Author Topic: Canada's Great Companies  (Read 3433 times)

mranski

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Re: Canada's Great Companies
« Reply #10 on: April 30, 2020, 10:58:03 AM »
Good list, thanks. There was a Jan 20/2018 post by shalab Titled Great Canada based companies which had some discussion also.


KCLarkin

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Re: Canada's Great Companies
« Reply #11 on: April 30, 2020, 12:51:11 PM »
KEG-UN.TO. Although it's real murky what the future holds for the restaurant business.

Strong aversion to income trusts. The restaurant trusts (AW, BP, pizza pizza) are interesting but I didnít see anything good enough to overcome my aversion. Would rather just own QSR.

For those interested in income, a separate list of REITs, income trusts, utilities, and pipelines would be interesting. But not my area of expertise.



beerbaron

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Re: Canada's Great Companies
« Reply #12 on: May 03, 2020, 07:25:10 PM »
Richelieu Hardware fits my list of great companies.

BeerBaron

Cigarbutt

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Re: Canada's Great Companies
« Reply #13 on: May 03, 2020, 08:30:40 PM »
Richelieu Hardware fits my list of great companies.
BeerBaron
Not much being said here about RCH although it was included in the list above.
In October 2009, you had mentioned:
I own Richelieu as well I think it has even more value then what people think. The management is great and has proved that it is focused and risk averse. It is determined to add new SKUs every year, they have 55 000 SKUs right now. I see that as their moat, no other supplier could come up with 55 000 SKUs in a short period and not being a drag on inventories and operations. They can just buy other distributors for their client base, implement their software and increase the returns almost immediately with all the new SKUs added. The bonus...as said in the last conference call, they can change their pricing overnight (except with special accounts). At one point RCH represented 25% of my portfolio, I would not sell those shares for a short term profit, this is no cigar butts.
Same old story but now they have 110k SKUs and have doubled their sales. It is reasonable to expect doubling of sales within the next 10 years (US expansion) and a significant variable in the equation is the price that the market will offer when they use free cash flow to buy back shares. Another consideration is the CEO who may be difficult to replicate.

KCLarkin

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Re: Canada's Great Companies
« Reply #14 on: May 04, 2020, 08:45:29 AM »
Richelieu Hardware fits my list of great companies.
BeerBaron
Not much being said here about RCH although it was included in the list above.
In October 2009, you had mentioned:
I own Richelieu as well I think it has even more value then what people think. The management is great and has proved that it is focused and risk averse. It is determined to add new SKUs every year, they have 55 000 SKUs right now. I see that as their moat, no other supplier could come up with 55 000 SKUs in a short period and not being a drag on inventories and operations. They can just buy other distributors for their client base, implement their software and increase the returns almost immediately with all the new SKUs added. The bonus...as said in the last conference call, they can change their pricing overnight (except with special accounts). At one point RCH represented 25% of my portfolio, I would not sell those shares for a short term profit, this is no cigar butts.
Same old story but now they have 110k SKUs and have doubled their sales. It is reasonable to expect doubling of sales within the next 10 years (US expansion) and a significant variable in the equation is the price that the market will offer when they use free cash flow to buy back shares. Another consideration is the CEO who may be difficult to replicate.

Thanks for the summary! I'm not too familiar with RCH. Maybe door knobs are too boring? This does look a very good business (I like boring).

beerbaron

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Re: Canada's Great Companies
« Reply #15 on: May 04, 2020, 05:50:14 PM »
Richelieu Hardware fits my list of great companies.
BeerBaron
Not much being said here about RCH although it was included in the list above.
In October 2009, you had mentioned:
I own Richelieu as well I think it has even more value then what people think. The management is great and has proved that it is focused and risk averse. It is determined to add new SKUs every year, they have 55 000 SKUs right now. I see that as their moat, no other supplier could come up with 55 000 SKUs in a short period and not being a drag on inventories and operations. They can just buy other distributors for their client base, implement their software and increase the returns almost immediately with all the new SKUs added. The bonus...as said in the last conference call, they can change their pricing overnight (except with special accounts). At one point RCH represented 25% of my portfolio, I would not sell those shares for a short term profit, this is no cigar butts.
Same old story but now they have 110k SKUs and have doubled their sales. It is reasonable to expect doubling of sales within the next 10 years (US expansion) and a significant variable in the equation is the price that the market will offer when they use free cash flow to buy back shares. Another consideration is the CEO who may be difficult to replicate.

Well, I never tough someone would quote me from 2009! Not sure how you manage to find that one in memory lane but my theory did not change on this one, although it did not perform like a rocket, it's been a steady train going in the same direction. I sleep well with that one.

BeerBaron

KCLarkin

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Re: Canada's Great Companies
« Reply #16 on: May 05, 2020, 08:37:23 AM »
MTY results less bad than I expected. They are hoping to be cash flow neutral by Q3. I haven't looked at debt covenants yet, but this might be worth a speculative bet. Still down 66% from 52 week high.

samwise

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Re: Canada's Great Companies
« Reply #17 on: May 11, 2020, 11:28:17 AM »
MTY results less bad than I expected. They are hoping to be cash flow neutral by Q3. I haven't looked at debt covenants yet, but this might be worth a speculative bet. Still down 66% from 52 week high.

Do you like the business though? I thought it was better when they focused on food courts in Canada, with no leverage. If you owned half the food court, you had a monopoly, almost. Now they sell pizza in US street side stores. Not the same business.

KCLarkin

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Re: Canada's Great Companies
« Reply #18 on: May 11, 2020, 02:21:08 PM »
MTY results less bad than I expected. They are hoping to be cash flow neutral by Q3. I haven't looked at debt covenants yet, but this might be worth a speculative bet. Still down 66% from 52 week high.

Do you like the business though? I thought it was better when they focused on food courts in Canada, with no leverage. If you owned half the food court, you had a monopoly, almost. Now they sell pizza in US street side stores. Not the same business.

There is a thread here:
https://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/mty-mty-food-group/msg408105/#msg408105

I sold after the Kahala acquisition with similar concerns to yours (I was wrong). For me, MTY was a jockey bet and Ma has retired, so I don't follow closely anymore. Quick serve restaurants will rebound quickly. Food courts won't. I own Domino's and QSR in size, so not buying MTY.

But any stock down 66% with a track record like MTY seems like a speculative opportunity.


MarioP

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Re: Canada's Great Companies
« Reply #19 on: May 11, 2020, 06:00:14 PM »
MTY results less bad than I expected. They are hoping to be cash flow neutral by Q3. I haven't looked at debt covenants yet, but this might be worth a speculative bet. Still down 66% from 52 week high.

Do you like the business though? I thought it was better when they focused on food courts in Canada, with no leverage. If you owned half the food court, you had a monopoly, almost. Now they sell pizza in US street side stores. Not the same business.

I didnít liked it too but it is probably what save them right now.