
TSE:SPB
This summary was created by AI, based on 3 opinions in the last 12 months.
Superior Plus Corp (SPB-T) is facing significant challenges reflected in the recent expert reviews. The volatility of propane, particularly in relation to weather dependencies, presents a notable risk, especially given the company's exposure to seasonal margin pressures. While the signing of a data center contract in the US offers some positive development, the recent earnings report fell short of expectations, leading to an 18% drop in share price and raising concerns about management credibility. Furthermore, the company, which operates primarily as a logistics business for fuels in Canada and the US, has downgraded its growth guidance significantly from a positive 10% to a negative 5%, indicating difficulties with its efficiency program (which hasn't performed as anticipated). Overall, there's a cautious interest in the company, with experts wanting to see tangible improvements before committing further.
Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The revenues were ahead of estimates by 14%. EPS was 40 cents, beating the estimated 33 cents. Q4 showed some income declines however. The acquisition plan backed by Brookfield has not changed. The dip is a buying opportunity. Unlock Premium - Try 5i Free
The company has good businesses. Their problem was the balance sheet. They will be 3 times debt-to-EBITDA. They have more funds for M&A, which could help them make some interesting acquisitions. He likes the distribution and the management team. They just partnered with Brookfield, which gives a strong vote of confidence. Its valuation is reasonable. Not the first place he would put capital, but you would do well if you already own it.
Recently reported earnings for SPB set a first quarter record as the Certarus acquisition is accretive to earnings. The company increased earnings guidance for the year. Net cash flow per share was up 250%. It trades at 16x earnings and under 2x book value and pays a great yield. We recommend a stop-loss at $9, looking to achieve $13 -- upside potential of 23%. Yield 7.0%
(Analysts’ price target is $13.10)