Topic: How To Invest

The Successful Investor Hotline – Friday, June 12, 2020

Article Excerpt

TRANSCONTINENTAL INC., $14.45, Toronto symbol TCL.A, is a buy for aggressive investors. The company is Canada’s leading commercial printer. It also makes plastic packaging for consumer and industrial products. Transcontinental’s overall revenue in its fiscal 2020 second quarter, ended April 26, 2020, fell 18.5%, to $625.1 million from $767.4 million a year earlier. Even so, that beat the consensus forecast of $607.9 million. The lower revenues are mainly because the company sold some of its smaller operations, including a paper packaging business and parts of its media division. The COVID-19 pandemic also hurt demand for printed advertising flyers. In response, Transcontinental has to temporarily close some plants and lay off 1,600 employees. However, it has since recalled 600 of those workers. If you exclude unusual items, earnings per share fell 16.7%, to $0.50 from $0.60. That also beat the consensus estimate of $0.36. Printing volumes will likely remain depressed as the economy re-opens given the number of businesses likely to reduce their advertising costs. However,…