Terra Firma Story

TFCCF -- USA Stock  

USD 0.37  0.00  0.00%

Macroaxis News
  
By David Taylor

Terra Firma Capital Corp. (TFCCF) is a Canadian real estate finance company.  The company specializes in bridge loans for developers and home-owners doing construction.  The company’s market capitalization is $35 million and the stock is trading at $0.489 per share, making this effectively a penny stock.  

 

A penny stock priced at 10 times earnings with future growth potential

Do not pass up a penny stock just because it is a penny stock.  There are solid earnings here and it is priced well below market averages.  If this stock were to continue and then meet up with the industry average for EPS ratio, the stock would double in price.  That is a significant opportunity for the savvy investor.  




Terra Firma Capital Corp. (TFCCF) is a Canadian real estate finance company.  The company specializes in bridge loans for developers and home-owners doing construction.  The company’s market capitalization is $35 million and the stock is trading at $0.489 per share, making this effectively a penny stock.  

Being a penny stock should not dissuade your thinking with this company.  First, look at what you earn with this penny stock via EPS.  The company is earning a decent $0.05 per share.  That is a cool 10-times earnings.  A stock priced so inexpensively, you could virtually corner the market.  And, you would get a high-yielding stock such as this.

There are a few aspects of this that I wanted to point out, the first being the industry average.  The industry and sector, respectively, are trading at 28 and 17 EPS ratio.  This makes this company’s 10-times earnings almost half of where it should be if the stock were to be trading at the average.  

Another point to show is that the return on assets and return on investments ratios are much higher than the industry, 9 and 7, respectively.  The industry and sector have been lagging these indicators.  That is interesting because it basically shows that the company is doing better at what it does in its niche.  However, the company’s stock does not price appropriately when you compare it to the industry.  That is an opportunity.  

If the company is going to perform highly, and especially highly versus its counterparts, then it is a strong candidate for putting into your portfolio.  What is even more compelling is the EPS ratio that allows for this company to increase in value substantially over the next several months and years.  

But, there is more to this.  First, the economy itself is continually expanding.  Interest rates are likely to continue to move higher and higher.  Because of that, the rates that TFCCF can charge its lenders will be higher.  This equates to more profits.  Further, the company will resell its loans in packaged bundles, a business model that is regularly employed in the industry.  The company then services the loans while keeping a small differential in between.  That is pure profit from what it charges to what it pays the purchasers of its bundled loans.  Those rates are going to be increasing and that is going to mean more profits for the company.  

As those rates continue to move higher via the central banks and the lending rates of financial institutions, the ratcheting of interest rates, there will be continued profit centers as the bank has more room to work with its differential.  

Given that this stock is a penny stock it is easy to look past the opportunity.  When considering this, keep this in mind, a 10-year government bond is currently yielding 2.50%, whereas purchasing this stock is akin to earning a 10% return with its EPS ratio.  Plus, earnings have been increasing and, as shown the economic landscape is going to be improving as such that there will be continued profits.  

My first inclination it to place this stock into my portfolio just until the EPS ratio breaks the industry average.  However, I am also inclined to add this stock into my portfolio simply because there will ultimately be a tremendous amount of growth.  If the stock were to trade at the industry average the price would double.  Then, from there, any growth from interest rate increases will only add to the revenues, which will add to the overall stock price.  

Given those variables, an investment in TFCCF is a smart move.  Given the stock is so inexpensive, it also makes sense to hold a significant position size. 

0.0

About Contributor

David Taylor
   David Taylor is a Senior Member of Macroaxs Editorial Board - Sector Analysis. David is a professional writer who writes for multiple investment news outlets. His primary focus is dynamic movements in financial markets and effects of economic volatility on North American industries and sectors. David has many years of experience in financial service industry including working with major banks as a FX trader. In his free time, he does a lot of outdoors type activities including rock climbing, mountain biking, hiking, mountaineering and kayaking in the summer, and snowboarding in the winter. View Profile
This story should be regarded as informational only and should not be considered as solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC.

Story Momentum

This story impact on price volatility cannot be determined at this time. Please check this story after some time to allow current data to be analyzed.

Similar stores for Terra Firma

over three weeks ago at www.fairfieldcurrent.com 
Terra Firma Capital Co. Director Purchases C49,000.00 in Stock - Fairfield Current
news
Terra Firma Capital Co. Director Purchases C49,000.00 in Stock Fairfield CurrentTerra Firma Capital Co. Director Miroslav Jerry Patava bought 100000 shares of Terra Firma Capital stock in a transaction that occurred on Thursday, ...
over two months ago at globenewswire.com 
Terra Firma Capital Corporation Reports Financial Results for the Third Quarter Ended September 30, 2018 and ....
news
GlobeNewswire Full coverage
over three months ago at whatsonthorold.com 
OncoCyte Corporation EPS Estimated At -0.09
news
Thorold NewsFull coverage
over three months ago at baycityobserver.com 
Revealed Dozens of well-heeled Irish investors to share in 2.5bn windfall
news
Bay City ObserverFull coverage
over three months ago at www.mondaq.com 
Guernsey Guernsey Embracing Innovation
news
Mondaq News AlertsFull coverage
over three months ago at www.nasdaq.com 
Terra Firma Capital Corporation Announces Closing of Two First Mortgage Transactions in Two Projects Totalling...
nasdaq News
NasdaqFull coverage
over three months ago at ztribune.com 
Analysts See 0.01 EPS for Terra Firma Capital Compass Diversified Holdings Has 1.83 Sentiment
news
Z TribuneFull coverage
over three months ago at ztribune.com 
Terra Firma Capital Analysts See 0.01 EPS Gargoyle Investment Advisor Has Increased By 1.89 Million Its ...
news
Z TribuneFull coverage
over three months ago at citywire.co.uk 
Tuesday Papers Alphabet shrugs off EUs record 4.3bn fine
news
Citywire.co.ukFull coverage
over six months ago at www.independent.ie 
Revealed Dozens of well-heeled Irish investors to share in 2.5bn windfall
news
Independent.ieFull coverage
over six months ago at heraldks.com 
Terra Firma Capital Corporation Is Yet to See Trading Action on Jun 24
news
Herald KSFull coverage
over six months ago at heraldks.com 
Analysts See 0.01 EPS for Terra Firma Capital Tesaro Has 1.21 Sentiment
news
Herald KSFull coverage
over a year ago at morganleader.com 
Investors Are Turning Their Attention Towards Terra Firma Capital Corp s Technicals
news
Morgan ResearchFull coverage

Total Debt

Total Debt Comparative Analysis

  Total Debt 
      Terra Firma Comparables 
Terra Firma is currently under evaluation in total debt category among related companies. Total Debt refers to the amount of long term interest-bearing liabilities that a company carries on its balance sheet. That may include bonds sold to public, notes written to banks or capital leases. Typically, debt can help a company magnify its earnings, but the burden of interest and principle payments will eventually prevent the firm from borrow excessively.
Also please take a look at Terra Firma Hype Analysis, Terra Firma Correlation and Terra Firma Performance. Please also try Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Search macroaxis.com