Q: Hello 5i team
I have invested in BAD in the past and did well, I still own a small position in this company ( I am not concerned with the weighting in my portfolio ). I work in the oil and gas field and I see BAD trucks at my work place, I drive home from work and see BAD trucks working on city Infrastructure projects. I like the idea that they can allocate their trucks away from slower areas (oil and gas sector) and move them to more profitable areas very quickly. I believe they have a good reputation in the field. I like that they build their own trucks and can ramp up assembly of these trucks on a whim. In having control of the construction of these trucks they have slashed the price of the trucks compared to buying them from a middle man dealer (a huge competitive advantage in my opinion) they have also maximized the usability of the truck since they have ultimate control of the product.
I have noticed over the years that large corporations ( In the O&G field and utility sectors) are becoming more focused on safety (probably due to wanting to keep insurance costs minimal) and in these slower times in the oil patch are starting to pinch their pennies harder. I see BAD as the safest, fastest and cheapest way of excavating pipes, cables etc which is just what their customers or potential customers should be wanting. I also see BAD as a excellent take out prospect maybe not today, maybe not tomorrow but some day. As they become more dominant in the north american hydro vac world they should look more attractive to some larger service companies. BAD seems to have a manageable debt load, good ROE and pays a div which hasn't grown but they have been in a aggressive growth phase and I expect after that phase is over that the div will begin to climb.
My question to you is why should a guy not back the truck up on this stock now (sector weighting not begin a concern to me)?? It should be able to easily survive this oil market slow down and come out the other end looking pretty good since it has plenty of business happening in the Infrastructure and utilities areas. What are the potential down falls of this stock?? What is your opinion of the management??
Thanks
I have invested in BAD in the past and did well, I still own a small position in this company ( I am not concerned with the weighting in my portfolio ). I work in the oil and gas field and I see BAD trucks at my work place, I drive home from work and see BAD trucks working on city Infrastructure projects. I like the idea that they can allocate their trucks away from slower areas (oil and gas sector) and move them to more profitable areas very quickly. I believe they have a good reputation in the field. I like that they build their own trucks and can ramp up assembly of these trucks on a whim. In having control of the construction of these trucks they have slashed the price of the trucks compared to buying them from a middle man dealer (a huge competitive advantage in my opinion) they have also maximized the usability of the truck since they have ultimate control of the product.
I have noticed over the years that large corporations ( In the O&G field and utility sectors) are becoming more focused on safety (probably due to wanting to keep insurance costs minimal) and in these slower times in the oil patch are starting to pinch their pennies harder. I see BAD as the safest, fastest and cheapest way of excavating pipes, cables etc which is just what their customers or potential customers should be wanting. I also see BAD as a excellent take out prospect maybe not today, maybe not tomorrow but some day. As they become more dominant in the north american hydro vac world they should look more attractive to some larger service companies. BAD seems to have a manageable debt load, good ROE and pays a div which hasn't grown but they have been in a aggressive growth phase and I expect after that phase is over that the div will begin to climb.
My question to you is why should a guy not back the truck up on this stock now (sector weighting not begin a concern to me)?? It should be able to easily survive this oil market slow down and come out the other end looking pretty good since it has plenty of business happening in the Infrastructure and utilities areas. What are the potential down falls of this stock?? What is your opinion of the management??
Thanks
