Q: KBL has been doing well this year could you give us the future prospects and your view going forward.
5i Research Answer:
KBL is up 12% this year, bringing valuation to 19X earnings, which is still at the low end of its historical ranges. The dividend is 3.24% but the dividend has not been increased in ten years. Good EPS growth is expected, but there is a bit of leverage here, with debt/cash flow at 3X. But cash flow is steady due to the company's long term contracts. Insiders own 4.6%. We would consider it a decent stock for income and some safety (it is still fairly small). We would truly love to see a dividend increase here. But we would give it a positive rating overall for a small cap stock with income and some growth potential.