Q: I have owned EIF in registered and non registered accounts over the years and generally have been satisfied with its combination of relatively high yield and modest growth. Management seems quite competent in operating their two, quite different divisions of aerospace and manufacturing. However, I am beginning to question their purchase of Northern Mat and now their purchase of a small ( 40 acres ) sawmill in Quebec. They justify their sawmill purchase as a way to integrate with NM and penetrate the Quebec market. Seems and odd approach to me.
The stock has stalled recently and that’s OK but I wonder if they have taken “ their eye off the ball” and may suffer the consequences. This is more of a gut feeling than sound analysis but your thoughts on EIF would be appreciated.
Thanks. Derek.
The stock has stalled recently and that’s OK but I wonder if they have taken “ their eye off the ball” and may suffer the consequences. This is more of a gut feeling than sound analysis but your thoughts on EIF would be appreciated.
Thanks. Derek.
5i Research Answer:
We would really second-guess management yet on the rationale of the capital investment projects...