exchange at $48.85 per share for a cost of $1959.09 including commissions. This transaction occurred in my margin account.


    During the most recent earnings they announced a dividend payment of $0.10 per share for the quarter. This purchase adds $16.00 to my annual dividend income on the assumption the annualized dividend is $0.40 per share.

    I am not 100% sure if this stock will be a long term hold at this stage as the dividend is low. With no record of dividend growth as this is a new formed company, it is hard to tell what the company will do going forward in  regards to dividends. 

I will update my Investing spreadsheet in early June to reflect the new purchase.

EDIT:  May 13 Total commissions which include ECN fees is $5.09. I purchased an odd lot of shares (not a multiple of 100). May 15 trading summary shows purchase price is $48.85 and not $48.84.

I am not a financial planner, financial advisor, accountant or tax attorney. The information on this blog represents my own thoughts and opinions and should NOT be taken as investment or business advice.

Every individual should do their due diligence to make their own financial decisions based on their financial situation and tolerance for risk.

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