Q: Christmas Greetings 5i Team!
I've owned Parkland Fuel for about 10 years now, and lately the stock's done very well. With the new EV sales mandates announced by the Federal gov't, would you continue to own a company whose main business is gas stations and fuel distribution? I'm thinking most people who can afford EV's are also likely to own a single-family homes and will charge at home. Of course, there is also the possibility that these sales mandates will be scrapped with a change in gov't in two years' time. Is it best to sell now, wait to see what happens in the next election, or continue to hold long term?
Many thanks,
Brian
I've owned Parkland Fuel for about 10 years now, and lately the stock's done very well. With the new EV sales mandates announced by the Federal gov't, would you continue to own a company whose main business is gas stations and fuel distribution? I'm thinking most people who can afford EV's are also likely to own a single-family homes and will charge at home. Of course, there is also the possibility that these sales mandates will be scrapped with a change in gov't in two years' time. Is it best to sell now, wait to see what happens in the next election, or continue to hold long term?
Many thanks,
Brian
5i Research Answer:
We think this transition will take time and the details will likely change closer to the time of when/if it happens. We do think this transition over time is something to keep an eye on but with it being so far away and with PKI shares trading at only 13X forward earnings and a 3% dividend, we don't think there is a whole lot of premium being priced in here to begin with.