Q: Given the current Political/Fiscal/Demographic environment, I want to deploy funds to services that cater to seniors. The caveats are: 1) Taxable Account; 2) Cdn. $s; 3) To hold for 5+ years; and 4) Dividends of both seem reasonable, but are future prospects comparable, given relative financial strength and current governance? Thank you for your support and the questions from my fellow subscribers with your responses. Bill
5i Research Answer:
EXE is $1.1B market cap, up 20% YTD and up 83% in a year. Dividend is 3.94% and was raised marginally in March. But it was unchanged for 10 years. P/E is 15X. The balance sheet is OK, and about 10% earnings growth is expected next year.
SIA is $1.7B, up 20% YTD and up 35% in a year. Yield is 5.0%, and the dividend has not been raised since July 2019. P/E is 28X. The balance sheet is much more leveraged. Decent growth (15%+) is expected this year, dropping to about 5% next year.
We would side with EXE. Though it has gone through some rough times in the early 2000s, it has outperformed SIA nicely over the recent 10 years, and is cheaper. Yes, the yield is lower but we would consider total return here.