Looking for a more stable company with the dividend. Would also get a tax loss by selling Nvei . Could you talk about the two for management, debt, and long term investment..
Which would you like in a downturn or recession if or when we get one?
Thanks
They are quite different, with EIF investing in other companies and paying out a lot of cash flow as dividends (the growth record is good). NVEI is tech/payment focused, and basically put in its dividend last year to try to appease shareholders after some horrible numbers and execution. We think both would get hit hard in a recession. EIF has some cyclical businesses, and NVEI may be vulnerable as tech/finance declines. Both have debt, each about at 6X cash flow. The debt might concern investors in a downturn. EIF is expected to grow EPS at about 10%, NVEI at a much higher rate. We would see EIF management as better, partly as they have a longer public history and have been through downturns and covid and come out fine. NVEI management has clearly 'screwed up' a few times already. EIF is smaller, and slightly more expensive on valuation. Its dividend of course is much larger. With some tax loss benefits we would be fine with a switch, if an investor wanted more stability and income as the prime goals.