Wednesday, October 3, 2007

Investing Based on Demographics - CLC.UN

I'm still on vacation but managed to get connected with a 28.0 kbps modem (very very slow)...and for those of you that live in Canada have a great Thanksgiving.

CML Health Care (CLC.UN)

“Provides laboratory testing services in Ontario and medical imaging services in five provinces across Canada through wholly owned CML Healthcare Inc.”

Dividend Yield: 6.4%
ROE: 19.91%
PE: 14.6X
Estimated 2007 PE: 13.3X
Estimated 2008 PE: 12.85X
TDNewcrest: Hold, $15.65 target

THESIS: This one is easy, CLC.UN makes money whenever a medical test is sent to the lab. As the population ages more tests are done. CLC.UN is a virtually recession proof company, in an industry with high barriers to entry and rock solid cash flows that I definitely plan on adding to my portfolio in the future. This is another case where I love the company but don’t like the price. The only disadvantage I see with owning CLC.UN (other than valuation)is that many of their prices are regulated but the government which means they lose their pricing power for some tests.

3 comments:

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QUALITY STOCKS UNDER 5 DOLLARS said...

Makes sense to me.

Eugene Short said...

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