Q: May I have your opinion of MD.TO? With appreciation,
Ed
Ed
5i Research Answer:
DR we would consider an 'OK' small cap income stock. It operates surgical hospitals in the US. There has not been much growth. EPS this year will be less than it was in 2017. There is some debt (about 1.3X cash flow). It has cut its dividend in the past (yield now 3.4%). Insiders do not own much. Its business is highly regulated, which is good and bad. Business tends to be stable, but government payments on procedures are often marked down. Overall, we would prefer an income stock with higher yield, or a company with better growth potential. It is priced well at 13X earnings reflecting its small size.