New businesses enhance their prospects

Article Excerpt

The shares of Finning and Toromont have moved down lately in response to lower commodity prices. However, recent acquisitions put both companies in a strong position to expand their earnings when commodity prices rebound. FINNING INTERNATIONAL INC. $25 (Toronto symbol FTT; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 168.2 million; Market cap: $4.2 billion; Price-to-sales ratio: 0.6; Dividend yield: 3.2%; TSINetwork Rating: Above Average; sells and services Caterpillar-brand heavy equipment in Western Canada, South America and the U.K. Finning recently agreed to pay $260 million for 4Refuel. The privately held firm operates a fleet of more than 200 tanker trucks that provide on-site re-fuelling services to 3,400 companies in the construction, transportation, oil and gas, and power generation industries. About half of its clients are in Western Canada. Meantime, strong demand for new equipment and maintenance services across the country increased Finning’s revenue in the third quarter of 2018 by 14.1%, to $1.76 billion from $1.54 billion a year earlier. Thanks to the…

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