Topic: How To Invest

The Successful Investor Hotline – Friday, September 11, 2020

Article Excerpt

TRANSCONTINENTAL INC., $16.32, 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 reported much better-than-expected quarterly earnings this week, thanks to cost savings from an acquisition and the Canada Emergency Wage Subsidy. That support was key for the company’s printing business, which was hit hard by COVID-19 shutdowns. Overall revenue in the company’s fiscal 2020 third quarter, ended July 26, 2020, fell 19.4%, to $587.4 million from $728.9 million a year earlier. That missed the consensus forecast of $593 million. The lower revenues are partly because the company sold some of its smaller operations, including a paper packaging business. The COVID-19 pandemic also hurt demand for printed advertising flyers. That forced Transcontinental to temporarily close some plants and lay off employees. However, it has since recalled about 60% of those workers. If you exclude unusual items, earnings per share jumped 30.0%, to $0.78 from $0.60. That easily…