November 20, 2017

On Monday, the S&P 500 was up 0.1% while Toronto was about unchanged.

Home Capital was up another 7.0%.

Melcor was down 1.6% to $14.70. It is possible that there is some tax loss selling involved. With the shares trading right around half of book value it can be argued that the market feels that this company is worth significantly more dead (liquidated) than alive. It is disappointing that management does not see fit to buy back even a token number of shares. They recently added to land holdings so that would suggest that they could have spared some cash for buy backs. This stock has required a lot of patience. If the Alberta economy and oil prices continue to improve then that should pull the share price up. We won’t get another earnings / sales report until March. Meanwhile the dividend yield is good at 3.5%.

Shortly I will post an update for Linamar which appears to be undervalued after its recent decline.