Element Fleet Management

EFN-T

Analysis and Opinions about EFN-T

Signal
Opinion
Expert
COMMENT
COMMENT
July 11, 2016

Element Financial (EFN-T) or Aecon (ARE-T)? Two different things. One is a financial player and the other is involved in industrials being a construction company. This one is mostly a financial that is in the leasing business, either equipment, railcars or fleet, and they are separating into 2 companies from the fleet and equipment leasing. The issue by and large is where the economic growth is going to come from and the financial leverage the companies will have. They need to be able to lever up the company and to grow the business, and that is a challenge after having acquired a few things from GE Capital.

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Element Financial (EFN-T) or Aecon (ARE-T)? Two different things. One is a financial player and the other is involved in industrials being a construction company. This one is mostly a financial that is in the leasing business, either equipment, railcars or fleet, and they are separating into 2 companies from the fleet and equipment leasing. The issue by and large is where the economic growth is going to come from and the financial leverage the companies will have. They need to be able to lever up the company and to grow the business, and that is a challenge after having acquired a few things from GE Capital.

John Kim

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Price
$14.360
Owned
Unknown
COMMENT
COMMENT
July 5, 2016

Has a particular issue with the fleet space, and specifically railcar space. This was a very tough one to analyse. It is sort of financial engineering at its best. There is a lot of support from the street. You would have to have a strong view in an economic pick up in North America to get behind this name.

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Has a particular issue with the fleet space, and specifically railcar space. This was a very tough one to analyse. It is sort of financial engineering at its best. There is a lot of support from the street. You would have to have a strong view in an economic pick up in North America to get behind this name.

WAIT
WAIT
July 4, 2016

(Market Call Minute) Wait and see how the break up plays out.

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(Market Call Minute) Wait and see how the break up plays out.

BUY
BUY
June 29, 2016

(Market Call Minute.) The stock has come down too much and there is some good value creation that is going to be happening in the next year.

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(Market Call Minute.) The stock has come down too much and there is some good value creation that is going to be happening in the next year.

WAIT
WAIT
June 21, 2016

At today’s price, you can wait on the sidelines. Eventually when the split happens, you will get the majority in the form of a leasing company and the balance will be a spinoff, which could create some uncertainty. You will then be open to pick and choose which particular company you would like to own.

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At today’s price, you can wait on the sidelines. Eventually when the split happens, you will get the majority in the form of a leasing company and the balance will be a spinoff, which could create some uncertainty. You will then be open to pick and choose which particular company you would like to own.

BUY
BUY
June 20, 2016

If people think there is going to be a slowdown in the global economy, this impacts a company like this in a big way. This is the headwind they are facing right now. A tailwind for them has been the US$, which has kind of reversed course. They have a great asset, and you can Buy it on the cheap now if you believe that we are not going to go down to 1% or a negative GDP growth. Announced plans to split into 2 separate companies, which creates an incredible amount of value. ROE potential of their fleet asset will really shine through, and are not getting credit for that right now because of their combined entity.

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If people think there is going to be a slowdown in the global economy, this impacts a company like this in a big way. This is the headwind they are facing right now. A tailwind for them has been the US$, which has kind of reversed course. They have a great asset, and you can Buy it on the cheap now if you believe that we are not going to go down to 1% or a negative GDP growth. Announced plans to split into 2 separate companies, which creates an incredible amount of value. ROE potential of their fleet asset will really shine through, and are not getting credit for that right now because of their combined entity.

PAST TOP PICK
PAST TOP PICK
June 16, 2016

(A top Pick July 8/15. Down 23.63%.) A leasing company. Made a big acquisition of some of General Electric’s (GE-N) leasing products. They got DVR rated, so their cost of funds has come down. He can see good growth for them in the US.

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(A top Pick July 8/15. Down 23.63%.) A leasing company. Made a big acquisition of some of General Electric’s (GE-N) leasing products. They got DVR rated, so their cost of funds has come down. He can see good growth for them in the US.

PAST TOP PICK
PAST TOP PICK
June 15, 2016

(A Top Pick June 1/15. Down 22.08%.) There is a restructuring coming. The stock was $19 a year ago, and now they are doing a restructuring to get value out, and the uncertainty has created a bit of angst. When it comes, you could see mid-$20 valuation on a break up.

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(A Top Pick June 1/15. Down 22.08%.) There is a restructuring coming. The stock was $19 a year ago, and now they are doing a restructuring to get value out, and the uncertainty has created a bit of angst. When it comes, you could see mid-$20 valuation on a break up.

TOP PICK
TOP PICK
June 15, 2016

His one-year target would be $19-$20, back where it was a year ago. When they announce the end of the deal, and earnings continue to come through, he thinks it will be fine and a good stock run up into the fall. Dividend yield of 0.68%.

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His one-year target would be $19-$20, back where it was a year ago. When they announce the end of the deal, and earnings continue to come through, he thinks it will be fine and a good stock run up into the fall. Dividend yield of 0.68%.

WATCH
WATCH
May 30, 2016

It appears to be breaking the downtrend and is breaking a neckline. This consolidation around the current price, if it gets broken, looks pretty good. He is looking at it.

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It appears to be breaking the downtrend and is breaking a neckline. This consolidation around the current price, if it gets broken, looks pretty good. He is looking at it.

COMMENT
COMMENT
May 26, 2016

He knows this is well-liked on the street, but every time he looks at it, it doesn’t work for him. If you have a longer-term view and you really like the name fundamentally, it has limited downside. The chart shows it is running in a band, so you could buy it at the low end at around $12.50-$13.00. If this were a trading account for him, he would probably be taking profits.

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He knows this is well-liked on the street, but every time he looks at it, it doesn’t work for him. If you have a longer-term view and you really like the name fundamentally, it has limited downside. The chart shows it is running in a band, so you could buy it at the low end at around $12.50-$13.00. If this were a trading account for him, he would probably be taking profits.

TOP PICK
TOP PICK
May 24, 2016

Earlier this year they announced plans to separate the company into 2 entities. One is a fleet business and the other is asset management. Thinks we are on the verge of a major re-rating on the back of this split. Both businesses are high quality and will both generate high ROE’s. The company is largely undervalued on the back of this. Dividend yield of 0.65%.

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Earlier this year they announced plans to separate the company into 2 entities. One is a fleet business and the other is asset management. Thinks we are on the verge of a major re-rating on the back of this split. Both businesses are high quality and will both generate high ROE’s. The company is largely undervalued on the back of this. Dividend yield of 0.65%.

TOP PICK
TOP PICK
May 18, 2016

Likes the value they are going to unplug by splitting the company in 2. They will be a fleet business and an asset management business in September. They will disclose the pro forma numbers in August. Last quarter management guided that the fleet business will earn about $1.12, but could actually be $1.10. If you use a 15 or 16 time multiple, this is what the stock currently is at. Even if you don’t like the commercial side of the business, it is probably worth at least $3, so you can easily get to $20 and above on a valuation. After the split, they will materially increase the dividend. Dividend yield of 0.68%.

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Likes the value they are going to unplug by splitting the company in 2. They will be a fleet business and an asset management business in September. They will disclose the pro forma numbers in August. Last quarter management guided that the fleet business will earn about $1.12, but could actually be $1.10. If you use a 15 or 16 time multiple, this is what the stock currently is at. Even if you don’t like the commercial side of the business, it is probably worth at least $3, so you can easily get to $20 and above on a valuation. After the split, they will materially increase the dividend. Dividend yield of 0.68%.

HOLD
HOLD
May 17, 2016

Has owned this in the past. Watching it closely. Announced they are going to spin the company into 2 different parts. When that happens, you typically see a fair degree of shareholder value created. Once they spin out the 2 different divisions, you will probably see the sum of the parts being greater than what it is right now. Longer-term there is lots of room for them to grow the different sides of their businesses. Can see it being higher in 5 years than what it is now.

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Has owned this in the past. Watching it closely. Announced they are going to spin the company into 2 different parts. When that happens, you typically see a fair degree of shareholder value created. Once they spin out the 2 different divisions, you will probably see the sum of the parts being greater than what it is right now. Longer-term there is lots of room for them to grow the different sides of their businesses. Can see it being higher in 5 years than what it is now.

HOLD
HOLD
May 12, 2016

(Market Call Minute) He sold a lot at the end of the year. Their earnings look pretty good. They are splitting the company in two.

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(Market Call Minute) He sold a lot at the end of the year. Their earnings look pretty good. They are splitting the company in two.

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