Vancouver, British Columbia--(Newsfile Corp. - November 5, 2013) - National Bank Financial has initiated coverage on Manac Inc. (TSX: MA). Analyst Cameron Doerksen gives the company an outperform rating, and a12-month target of $10.00, a premium of 29% to the $7.75 price the day the report was issued.
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Manac is the largest manufacturer of trailers in Canada and is a leading manufacturer of specialty trailers in North America. Given its strong growth presence in specialty trailers used in forestry and construction, National Bank Financial believes the company may also benefit from a rebounding U.S. housing market. An aging fleet of trailers may also help extend the current up-cycle beyond what is normally the case.
In 2012, the company generated revenue of $270 million from the sale of 6,900 trailers manufactured at the company's 3 manufacturing facilities in Quebec and Missouri.
Manac has established an extensive distribution network in North America consisting of 10 points of sale, of which 5 are located in Canada and 5 in the United States. With a network of 73 independent dealers and more than 100 independent service centres across North America offering parts and services, the company ensures prompt service to its customers.
Analyst Cameron Doerksen stated, "Manac has several initiatives aimed at increasing its annual EBITDA by $8 to $10 million by 2016. From a high of over 280,000 in 2006, trailer shipments in North America fell to around 80,000 in the 2009 recession low, a stunning drop of over 70%. We believe the current up-cycle is still in its early innings, however."
According to National Bank Financial, a key component of Manac's growth plan is industry consolidation, and the primary reason why the company is accessing capital by going public is to execute on its acquisition strategy.
The company went public in September, with an IPO of 4,761,905 shares at a price of $8.40 per share, raising gross proceeds of approximately $40 million.
National Bank Financial Inc. was the sole bookrunner, for a group that included CIBC World Markets Inc., TD Securities Inc., Stifel Nicolaus Canada Inc., Desjardins Securities Inc., and GMP Securities L.P.
The company currently trades at $7.75, below the $10.00 target price, and with 17 million shares outstanding, the company is capitalized at $132 million.
For more information, please visit the company's website www.manac.ca or contact Charles Dutil, President and CEO at 418-228-2018 or email charles.dutil@manac.ca.
For more information about National Bank Financial or to obtain a copy of their research report, contact your nearest National Bank Financial office. Their branches are listed on their website at www.nbf.ca.
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