Bear case:
- heavily geared (debt:equity is fifteen times),
- negative earnings growth (-7% YoY),
- bad economics (the company keeps archive boxes of paper for companies that need space),
- poor return on assets (3.94%),
- $2mmm of current liabilities to finance (OK, some trade creditors, but still),
- vulnerable to multiple compression (P/E ~30 ) aka rotation,
- balance sheet assets may collapse if rates keep rising (presumably they are warehouses in marginal locations).
Bull case:
- high dividend yield (~5%),
- very steady historical revenue,
- seems to be well managed, with a fairly demanding schedule of debt repayment historically,
- cost of interest seems modest ($425 mm pa on $13.5 mmm of total liabilities).
I can see why people like this stock, and I understand that it's doing some work to extend its market leading paper archiving into the digital world, but a company with expertise in collecting boxes of papers and storing them in warehouses is not likely to be that good at creating world-beating software (just to show my biases).
Last updated: 2026-03-07 by automated standardization process
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