WAJAX CORP. $32.54 - Toronto symbol WJX

WAJAX CORP. $32.54 (Toronto symbol WJX; TSINetwork Rating: Extra Risk) (905-212- 3300; www.wajax.ca; Shares outstanding:16.7 million; Market cap: $528.7 million; Dividend yield: 7.4%) sells and services cranes, forklifts and other heavy equipment. It also sells related parts (such as bearings, motors, hoses and fittings) and power systems (including diesel engines and transmissions).

In the quarter ended March 31, 2013, Wajax’s revenue fell 6.1%, to $336.3 million from $358.1 million a year earlier. Earnings per share fell 39.8%, to $0.62 from $1.03.

The declines mostly came from reduced activity in the western Canadian oil and gas industry, which hurt results at Wajax’s power systems business. Lower mining equipment sales more than offset strength in the forestry and construction markets.

The company needs a recovery in western Canadian oil and gas drilling to restore its revenue and earnings growth, but its longterm outlook is positive. Meanwhile, Wajax has lowered its monthly dividend by 25.9%, to $0.20 from $0.27. It’s making the cut to conserve cash until its markets rebound. The shares still yield a high 7.4%.

Wajax is still a buy.

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