High Liner Foods (HLF.TO)

Seafoods. Trading on a single digit PE ratio. 9.9X 2013 earnings. Has made some really good acquisitions, particularly the Icelandic one. Have expanded their brands quite dramatically and are now becoming big players. Undervalued.

Fish food processing. Seems to have found the magic formula for acquisitions using debt. Debt is about 3X equity. Did a very big acquisition in Iceland with a hostile bid for a privately held company. This gives them a big part of the East Coast US. Won’t have top line growth but are putting on cash flows like you wouldn’t believe. Very good managers.

(Top Pick Nov 21/11, Up 100.27% Total Return) It was trading obscenely cheap. Made an amazing acquisition to get them exposure to the US. Still cheap today.

Buying up more and more brands so really becoming a consumer marketing company and not one that has a huge amount of “risk on” for fish stocks etc. Some great acquisitions and a really wonderful story. Return on capital is excellent. Trading at only 8X earnings so it has lots of room to go.

Not the kids’ fish stick company anymore. Now 70% in the US. In food services in hospitals, restaurants, etc. Seafood business is very fragmented and they want to be the leader through consolidation. Absurdly cheap at 8X earnings. Have raised the dividend 7 times since 2003. 2.2% dividend.

(A Top Pick Aug 11/11. Up 28.54%.) Pays a dividend of $.40 a share. Have made a terrific acquisition by getting assets from Icelandic Group giving them an entrée into the US, retail, grocery and food service. Took on a lot of debt but are already paying it down. Trading at 8X earnings so is still very cheap