Income Investing – Peller Expands in Wine Kits

Article Excerpt

ANDREW PELLER LTD. $9.75 (Toronto symbol ADW.A; Income Portfolio, Consumer sector; Shares outstanding: 14.9 million; Market cap: $145.3 million; SI Rating: Above average) has acquired World Vintners Inc., which makes and sells home wine-making kits. World Vintners sells its products through 75 franchised stores under the ‘Wine Kitz’ banner. Peller currently sells wine kits through its Vinceco and Winexpert divisions. The $9 million purchase price is equal to 79% of the $11.4 million or $0.78 a share that Peller earned in the fiscal year ended March 31, 2008. World Vintners’ annual revenue of $12 million will increase Peller’s revenue by 5%. The purchase strengthens Peller’s position as Canada’s leading supplier of home winemaking kits, and integrating these new operations will let it cut costs. Its shares yield 3.4%. Andrew Peller is an income investing buy. buy. …