Wednesday, 5 October 2011

Analyst - Carfinco Is An Excellent Defensive Play

Carfinco Income Fund
TSX: CFN.UN
Units outstanding: 24.61 million
Units fully diluted: 24.65 million

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With the fear factor throttling the market, logic has gone out the window. All companies are being dumped into the same basket and people are forgetting that a lot has changed since 2008.

Industrial Alliance analyst Fred Westra has been bullish on Carfinco since his initial report published in February, 2010. It was titled, "Small Niche Lending Play, Big Time Potential" and he had a Strong Buy Rating and a 12 month price target of $3.50.

Much of his belief was based on the measures that Carfinco management implemented to avert disaster before the 2008 meltdown and establish the platform for growth. In short, there was great foresight.

Carfinco was proactive and tightened its reins on lending becoming far more stringent in its process along with improving its collection methods employing top end proprietary technology at the time.

In this latest research update, Mr. Westra emphasizes that Carfinco has never loosened its rules on lending and the technology that was brought in to collect its loans has been very effective. In addition, it is in a very strong financial position.

See the full report here....