AD - research comments from todays Globe Positive catalysts are on the horizon for Alaris Equity Partners Income Trust
Ahead of the release of its first-quarter results on May 6, Mr. Ho is projecting EBITDA of $28.6-million for the Calgary-based company, exceeding the consensus on the Street of $28.4-million.
“With 85 per cent of its portfolio investments being U.S.-based and the rebound in economic activity, this should bode well for the underlying portfolio businesses, leading to positive FV increases,” he said. “We believe AD’s BV [book value] is conservatively valued and offers upside on an economic recovery (AD has delivered three consecutive quarterly FV write-ups).”
Though he made narrow negative estimate revisions to his projections for the next two years, Mr. Ho raised his target for Alaris shares to $20.50 from $20, which exceeds the consensus by 6 cents. He kept a “buy” recommendation.
“AD has a diverse portfolio. We are encouraged by the strong capital deployment year-to-date and turnaround at PFGF and Kimco,” he said. “With potential PFGF distribution increases in 2H21, the payout ratio could drop further to the low-60-per-cent range. FED and Kimco redemptions may also result in a windfall for AD. The units remain attractively valued, trading at 1.0 times P/BV, with a 7.6-per-cent distribution yield.”