Q: Hi !
Regarding your answer re PRL poor performance and fear of a recession as possible cause. Just how do you see this stock performing in a recession? Would you add/buy at this point?
Thanks!
Regarding your answer re PRL poor performance and fear of a recession as possible cause. Just how do you see this stock performing in a recession? Would you add/buy at this point?
Thanks!
5i Research Answer:
This is perhaps one of the problems, as the company has only been public since 2021, and investors have not seen how it performs in a true recession. It did make money in 2022, but technically there was no recession. If we look at peer GSY, it remained profitable in several prior recessions, BUT...it's stock still got hit very hard (down 48% in 2008). If we see a recession we doubt it will be long, and 'probably' not harsh, unless policy makers do silly things. With PRL raising its dividend in February, and its low valuation, we would be OK buying, but an 'add' only if underweight.