M&A Watch: 3 Canadian Companies That Should Be on American Firms’ Buy Lists

InvestorPlace07-26

Canadian acquisition targets to buy now could yield high rewards for American companies. Thomson Reuters (TRI): It would be a large acquisition for any sized business. TFI International (TFII): The ...

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href=https://investorplace.com/2024/07/ma-watch-3-canadian-companies-that-should-be-on-american-firms-buy-lists/><strong>InvestorPlace</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Canadian acquisition targets to buy now could yield high rewards for American companies. \nThomson Reuters (TRI): It would be a large acquisition for any sized business. \nTFI International (TFII): The ...</p>\n\n<a href=\"https://investorplace.com/2024/07/ma-watch-3-canadian-companies-that-should-be-on-american-firms-buy-lists/\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK4533","symbol_name":"AQR资本管理(全球第二大对冲基金)","start_time":0,"source_url":"https://investorplace.com/2024/07/ma-watch-3-canadian-companies-that-should-be-on-american-firms-buy-lists/","article_id":"2454880078","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2454880078","pubTimestamp":1721930171,"sourceInfo":{"source_id":"investorplace_stock_picks","name":"InvestorPlace stock picks"},"weMediaInfo":null,"summary":"There are plenty of Canadian acquisition targets trading on the NYSE and Nasdaq for American firms to buy.","collect":0,"end_time":0,"defaultTopTitle":"investorplace.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4533":"AQR资本管理(全球第二大对冲基金)","LU0971096721.USD":"富达环球金融服务 A","IE00B19Z9505.USD":"美盛-美国大盘成长股A Acc","BK4548":"巴美列捷福持仓","ARR":"ARMOUR住宅房地产公司","LU0980610538.SGD":"Natixis Harris 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Funds - Global Absolute Alpha A Acc USD","LU0354030438.USD":"富国美国大盘成长基金Cl A Acc"},"translate_title":"并购观察：应列入美国公司购买名单的3家加拿大公司","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"ARR":1,"TRI":1,"TFII":1,"SPGI":1,"DCBO":1,"AFG":1},"content_text":"Canadian acquisition targets to buy now could yield high rewards for American companies. \nThomson Reuters (TRI): It would be a large acquisition for any sized business. \nTFI International (TFII): The firm could be a perfect acquisition for Warren Buffett’s company.\nDocebo (DCBO): Its learning management system is training the world.\n\n\n\n\n\n \n\nSource: Shutterstock\n\n\n\nOn July 11, private equity firm Platinum Equity Advisors announced that it would acquire Héroux-Devtek (OTCMKTS:HERXF), a Quebec-based aerospace firm. The $1.35 billion deal is one of the many Canadian acquisition targets that are or should be on American firms’ buy lists. \nWhy are American firms attracted to Canadian businesses? The reasons include close geometric proximity to the U.S. and similar business practices and regulatory approval protocols. \nWhile the Héroux-Devtek acquisition is a private-equity sponsored transaction, I can think of plenty of strategic targets for American firms to feast their eyes on. Two industries that come to mind are cannabis and clean energy. \nWith that in mind, I’ll recommend three Canadian acquisition targets, all of whom trade on a U.S. stock exchange. To ensure these businesses are large enough, I’ll restrict my search to those with market capitalizations of $1 billion or more. \nAccording to S&P Global Market Intelligence, 85 such firms exist. Let’s examine the three that should be most attractive to strategic buyers.\nThomson Reuters (TRI)\nSource: ShutterstockThomson Reuters (NYSE:TRI) is 69% owned by Woodbridge Company, a holding company for the Thomson family of Canada. Any deal would have to get the green light from Chairman David Thomson and his brother Peter, who sits on Thomson Reuters board, and is Chairman of Woodbridge.\nThe company provides information, technology and expertise to industry professionals in tax and accounting, news and media, and legal. It has five reporting segments. Among them are Legal Professionals (41% of 2023 revenue if $6.8 billion), Corporates (24%), Tax & Accounting Professionals (16%), Reuters News (12%) and Global Print (7%). \nCurrently, Thomson Reuters has an enterprise value of $76.49 billion, 25x EBITDA. For anyone looking to buy the company, they would likely have to pay close to $100 billion or more. \nS&P Global (NYSE:SPGI) has a market cap about double Thomson Reuters. So it might be able to pull off the acquisition. Whether it would want to is another thing entirely. \nTFI International (TFII)\nSource: BalkansCat / Shutterstock.comTFI International (NYSE:TFII) has an enterprise value of $20.73 billion, 12.75x the transportation and logistics company’s EBITDA.\nThe company’s history dates back to 1957. But it was only in 1996 when a new management team led by Alain Bédard took over. Then the business really began thriving by focusing on increasing revenues and profits. Also, it strengthened its position in the North American transportation market and created a more balanced revenue mix. \nWhile organic growth has been generated, TFII is known for making plenty of acquisitions, both big and small. Since 1996, Bédard and his management team have made over 90 acquisitions. Many of them are in the U.S., where it generates two-thirds of its revenue. \nIn 2023, it made 11 acquisitions, none of them significant to top-line revenue. However, in 2024, it’s already made one big move, acquiring Daseke, a flatbed and specialized transportation company, for $1.1 billion. \nI think TFI would be an excellent acquisition for Berkshire Hathaway (NYSE:BRK-A, NYSE:BRK-B). The latter could merge it with McLane Company, the foodservice distribution business it owns.     \nDocebo (DCBO)\nSource: Phonlamai Photo / Shutterstock.comDocebo (NASDAQ:DCBO) has an enterprise value of $1.09 billion, making it the smallest of three Canadian companies. The company’s AI-powered learning management system (LMS) is used by over 3,800 corporate customers. In 2023, DCBO generated over $200 million in annual recurring revenue (ARR), growing its ARR by 24%.  \nFounded in 2005, its customer base includes well-known brands such Thomson Reuters, Lululemon Athletica (NASDAQ:LULU) and Netflix (NASDAQ:NFLX). The average contract value has grown from $12,000 in 2017 to $52,000 in 2024.\nDocebo follows the “Rule of 40” which is defined as year-over-year (YOY) revenue growth plus EBITDA margin is 40 or greater. In 2023, it had revenue of $180.8 million, 27% higher than 2022. Meanwhile, its EBITDA margin was 9.0%, for a total of 36, just shy of 40. In Q1 of fiscal year 2024, these two numbers came to 38.5, 150 basis points from becoming a Rule of 40 company.    \nOn the date of publication, Will Ashworth did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.\nOn the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.\nWill Ashworth has written about investments full-time since 2008. Publications where he’s appeared include InvestorPlace, The Motley Fool Canada, Investopedia, Kiplinger, and several others in both the U.S. and Canada. He particularly enjoys creating model portfolios that stand the test of time. He lives in Halifax, Nova Scotia.Artificial Intelligence, Communications, Industrial, Media, Shipping, Software, Technology\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\nSubmit\n\n\n\n\n\n\n\nArticle printed from InvestorPlace Media, https://investorplace.com/2024/07/ma-watch-3-canadian-companies-that-should-be-on-american-firms-buy-lists/.\n©2024 InvestorPlace Media, LLC","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"1","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.26.3","shortVersion":"4.26.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2454880078"}