Q: Why the large drop on share value today? Is this a good entry point or wait and see if further drops are around the corner?
5i Research Answer:
GFL has made a large acquisition of SES with a value of $6.4B. Since 80% of the transaction is for stock, GFL shareholders have sold on dilution fears. We think the deal itself makes sense, but it is large and there is integration risks. But past deals have worked and we would not really expect issues here. But the stock will likely stay volatile while investors digest this news. We would be OK waiting before adding.