Chemtrade is the better buy right now

Article Excerpt

CHEMTRADE LOGISTICS INCOME FUND $15.33 (Toronto symbol CHE.UN; TSINetwork Rating: Speculative) (416-496-5856; www.chemtradelogistics.com; Units outstanding: 92.6 million; Market cap: $1.4 billion; Dividend yield: 7.8%) is one of the largest removal-service providers for resource firms that create acids and sulphur as byproducts. The trust converts (and sells) these substances into useful chemicals such as sulphuric acid. Many of its removal contracts are with oil refineries and base-metal processors. In the quarter ended December 31, 2017, Chemtrade’s revenue jumped 53.6%, to $386.7 million from $251.7 million a year earlier. The gain is due to its acquisition of Canexus. Cash flow rose 33.8%, to $41.4 million from $31.0 million. Cash flow per share was unchanged at $0.45, on more shares outstanding due to the Canexus purchase. The higher cash flow came despite a number of one-time items. Among them is a temporary plant shutdown at the company’s Sulphur Products & Performance Chemicals business. It was the result of Hurricane Harvey. Chemtrade also had to deal with operational issues at its…