Friday was a positive day in the markets with the S&P 500 up 0.85% and Toronto up 0.6%.
Our one penny stock, Ceapro was up 7.5%.
Linamar was up 4.8% to $51.17 after it announced approval for a share buy-back. They are authorized to buy back up to 10% of the public float or 4.5 million of the total 66 million shares. The company explained:
“We are initiating this NCIB in recognition of what we believe is a significant level of under valuation of Linamar stock. We do not feel that the value of our business is being adequately reflected in our current share price” said Linamar CEO Linda Hasenfratz .
I believe this is an important announcement. Linamar is a growth company and would prefer to be doing an acquisition rather than giving up cash like this. Looking at the share count it appears they last bought back shares during the financial crisis when their shares got really hammered down (like from a peak around $26 to briefly under $4!). My impression is that this is a very well-managed company. I certainly believe that management honestly believes that the shares are significantly undervalued. And while there are risks to their sales outlook and while “the market” may remain skeptical, I think they are right. This buyback should provide support for the share price and hopefully earnings reports during 2019 will further support an increased price.
BHP Billiton was up 4.3% (The BBL shares on New York)
Starbucks was up 3.6% after releasing an earnings report.
AutoCanada started the day down slightly but ended the day up 3.0% which may be a positive reaction to the CRM partnership that it announced and which I mentioned yesterday.