DBM has performed well year-to-date with shares up 25% . Valuation is very attractive at a 10.3x forward price-to-earnings although the company is expected to see a significant pull back in EPS in 2024. Revenues have been declining, and in the recent quarter, down 13.5%. EPS has come in at or above expectations for the last 8 quarters. Margins declined slightly in Q3. Profits rose 82% in the quarter despite the drop in sales, displaying some resilience to the macroeconomic pressures that DBM is facing. The balance sheet is quite leveraged with $457.2M in net debt and low cash of just $1.5M. DBM is mainly targeted by dividend investors as the company pays a 7.75% forward dividend yield. DBM is cheap, but with a muted growth outlook and high debt load, it is a higher risk option and we would see it only for income as part of a high-risk stock basket of several names right now.
5i Research Answer: