CIBC World Markets’ Peter Gibson added Toromont Industries Ltd. (TIH) to his buy list last week (July 8). Gibson is one analyst worth heeding. For years he’s had a hammerlock on the No.1 spot in Brendan Wood’s rankings of quantitative analysts.
The company made Gibson’s list because its return on equity has been increasing (reaching 8.7% last quarter) and analyst consensus estimates imply further increases. Moreover, its shares have the requisite price momentum and trade at a discount of about 17% against peers on the basis of book value. It pays a dividend yielding 3.4%.
Toromont, which recently spun off its Enerflex arm, operates one of the largest Caterpillar dealerships in Canada. It also has a division focused on industrial and recreational refrigeration systems.