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  5. TFII: RBC lowered target price to 153. [TFI International Inc.]
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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: RBC lowered target price to 153. Anything to be concerned about? I looked up report section and last time TFII was formally reported upon was April 2022. Can you explain why 5i feels TFII is a top pick? What are the main strengths and weaknesses going forward? What price do you see down the road and why?
A suggestion: company reports should be updated every 12 months. In TFII's case, it's 17 months and counting. I realize there are lots of questions about TFII but a report formally brings it all together. I'm sure your customers would appreciate this.
Asked on September 27, 2023
5i Research Answer:

TFII is up 26% year-to-date and 35% on a one-year basis. It pays a small yield of 0.8% and has grown its sales and earnings at a 16% and 19% five-year CAGR, respectively. TFII has reduced its debt load over the past several years and margins have expanded nicely. It generates good free cash flow, and trades at a reasonable valuation of 1.4X forward sales and 17X forward earnings. Its main strength going forward is its ability to see strong topline growth, its ability to navigate challenging environments, and strong cost controls. Some weaknesses heading forward include a tougher macro environment for transportation and increased competition. We could see TFII trading at a higher price down the line, but there may be volatility in the intermediate term.

Our latest full research report on TFII was ~18 months ago, however, we tend to at least write either a full report or flash report on each of our coverage companies every 12 months. Thus, TFII was in our February 2023 flash report.