Mainstreet Equity Corp (MEQ.TO)

Thinks highly of CEO. Great example of building a great business by investing in accretive acquisitions instead of paying out a distribution. Discount to NAV. Migration into Alberta is a great story. No dividend.

MEQ operates as a real estate corporation focusing on managing residential rental apartments and is now trading at 27.6x times' Forward P/E, but only at 1.0x Book value. In the last five years, MEQ’s revenue growth has been quite consistent, around 12% on average. Like other real estate companies, the balance sheet is leveraged, with net debt of $1.5B. The net debt/EBITDA is currently around 14.5x. MEQ reinvested heavily into acquiring new properties. As a result, the company has had no dividend payments and limited shares repurchase over the last few years.

We think MEQ has the potential to be a compounder, trading at 1.0x Book value is also an attractive valuation, but the leverage levels need to be monitored carefully, as the debt is quite high. We would be comfortable with this name for a three-year+ timeframe given its cheap valuation and consistent revenue growth.
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Very well run with a long track record. Is one of the best compounding stocks in Canada that nobody knows. It returns 20% annually for the last 20 years. They played Covid perfectly by buying companies and locking in their debt at 2% over 10 years. Are well positioned given Canada's housing shortages with low vacancies and more immigrants coming.

Attractive long-term assets. Calgary-Edmonton based. Active in their portfolios. Looks extremely good from an ROC metric. Pay attention to the apartment sector, it's a good one right now.

Likes it. Corporation, not a REIT, so it's able to retain cashflow instead of paying a distribution. Has grown well without issuing any equity. May have traded off because it reached NAV. Solid operator. Keep holding.

MEQ continues to chug along, producing fairly steady EPS growth. 
With a 16% YTD gain, the stock is somewhat expensive for the sector, at 22X earnings. 
It is likely getting more attention as market cap has breached $1B, and there are few non-REIT real estate plays in Canada. 
There is no dividend but three analysts cover it. 
Insiders own 50% and are certainly committed. 
Revenue rose 13% last year and vacancies improved. 
Debt is quite high, but shares have done very well: up more than 6-fold since 2016. 
We would consider it expensive, but otherwise pretty good for a real estate stock.   
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Specializes in acquiring and managing small apartment buildings in Western Canada.
Not a REIT, rather a corporation that retains capital.
16,000 doors currently with minimal equity dilution.
18% compound rate of return.
Sub 2% debt levels that were guaranteed at low interest rate levels. 
Rental rate increases will positively affect business.