Q: Can we get your take on the call this morning. Anything serious to be concerned about? Would you buy now?
5i Research Answer:
Cost creep and some weakness in divisions are negatives, but working capital control and cash flow are positive offsets. The call was not overly newsworthy. The company discussed how customers have a bit more inventory, so the previously expected better half of 2023 has likely been pushed out a quarter or two. Still, performance is better than peers with good operational control. M&A may pick up if weakness continues, and TFII even talked about a 'large' acquisition if prices go the right way. Nothing too worrying here; but it is a cyclical business. We would still be comfortable as buyers if an investor has a 3-year term and understands the economic sensitivity here.