FirstService Corp.
Toronto symbol FSV, operates in the real estate services market, providing services in the following areas: commercial real estate; residential property management; and property improvement.
BROADRIDGE FINANCIAL SOLUTIONS INC. $17.94, New York symbol BR, has outlined details of a recent transaction by its clearing services subsidiary, Ridge Clearing & Outsourcing, in response to last week’s downgrade of its credit rating by Standard & Poor’s. In late 2007, Ridge Clearing accepted $380 million worth of securities as collateral. That transaction increased Broadridge’s short-term debt to just $426 million, which is equal to only 17% of its current market cap of $2.5 billion. The transaction involved 143 pools of AAA-rated mortgage-backed bonds issued by the Federal National Mortgage Association. The company states “there were no exotic or illiquid mortgage-backed derivative securities in this transaction”. As well, the party who had committed to purchase these bonds is a global financial services company rated A+ by Standard & Poor’s. This party completed the transaction on January 17, 2008, and Broadridge repaid the related short-term loan....
FIRSTSERVICE CORP. $21.07 (Toronto symbol FSV; SI Rating: Extra Risk) (416-960- 9500; www.firstservice.com; Shares outstanding: 28.6 million; Market cap: $602.2 million) operates in the expanding service sector, providing services in commercial real estate, residential property management, integrated security services, and property improvement services. FirstService’s revenues rose 34% in the three months ended December 31, to $502.2 million from $374.8 million. Excluding onetime items, earnings per share rose 31.8%, to $0.29 from $0.22. Cash flow per share rose 35.3%, to $0.92 from $0.68. FirstService now trades at 5.7 times cash flow. Since November 2007, the stock has dropped from $36 to its current price along with falling markets, plus investor concerns that the U.S. subprime crisis would hurt FirstService’s revenues. However, increased foreclosures would likely boost demand for its property management services from banks and other creditors....
RESTORATION HARDWARE, $4.49, symbol RSTO on Nasdaq, agreed this week to accept a reduced $4.50 a share buyout offer from Catterton Partners, a leading U.S. private equity firm. Restoration had previously accepted a $6.70 a share buyout offer from Catterton. Restoration accepted the lower offer after falling housing markets and a weakening U.S. economy hurt its sales. Catterton is also providing Restoration with a $25 million loan for working capital. Restoration Hardware is a U.S. specialty retailer of high-quality home furnishings. Over the nine-week holiday season ended January 5, 2008, its sales fell 1% from a year earlier. Restoration Hardware is still a hold....
FIRSTSERVICE CORP. $33.56 (Toronto symbol FSV; SI Rating: Extra Risk) (416-960-9500; www.firstservice.com; Shares outstanding: 28.6 million; Market cap: $958.8 million) operates in the rapidly growing service sector, providing services in the following areas: commercial real estate; residential property management; integrated security services; and property improvement services. The company continues to expand profitably through acquisitions and internal growth. Both avenues still offer lots of potential for expansion in the fragmented service sector. Firstservice reports 28.8% higher revenues in its first quarter ended June 30, 2007, to $419.3 million from $325.5 million a year earlier. (All figures except share price in U.S. dollars.) Earnings per share rose 29.8%, to $0.61 from $0.47....
IVY ENTERPRISE FUND $4.85 invests in smaller and medium-sized companies. The $201.4 million fund has an MER of 2.42%. The fund’s overall choice of stocks doesn’t inspire our confidence. Its top holdings are Richie Brothers Auctioneers, National Instruments, Resources Connection, Idexx Laboratories, Astral Media, Canadian Western Bank, FirstService Corp., Henry Schein and Stratasys Inc. We think investors can do better by buying some of the other small-cap funds we recommend in Canadian Wealth Advisor....
At one time, mutual funds within a particular ‘fund family’ often shared some key investment characteristic, such as a conservative or aggressive investment approach, or a stress on value as opposed to growth. However, due to trends in the mutual-funds industry such as corporate mergers and takeovers, and more aggressive marketing, a fund’s membership in a fund family now has little bearing on its investment approach or appeal as an investment. Below, for instance, we analyse five funds from the Ivy Group. (Note that Ivy is now part of Mackenzie Financial, which in turn is part of IGM Financial. The contact information listed for Ivy Growth and Income also applies to the other four.)...
FIRSTSERVICE CORP. $29.58 (Toronto symbol FSV; SI Rating: Extra Risk) (416-960- 9500; www.firstservice.com; Shares outstanding: 28.6 million; Market cap: $846.0 million) reports 26.3% higher revenues in its third quarter ended December 31, 2006, to $374.8 million from $296.7 million a year earlier. (All figures except share price in U.S. dollars.) Earnings per share rose 30.4%, to $0.30 from $0.23. FirstService now expects earnings in the fiscal year ending March 31, 2007 in the range of $1.27 to $1.32 U.S. a share. That’s a price/earnings ratio of less than 20.0. FirstService operates in the rapidly growing service sector, providing services in the following areas: commercial real estate; residential property management; integrated security services; and property improvement services. It continues to expand profitably through acquisitions and internal growth. Both avenues still offer lots of potential for expansion in the fragmented service sector....