# Park Lawn Corporation (PLC.TO)



## john.cray (Dec 7, 2016)

Hey folks,

Another company that I've been looking at recently, being pitched as recession-proof.

The thing that puzzles me is that it doesn't seem to participate in the TSX composite index
for some reason and I can't find out why.

Other questions on my mind:
* What sector would you put them in?
* Is any CMFer here holding it?

Cheers,
JC


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## OptsyEagle (Nov 29, 2009)

I don't know, it's a dying business man. lol

There are many companies that are not in the index. They just were not picked. 

My only concern with these guys is that they trade at a very high multiple of earnings. The business model is quite simple. Use high PE stock to generate capital to buy low PE businesses. It is immediately accretive to earnings right up until investors stop giving it a free ride, with the high PE. Once that happens, the growth stops, the stock craters even more and the growth story is over.

I can't say that will happen for sure but I try to stay away from "highPE acquiring lowPE" model stocks. They are always beholden to investor sentiment. Add to that, they are not the only company playing this game. There are a lot of mom and pop type acquisition out there and perhaps there is enough for all players, but I have stayed away from this one for years, for those reasons. Obviously, so far I have been wrong.

I also think that one day a Walmart or Amazon will come along and show people how you can bury or burn a body for $250 or less. At least to burn it anyways. Again, so far I have been wrong on that one as well.


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## john.cray (Dec 7, 2016)

I see being qualified as "Consumer Cyclical" on 5i's website.
It makes me wonder what is cyclical about people passing ?


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