Topic: How To Invest

What is Pat’s commentary for the week of February 25, 2020

Article Excerpt

Linamar’s shares were trading as high as $80.59 a share in November 2017. They have since fallen to $39.53—a 50.9% drop in market value. That includes the 20.1% decrease since the start of 2020. Some investors worry this downward trend will continue, mainly because the company is often viewed as simply an auto-parts supplier, overly exposed to the current slump in the automotive industry. We think this view fails to give Linamar credit for its increasingly diversified revenue stream and its commitment to innovation. The company has positioned itself to perform even in periods of economic uncertainty for the auto industry. Linamar investors benefit from several key growth drivers: The company’s rising market share in the auto parts industry Linamar’s growing presence in the high-tech agricultural-equipment segment Expanding markets for the company’s Skyjack line of aerial work platforms and its recent strategic acquisition. Both also help to ease Linamar’s dependence on the cyclical auto industry. Our Successful Investor research department has drawn…

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