Just Energy Group Inc. (Canada) T.JE

RE:RE:CIBC research - $14 target

[DaveWpg]

I see that the CIBC target of $14 is based on a current EV/EBITDA of about 5 at at share price of about $7.  As far as it goes that makes sense but the problem is that JE profitability is inconsistent and the operating margin it is only about 1% vs a Utilities average of about 15%.  I guess that the change in management is giving hope to some investors, but hope is generally not worth a lot unless it is supported by data - which we don't have yet.  I had my convertible debentures converted to shares and they are currently worth about half of what I paid.  I have decided to hold on for the time being but if they get to $12 I will sell and take a small loss.  If they go to $2 then I will sell and take the big loss on this garbage company.  I expect the latter.  Note that CIBC has a neutral rating even though the share price is half of what they target.  Not a vote of confidence!