Q: Looking for updated thoughts on Bird Construction, it seems since the Fall of 2022 this stock (up 3X) turned around and has a nice run of new contracts expanding into Nuclear work for the Ontario Government, which is intriguing among many other contracts for larger builds and a nice growing backlog.
Market Cap nearing 1 billion which you seem to like as more Investors consider it.
Do you know Management at all and what are your thoughts?
Who is their nearest competitor regardless of size and who is their closest in size and competition in Canada?
What is the biggest risk you see to this specific company?
If you had to choose between BDT or another North American company in the same space (non-residential construction exposure) if not BDT who are they?
Market Cap nearing 1 billion which you seem to like as more Investors consider it.
Do you know Management at all and what are your thoughts?
Who is their nearest competitor regardless of size and who is their closest in size and competition in Canada?
What is the biggest risk you see to this specific company?
If you had to choose between BDT or another North American company in the same space (non-residential construction exposure) if not BDT who are they?
5i Research Answer:
We have met management and would consider them good; it is a tough, competitive business and it has not always been smooth sailing for them. Insiders own about 5% and have been buying; Canso Investment owns 17.9%. WSP/STN would be their biggest competition but ARE is closer in size. The stock is cheap at 12X earnings, reflecting the cyclicality of the business, but recent growth has indeed been excellent, with EPS close to doubling from 2022 to this year's estimates. It did lose money in 2018. But we think investors will continue to be interested here. The last quarter was a big 'beat' and earnings estimates have risen in the past month.