North American Construction Group (NOA-T)

Stockchase Research Editor: Michael O'Reilly

Trading at 11x earnings and 2.3x book, we again reiterate NOA as a TOP PICK.  The company recently announced a $395 million acquisition in Australia that will expand their presence there further.  We recommend trailing up the stop (from $25) to $26 at this time, looking to achieve $40 -- upside potential over 35%.  Yield 1.2%  

(Analysts’ price target is $40.40)

Stockchase Research Editor: Michael O'Reilly

NOA is reiterated as a TOP PICK following its recent announcement to acquire an Australian heavy equipment services company.  This will greatly expand their market reach.  It currently trades at 13x earnings and supports a 26% ROE.  Cash reserves are growing, while debt is retired and shares bought back.  We recommend trailing up the stop (from $23) to $25, looking to achieve $40 -- upside potential of 19%.  Yield 1.0%

(Analysts’ price target is $40.40)

(A Top Pick Jun 29/23, Up 50.9%)Stockchase Research Editor: Michael O'Reilly

Our PAST TOP PICK with NOA has achieved its $30 target.  To remain disciplined, we recommend covering half the position at this time and maintaining the stop at $23.

Stockchase Research Editor: Michael O'Reilly

We reiterate NOA, one of Canada's largest heavy construction and mining contractors as a TOP PICK.   The company recently reported record revenue on wholly-owned business, as oil sands activity improved and operating margins widened.  We like that cash reserves are growing, while debt is retired and shares bought back.  It trades at 10x earnings and 2x book, while supporting a 24% ROE.  We continue to recommend a stop-loss at $23, looking to achieve $30 -- upside potential of 18%.  Yield 1.3% 

(Analysts’ price target is $30.17)

(A Top Pick Feb 09/23, Up 23%)Stockchase Research Editor: Michael O'Reilly

Our PAST TOP PICK with NOA is progressing well.  We recommend trailing up the stop to $23 at this time. 

(A Top Pick Feb 09/23, Up 40.4%)Stockchase Research Editor: Michael O’Reilly

Our PAST TOP PICK with NOA has achieved its target at $24.  To remain disciplined, we recommend covering half the position at this time and trailing up the stop (from $16) to $20. 

Stockchase Research Editor: Michael O'Reilly

We again reiterate NOA as a TOP PICK.  Management reports the company is experiencing "less skilled trade vacancies and improved equipment utilization" as it emerges from the effects of the pandemic.  It trades under 2x book value and supports a 20% ROE.  The dividend is backed by a payout ratio under 20% of cash flow.  We like that cash reserves have been growing, while debt is aggressively retired and shares are bought back.  We recommend trailing up the stop (from $14) to $16, looking to achieve $24 -- upside potential of 16%.  Yield    %

(Analysts’ price target is $23.79)

(A Top Pick Nov 03/22, Up 6.8%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with NOA is progressing well. To remain disciplined, we recommend trailing up the stop to $14 at this time.

Stockchase Research Editor: Michael O'Reilly We reiterate this supplier of heavy equipment maintenance and services as a TOP PICK. It has weathered issues during the pandemic with staffing and the effects of rising costs to post record highs in revenue and earnings. Cash reserves continue to grow. It trades at 11x earnings and 1.7x book. Its dividend is backed by a payout ratio under 20% of cash flow. We continue to recommend placing a stop-loss at $12.00, looking to achieve $23.00 -- upside potential over 35%. Yield 1.9% (Analysts’ price target is $23.44)

Stockchase Research Editor: Michael O'Reilly This supplier of heavy equipment maintenance and service has had issues during the pandemic with staffing, but has been able to weather the effects of rising costs and still generate positive free cash flow. It trades at 10x earnings, 1.5x book, and supports a ROE of 18%. It pays a small dividend backed by a payout ratio under 20% of cash flow. We recommend placing a stop-loss at $12.00, looking to achieve $23.00 -- upside potential over 45%. Yield 2.1% (Analysts’ price target is $23.25)

(A Top Pick Feb 17/22, Down 7%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with NOA has triggered its stop at $18.50. To remain disciplined, we recommend covering the position at this time. This will result in a net investment loss of 6%, when combined with the previous buy recommendation.

Stockchase Research Editor: Michael O'Reilly Reporting Q4 net income up 53% over the year, we again reiterate NOA as a TOP PICK. Support work at the Fort Hills and Kearl mines is doing well along with benefits from the recent Australian component supplier acquisition. It trades at 14x earnings compared to peers at 17x. We like how cash flow is increasing while they pay down debt. It trades just over 2x book and pays a small dividend backed by a payout ratio under 15% of cash flow. Management announced the dividend will double to $0.32 per annum. We recommend trailing the stop up (from $15.00) to $18.50, looking to achieve $25.50 -- upside potential over 24%. Yield 0.84% (Analysts’ price target is $25.13)