Scotiabank maintained the Outperform rating on Interfor Corporation(IFP:TSX)

STA Research
by: STA Research

Scotiabank maintained the Outperform rating and $42 target on Interfor Corporation.

Our view of the stock is Bullish with a score of 7.5 out of 10, where 0 is very bearish and 10 very bullish.

What to like:

Underpriced compared to earnings The stock is trading low compared to its peers on a price to earning basis and is in the top quartile. It may be underpriced but do check its financial performance to make sure there is no specific reason. Underpriced on cashflow basis The stock is trading low compared to its peers on a price to cash flow basis and is in the top quartile. It may be underpriced but do check its financial performance to make sure there is no specific reason. Superior return on equity The company management has delivered better return on equity in the most recent 4 quarters then its peers, placing it in the top quartile. Superior capital utilization The company management has delivered better return on invested capital in the most recent 4 quarters than its peers, placing it in the top quartile. Superior return on assets The company management has delivered better return on assets in the most recent 4 quarters than its peers, placing it in the top quartile. Positive cash flow The company had positive total cash flow in the most recent four quarters. Positive free cash flow The company had positive total free cash flow in the most recent four quarters. Underpriced on free cash flow basis The stock is trading low compared to its peers on a price to free cash flow basis and is in the top quartile. It may be underpriced but do check its financial performance to make sure there is no specific reason. Superior Earnings Growth This stock has shown top quartile earnings growth in the previous 5 years compared to its sector.

What to not like:

High volatility The total returns for this company are volatile and above median for its sector over the past 5 years. Make sure you have the risk tolerance for investing in such stock. Overpriced compared to book value The stock is trading high compared to its peers median on a price to book value basis. Highly leveraged The company is in the bottom half compared to its sector peers on debt to equity and is highly leveraged. However, do check the news and look at its sector and management statements. Sometimes this is high because the company is trying to grow aggressively.

 

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