Q: What do you think of wjx at these levels for a income investor. If Canada decides to build pipelines would it help this company,
5i Research Answer:
WJX is a small ($388M market cap) name with a good yield of 7.9%, and a cheap valuation of 7.7X forward earnings, but it is down 15% year-to-date, and 47% over the past year. Analyst estimates have been trending down, forward growth estimates are fairly weak, and it has a high debt load (3.6X net debt to EBITDA). Margins have been softening over the years, and its long-term stock performance has been weak (-33% over 15 years). Largley, we would like to see the name see consistency in its earnings and margins, and a reduction in its debt before becoming interested here.