RE:ACQ used to pay a dividend...A dividend would be nice. I suspect they probably see the ability to allocate cash flow towards new acquisitions, at some fairly healthy rates of return, as a better use of that shareholder cash. I would probably agree with them. In the conference call they said they did buyback $20 million in ACQ stock in the first quarter. If they continue with that run rate, that would be $80 million or $2.66 per share, or better put, a cash returning to shareholder yield of almost 9%. Probably a better use of cash then the dividend would be right now if the stock stays at this price level for a while.
This is hands down, an $80 stock. The problem you have today is that investors are worried that once the new car supply issues get resolved the profit margin this company recieves on car sales will fall. I won't disagree with that logic but it is unlikely to happen in 2022 and by then they will have bought back a boat load of ACQ shares, earned an extra $120 million dollars in profit. They will take that profit plus their warchest of capital, currently in the bank and grow their business to the point that they will probably be able to continue with this earnings rate into 2023 and then just keep growing at double digit rates every year after that.
A company earning over $4 per share, growing that at double digit growth rate, for as far out into the future as one's imagination can comprehend, will not trade at $30 for too long. As I said, this stock should trade today in the $80 range, but does not only because of the short sightedness of current investors. I imagine they hope to rebuy at lower prices when this so called collapse in margins happens and all I can say is good luck with that.