Top PickBNN Market Call Tonight March 29, 2017
Jason Del Vicario, Portfolio Manager, Hollis Wealth
BOYD GROUP INCOME FUND (BYD_u.TO) We’ve held Boyd since the summer of 2016 when we bought it at $79. Boyd is in the autobody repair business. They are focused on increasing same store sales as well as being a consolidator in the sector. They sport impressive cash ROE and adjusted EPS growth metrics. On the surface they look overvalued with a PE ratio of 68. One has to dig a bit deeper to get the full picture, however — a lot like the case of Constellation Software (CSU). While their TTM net earnings was $30 million, their operating cash flow was $91 million and free cash flow $78 million. We like companies that have a large difference between their net income and cash earnings as this may not be fully understood and priced in by the markets. The long-term chart on this company is nothing short of spectacular and we look for them to continue their impressive run. The stock can be had for approximately $84 these days, which we feel represents fair value
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