# Bird Construction (BDT.TO)



## zylon

Revenues from Q1 2011 were down from a year ago.

The price drop on Friday (June 3) looks like an opportunity to me; of course it could go lower. The day's volume of 76.5k although slightly above average, does not hint of a wash out.

At Friday's close of $11.24 the monthly dividend (0.055) yields 5.8%



> Revenues were $171 million, down from $181 million.
> 
> The company said construction revenues declined due to lower construction activity in the Alberta oilsands. It said it also saw lower gross profit margins due to high competition.
> 
> Bird Construction converted from an income trust to a corporation in January, which made it subject to different tax rules.
> Winnipeg Free Press


Bird's home page

Charts: daily / weekly

Disclosure: I own shares in BDT with average cost just under $12


----------



## al42

I have had this on my watch list foe a while now. Almost pulled the trigger yesterday @ $11.50 but didn't. When it got below 11.5 I was hoping for 11.00 but never got there. maybe Monday?

Is your average cost of below $12.00,before the 3 for 1 split?


----------



## zylon

al42 said:


> Is your average cost of below $12.00,before the 3 for 1 split?


I wish it was before the split 

No, I bought around $36 before the split, and added some yesterday to bring my average down.

These one day hits are becoming more common in many stocks and recoveries don't happen quickly if at all. To me, that's an indicator of more weakness to come this summer. However, it being the 3rd year of the US election cycle, I would be surprised to see the year end lower in US & Cdn indices. I'm buying small amounts of Cdn dividend stocks and precious metals miners.


----------



## al42

zylon said:


> I wish it was before the split
> 
> No, I bought around $36 before the split, and added some yesterday to bring my average down.
> 
> Ah, too bad it would have been a nice profit if you had. But looking back it looks like it only got to the low $14 dollar range back in 08 - 09.
> 
> I think it should be OK though, Oil should stay above the 70 - 75 dollar range for the foreseeable future. This would be important for Bird as allot of their business is coming from the oil sands and most of the projects will go ahead with strong oil prices.


----------



## daddybigbucks

Does Bird have a drip program?

Ive been wanting to get into Bird for a while as well, ill check the financials tonite to see if there are any warning flags.

took a look over the finanicials and they look ok. Im suprised how much cash they have outstanding.

They can pretty much pay off all they debt with their cash.

I think it is a great long term hold at 5%. I might try to take a position as well this week.


----------



## al42

daddybigbucks said:


> Does Bird have a drip program?
> 
> I don't think so ... I wasn't able to find anything that suggested that they did.


----------



## zylon

I think al has it right - no drip.

extensive list of DRIPs - perhaps not up to date.


----------



## gibor365

Just wondering if anyone took position in BDT?
Fundamentals are great: P/E, P/S, Payout ratio....


----------



## al42

gibor said:


> Just wondering if anyone took position in BDT?
> Fundamentals are great: P/E, P/S, Payout ratio....


Not yet, got scared after seeing what happened to Armtech.
Not the same company but seems to be the same earnings compression.

Highlights
----------
(000's except per share amounts) Three months ended March 31
2011 2010
------------ ------------
Construction Revenue $171,155 $181,626
Income before income taxes 5,792 16,903
------------ ------------
Net income and comprehensive income for the
period $4,109 $13,813
------------ ------------
Basic and diluted earnings per share $0.10 $0.33

Earnings per share amounts reflect the stock split effective in April
2011

- Construction revenue declined by 5.8% to $171.2 million in 2011
compared to 2010, primarily due to lower construction activity in the
Alberta oil sands.
- Income before taxes of $5.8 million was $11.1 million lower in 2011
than 2010, reflecting the impact of lower gross profit margins
resulting from the continuation of a very competitive market
associated with recent economic conditions.
- Net income of $4.1 million in 2011 was $9.7 million lower than 2010,
resulting from lower construction margins and the impact of Bird's
income being fully subject to income tax in 2011.
- Backlog remains robust at $1,071.4 million at March 31, 2011.


----------



## Eder

There's a lot of risk in construction/engineering stocks compared to other industries. They scare me to death.


----------



## daddybigbucks

i started a small position this week.
Ill buy again if it drops 10%.

I predict oil sands construction should be high for the next couple years, so i feel it is a safe bet.


----------



## zylon

*Bird Construction to Acquire H.J. O'Connell*

July 20, 2011


> Bird Construction Inc. ("Bird") (TSX: BDT) today announced that it has signed an agreement to acquire all of the outstanding shares of H.J. O'Connell, Limited ("H.J. O'Connell"). The purchase price for the acquisition will be approximately $77.5 million. ~newswire.ca


At current price of $12 
the monthly $0.055 dividend yields 5.5%

BDT chart (weekly)


----------



## FrugalTrader

CDZ, the dividend achievers ETF, also holds BDT which means that it's a company that has a history of increasing their dividends.


----------



## zylon

> *Bird Construction Inc. Announces Termination of Oil Sands Contract*
> 
> LISTING: TORONTO STOCK EXCHANGE
> SYMBOL: BDT
> 
> TORONTO, Jan. 24, 2013 /CNW/ - Bird Construction Inc. announced today that it has received a contract termination notice for convenience from an oil sands client. The amount of work remaining on the contract will be removed from Bird's backlog when our fourth quarter results are released.
> 
> http://tmx.quotemedia.com/quote.php?qm_symbol=BDT


I wonder; a sign of things to come in Alberta if pipelines aren't built?


----------



## Barwelle

Seems like everybody is gearing up for a big year, I'm surprised... who knows though.

There is another storm cloud on the Albertan horizon: A large shale oil deposit was discovered Down Under. http://www.cbc.ca/news/business/story/2013/01/24/business-australia-shale-oil.html

It will be a long time before they're up and running, but it's something to be aware of. Look at how fracking has brought down NG prices and companies.


----------



## humble_pie

i don't know bird at all but i'm presently a fan of heavy infrastructure engineering. I was lucky enough to buy SNC in the high 37 range soon after the scandal broke. Loosely, i follow snc, genivar & jacobs engineering of the US.

barwelle u have expert knowledge in this sector, i believe ? i certainly appreciate hearing your views ...


----------



## Barwelle

We're not really a competitor to Bird, and not in all the same sectors - mostly just light industrial. Small company. Our subtrades have been warning us to book now because they are filling up fast. We could do fine ourselves with what we have on the table already for this year, and we are pricing out more work, and hiring... should be a year for growth.

They are a fairly big company, seem to have a good name in the industry (at least, I haven't heard horrible things about them like I have with others), and they seem to be well diversified. 

Labour shortages will be a problem in Alberta, of course, if things really get going. And one of their competitors got a leg-up last year... The owners of the well-regarded Clark Builders sold 51% to Turner Construction, a huge American company. As I understand, the main advantage for Clark is that they can now finance much larger projects... compete more with the likes of PCL, Bird, Kiewit...

This is my novice opinion (I haven't done research and don't have insider info)... they might have some issues filling in the gaps and rearranging the work they have (because it sounds like it was a big contract), and they have competition, but there is work to go around in Alberta so I don't think it'll affect them in the long term. Just from looking at the chart, I want to buy some at around $13, similar to you SNC move, buy on the bad news... Should probably actually do some research though.

What do you think?


----------



## riseofamillionaire

Anyone have any details on how big the contract is? Nothing mentioned in the press release.

I own with around a $12 average price. They have the best balance sheet among peers, good backlog of projects, in a hot part of the country and growth through acquistions. Also own SNC on a turnaround play around 37 which has done well lately. I'm attracted to contracting and engineering because i can easily understand what they do. SNC, BDT with good balance sheets, lots of cash and great dividends, whats not to like. (besides the cyclical nature of the businesses)


----------



## Barwelle

Nope. Might (?) have something to do with Suncor's Voyageur upgrader though. But most of their work on that job should be complete already.

See May 10 press release here.



> Bird has been awarded a contract for the Early Works Civil Program at the Voyageur Upgrader Project located north of Fort McMurray, Alberta. Work on the project includes earthworks, concrete foundations and underground piping. The Voyageur Upgrader Project is operated by Suncor Energy and jointly owned by Suncor and Total E&P Canada Ltd. The Early Works Civil Program is expected to start in May 2012 and be completed by spring of 2013.


And news here and here.



> The oil sands major plans to build the multi-billion dollar upgrader along with Total E&P Canada Ltd, but the two parties have cut spending on the plant until they can decide on the project by the first quarter of 2013.


----------



## humble_pie

riseofamillionaire said:


> SNC, BDT with good balance sheets, lots of cash and great dividends, whats not to like. (besides the cyclical nature of the businesses)


cyclical nature is the 64M question. As it happens i incline towards the probability that it's very early in a new cycle. Onwego.

but bar i can't touch bird, it has no options, therefore sings no birdsong to my soul. SNC options on the other hand are appealing in spite of the neverending stories. As the bodyguard said, what was he supposed to do, leave them all there to get butchered ?


----------



## Mall Guy

riseofamillionaire said:


> They have the best balance sheet among peers, good backlog of projects, in a hot part of the country . . .


they are actually across the country, and currently trying to get a foothold in NL . . . which of course is the new AB :biggrin:


----------



## doctrine

Been an owner of Bird for a while. They have an annual dividend increase coming up in the next few months. Great dividend paying company and great management here. Although it's a big drop today, it's really just down to where it was 3 weeks ago.


----------



## My Own Advisor

Is this why the stock tanked 8%?

http://tmx.quotemedia.com/article.php?newsid=57496428&qm_symbol=BDT

Could be a good time to buy.


----------



## doctrine

Bird is raising it's dividend by 5.5%. They had $1.38 in earnings in 2012, nearly double that of 2011 - and have a P/E of about 9.6 on a trailing 12 month basis. They did say in their annual report that they don't expect earnings to be as high for this year. They had a 11% profit margin, up from 9% last year, which accounted for about 2/3rds of the profit gains. 

http://www.newswire.ca/en/story/112...esults-and-a-5-5-increase-in-the-monthly-divi


----------



## Woody

Bird was my first pick to start my portfolio.


----------



## Islenska

Actually worked for them (waterboy) on construction at a school building site, Cranberry Portage, Mb.---1968.

Didn't really appreciate finances of the company in those days, but my first real paying job and got to wear a hard hat!


----------



## Eclectic12

Hmmm ... this seems to have slide a lot these last couple of days.

Any thoughts?


----------



## doctrine

A good buying opportunity? They had a bad quarter, but their earnings can be quite volatile. While they only had $0.06/share in net earnings in Q1, in Q4 they had $0.70 in earnings. I'm holding - they indicated they are cautiously optimistic that business is picking up.


----------



## GoldStone

What's their exposure to mining?


----------



## doctrine

They do construction for the mining industry including oil sands projects. However, they are a general contractor and do a lot of civil and other government projects. It's hard to say exactly but I would guess 20-30% of their revenue is related to mining and oil sands, either directly or as a result of nearby growth.


----------



## GoldStone

Mining exposure is a concern.

G&M: Commodities bust reaches well beyond resource stocks
http://www.theglobeandmail.com/glob...-well-beyond-resource-stocks/article11947733/


----------



## Canadian

http://www.newswire.ca/en/story/1258235/bird-construction-inc-announces-third-quarter-2013-financial-results

Missed earnings but more or less in line with management's tone for the year. Big drop today (down 8% as I write this). That one fixed price contract they had issues with earlier this year really hurt their year but I still like their backlog and balance sheet. Industrial revenues are down but other sources of construction revenues (i.e., commercial) are up. They have also opened up a district office in St. John's, which will hopefully help them win some more contracts in Newfoundland. I was debating adding to my position on today's drop but I think I'll hold off and see if the price pattern from the last two quarters repeats itself this quarter.

Anyone else holding/following this stock?


----------



## doctrine

Three very poor quarters in a row. I'm souring quickly on them, at least in the short term...wouldn't be surprised to see them slip down to $11 in the next few months.


----------



## Canadian

That one contract loss earlier this year really seemed to hurt their financial performance. I'm curious to see how soon they will start realizing the projects on their backlog. Their MD&A says they are focused on growth for the foreseeable future. I'm hoping their revenues start reflecting a successful strategy implementation. I only hold a small position right now so I'm willing to hang on for the ride.

doctrine - what are your thoughts on the dividend sustainability? The board has approved the next 3 months dividends but I hope they don't drain their cash/retained earnings if the next few quarters don't improve.


----------



## My Own Advisor

I also own a small position. Not worried about any short-term pain.


----------



## HaroldCrump

It seems blowing up fixed price contracts is a bad habit for many of the leading Canadian construction companies.
A couple of years ago, Aecon (ARE) blew up a large fixed price gig for Suncor in the oil sands.
It cost the company nearly 40% in their share price and it languished for over a year.

The CEO had to quit over it.

Last year, Churchill (CUQ) similarly crashed and burned some contract and their share price fell 40%.

Given the terrible net margins in this sector, maybe these companies ought to reconsider their contract pricing and bidding strategy.


----------



## celishave

Stantec is a much better play in this sector. No construction risk. Has tripled over the last few years, however they almost always beat consensus and organic growth is outstanding.


----------



## doctrine

Dividend is probably okay for now, they have lots of cash on hand, but they'll need to turn around their margins in the next 6-9 months. Last year was quite an outstanding year for them which really built up their cash supplies. However, I wouldn't get your hopes up for an annual dividend increase unless they blow it out of the water in Q4.


----------



## Canadian

celishave said:


> Stantec is a much better play in this sector. No construction risk. Has tripled over the last few years, however they almost always beat consensus and organic growth is outstanding.


I don't consider Stantec a substitute for a company like Bird. Stantec deals with the planning (engineering, architecture, etc.) while bird executes the projects. The only other stock I would consider replacing Bird with at the moment is Aecon - but I think Bird is a bit more growth focused right now. That all being said, I wouldn't mind adding Stantec to my portfolio. I've looked at it a few times but it's at its 52-week high right now.


----------



## Canadian

doctrine said:


> I wouldn't get your hopes up for an annual dividend increase unless they blow it out of the water in Q4.


Definitely not. I think their dividend is quite generous right now. If they manage to turn things around over the next couple quarters I'd rather they keep the dividend as is and maintain a low payout ratio.


----------



## HaroldCrump

Canadian said:


> I don't consider Stantec a substitute for a company like Bird. Stantec deals with the planning (engineering, architecture, etc.) while bird executes the projects.


I was about to post the same thing.
Stantec is like a junior cousin of SNC Lavalin.
Aecon, Bird, and Churchill are siblings.



> The only other stock I would consider replacing Bird with at the moment is Aecon - but I think Bird is a bit more growth focused right now.


Aecon is more diversified though.
Their backlog is bigger, and they are much bigger participants in P3 projects.
They used to have some international business as well, but they have been slowly divesting it.
The last remaining bit is the Quito Airport.


----------



## Canadian

http://www.newswire.ca/en/story/1283053/bird-construction-inc-announces-new-contract-awards-totalling-400-million

Some good news for Bird! I like that its backlog's diversity is increasing.


----------



## Echo

Great news! I just bought in last week.


----------



## Canadian

I remember that. I meant to congratulate you in the What Are You Buying thread, but work ended up being too busy today!


----------



## feetfats

Canadian said:


> I remember that. I meant to congratulate you in the What Are You Buying thread, but work ended up being too busy today!


I have toured two different facilities they have constructed here and I must say they are absolutely top notch. Talking to some people involved in one of the projects they were very happy with Bird and highly recommended them. 

I may buy some of this in January when I have more TFSA room.


----------



## Canadian

It's pretty volatile, which I like. There are frequent opportunities to add / book profits. Can't complain about the 6% dividend either. There's a fair bit of construction happening in the downtown core of my city and over half of it is being completed by Bird. As long as it doesn't have any more big hiccups like it did with the fixed-price contract loss earlier this year, I predict a strong 2014 for the company.


----------



## doctrine

I like BDT but have decided to sell to move the capital to some other names. I may come back especially if there is price drop to the $10-11 level.


----------



## DividendLuvr

Nice boost today on the news of some analyst upgrades - now near its 52-week high.


----------



## doctrine

No dividend increase this year.


----------



## My Own Advisor

So doctrine, you want annual dividend hikes, and capital appreciation in the form of 52-week highs and 5%+ yield? Pick two of three, that's pretty good


----------



## doctrine

Well, with $0.34 in EPS in 2013 year after $1.47 EPS in 2012, yes I am surprised to see the stock price so high. It didn't jump that high after $1.47 in EPS, so why now with $0.34 in EPS? The message I see is that investors are anticipating their record backlog will be turned into earnings better than those in 2012. That may be true, so hopefully they do well.


----------



## DividendLuvr

The payout ratio is really too high to support an increase right now - holding steady is the right thing to do.


----------



## My Own Advisor

You never know... we'll see. I would like more BDT but price is high. Need to go shopping this spring for something else outside of banks and energy.


----------



## leeder

Current P/E > 18
Current P/B > 3 
Current P/CF > 11

Even with the nice dividend, looks mighty expensive. I'm interested in this engineering and construction space, but everything looks mighty expensive.


----------



## OurBigFatWallet

Div increase or not, I think it's a good long term hold. A bit expensive right now to buy more though


----------



## Longwinston

My Own Advisor said:


> You never know... we'll see. I would like more BDT but price is high. Need to go shopping this spring for something else outside of banks and energy.


Have a look at bip.un


----------



## My Own Advisor

Thanks...considered that one as well. Need to hold registered though. A small downside, can't DRIP this one.


----------



## Canadian

The company's backlog isn't only increasing in size, it's increasing in diversity. The company is doing a good job rounding out its income streams, which reduces the company's reliance on one particular sector. No dividend increase this year is understandable, given the struggle with the fixed-price contract loss. I'm actually glad to see that management didn't increase the dividend because it would have shown a lack of prudence on their part. If Bird can avoid another hiccup in 2014 I expect there will be a dividend increase at the end of the year. My prospects of the company are long term, anyway. 2013 is an anomaly as far as I'm concerned.


----------



## Canadian

Considering adding to my position if there's a pull back on Monday.


----------



## Woody

I bought this stock 2 years ago at about $11 per share, its had its small increase as well as regular, comfortable dividend payouts. Its one of my favourite 'hold's.

I have to admit it was an emotional purchase. When living it St. John's almost every commercial construction site I saw had Bird logo's plastered all over them and their company trucks were everywhere; When I moved to Halifax 2 years ago, same deal! I assumed they had to be doing well and quick look at their stats showed them being fairly viable. In I dove, no regrets.


----------



## Canadian

I have also noticed that Bird seems to be one of the preferred construction companies around Halifax. The price didn't pull back as much as I would have liked so I will continue to hold my existing position and revaluate the company once I have some extra cash again.


----------



## doctrine

I like the company but the last 5 quarters have been pretty bad. Not sure what good a record backlog is if you have a 1% profit margin. They did earn enough in 2012 to pay for a couple years of dividends but they need to turn it around eventually or the stock price will tank.


----------



## Canadian

I agree. I'm comfortable with their cash levels for the next few quarters - so I was willing to add to my position (I only have a small position now) if there was a significant pullback but it didn't go low enough for me. The lower revenue seems reasonable given harsh weather during Q1 but I didn't like seeing the increased admin costs. I used my cash for other purchases that I believe have better upside potential. I'll give Bird another quarter or 2 - if they don't turn things around this spring/summer I'll likely move on.


----------



## DividendLuvr

Great financial results sent this to a 52-week high on Friday. Several analysts raised their targets.


----------



## Canadian

I like the results. Their projects seem to be back on track - hopefully no more hiccups in the near future (however those hiccups do provide nice buying opportunities). Backlog has increased as well. Happy to continue holding this.


----------



## My Own Advisor

Long term hold for me.


----------



## londoncalling

still holding as well


----------



## bettyboop

I sold a couple weeks ago.


----------



## Hodgie

*Bird*

Hello , Bird seems to have done ok recently reaching a new high. This company for the most part is very quiet so no hype here. I was at the AGM in Toronto, it was very straight forward, no real nuggets to grab onto, CEO stuck to the script, there was a social after with food, but did not attend. The room was quite filled up but there were maybe 1 or 2 questions at the end, so that was disappointing. CEO was very frustrated with that 20mill loss on the one deal. A question was asked about it and you could see and hear the frustration.

I got the feeling the analysts etc had already got their answers on what they wanted to know or were going to get that during the gathering after. No analysts asked questions in the Q & A. If i attend next year i will have questions ready.

I usually invest in small growth companies. Bird is small and growing to some extent all be it slowly. The dividend is nice, but my concern is there is not much money left over for any type of growth opportunities. On Birds website they talk about being on a growth trajectory, but that will be limited if no money to make an acquisition. Dividends eat up about 32million on an annual basis, that is quite the chunk of change.

Insider selling has been on the increase. The new ceo of O Connell just sold approx 150,000 shares, the ceo of Bird few months back sold 150,000 shares approx, this is not chump change. 

There is no question there are plenty of opportunities in this space to consolidate, my best case scenario for Bird is for them to be bought out, will see how that plays out.


----------



## Hodgie

*Bird*

Testing


----------



## Hodgie

*bird*

testing


----------



## Hodgie

*Bird*



bettyboop said:


> I sold a couple weeks ago.



ok


----------



## Hodgie

*Bird*

ceo retires in Dec 2014


----------



## Hodgie

*Bird*

ceo retires


----------



## DividendLuvr

I averaged down on this today near its 52-week low @ $11.90.


----------



## OurBigFatWallet

So did I. Love the company and it's a long term hold for me


----------



## leeder

This stock has recently hit my radar. The stock price has come down to what I think is cheaper levels. The Q3 results show it has increased its backlog, but I wonder how much impact the decline of oil prices have on this company. Have anyone else looked into this company recently? Any issues on this company to share?


----------



## CPA Candidate

I don't like construction companies because of the variability of earnings and cashflow. They don't make for buy and hold investments. You have to be alert and time your purchases and sales to make money.

The past three years (starting with 2011) EPS was 0.70, 1.38, 0.28.

Go back 3-5 years and very little money has been made on holding this name. In fact it was higher in 2008 that it is now.


----------



## leeder

CPA Candidate said:


> I don't like construction companies because of the variability of earnings and cashflow. They don't make for buy and hold investments. You have to be alert and time your purchases and sales to make money.
> 
> The past three years (starting with 2011) EPS was 0.70, 1.38, 0.28.
> 
> Go back 3-5 years and very little money has been made on holding this name. In fact it was higher in 2008 that it is now.


That's certainly true. I think my interest in this company is somewhat beyond the numbers. Construction will always occur, and the government has committed to infrastructure spending. I would think this space would benefit in the long term. I bought Stantec about two weeks ago, so I'm less enamored to buy Bird. But it is an interesting name on my watchlist...


----------



## Canadian

The volatility in Bird's 2014 earnings was caused by a bad project that lingered through the first half of 2014. That project has since been completed and everything is currently on track. Of course current cash flows are volatile and projects depend on the economy but construction companies are best assessed by looking at the diversity of projects, geography, and the company's backlog. Bird continues to grow and manage an impressive backlog, continues to diversify its projects, and has a nice variety of projects spanning across the country. I like that its projects are not focused in the oil sands, so the future work won't be crushed by low oil prices. I've held and followed Bird for about the last year and I like holding a construction company in my portfolio (albeit my exposure is minimal). Larger companies like Aecon may be less volatile but with Bird being a younger, smaller company I see more opportunity for growth (not to mention the dividend is pretty nice).


----------



## DividendLuvr

Canadian said:


> The volatility in Bird's 2014 earnings was caused by a bad project that lingered through the first half of 2014. That project has since been completed and everything is currently on track. Of course current cash flows are volatile and projects depend on the economy but construction companies are best assessed by looking at the diversity of projects, geography, and the company's backlog. Bird continues to grow and manage an impressive backlog, continues to diversify its projects, and has a nice variety of projects spanning across the country. I like that its projects are not focused in the oil sands, so the future work won't be crushed by low oil prices. I've held and followed Bird for about the last year and I like holding a construction company in my portfolio (albeit my exposure is minimal). Larger companies like Aecon may be less volatile but with Bird being a younger, smaller company I see more opportunity for growth (not to mention the dividend is pretty nice).


Agreed on all counts. This is a long-term hold for me, too.


----------



## HaroldCrump

Canadian said:


> Larger companies like Aecon may be less volatile


Take a look at Aecon's chart for last 10 years and then tell us how _less volatile _it is :biggrin:

It has been a graveyard for investors.
Same for pretty much every other Canadian construction company - SOX, Genivar, even SNC (which is actually engineering & utilities).

The only one that has done better is Stantec, but it is also engineering and not construction.


----------



## Canadian

Ok - I agree that chart does look volatile. What I meant by larger companies and volatility is that an investor will likely see less volatility with a large-cap compared to Bird, which has a pretty small market cap.

Harold, why do you say Aecon has been a graveyard for investors? It doesn't have the prettiest chart but with trimming / averaging / rebalancing surely an investor could have made money in this over the past decade (or other timeframe).


----------



## HaroldCrump

Canadian said:


> Harold, why do you say Aecon has been a graveyard for investors? It doesn't have the prettiest chart but with trimming / averaging / rebalancing surely an investor could have made money in this over the past decade (or other timeframe).


I should have clarified - I meant a graveyard for _buy and hold_ investors, as CPA Candidate said above.
I have made some money trading Aecon between 2011 and 2014 a couple of times.

However, if you analyze the company, you will find they are a very poor performer relative to potential.

They are one of the oldest construction companies in Canada (if not _the_ oldest), routinely get lots of contracts, have P3 assets, have (or had, until recently) overseas assets, etc.
The scope of their work is coast to coast, and they routinely partner with larger engineering firms like SNC & Holcim.

But...they are not able to deliver any shareholder returns, other than a measly 2.5% dividend yield.
Dividend increases have been rare.
Stock price peaked in 2007 at over $22 and since then has stagnated.

There have been 3 gut-wrenching crashes (in 2008, 2011, and 2014).
The 2008 crash can be forgiven...however, the 2011 crash was 100% management incompetence (low margins, fixed price contracts with unfavorable terms, etc.).
The 2014 crash from $18+ down to $9 is also a 50%+ crash.

I can go into more details if you want...I believe there is a separate thread on Aecon buried somewhere within this section.

As a buy & hold investor, your performance would have been as follows:
- Current stock price is at 9-yr lows
- Only 2 dividend increases in 10 years
- No significant EPS growth
- No appreciable expansion in work scope - gave up on overseas projects
etc.

Yes, it is possible one could have made money buying on the lows and selling on the up.
But that is easy to say in hindsight, but difficult to do correctly in practice over and over again.
Every time you think the stock has fallen enough, it goes lower.

Last year, stock came close to its previous high when it was over $18.
But it has again crashed spectacularly to $9 & change currently.

I had bought at an average of $9-something in 2011, and finally sold out in 2014 for $15 & change.
Fortunately, I managed to catch the only 2 dividend increases in last 10 years.

If it drops into the low $9 or $8 range, I will consider same type of trade again.


----------



## CPA Candidate

Despite what I said earlier with sentiment in the gutter, this might be setting up for a profitable trade with the stock at a 3 year low. Watching to see where this finds support.


----------



## CPA Candidate

BDT getting flogged by the market again, multi year lows. This may be an opportunity for medium term trade.


----------



## OurBigFatWallet

I don't get why its down so much today.....


----------



## GoLong

OurBigFatWallet said:


> I don't get why its down so much today.....


Think the fact they said results from 2014 will be hard to reproduce in 2015 probs led to that. The decreased backlog isn't good either


----------



## RParks

Bought 600 shares today. Long term hold.


----------



## humble_pie

bird, aecon, snc, genivar (has a new name although original name tends to stick), jacob engineering in the US - have all taken big hits over the past year. Understandable with the global downturn in infrastructure spending. To me at least, this suggests they may be starting to look like interesting long-term buys.

i don't mind buying too soon. Usually i look for decent option plays, in order to pass the wait time at some slight profit.


----------



## londoncalling

I have worked with and or for 3 of the above on mining, energy and infrastructure projects for the past 15 years. I can verify first hand the changes that are happening with each of them. It is definitely interesting for me to see what is happening to these companies and their projections for the futures. They are definitely having some challenges but there is also some excellent opportunities in other sectors and regions for all of them. I am trying to decide wether to add to my existing Bird position or diversify into one of the others mentioned by Humble. While I wait and decide I will just keep adding cash to my portfolio.

Cheers


----------



## humble_pie

london, so interesting that you are with these guys already in some manner, ie through work, although your cash to buy actual shares may still be accumulating on the sidelines. 

birds of a feather flock together. People are known by the company they keep. That you've worked with/for these companies is another atout (i have to ask oldPro for the translation.)

Edit: wondering to myself if the sector would have any correlation to the Baltic dry index (shall try to look into this)


----------



## londoncalling

HP you always make an effort to educate this forum be it with financial wisdom or vocabulary of another language. Thanks for that. I am not sure how this sector would correlate to BDI. Most of the move in share price for these companies are based around project announcements and awards. There would be quite a delay between announcements, completion and production. I would be curious to know if a pattern did exist.

I can comment that the slow down in energy has moved these companies attention form oil and gas development in Ft Mac to Mining projects in Saskatchewan. They were always involved but recently they have had a larger presence. There has also been an influx of job seekers coming from the patch to find work in the province. Even using population as a baseline I am certain the number searching exceeds the number of jobs available. Also, a slowdown in energy affects the skilled trades in this province as well. A few starting points for those who seek would be to look at the progress of the uranium and potash projects that have started and are planned to commence.

Cheers


----------



## bettyboop

I held BDT for years but sold it earlier in the year when someone pointed out the very high payout ratio, now its come down to 89% plus it's cheap again so I'm thinking of buying back in. Is it too early?


----------



## humble_pie

^^

when is early ever too early, for those willing to wait patiently?

i don't know Bird but i like this early sector. My pick was SNC though, because it had the best options.


----------



## dubmac

Wajax (WJX) is another interesting one on the radar. Mining has taken a real hit. P/E is around 9.8. It "appears" to be making $. I don't know anything about it's debt or it's payout ratio. Unloved by many analysts. Some insider buying on Apr 1.


----------



## humble_pie

me i kind of crumble along in the resource stocks as a rule but this am i was reading the Constellation software thread on cmf.

holy cow. Have i ever wasted my life on a bunch of deadbeat mines & oils.


----------



## Flash

So, all around Vancouver I see construction booming. Any reason construction stocks stay low? Anything particular with Bird? Any other construction companies worth looking into? Lavalin Group?


----------



## Eclectic12

Any thoughts on whether Bird or other groups like Aecon will benefit from the Liberal investments in infrastructure?


Cheers


----------



## chantl01

Any ideas on why the volatility in this stock today? I would hardly think the announcement of the retirement of the CFO after eight years, with what sounds like a well-qualified replacement (getting two months handover) should be cause for a dip of over 6%.


----------



## thepitchedlink

any thought s on this one guys? 7% yield right now......


----------



## chantl01

thepitchedlink said:


> any thought s on this one guys? 7% yield right now......


I'm still in it, happily DRIP'ing away. I think this stock has been overly punished for simply being based in Alberta. It's a good, solid construction firm that's not going anywhere soon.


----------



## tombiosis

I am reviving this thread who's last post was April of last year...
I have been contemplating opening a small position in this co. (enough shares to drip I guess), and I missed my bid on the last dip.
Does anyone have any comments good or bad? and is now a good entry point?
Thanks in advance


----------



## londoncalling

Been awhile since this thread got some attention. Interesting headline today.





__





TMX Money







web.tmxmoney.com





Other headlines indicate that Bird acquired Stuart Olson which I think would be more apt then a joining of forces.
BDT up 2% SOX down 63% on the day. 
Still hold BDT from way back when. It was a small position at the time. Even smaller now due to poor performance and portfolio growth. Haven't had time to give a thorough review of the news but I can see it was not well received for fans of SOX.

Cheers


----------



## doctrine

The combined entity will have $2.5B in annual revenues. But likely will still lose money.


----------

