Steve MacInnes Major Drilling Group International Inc MDI-T TOP PICK May 15, 2008

At 11X forward earnings with net cash and good growth expected this year, we don't think much has really changed here. The company expects to report on May 23. Being so close to earnings, we might prefer to just wait and act on more information once earnings are released butdon't see much reason for a view to change on the name overall.
Unlock Premium - Try 5i Free

Picks and shovels again. Leading driller for exploration on the planet. If the EV revolution happens, there will be more and more exploration drilling. The whole electric grid needs replacing. $50M in cash, no debt. Trades at 10x earnings. A home run swing. No dividend.

Industry sees them as a well-regarded, very competitive firm. He doesn't normally own process and service stocks. No objection to someone adding. Pretty attractive margins and market share.

A way to play the miners, as it does drilling for companies while being agnostic to what it's drilling for, giving exposure to the whole sector. True, commodity prices have backed off, and equity markets for raising capital haven't been the most favourable. When the sector turns, in very good shape to take advantage of demand for 5-10 years. Reduced debt to nothing, buying back stock.

Leading exploration driller for metals worldwide. Demand for copper and gold not going away. Well placed for commodity demand. No debt on cap table. Very good outlook for business. Would recommend buying. Cyclical business by nature, but overall - a good business. Target price is $14. Owns shares in portfolio. 

Mining services company across the globe. Excellent small company to hold for the long term. Expecting strong commodities cycle going forward. Excess cash on the balance sheet. Paying down debt. If demand for gold and copper rises, will benefit from drilling services demand. Good stock to hold for the long term. 

He likes the resource industry, mainly metals. It is a good way to play the sector without having the risk of which mines will work. It has no debt, lots of cash and is buying back stock. He has a $14 to $15 target price. 

Last big exploration cycle peaked in 2013. Gold is already going. World copper supply is down substantially, and we need it for the electricity boom. No debt, cheap, buying back stock. Accumulate below $10, reduce it over $14, and sell at $20.

Any drilling company connected with the mining industry won't get a big multiple because of the cyclicality of the industry. It's boom or bust. It is a pretty well run company with fine operations and satisfied customers. It is interesting to note that mining companies are in great shape with lots of money pouring in with the rising price of gold. There is lots of M&A activity. It is just a matter of time before money starts trickling down to Major Drilling so there is good potential. An increase in the multiple and increase in earnings at the same is pretty powerful. 

The stock really works when mining companies are outlining plans to put mines into construction. It's early in the mine cycle, construction hasn't ramped up yet. Range-bound. Very well run, no debt, recent acquisition. In his global equity fund. 

Primed and ready for the next mining cycle. The signal will be more equity raises from junior gold and copper companies.