Stockchase Opinions

Fabrice Taylor BrightPath Early Learning BPE-X DON'T BUY Jul 26, 2013

Doesn’t think much of this one. Prefers Loyalist Group Ltd (LOY-X). This is a kind of a roll up of day care centers. There is a little bit of a real estate play. Business, to him, doesn’t work because of demographics. Neighbourhoods age and young families move to neighbourhoods.

$0.290

Stock price when the opinion was issued

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TOP PICK
(Disclosure: he sits on the board.) Consolidating the child care industry and building new childcare centers across the country. Canada is last country to do this. Assembled a management team from Australia and US. Tripled their growth from a standing start. Analysts have targets at $1.75 to $3.00 a share. Thinks that is conservative.
BUY
Privately run day care centers in Alberta and trying to expand into Ontario. Seem to have top-level people and have limited competition. Good for a long-term position.
TOP PICK
(A Top Pick July 29/10. Up 26.87%.) Consolidating childcare centres and because of a huge shortage they are creating new centres. Just announced buying another 5 centres in Western Canada. Very cheap price.
COMMENT
New effort and well sponsored and seems to be catching on a lot. Finally starting to get cash flow. Very, very illiquid. If you like the concept, you take a long term position. Expects it will succeed.
TOP PICK
A consolidator and developer of child care centers in Canada. The leading player in this space. There is a shortage of 165,000 child care spaces. Has grown from zero in May of 2010 to 4500 licensed childcare in 44 centers. Outstanding management. Back up the truck.
BUY
Recently announced they will site some of their childcare centers in apartment complexes owned by CAP REIT (CAR.UN-T). Apartment/Shopping centres want them. Not sure how it would help an apartment as much as it would a shopping center. Very positive. Expecting it will gradually keep growing. No yield at this time.
SELL

Consolidator of day care businesses. The return on capital on this business as it is and the projected return on capital is very hard to justify the existing share price. Has not been a fan of this company for a while. Doesn’t see the stock rebounding.

SELL

This one is down and he thinks it is going to stay down. Doesn’t see where the upside comes from. Company is not profitable.

COMMENT

A microcap company and a consolidator of day cares. This stock has not done well, however he thinks that most of the changes they needed to do have been done and are looking for efficiencies going forward. At some point he thinks it will be worth $.40-$.50, but it will take some patience to go there. This is a long shot and is probably a bit niche for individual investors.