Topic: How To Invest

The Successful Investor Hotline – Friday, September 20, 2019

Article Excerpt

TRANSCONTINENTAL INC., $16.05, Toronto symbol TCL.A, has agreed to sell most of its remaining speciality magazines and event-planning businesses. It has yet to say how much it will receive for those operations. The sales are part of the company’s long-term strategy to cut its exposure to businesses that rely on cyclical advertising revenues. That plan includes paying $1.7 billion for Chicago-based Coveris Americas in May 2018. To put that cost in context, Transcontinental’s current market cap (the total value of all outstanding shares) is $1.4 billion. Coveris makes plastic packaging for consumer and industrial products at 21 plants in the U.S., Canada, the U.K., Ecuador, Guatemala, Mexico, New Zealand and China. With that purchase, Transcontinental now gets over half of its revenue from packaging. The rest comes from printing newspapers, magazines, books and advertising flyers. The company’s projected earnings will likely rise from $2.46 a share in fiscal 2019 (fiscal years end October 31) to $2.55 in 2020. The stock trades a low 6.3…