Student Transport of America Ltd. (STB.TO)

7.5-8% yield is pretty sustainable. They recently did an equity raise. Everything seems to be going in the right direction. There was not the benefit from oil prices that people anticipated. The stronger dollar will have benefit as their hedges start to come off. A decent dividend play.

If you are buying this for yield only, you can feel very comfortable with it. Most of their revenues are in US dollars, but they pay their dividend 7.5% yield in Cdn$. A non-cyclical business. Have quite a bit of debt, given the non-cyclicality of the student transportation business, but he is not overly concerned about it.

They have been paying the dividend forever. It is more risky than more companies because they issue stock and debt constantly. They are going to reduce payout ratio over time. It is all about lowering debt. It is too early to tell.

A medium risk stock and suitable for income oriented investors. He models its 2014 payout ratio at 89% and 77% for 2015. Thinks they grow their 2014-2016 revenues an average of 10%. Well-positioned to grow by acquisition. This is something you can continue to own and build positions on. Dividend of nearly 8%.

Dividend is safe. Third largest operator of school busses in the US. 15-18% margins. It is cheap 10-15%. Capital structure is fine, but it is a small cap.

Very good company. Doesn’t think there is a lot of huge growth potential, but thinks the dividend is very sustainable. A very stable business model.

Got hammered when investment trusts got hammered. Not sure how many costs you can squeeze out of the systems after they acquire them. Well managed.

Ranks well in his process. Thinks the dividend is fairly safe and there is some growth potential in this business. More and more school districts are subbing it out to this company. 12% return expectation including dividend.

High yield and consistent business, but they don’t get the respect they should. A lot of school districts are getting rid of their busses and hiring this firm to bus students. Bad press spooked investors a while back.

Fundamentals do not look very great. Quite expensive. There is a lot of growth being built in. They have an aggressive growth plan. Have interesting ways of driving margins and different ways of driving their school buses. Payout ratio is quite stretched at these levels. Wouldn’t say the dividend is 100% safe. They are going through a phase of growth.

Good name for income investors. Dividend looks sustainable. Went through a lot of cost-cutting and he sees good earnings growth over the next couple of years. Just did an acquisition that looks accretive. Likes the chart which looks like it wants to go a little bit higher. Not cheap at 8.3X enterprise value to EBITDA. Close to being fully valued.

Ranks really well in his process. Excellent management team. There is a lot of runway for this company to continue to acquire. School districts don’t want to run their own bus operations so they basically hire this company. Good yield. This will be a “show me” story as they continue to execute.

Has had a decent year and the yield on it is backfilling. There is still a fundamental need to transport students. Not sure where their future growth is going to come from and he thinks they are going to need to do more acquisitions. Excellent yield.

Has a chance to have some growth with enough dividend. Somewhat illiquid. You could hold it for the dividend. 8.46%

Just had their quarter and beat expectations. Thinks they can grow their EBITDA another 13.5% over the next year. They now want to focus on the asset light part of the business, less capital intensive, which makes sense. A suitable stock for income oriented investors. $6.75 is his target.