Author Topic: DLX - Deluxe Corp  (Read 309 times)

valuedontlie

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DLX - Deluxe Corp
« on: May 22, 2019, 05:04:35 AM »
This has rolled back to Dec 2018 levels and looks interesting again...

They make checks and other "declining sales" type products (~56% of sales) and offer marketing/business services (email marketing, incorporation, web design/hosting, payroll, etc.) which are growing and ~43% of sales. The company has redirected cash from the declining businesses into growing businesses over the past decade or so. Over that period, net debt is virtually unchanged while cash flow up $150m or so and share count down 15% or so. Not bad...

New CEO just joined and is pulling back on tuck-in M&A in favor of buybacks at the moment. Cash flow guide for 2019 is $260m FCF on 44m current shares = $5.90/sh with stock right around $40. Call it 7x FCF and 5x EBITDA here.

The secularly challenged checks business declined a whopping 4.5% in 2018 while the growing segment was up 11% (tuck-in M&A fueled)...