Q: I would like your thoughts on MCan Financial today. Their results were good, but are they worth the jump today? They sold shares earlier in the year which got me nervous, but it seems like they are delivering.
5i Research Answer:
EPS of 70c nicely beat estimates of 44c; revenue was $33.6M. EPS rose from 53c last year. Limited estimates were available with only two analysts. The company is performing well in a relatively soft housing market. Its focus on margins, operational efficiency and market share seems to be paying off. MKP expects an improved market in 2025 with lower interest rates and more housing activity. BMO raised its target price by $1 to $19. Its small size adds risk and there is significant economy/rate risk here, but at 8X earnings with a nearly 8% dividend it is certainly priced well to reflect these risks. They did certainly deliver this quarter.