# GSY



## Pluto (Sep 12, 2013)

I have over 80% of my $ in conservative dividend payers and the rest is for some growth stocks. To that end I have been nibbling on GSY after it came down about 30%. It is forming a really nice cup pattern. 

This buying is contrary to Jessie Livermore who apparently said, "I never buy cheap". He bought when stocks broke out into new highs. I gues my buying here is in line with Templeton who advised to buy during times of pessimism. 

Apparently, GSY started its stock price consolodation when Home Capital ran into trouble. To me GSY looked due for a consolodation anyway, but the Home Capital thing exacerbated it. 

The plan is to do a Templeton- Livermore hybrid strategy. Buy some now, and then, in the event of a breakout to new highs, buy more. 

For those who are looking to add some jet fuel to your portfolio, have a look at GSY.T


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## gardner (Feb 13, 2014)

At 380M market cap, they are pretty small for my liking. They seem to be mainly focused on non-prime consumer debt. I feel like I have plenty of exposure to that already in my big bank holdings, through their credit card businesses.


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## Pluto (Sep 12, 2013)

yes its market cap is relativly small, but I'm used to that for a trade. Small cap, high growth, fairly low p/e, insider buying...it adds up to the odds being in my favour....

However, not trying to talk anyone into it if it doesn't suit them. Just yakking.


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## doctrine (Sep 30, 2011)

I've owned shares a few times, I bought back in 2015 when it dropped to $15-16 then sold late 2016 when it rose to $24-25. I'm back in over the last few months due to the pullback but also their ever-continuing growth and now expansion into QC. Q2 indicated growth was well on track. They have the best problem of all to solve in the next few Q's, namely where to find more money to lend, because their business is booming. I would have a target of $35-40 in a year.


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## CPA Candidate (Dec 15, 2013)

I've owned the stock since 2013 and would not hesitate to buy it here. Adjusting for dividends I've received, my share cost is around $10.

During that four year period the market's valuation of the stock has been all over the place despite results that continually get better, indicating that the market for the stock isn't particularly intelligent or efficient (retailers and trend followers), which makes for greater opportunities. 

I'm the opposite of a momentum investor, I sell strength and buy weakness. My last purchase of GSY was about a year ago around $16. I last sold in April at $36.


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## Pluto (Sep 12, 2013)

CPA Candidate said:


> I
> 
> I sell strength and buy weakness. .


very respectable strategy.


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## MrsPartridge (May 15, 2016)

I like the business model. They provide loans to people who don't qualify for bank loans but they're not those Cash Stores that charge crazy interest (Vig?). I have some and hope to score some good money.


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## Pluto (Sep 12, 2013)

GSY is really delivering. Up about 88% in the last year.


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## Pluto (Sep 12, 2013)

Just a note to those who may have considered GSY: today it is breaking out of its flat base to all time highs. Would be buyers should buy close within a few % of the top of the base, 53.70.


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## lonewolf :) (Sep 13, 2016)

Pluto said:


> This buying is contrary to Jessie Livermore who apparently said, "I never buy cheap". He bought when stocks broke out into new highs. I gues my buying here is in line with Templeton who advised to buy during times of pessimism.


 livermore made his first million shorting the 1907 crash & 100 million shorting the 1929 crash. He had death threats after the 1929 as some blamed him for the crash


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## Pluto (Sep 12, 2013)

^
Apparently that's true. 

My latest buy of GSY is more in line with the livermore strategy.


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## doctrine (Sep 30, 2011)

Just keep in mind, GSY is growing its portfolio of loans far faster than its revenue or earnings, because its moving into less risky loans. While that is good, don't get too carried away on valuation - there are arguably less risky lenders who trade on lower valuations. But if the momentum trade has a hold on this, then the sky is the limit as valuation is not a concern.


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## lonewolf :) (Sep 13, 2016)

Pluto said:


> ^
> Apparently that's true.
> 
> My latest buy of GSY is more in line with the livermore strategy.


Livermore would never spend time on this forum instead he would isolate himself from others so his thinking would not be bent. Livermore was smart enough to understand the mood of the masses could bend the thinking of even the most advance of intellect.


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## Pluto (Sep 12, 2013)

^
LOL. Good point. I don't plan on ending like he did, so I don't mind getting bent by the masses a little bit.


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## Pluto (Sep 12, 2013)

new EPS report. EPS up 54%. Wow. My dreams are coming true.


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## Pluto (Sep 12, 2013)

Up 8.8% today. Holy smoke. Value investing is alive.


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## doctrine (Sep 30, 2011)

I would say GSY is more growth than value. GSY trades at a premium to most of the financial companies in Canada, including most if not all of the big banks and insurance companies. It was more value when it was at $25-30 and looked like a forward P/E of 7-8 and has now gone from a 20% discount to 20% premium. But a good story and not a lot of competition with momentum in their space.


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## Pluto (Sep 12, 2013)

I see. Well I was wondering about that in terms of value. I guess I was thinking that the growth rate has been aproximately 2x's the p/e in recent years. So on a p/e/g basis it is undervalued. I suspect the peg of its peers is higher, possibly making them overvalued. I have puzzeled over "what is value" for some time and can't say that I have a definitive answer.


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## MrBlackhill (Jun 10, 2020)

We may see a jump tomorrow. EPS jumped from 1.26 on August 2019 to 1.89 this August 2020, which is +50% and easily beating the forecast of 1.35. This stock has a high beta, so I guess this could get them pretty quickly to their pre-COVID level. We'll see. I'm currently up +67% for my first buy in mid-April et up +12% from my second buy in June which then lagged through all the month.


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## doctrine (Sep 30, 2011)

I bought shares towards the end of April at $36.50. I am up a similar amount to you (+77%), although just with the single buy. Very good results. And after an expected slowdown in Q2, they are back in growth mode and their loan book should be back at record levels perhaps even by now at mid-August/mid-Q3. They also bought back $20M worth of shares in the quarter. 

GSY is killing it, no doubt. Their loan losses dropped 35% in a time when banks are increasing their loan losses by 100%. Just awesome.


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## MrBlackhill (Jun 10, 2020)

There you go, +15% as of 10 AM. We'll see if there will be profit taking or if it's going to thrive more. With a forward P/E around 10, I think it should keep around that new level, at least at +10%, maybe.


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## birdman (Feb 12, 2013)

MrsPartridge said:


> I like the business model. They provide loans to people who don't qualify for bank loans but they're not those Cash Stores that charge crazy interest (Vig?). I have some and hope to score some good money.


Rates start at 19.99% for Easyfinancial and 29.99% for Easyhome which I interpret as "Crazy Interest". There could be fees in addition to the interest. I realize these rates are somewhat similar to CC companies its not for me as I just can't support businesses charging usurious rates.


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## Pluto (Sep 12, 2013)




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## Pluto (Sep 12, 2013)

^
FastGraphs has the growth rate at 25%. wow.

Wouldn't surprise me it the pe expands, maybe to 15.


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## doctrine (Sep 30, 2011)

frase said:


> Rates start at 19.99% for Easyfinancial and 29.99% for Easyhome which I interpret as "Crazy Interest". There could be fees in addition to the interest. I realize these rates are somewhat similar to CC companies its not for me as I just can't support businesses charging usurious rates.


The rates are high, but they are well within legal limits, and you also have to note that 13-15% of their customers will never pay the money back. What is a good interest rate for a default rate of 13-15%? It certainly can't be 15%, you wouldn't make any money. Is the solution therefore not to offer a product, or just have governments subsidize the business and absorb the losses? Because we all know that lack of options drives people into the grey and black markets for sources of money, often with far higher interest rates and virtually no scrutiny. GSY is a legit publicly traded company, and those 85-90% of the customers who pay back their loans get good credit and can move on to lower interest loans, some of which GSY will provide themselves now for better credit profiles.

To each their own, but I'm happy to invest. Although sometimes I trade out of GSY, it's been my most reliable investment in market corrections as it always bounces back. I had 900 shares back in 2016 at $16.52, and sold after holding for just 3 months at $23 for a 40% gain. Now holding about 550 shares at $36.50 and sitting on ~90% total return over 3.5 months.


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