APA Corp got my attention when I saw a number of people talking about it in a dividend investing group.
The first thing I did is pull it up and look at some of the basics. It was showing a 2.27% yield, not bad but nothing special.
Its EPS yield is 18.88% and it was trading well below its normal EPS which suggested to me there may be value here.
APA’s long term debt to capital ratio is 86.56% which is high for me, but their payout ratio is just 8.28% which would make me think it can cover its dividends.
The other warning sign I found was that their 5 year dividend growth rate was -8.97%, this is a pretty big red flag for me when I am considering a longer term investment.
I decided to do my standard 10 year analysis of the stock to see what was really going on here. Needless to say, I did not like what I saw as you can see from the table below.
The two biggest things I look at are the 10 year investment change and the 10 year dividend income change.
The 10 year investment change was -37.06% and the 10 year dividend change was -35.88%, both of these are terrible for my investment strategy.
| Initial Investment | $10,000.00 | Avg Yrly Price | |||||||
| Begin | Beg Year | Year End | Dividend | Shares from | Year End | Year End | Yearly | ||
| Year | Value | Stock$ | Shs Owned | Dividend Yield | Income | Reinvestment | Shares | Value | Change |
| 2013 | $10,000.00 | $84.85 | 117.86 | 0.90% | $90.00 | 1.09 | 118.95 | $9,546.54 | -4.53% |
| 2014 | $9,546.54 | $80.26 | 118.95 | 1.52% | $145.11 | 2.03 | 120.97 | $7,606.76 | -20.32% |
| 2015 | $7,606.76 | $62.88 | 120.97 | 2.25% | $171.15 | 3.44 | 124.41 | $4,559.70 | -40.06% |
| 2016 | $4,559.70 | $36.65 | 124.41 | 1.58% | $72.04 | 1.44 | 125.86 | $7,944.04 | 74.22% |
| 2017 | $7,944.04 | $63.12 | 125.86 | 2.37% | $188.27 | 3.44 | 129.29 | $5,997.98 | -24.50% |
| 2018 | $5,997.98 | $46.39 | 129.29 | 3.81% | $228.52 | 5.90 | 135.19 | $4,204.49 | -29.90% |
| 2019 | $4,204.49 | $31.10 | 135.19 | 3.91% | $164.40 | 5.18 | 140.37 | $4,545.25 | 8.10% |
| 2020 | $4,545.25 | $32.38 | 140.37 | 2.29% | $104.09 | 4.25 | 144.62 | $2,397.87 | -47.24% |
| 2021 | $2,397.87 | $16.58 | 144.62 | 0.51% | $12.23 | 0.53 | 145.15 | $4,306.69 | 79.60% |
| 2022 | $4,306.69 | $29.67 | 145.15 | 1.34% | $57.71 | 1.59 | 146.74 | $6,293.83 | 46.14% |
| 2023 | $6,293.83 | $42.89 | 146.74 | ||||||
|
10 Investment Year Change
|
-37.06% | ||||||||
|
10 Price Change
|
-49.45% | ||||||||
|
10 Year Dividend Change
|
49% | ||||||||
|
10 Dividend Income Change
|
-35.88% |
The current P/E ratio would seem to indicate that there might be some upside from where APA is trading currently. Perhaps the next 10 years will look a lot better but for me, I am going to pass.