Opinions
James Telfser
Heroux-Devtek Inc.
HRX-T
TOP PICK
Jun 20, 2016
Stock price when the opinion was issued
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They execute brilliantly, integrating very well. They produce landing gear for airplanes. They finished absorbing a major acquisition of a Spanish company which got them into Airbus. They also work on the Boeing 777x. The capex and acquisition spend is now done, so they can pay down debt or buy more companies. HRX is one of the most profitable companies in aerospace/defence. But the market hasn't given them the credit in the last quarter, so now is a good time to take advantage of their discount valuation. (Analysts’ price target is $22.71)
Very strong Canadian company that doesn't get enough attention from the markets. Last quarter starting to prove business prospects. Landing gear in very high demand within airline sector. Trading at discount to other names in the sector. Very high barriers to entry within the business. Margins continue to expand - will be good for cash flow. Balance sheet very strong with cheap valuation.
An aerospace company. Do a lot of landing gear for planes. They have a long history of making very wise allocation of capital, and thinks they are at a point now where they might start to look at doing something else interesting. They just did a lot of work for the Triple7 landing gear for one of the new planes.