Medical Facilities Corporation (symbol DR.TO)

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Medical Facilities Corporation (symbol DR.TO)

Post by 2 yen »

Other than a bit of discussion on the CML Healthcare thread, I have seen almost nothing about Medical Facilities Corporation (DR.TO) on this site.
They are in a smallish expansion mode with a couple of newly purchased clinics. Any thoughts?

http://www.medicalfacilitiescorp.ca/sec ... nv_rel.htm
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by Sensei »

Hi,

I've held it for 3 years or so. No complaints.

It's a Canadian company, but the bulk of the clinics are in the US. Super small cap. It is one of the trusts that have successfully transitioned into a regular business with no change in the dividend which is quite decent. They used to have a really clever way of getting around taxation when they were a trust. Your unit dollars were invested partly in a bond structure. Really smart. I see it as a play on the US dollar which I'm bull on. In the long term, I see the US dollar as at least par with the Canadian dollar. The company mostly deals in US dollars, as you probably know. Lots of insider investment on this one too.

I like the health care space as well especially in the US. I think since Obamacare is pretty much a done deal, I don't see too many surprises going forward. If you look at Stockchase, most analyst like it too.
I have seen almost nothing about Medical Facilities Corporation (DR.TO) on this site.
Right and that is the way I like my stocks. No news is good news. Always too much chatter about CML, since you mentioned it, for my taste and I dumped CML during its 'US crisis' phase and don't see any reason to buy it back.

I think you could get a better entry price, than today's,though. I paid about 11.50 so I'm up 21%. And it did dip down under 13 briefly I think. Jay might know better than I.
Cheers

"A dividend being paid today is always a positive return." Josh Peters, Morningstar
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by 2 yen »

Hi Sensei....hisashiburi desu ne! Why does the DR dividend stay so stubbornly high if the general concensus is that this is a good company? That's the thing I don't get. (?)
I wonder if the big players, like pension plans, don't like the small size....
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by Sensei »

Hi,

Good question. A dividend that high might be a red flag. However, the stock price has moved up too. I checked and see I started a position in March of 2010 @ 10.86. I added a bit more in March of 2011 at 12.60. Today it's 14.16. If you look at:

Medical Facilities Distributions

You'll see three things:
1. They've paid distributions consistently since 2006. Not affected by the sub-prime mortgage mess.
2. Up to 2011, about 2/3 of the distribution was in interest (as I mentioned upthread), thus more tax efficient for a Canadian non-resident. That was a main motivation to buy in the first place.
3. They raised the dividend in August of last year (2012)

Like most of my small caps, it is only around 3% of my Canadian portfolio, so I'm not making a huge bet on it. Still, from all I've read when I bought it and since, it just seems like a well run little company.
Cheers

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Re: Medical Facilities Corporation (symbol DR.TO)

Post by pmj »

Here's a recent start-up in this field: NorthWest Healthcare Properties REIT NWH.UN
(Not to be confused with NorthWest International Healthcare Properties REIT MOB.UN - although there is a historic relationship between them)
Wait a minute - you were in at the start: http://www.financialwisdomforum.org/for ... 03#p380803 :thumbsup:
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Reason: replace old domain name with www.financialwisdomforum.org to reflect new domain name effective 19-Jan-2014
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by 2 yen »

pmj.....I see that I should always be careful what I post as someone may go back to check! :D

NWH has been good so far and are also expanding. DR actually does medical work while NWH just holds the buildings, including the one where our family doctor works.
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by 2 yen »

http://www.fool.ca/2013/06/26/be-wary-o ... ocs0040001

This Motley Fool article talks about a major problem with DR. Any thoughts?
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Medical Facilities Corp (Symbol- DR.TO)

Post by petfiora »

Been looking at "medical facilities corp"
My broker has has been pushing it.
Would like some opinions please.
Looks pretty good to me???

When starting a stock thread, please provide the stock name and trading symbol in the thread title
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Re: need some info

Post by deaddog »

You haven't mentioned why you are interested in the stock.
Are you looking short or long term?
What do you expect the stock to do?
Why is your broker recommending it?

Know what you expect of the stock and if those expectations are not met, get rid of it.
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by j831robert »

I'm no expert in stock picking etc but have a small holding of DR in my wife's TFSA initially purchased in Feb 13 and DRIP'd - gain to date is indicated at 27.15% with which I am quite content. I note that the market mavins can't seem to get together on this - one of the larger companies has consistently indicated it as 'SELL' while some of the smaller one bounce up and down. Don't much care - it's a smallish bet for us and their holdings in a collection of smaller 'specialist' hospitals holds some appeal for me. Wouldn't "bet the farm' on it but it is, for me, an 'interesting hold'.
'
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by 2 yen »

http://finance.yahoo.com/news/medical-f ... 00431.html


Very good quarterly results. Hope they don't blow it by either expanding too fast or raising the dividend too much. Overall, I'm pleased.

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Re: Medical Facilities Corporation (symbol DR.TO)

Post by JaydoubleU »

Big position of mine and has been for a few years. It seems the stock sold off last quarter on weak earnings and a payout ratio that was coming dangerously close to 100%.

I thought this was a great USD play and a pretty steady source of cash flow. Today's report is definitely encouraging, as is the continuing stock buyback program. I'd like to see them have a few such quarters before they raise dividends, however.
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by 2 yen »

JaydoubleU wrote:Big position of mine and has been for a few years. It seems the stock sold off last quarter on weak earnings and a payout ratio that was coming dangerously close to 100%.

I thought this was a great USD play and a pretty steady source of cash flow. Today's report is definitely encouraging, as is the continuing stock buyback program. I'd like to see them have a few such quarters before they raise dividends, however.
Agreed. This stock is still a very minor part of my holdings, but a bit outside my usual area of investing, so it's been educational to follow it.

Have a good one JaydoubleU!

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Re: Medical Facilities Corporation (symbol DR.TO)

Post by nisser »

I wish they'd purchase another hospital rather than raising the dividend. They've got enough cash to make a purchase and haven't expanded since their last purchase in 2012. I'm happy to hold them given their 7% dividend but stock won't move much until they do something.
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by Springbok »

According to longrundata, DR has had a Total Return of 18.65% since Nov 2006 and 28.02% since Nov 2008. I would guess that that would have beat the tsx and just about anything else by quite a margin. Wish I had bought it when I was thinking about it. It is a very small part of SIN.UN which I own, but that fund has been dragged down by the energy stocks it holds.
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by JaydoubleU »

I remember when the DR was yielding over 10%. I watched it, studied it, couldn't believe it. Everything looked fine, except for that ridiculous yield.

But a fund I was also following closely had a large position, as did several others. I read some manager commentary. I studied some more and took the first plunge at about $13. It kept rising and the yield kept falling. Then in 2012 they RAISED the dividend! Couldn't believe it again. I bought more.

I've always thought of DR as a high-yield bond-proxy. But it has decent ROE, low debt levels, and extremely low beta (globeinvestor gives me 0.05). I like to have some of these cash flow anchors in there, providing monthly income which I can use to buy other undervalued stocks, or just more DR.
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by 2 yen »

http://www.theglobeandmail.com/globe-in ... e28677788/

Now this is one I didn't expect to be analyzed this way. Read down toward the end for the DR bit.

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Re: Medical Facilities Corporation (symbol DR.TO)

Post by Sensei »

Hi,

As I wrote up thread, I bought DR back in 2010. Somewhere along the way, I sold it and then rebought it at $15 probably last year. At that price it was paying a 7.5% yield which seemed respectable to me and still does. That said, it's 13.85 today. I'm still a fan of the company and company fundamentals, though, and I expect the stock price is the result of being sucked down with the the rest of the market. Furthermore, stock appreciation is secondary to building a sustainable stream of income. I'm long DR and will continue to be.

For those looking for capital appreciation, there are a lot of ways to screen stocks. I'm familiar with Joel Greenblatt and read through his book 'The Little Book that Beats the Market'.

The main things to consider about DR are:
1. It is tiny in the grand scheme of things so not much room for error.
2. Income is in US dollars. Outside the current garage sale mentality now in vogue, that should work well in the short term. Long term, double edged sword in my opinion.
3. Subject to US healthcare 'system' if you want to call it that. Important to note every remaining candidate in the race for presidential nominations is proposing some changes to the status quo.
Cheers

"A dividend being paid today is always a positive return." Josh Peters, Morningstar
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by nisser »

Cash flow will stagnate and go down a bit in the near future a bit because they sold 1 of their ?six hospitals and haven't replaced it with anything. They've been "looking" for new opportunities since 2012. I'm still holding it but not really too excited to add to it as they haven't given any indication that they're eager and aggressively looking for expand.
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by Sensei »

Hi,

Not quite true. They have just acquired Integrated Medical Delivery. It's not a hospital, but should expand their business in a different way.
Cheers

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Re: Medical Facilities Corporation (symbol DR.TO)

Post by nisser »

Sensei wrote:Hi,

Not quite true. They have just acquired Integrated Medical Delivery. It's not a hospital, but should expand their business in a different way.
51% interest for a purchase price of less than 2 million. That won't even move the needle. My point still stands.
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by Sensei »

Hi,
nisser wrote:
Sensei wrote:Hi,

Not quite true. They have just acquired Integrated Medical Delivery. It's not a hospital, but should expand their business in a different way.
51% interest for a purchase price of less than 2 million. That won't even move the needle. My point still stands.
I got your point in the first place, and a good point it is based on recent company performance. I'm just pointing out the most recent information and 'not quite' speaks directly to your comment. Just putting all the facts out on the table for others considering buying the stock. I'd say the purchase will move the needle...a little bit... and your point mostly stands. :wink:

Disclaimer: I have no inclination to add or sell to my current (modest) position.
Cheers

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Re: Medical Facilities Corporation (symbol DR.TO)

Post by Descartes »

Consolidated facility service revenue from continuing operations of $308.8 million, up 3.8% as compared with $297.4 million in 2014
Consolidated income from continuing operations of $74.7 million, up 12.0% as compared with $66.7 million in 2014
Cash available for distribution1 of Cdn$45.9 million, up 10.8% as compared with Cdn$41.4 million in 2014
Payout ratio1 of 76.7% as compared with 85.2% in 2014
http://medicalfacilitiescorp.investorro ... al-Results

As a long-time stockholder, it's good to see things moving in the right direction.
"A dividend is a dictate of management. A capital gain is a whim of the market."
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Re: Medical Facilities Corporation (symbol DR.TO)

Post by 2 yen »

Descartes wrote:
Consolidated facility service revenue from continuing operations of $308.8 million, up 3.8% as compared with $297.4 million in 2014
Consolidated income from continuing operations of $74.7 million, up 12.0% as compared with $66.7 million in 2014
Cash available for distribution1 of Cdn$45.9 million, up 10.8% as compared with Cdn$41.4 million in 2014
Payout ratio1 of 76.7% as compared with 85.2% in 2014
http://medicalfacilitiescorp.investorro ... al-Results

As a long-time stockholder, it's good to see things moving in the right direction.
Yes. I actually added a bit today to fill out a position. One thing I really like is that they are not moving too fast. With these interest rates, they may be tempted to fatten up a bit, though.

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Re: Medical Facilities Corporation (symbol DR.TO)

Post by Descartes »

Has hit an all-time high today. Up 44% on the year. One more data point in the massive flight to CDN dividend stocks this year.
"A dividend is a dictate of management. A capital gain is a whim of the market."
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