Q: Apples and oranges I realize, but who do you prefer at this point in time, and why--ECN or WELL?
5i Research Answer:
We like both names; both are down quite significantly from their highs and are poised for recovery as interest rates peak, and the macro environment becomes easier to operate, and for small cap investors we are comfortable holding both. However, if we HAVE TO pick one, we would side with WELL, as we are more comfortable with WELL’s growth prospects going forward as they execute on their acquisition playbook. Its business is less-sensitive to the econom and interest rates, management has done a solid job, and quarterly numbers have been better than expectations (unlike ECN recently).