Risk

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What would you consider the risk out of 10, with 10, being the highest score, would be for ATD, EQB and TOI???….thanks Tom

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Asked on June 17, 2024 9:56 am
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ATD - 3
EQB - 5
TOI - 7

ATD, established moat with strong cash flow generation. Global reach in a fragmented market. Lots of runway for growth but even if growth falters a bit it still has established itself to the point where it should remain a relatively steady cash flow generator.

EQB, deposit heavy challenger bank. It doesn't have a diversified enough portfolio to warrant the valuations of some of the major institutions but it's getting up there. Its loan portfolio is a bit higher risk and if growth slows it could face some volatility. I believe in this one, it's my largest bank holding, but I also do acknowledge the risks are greater than say something like Royal or National.

TOI, likely the largest risk of the 3 on this list. Acquisition heavy, high valuation technology company. If it can follow in Constellations footsteps it's in very good shape, but acquisition based growth companies to bring with them an added human element. Management missteps can stunt growth and impact value.

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Posted by Dan Kent
Answered on June 18, 2024 8:09 am