Q: Is this a good entry point for 3-5 yr hold in a registered account? Can I get at least a 10%/yr ROI?
What is risk level compared to others and would you prefer others in this space?
Is dividend safe?
Thx
What is risk level compared to others and would you prefer others in this space?
Is dividend safe?
Thx
5i Research Answer:
It is a cyclical industry and with an 11%+ dividend yield investors are expressing concern on the dividend. There is not much growth at all here, but the balance sheet is fine, with a small amount of debt (about only four months' cash flow). 12-month dividend payout is less than 50%. No dividend is guaranteed but we would not see it at immediate risk of reduction. It was last raised in November 2022. The dividend was slashed in 2018 and was omitted for a period during the Pandemic. Valuation is attractive, but we would consider it more risky than larger companies in the space, such as WCP, which we would prefer.