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  5. AW.UN: Hey can get your take on these two companies for income and just general value? [A&W Revenue Royalties Income Fund]
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Investment Q&A

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Q: Hey can get your take on these two companies for income and just general value? I know they are different sectors but both compelling yield. Which would you prefer overall. I don’t really care about small cap risk just which do you prefer? Should I just own both. What did you think of their recent quarterly results? Feel free to take 2 creds here thanks.
Asked by Scott on May 24, 2024
5i Research Answer:

AW.UN has a more attractive yield at 6.7% vs. PIF at 5.0%, but PIF trades at a slightly cheaper valuation. We like the profit margin profile of AW.UN more, and its growth has been better overall. Both names have some level of cyclicality, but we feel that AW.UN has a more consistent track record, and largely we would be more comfortable with AW.UN today. 

AW.UN reported royalty income growth of 1% year-over-year, and royalty pool same store sales growth of 0.6%. Consumers seem to be getting stretched thin, but growth is expected overall and we are not concerned on its distribution. 

PIF reported EPS of $0.21, beating estimates of $0.1184 and revenues of $20.63M beat estimates of $20.51M. Sales grew marginally against the prior year, although energy production declined 2%, mainly due to lower production from its geothermal facility in Nicaragua and hydroelectric facilities in Peru. Overall it was an OK quarter for the company.