SNC-Lavalin Group Inc.
SNC-T
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About SNC-Lavalin Group Inc. (SNC-T)
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WSP Global is pretty much the gold standard. They are pretty much 100% consulting, whereas STN-T and SNC-T are not. He has shied away from the whole sector. The problem is the engineering and construction business, which he has never liked. Margins are razor thin. STN-T wants to get away from E&C. He would buy WSP-T on a correction. STN-T might be a buy at some other point. SNC-T he stays way from and has done so for many years.
WSP Global is pretty much the gold standard. They are pretty much 100% consulting, whereas STN-T and SNC-T are not. He has shied away from the whole sector. The problem is the engineering and construction business, which he has never liked. Margins are razor thin. STN-T wants to get away from E&C. He would buy WSP-T on a correction. STN-T might be a buy at some other point. SNC-T he stays way from and has done so for many years.
Stay away. This company is under attack from various directions. It's flailing, trying to sell its crown jewel assets. Many negatives here. If it does happen, it could have a nice move up. Too risky.
Stay away. This company is under attack from various directions. It's flailing, trying to sell its crown jewel assets. Many negatives here. If it does happen, it could have a nice move up. Too risky.
He's playing infrastructure through WSP instead who are locking their debt to earnings, yet grow by acquiring.
He's playing infrastructure through WSP instead who are locking their debt to earnings, yet grow by acquiring.
It trades below it break up intrinsic value. As a Quebec based company it will be too important to fail in political terms.
It trades below it break up intrinsic value. As a Quebec based company it will be too important to fail in political terms.
(A Top Pick Aug 11/17, Up 2%) Hasn’t done much, though a good company. With gas line approval in BC, should be lots of work. Sideways action, dividend is indifferent. Need some excitement to get investors interested. Not a bad hold.
(A Top Pick Aug 11/17, Up 2%) Hasn’t done much, though a good company. With gas line approval in BC, should be lots of work. Sideways action, dividend is indifferent. Need some excitement to get investors interested. Not a bad hold.
One of the best infrastructure plays, despite past troubles (which he hopes are behind them). Has a choppy chart, but long-term this looks good due to new management, creating a fresh slate.
One of the best infrastructure plays, despite past troubles (which he hopes are behind them). Has a choppy chart, but long-term this looks good due to new management, creating a fresh slate.
He's traded this three times. because it's been a consistent range of $45-50 since mid-2015. (2.2% dividend, Analysts' price target: $70.73)
He's traded this three times. because it's been a consistent range of $45-50 since mid-2015. (2.2% dividend, Analysts' price target: $70.73)
He bought it when it was dealing with its ethical issues. The stock has not recovered as well as he expected. He is still waiting for the US and Canadian governments to come through with their infrastructure spending, which would provide SNC with great business. This continues to be a tomorrow stock that he keeps waiting for.
He bought it when it was dealing with its ethical issues. The stock has not recovered as well as he expected. He is still waiting for the US and Canadian governments to come through with their infrastructure spending, which would provide SNC with great business. This continues to be a tomorrow stock that he keeps waiting for.
The construction companies are difficult for investors. You can't tell how much money they'll make on a contract. Suppose they underbid or hit execution problems or a customer stiffs them? It's okay to own one of them in a portfolio, but no more. SNC is okay--has worldwide exposure but also carries geopolitical risk. It's riskier than most stocks he owns.
The construction companies are difficult for investors. You can't tell how much money they'll make on a contract. Suppose they underbid or hit execution problems or a customer stiffs them? It's okay to own one of them in a portfolio, but no more. SNC is okay--has worldwide exposure but also carries geopolitical risk. It's riskier than most stocks he owns.
(A Top Pick May 17/18, Down 3%) Would still buy at this point. Getting penalized because of Saudi-Canadian issues. Geopolitical issues let you buy good companies at a good price.
(A Top Pick May 17/18, Down 3%) Would still buy at this point. Getting penalized because of Saudi-Canadian issues. Geopolitical issues let you buy good companies at a good price.
Geopolitical risk is priced in. Good backlog of opportunities. Growth coming in. EBITDA could be strong going forward. Yield is 2%. (Analysts’ price target is $70.54.)
Geopolitical risk is priced in. Good backlog of opportunities. Growth coming in. EBITDA could be strong going forward. Yield is 2%. (Analysts’ price target is $70.54.)
He likes the valuation. The pull back was way over done a few weeks ago. It represents a decent opportunity at this level but some risk. There are risks with the current Saudi Arabia situation. Fundamentals are good for this company. He has a $70.00 target. Yield of 2.2%. (Analysts’ price target is $70.54)
He likes the valuation. The pull back was way over done a few weeks ago. It represents a decent opportunity at this level but some risk. There are risks with the current Saudi Arabia situation. Fundamentals are good for this company. He has a $70.00 target. Yield of 2.2%. (Analysts’ price target is $70.54)
He picked this because it is down about 10% based on the Saudi Arabia situation with Canada. Revenues in Saudia are 11% or $900 million on long term oil projects. They employ 5,000 Saudis in their projects. The company says there is no disturbance. He thought it was cheap at $57. They have a $15 million backlog. Yield 2.2%. (Analysts’ price target is $70.54)
He picked this because it is down about 10% based on the Saudi Arabia situation with Canada. Revenues in Saudia are 11% or $900 million on long term oil projects. They employ 5,000 Saudis in their projects. The company says there is no disturbance. He thought it was cheap at $57. They have a $15 million backlog. Yield 2.2%. (Analysts’ price target is $70.54)
The dispute between Canada and Saudi Arabia is a concern because SNC has bought companies that do business in Saudi Arabia. However, so far no contracts have been invalidated and there is no negative information about the company’s projects. Uncertainty is hurting the stock price, but their core operations are doing very well. In addition, they are looking to monetize their stake in Highway 407 and this is highlighting the value of that investment whether they make the sale or not. He thinks this is a sound company that he is happy to own. He sees the Saudi Arabia news as noise that should not cause a fundamental investor to take action. He thinks the impact of the dispute will fall more on private individuals than on businesses.
The dispute between Canada and Saudi Arabia is a concern because SNC has bought companies that do business in Saudi Arabia. However, so far no contracts have been invalidated and there is no negative information about the company’s projects. Uncertainty is hurting the stock price, but their core operations are doing very well. In addition, they are looking to monetize their stake in Highway 407 and this is highlighting the value of that investment whether they make the sale or not. He thinks this is a sound company that he is happy to own. He sees the Saudi Arabia news as noise that should not cause a fundamental investor to take action. He thinks the impact of the dispute will fall more on private individuals than on businesses.
He owns WSP instead. The infrastcuture sector is okay, nothing wrong. Buy on weakness any of these stocks. Commodities will come back and infrastructure will rise along with them.
He owns WSP instead. The infrastcuture sector is okay, nothing wrong. Buy on weakness any of these stocks. Commodities will come back and infrastructure will rise along with them.
He hasn't looked at this sector in a long time. This stock has gone nowhere. He's waiting for management to shake things up.
He hasn't looked at this sector in a long time. This stock has gone nowhere. He's waiting for management to shake things up.
He likes it and it has moved a little lately. They've settled a few lawsuits and are putting their problems behind. Highway 407 has been a fantastic asset for them. SNC has touched $60 for the first time in a while and he sees 10-15% upside in the next 12 months. Be patient. Over the next few weeks you could buy this for a dollar or two lower.
He likes it and it has moved a little lately. They've settled a few lawsuits and are putting their problems behind. Highway 407 has been a fantastic asset for them. SNC has touched $60 for the first time in a while and he sees 10-15% upside in the next 12 months. Be patient. Over the next few weeks you could buy this for a dollar or two lower.
The stock has done nothing since 2010. It is finally coming back to where it was in 2010. He doesn’t see much opportunity for dividend growth or capital appreciation with this stock. His model price is $44 (the stock is $59 today). (Analysts’ price target is $69)
The stock has done nothing since 2010. It is finally coming back to where it was in 2010. He doesn’t see much opportunity for dividend growth or capital appreciation with this stock. His model price is $44 (the stock is $59 today). (Analysts’ price target is $69)
Technically the stock looks reasonable. However, at 22 times earnings it is not cheap. There had been 70,000 layoffs through the company, he says. It is a mining and infrastructure play. It is not his favorite space to invest.
Technically the stock looks reasonable. However, at 22 times earnings it is not cheap. There had been 70,000 layoffs through the company, he says. It is a mining and infrastructure play. It is not his favorite space to invest.
A very cheap stock vs. Canadian and US peers. A Canadian company that generates revenue outside Canada--he likes that. It recently broke out and he thinks will continue to make new highs, easily to $70. Their oil and gas business is a tailwind. (Analysts' price target: $69.96)
A very cheap stock vs. Canadian and US peers. A Canadian company that generates revenue outside Canada--he likes that. It recently broke out and he thinks will continue to make new highs, easily to $70. Their oil and gas business is a tailwind. (Analysts' price target: $69.96)
The infrastructure space has been a little disappointing, but SNC has made a good move. Now, SNC is hitting technical levels (limits) now. A good hold for the long term as global infrastructure spending increases.
The infrastructure space has been a little disappointing, but SNC has made a good move. Now, SNC is hitting technical levels (limits) now. A good hold for the long term as global infrastructure spending increases.
The company has come through the investigations into bribery and there is increasing spending on infrastructure global. This is a global company that will benefit from that trend over the long term. He doesn’t own the stock but he can see a case for buying it.
The company has come through the investigations into bribery and there is increasing spending on infrastructure global. This is a global company that will benefit from that trend over the long term. He doesn’t own the stock but he can see a case for buying it.
They own it, bought it after the corruption scandal came up. They have new management and made some good acquisitions. But the stock still hasn’t been moving too much. Not a lot of money has come out of the governments for infrastructure spending. Thinks long term SNC is a fabulous name to own.
They own it, bought it after the corruption scandal came up. They have new management and made some good acquisitions. But the stock still hasn’t been moving too much. Not a lot of money has come out of the governments for infrastructure spending. Thinks long term SNC is a fabulous name to own.
(Past Top Pick on May 15, 2017 Up 9%) Their return for the next 12 months will be higher than 9%. They just settled with provincial governments over the 2012 bribery scandals, though still have to settle federally. Excluding their highway 407 operation, their mulitple is less than 10X earnings. This should trade in the mid-$60s ($55 today).
(Past Top Pick on May 15, 2017 Up 9%) Their return for the next 12 months will be higher than 9%. They just settled with provincial governments over the 2012 bribery scandals, though still have to settle federally. Excluding their highway 407 operation, their mulitple is less than 10X earnings. This should trade in the mid-$60s ($55 today).
Infrastructure has been slow lately. Meanwhile, we've been in a strong stock market. Wait until this breaks out above $58 before buying. Right now, this is stuck in neutral. If you have a long-term view of say 10 years, you'll do well.
Otherwise, wait for that breakout.
Infrastructure has been slow lately. Meanwhile, we've been in a strong stock market. Wait until this breaks out above $58 before buying. Right now, this is stuck in neutral. If you have a long-term view of say 10 years, you'll do well.
Otherwise, wait for that breakout.
Good backlog. Exposure on the oil and gas looks good. (Analysts’ price target is $69.73)
Good backlog. Exposure on the oil and gas looks good. (Analysts’ price target is $69.73)
Their steady growth ended a decade ago, then they got into a governance (corruption) scandal overseas. To evaluate them, look at their various operations. They own the 407, a toll highway, their crown jewel. But they also do engineering and construction, which is cyclical, and an area mired in legislative roadblocks. Not one he'd buy.
Their steady growth ended a decade ago, then they got into a governance (corruption) scandal overseas. To evaluate them, look at their various operations. They own the 407, a toll highway, their crown jewel. But they also do engineering and construction, which is cyclical, and an area mired in legislative roadblocks. Not one he'd buy.
(A Top Pick July 7/17 Up 0.4%) They were expecting a little more follow-through on the Trudeau promises to increase infrastructure spending. Although the work is happening, it has not yet paid off. He would continue to hold it.
(A Top Pick July 7/17 Up 0.4%) They were expecting a little more follow-through on the Trudeau promises to increase infrastructure spending. Although the work is happening, it has not yet paid off. He would continue to hold it.