Service Corp International (SCI)

A few weak quarters in a row after Covid. Not a homerun-type stock, but a way to add ballast to your portfolio. Dominant operator in fragmented industry, serial acquirer. Financially strong. Growing dividend.

#1 operator of funeral homes and cemeteries in Canada and the US. 17% market share, in a fragmented industry. Size and scale allows it to earn a premium level of profitability -- 30% ROE and rising. Innovative pre-need strategy. Sees it getting back to normal 8-10% earnings growth rate.

Shares starting to break out nicely. Nice, quiet little outperformer in this market. Yield is 1.60%.

May be able to ramp up M&A a bit. Many died before their time during Covid, then there was a lull, and now getting back to normal averages. Benefits from scale and operating efficiencies as it makes acquisitions. Dominant position.

NA's leading death-care company. Consolidator in a fragmented industry. 15-16% market share. Size and scale are a meaningful advantage, as is financial strength. Two closest rivals are encountering financial difficulties. 30% ROE and rising. 

After a couple of tough Covid years, should return to historic 14% earnings as well as dividend growth. Good combination of value and high-visibility, non-cyclical, non-discretionary growth. Testing all-time highs. Yield is 1.7%. 

This funeral company is in a fragmented sector, yet there is good growth opportunity given current demographics. The stock is up 19% over the year, so he feels the stock needs to grow into this current valuation and it won’t happen overnight.

He likes the industry because it is a good, predictable business. Demographics are leading to increases in volumes. It pays a dividend. There is a secular trend in the industry.

(A Top Pick Aug 17/16. Up 34.4%.) A very boring, steady business that is probably going to improve over time. A really well run business and he likes management. Felt it became fully priced, and would look for a better entry price.

A pretty boring, steady business. An industry he has followed and been invested in for a long time. This is a much higher quality company than StoneMor (STON-N). They operate both funeral homes and cemeteries. The largest player and a consolidator in a fragmented industry, and have made a number of acquisitions which have been very accretive for them. Thinks they will continue to consolidate. Demographics are favourable. There are fairly high barriers to entry for competition.

The leading consolidator in the funeral industry. Excellent management. A big, diversified business. Have been acquiring other companies in the US.

(A Top Pick Feb 21/14. Up 39.64%.) No longer as cheap as it used to be and is trading at a premium valuation. People like the stability of the funeral/Cemetery business. The largest in North America and has been a really aggressive consolidator.