I'm currently down on this investment, but every time I look at it I can't work out why it's not valued higher. As you said a capital light business, with fairly stable clientele, that throws off lots off cash and generally rising divs. Despite it not requiring lots of capital and having generous payout ratios, management seem to be able to utilise the capital they do keep well with good ROIC and ROE. This has seen steady increases in EPS and Divs across the last decade. What am I missing?
I'm very tempted to add to my holding but struggling between two mental models. One telling me that it is a bargain and I'll be rewarded by adding to my holdings. The other thinking is that you don't "water the weeds" in your portfolio. If my thoughts on it's true value are right, I can see another firm taking this out and then I'll kick myself for not adding.
SIQ Price at posting:
$6.84 Sentiment: Buy Disclosure: Held
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