Alain Bédard is very good in capital allocation. TFI International (TSX: TFII) announced they are going to sell 4 million shares to the market.
Their stock chart looks like this:
When you have a stock chart like this, what do you do? Raise equity capital while the going is good. Especially after you’ve exercised and dumped a bunch of stock options (he still owns about 4.1 million shares at present, so still plenty of skin in the game).
I took a small shot at them last February for selling equity after buying back shares, but this move I think is admirable – will also get their debt down to something a little more comfortable. They’ve acquired a couple companies since the Covid-19 debacle began.
I own this stock as well. Really like what they’ve been doing and have made some good transactions in my opinion. Where I live I see transforce trucks everywhere in cities, highways and around industrial areas. They’ve got a good mix of consumer item shipping as well as industrials. I think from now on I’m just going to buy stocks when the head honcho’s name is Alain.
Upsized to 4.4 million shares, priced at CAD$57.32 equivalent. Good for them! The implied cost of equity is clearly higher than debt (so when they do the debt paydown it isn’t going to amount to much) but it’ll create some more room for strategic acquisitions down the line.
He really is a genius.