RE:Globe and Mail, Published Nov 12 12:04 pm EST BNN Market CalJust to be clear, Aventine is a buyer of Concordia notwithstanding its higher leverage profile. Great news! Other fund managers should jump on board!
CJAlberta wrote: FYI, Aventine Management Group has received the Morningstar #1 rating for their Canadian Equity Fund...
"Our evalution methodolgy [on Concordia] will penalize a stock for having excessive leverage - which we have done for Concordia. Even assigning our most conservative valutation multiple against our EPS projection, we believe the shares are at leat 50% undervalued. At 5X 2016 EPS, the stock is trading at a multiple reserved for companies going out of business, which is certainly not the case."
More on their investment thesis can be found on Aventine's website.