Q: Is it time to sell ECN? I am surprised at their reversal of fortune since their special dividend.
Is there a lesson I can learn from this?
Is there a lesson I can learn from this?
5i Research Answer:
ECN is, at least, up 58% in the past year (down 16% YTD). Considering its economic exposure and small size, its decline is not really out of line with others. That being said, it is hard to be too bullish here. Consumers are not very likely to finance big-ticket discretionary items in the current economic scenario. The stock is cheap but we doubt it does much at all this year. A lesson might be: 'don't give out all your cash'. ECN would be in much better shape and able to buy growth if it had kept its billion+ dollars it paid out to shareholders in late 2021. We would not miss it if sold.