Stock Idea…Rocky Mountain Dealerships Inc

Stock Idea…Rocky Mountain Dealerships Inc

Symbol : RME

Exchange: TSX

Market Cap : 201.8 Million

Revenue : 951 Million
Three Year Revenue Growth : -2.6 %
Investment Type : Small Cap Value

Price/Earnings : 13.0

Forward P/E : 8.9

Price/Book : 1.1

Price/Sales : 0.2

Price/Cash Flow : 8.1

Yield 4.42 %

Price : 10.41
Investment Stem : Cheap Small Caps Screen

Rocky Mountain Dealerships Inc through its subsidiaries sells, leases and provides product and warranty support for agriculture and industrial equipment in Western Canada.

Rocky Mountain Dealerships Inc. is an agriculture equipment dealer with a network of full-service agriculture and industrial equipment stores across the Canadian Prairie Provinces. The Company operates in two segments: agriculture segment and industrial segment. The agriculture segment primarily includes sales of agricultural equipment, parts and services, and the industrial segment includes sales of industrial equipment, parts and services. Through its subsidiaries, the Company sells, leases, and provides product and warranty support for a range of agriculture and industrial equipment in Western Canada. The Company's operations in Alberta, Saskatchewan and Manitoba are conducted through Rocky Mountain Equipment Canada Ltd., under the name Rocky Mountain Equipment. It offers its customers a solution for their equipment needs through new and used equipment sales, parts sales, repairs and maintenance services, and third-party equipment financing and insurance services.

A cyclical stock coming up from its bottom as the Capital Cycle in commodities is slowly shifting to the upside. Consistently reports high ROIC numbers year after year, even during the commodity down cycle, a good sign of management’s capital allocations abilities. The huge build up of inventory that was accumulated during the 2012-2014 period is now starting to roll off. Balance sheet in good shape. Has a cash return of a staggering 11.0 %.

The dreaded metrics from Morningstar…

http://quote.morningstar.ca/Quicktakes/stock/keyratios.aspx?t=RME&region=CAN&culture=en-CA&ops=clear

The company’s website…

https://www.rockymtn.com/

Another one of Peter Lynch’s, ‘Blossoms in the Desert’ stocks…a survivor that should do well during the next upswing in the commodity cycle, pays a nice dividend while you wait. A well run company.