Stockchase Insights BUY on WEAKNESS
goeasy(GSY-T)
29/03/2023
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research.
Considering the earnings impact of the new loan rates should be in the 7% to 11% range, the 20% drop (two days) to us seems a bit much.
But the loss on Canada Drives is also a factor. GSY still expects growth, and we largely expect to still meet its three-year growth plans. But, there is still macro risk, and sentiment may take a while to recover here.
Based on the company's adaptability in other challenges of the past 15 years, we are confident they will steer out of this.
GSY's comments on the move hurting smaller competitors 'more' are valid, in our view. It could pick up some market share.
At 6X earnings now and with a 4.2% yield that likely is not in any jeopardy, we think it is worth staying the course for now. We have not heard back yet with a specific response from the company.
The company is the one that determines whether an event is material.
Financial Services
Stockchase Insights
$93.370