Uni-Select Inc T.UNS

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Stock of the week: Uni-Select Inc. -------------------------------------- The acquisitions Uni-Select Inc. (TSX-UNS, $27.49) made last year are paying off. Canada's second-largest distributor of auto and heavy-duty replacement parts, equipment, tools and accessories remains a buy. In the first quarter, Uni-Select earned $5.4 million, or 28 cents a share. That's up 27.3 per cent from $4.1 million, or 22 cents a share, a year earlier. Much higher sales and profit in the U.S. more than offset lower sales and profit in Canada. For 2005 as a whole, Uni-Select is expected to earn $1.97 a share. That's up by 19.4 per cent from $1.65 a share last year. The higher earnings come from acquisitions that expanded its Automotive Group USA unit. In November, Uni-Select acquired Middle Atlantic Warehouse Distributor. This increased the U.S. division's sales by 252 per cent, to $135 million. In the first quarter, the company acquired Action Automotive Distributing, which operates a store, as well as Motor Parts Warehouse, which runs two distribution centres. Despite these acquisitions, Uni-Select's debt-to-cash-flow ratio remains within our comfort zone of 2.0. Of course, with first-quarter cash flow up by 45 per cent, to $79 million, an acceptable ratio is easier to achieve. Uni-Select's first-quarter cash flow exceeded the $1.9 million it invested in fixed assets, the $1.1 million in spent on acquisitions and the $1.4 million it paid in dividends. So we expect the company to repay debt and continue to raise its dividend. Uni-Select remains a buy for long-term gains and dividends. (Click below for a profile of this week's stock.) https://www.adviceforinvestors.com/query_results.phtml?search_type=by_symbol&search_input=uns