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Diversified Royalty Corp T.DIV

Alternate Symbol(s):  BEVFF | T.DIV.DB.A

Diversified Royalty Corp. is a multi-royalty company. The Company is engaged in acquiring royalties from multi-location businesses and franchisors in North America. It owns Mr. Lube + Tires, AIR MILES, Sutton, Mr. Mikes, Nurse Next Door, Oxford Learning Centres, Stratus Building Solutions and BarBurrito trademarks. Mr. Lube + Tires is the quick lube service business in Canada, with locations across Canada. AIR MILES is a coalition loyalty program. Sutton is a residential real estate brokerage franchisor business in Canada. Mr. Mikes operates casual steakhouse restaurants in western Canadian communities. Nurse Next Door is a home care provider. Oxford Learning Centres is a franchisee supplemental education service. Stratus Building Solutions is a commercial cleaning service franchise company providing comprehensive environmentally friendly janitorial, building cleaning, and office cleaning services in the United States. BarBurrito is a quick-service Mexican restaurant food chain.


TSX:DIV - Post by User

Bullboard Posts
Post by bertanderon Nov 26, 2009 10:48am
670 Views
Post# 16526180

Opinion

Opinion

Based on Bennett’s low operating costs and lean administration, Bennett can definitely compete in the large waste destruction market across North America. The Environment Canada PCB Waste Storage Abatement regulation has only been in effect for about a year. It is also known that the Ministry of the Environment will be significantly lowering the PCB soil clean-up limits very soon. Further, certain PCBs were recently reported to be known carcinogens. This is the first time that this has ever been reported. Up until now, PCBs were only suspected carcinogens. This is going to create significant additional pressures for regulators for the abatement of PCBs from the environment. The US has typically been more relaxed than Canada and this should trigger some significant changes across North America. Further, the PCB waste storage sites are only a small percentage of the PCB waste that will be generated during the clean-up of the numerous PCB contaminated sites in Ontario and across Canada. It is believed that many of the owners of significant PCB waste storage sites in Canada have not yet complied with the Environment Canada regulation. With the economy improving and the increased risk of government fines under the Canadian Environment Protection Act for not complying with the regulation, owners are expected to comply in 2010 through to 2011 and beyond. This will create timely opportunities for Bennett as the Bennett stored Pottersburg backlog waste is destructed. As Bennett reported, they declare their revenue as they process the waste. Because of their significant backlog, they are projecting excellent quarters to give them well over $1 earnings per share for 12 consecutive months. If we conservatively give BEV a forward P/E ratio of 5, we get a projected price of at least $5 by July/August 2010. This projected price doesn’t take into account the identification of potential PCB contaminated soils during the Phase II ESA at Pottersburg (as noted on their website) or any new contracts won by Bennett over the next 9 months. When further material for processing is obtained over the next 9 months and if Bennett diversifies and invests the significant cash reserve generated from Pottersburg, this number should go higher, These numbers are still well below BEV's all time high of $26.

Bullboard Posts