Monthly Message

The Wutherich & Co. Composite was down 0.3% in March. This compares with the S&P/TSX down 0.2% and the BMO Small Cap Index down 1.6%.

By the end of March, all of our companies in the Wutherich & Co. Portfolio had reported their most recent quarterly results. With a few exceptions, the numbers were good, not that you would know it from the reaction in their stock prices.

One of our long-term holdings is Badger Daylighting. It has been interesting to watch how this stock has performed over that last 2 years or so. The company has proven that it can grow beyond its Western Canadian oil and gas roots and enter other end-markets and geographic areas. It has done so in spectacular fashion. Yet, the stock price is about the same as it was two years ago despite much stronger fundamentals. A key reason is that it has been the prey of US short sellers who seem to be able to make any number of unsubstantiated claims against the company. To date, nothing has come to light of a material nature to indicate that the company has done anything wrong. Now, Badger management is fighting back. They have hired advisors to investigate the practices of the short-sellers and they will forward their findings to securities regulators. Meanwhile, we focus on the fundamentals of the company which continue to look very good. We are happy to continue to hold a significant position.

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