The Investment Reporter, in its April 17, 2015, issue, says buy Hardwoods Distribution Inc., recently $12.96. The Reporter said buy three times from Sept. 13, 2013, to Oct. 17, 2014, at prices ranging from $8.30 to $10.84. Assuming an investment of $1,000 for each of the three buys, the $3,000 position would now be worth $3,991. The hardwood lumber distributor earned $14-million, or 84 cents a share, in the year ended Dec. 31, 2014, up from $13.1-million, or 79 cents a share, the year before. In 2014, Hardwoods' sales increased by 22.8 per cent while costs increased a little more, by 23.1 per cent. Even so, pretax earnings advanced by 16.3 per cent. The company's 2014 cash flow of $19.7-million fell short of covering net capital investment of $1.4-million, a $16.5-million business acquisition and dividend payments of $2.8-million. In 2015, Hardwoods expects to earn 99 cents a share, giving a reasonable forward price-to-earnings ratio of 13.1. Next year, the stock should trade at an even better P/E ratio of 11.8, based on the earnings estimate of $1.10 a share. Hardwoods remains a buy for long-term price gains and fair dividends.
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