Q: hi,
can I get your thoughts on Alaris re recent news on partnership arrangement with Shipyard?
are you comfortable holding AD.UN right now and into the years ahead?
cheers, chris
can I get your thoughts on Alaris re recent news on partnership arrangement with Shipyard?
are you comfortable holding AD.UN right now and into the years ahead?
cheers, chris
5i Research Answer:
AD should be considered higher risk overall, with its relatively small size and private company royalty portfolio. But we would be comfortable holding it as 'part' of an income portfolio allocation. Shipyard is a marketing agency, and AD gets a 14% pre-tax yield royalty and is also buying $17M in common equity. Shipyard's business requires little capital so the new money will be mostly for growth initiatives. We would consider it a decent deal and follows the company's typical MO.