DH Corporation (DH.TO)

BUY
Earnings looked fairly good in the 1st quarter and were helped quite a bit on the top line by an acquisition they made. Multiples appear reasonable. Close to a 6% yield.
WEAK BUY
5-10% dividend grower. A good quality company. A bit small for his fund. 8.6% sustainable yield. There isn’t a lot of potential for upside due to the nature of their business.
BUY
Cheques but are diversifying. Strong management. Likes this stock. Has done reasonably well.
HOLD
Started in cheques, which they have totally tied up. Have added new products. Pays a reasonable return.
BUY
Good management. One of the true monopolies in that they control cheques and can increase pricing when needed. Tremendous amount of cash flow. Expect they will diversify away from cheques.
WEAK BUY
They are not earning their payout. Now that they have announced what they will payout, people are taking another look at it. It is not a big growth area. There is still a huge market for cheques but to grow they have to take market share and it could be a long haul.
BUY
Very solid lead managed. You would think cheque making would be threatened by technology but they have been very good at adapting. Good solid trust to own.
DON'T BUY
Not a name he likes that much. They are in a sunset industry.
BUY ON WEAKNESS
Manufactures bank cheques Good yield. Very solid and extremely well managed company.
BUY
(Market Call Minute) Great name. Bought two companies and did well. Good payout ratio and sustainable yield.
PAST TOP PICK
(Top Pick Jan 16/09, Up 7%) Maintained distribution. Trimmed his position a bit. Will have to cut distribution 25-30% as they convert their company.
DON'T BUY
Fully valued and he has taken profits recently on this one.
COMMENT
Distribution is safe. Has about an 82%-83% payout ratio. Have diversified outside of the cheque business, which is declining. Have invested in Biologics and mortgage brokerage software. Looking for a distribution cut to take into account taxes and possibly more growth acquisitions.
DON'T BUY
Pay out about $1.84 in distribution and earnings per unit are around $2.20 giving them about an 80% payout ratio. Not sure they will be able to sustain the distribution.
HOLD
(Market Call Minute.) Looking at little bit expensive. Good base business. 11% yield.
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