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Leon's Furniture Limited (LNF.TO)

Toronto - Toronto Real Time Price. Currency in CAD
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18.18-0.82 (-4.32%)
At close: 03:59PM EDT

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  • D
    David
    Leon’s posts blowout second quarter earnings of $.70 per share. Lower share count making a big difference. Extremely cheap stock in terms of earnings, when you throw in the 4.4 million square feet of wholly owned real estate it is grossly undervalued. But with results like this it won’t remain this cheap for long…….
  • w
    w
    25 is there with no additional global issues
  • C
    C
    4,800,000 sq ft of owned commercial and warehouse space in Canada for Leon's Furniture.
    In commercial and retail properties, the average price was $337.89. per sq ft.
    So the total real estate value is roughly 4,800,000 sq ft x $337.89. per sq ft. =$1.622 billion.
    The net debt is 347 million, so liquidation value is somewhere 1.622 - 0.347 = $1.275 billion.
    Per-share liquidation value is $19 a share.
    Oh right, don't forget the company is still profitable and growing. Forward PE is 6.89x.
    Raining gold?.
  • D
    David
    just bought my first 36 shares. this seems like a long term gem
  • C
    C
    How can they unleash the value of the real estate under their balance sheet? Spinoff a REIT? Or sell the real estate and rent them?
  • D
    David
    According to Simply Wall Street, Leon’s Chairman Mark Leon bought 73000 shares of Leon’s on the open market on June 9 at $16.59/share. Other insiders have also been making major purchases over the last 3 months in the millions of dollars.
    These people are in the best position to understand the value of the company. I would not be surprised to see management or the Leon family try to take this company private if it continues to trade far below its intrinsic value.
    Yes a recession will hurt Leon’s. But the company earned $2.60 a share last year, and this year the share count is 10% lower. Even if earnings fell by 50% (which is unlikely), the stock would still be selling at around 10X earnings and yield 4%.
    The sell off is WAY overdone. Buy Leon’s for high dividends and share price recovery……..
  • J
    Justin
    This stock seems like a steal of a deal at this price.
  • D
    David
    Another blowout quarter for Leon’s. My favourite stat, $300 million of free cash flow for 2021. Based on 70 million shares (actual less) shares outstanding that works out to $4.28 per share of free cash flow. Stock trades at 6 times that figure. Absurdly cheap. Earnings per share of $2.60 for the year based on old share count, after the buyback earnings closer to $3 a share.
    They have tons of free cash flow to pay higher dividends, buyback more stock and expand the business. Buy Leon’s while it’s still cheap………..
  • D
    David
    Leon’s to buy back $200 million in common stock in a Dutch auction, representing over 10% of shares outstanding. Management seriously considers the shares undervalued obviously. Compete with Leon’s management and buy………
  • D
    David
    Disappointing results below expectations, but stock was so oversold it still rose. Still owns 4.8 million square feet of real estate. At $250 per square foot that would be worth more than the companies entire current market cap. And the cash flow easily covers dividends and more share buybacks………
  • B
    Beef
    Wouldn't all the nee condos being built, the housing supply shortage, and mass immigration cause this stock to rise for the simple fact that people need to buy appliances and furniture before buying other discretionary things? I'm left wondering why the share price keeps declining. I'm looking to start a position here asap...
  • D
    David
    This company has 4.4 million square feet of real estate that they own outright. I figure that is worth $8 to $10 a share. And $375 million in net cash after paying off all debt. With 80 million shares, that is almost $5 a share. So your paying $6 for a company that generates tons of cash and earnings close to $2 a share. Rising earnings, rising dividends, special dividends, share repurchases, dirt cheap.
  • D
    David
    Another awesome earnings report with record sales, record earnings, record cash flow, $1.25 special dividend, bought back 3.3 million shares (about 3.5% of the float)………
    Still trades at less than 10X earnings. Real cheap stock with growing earnings.
    I will continue to accumulate Leon’s.
  • P
    Playercelli
    Sold my position today. I wouldn't be surprised it dips below $14 tomorrow. after earnings.
  • L
    Lila
    I am seeing a lot of negative press on this Co. who also owns the Brick. They are forcing employees to work but lying about not doing this. They are laying off long time employees at this time to save money. Don’t support them.
  • G
    GreenMarty
    What's with the massive drop over the last year? Is it because its retail and investors are staying away?
  • S
    Saverio
    It looks like Leon's has a decent EBIT/Interest Expense ratio, yet unless I'm mistaken the average coupon rate on the bonds (Interest Expense/Long Term Debt) seems to be around 25%. The company has more current assets than it does long term debt. I realize it's a brick and mortar store, but it sells furniture--surely it's not threatened that much by online retailers?

    Anyhow, $22 to $24 seems to be the right valuation. I'd expect about $3 of FCF per share, and a multiplier of 8 seems reasonable given that it's a furniture store. I'd say it was a bargain when it was sitting around $15.
  • D
    David
    Another blow out quarter for Leon’s. Still sells for less than 10X earnings, even excluding all the real estate they own and the cash they hold. More special dividends and share buybacks on the way. Buy Leon’s……….