STUDENT TRANSPORTATION INC 5.25 PCT DEBS T.STB.DB.A

RE:RE:RE:RE:New here

[ffhwatcher3]

To be fair, they have successfully reduced the impact of changing fuel prices on their business significantly. In good times it fuel is 6% of Rev and bad times it is 8-9% of revenue. Not massive but for a low margin company, very important.  High fuel prices can wipe out 1/3 of their net margin, so I like that they have insulated themselves as much as possible.  You have to see that through an entire cycle to help (which you alluded too).

Also, you would think Oil Companies have the best outlook on oil prices.  So, how many of them are 100% hedged out for a couple years?  Almost none.  Hindsight is great.  How much money did you make shorting oil companies 2 years ago? Also likely none but it was 'obvious'.  If you did make money shorting oil, good for you.

Better question : What do buybacks, low DRIP participation rate and lots more operating leases do to their POR (pay out ratio)?  Is the market ready for that?  It is a very significant #, imo. Maybe $15M + the additional operating leases, as a guess. A 3% price increase would offset that.  Hopefully their price increases and additional revenue can offset that...which is what the company is suggesting.