Good news from Churchill Corp (OTC:CRHLA): over the past two days has been all but ignored, as deteriorating global economic conditions continue to take their toll on investor confidence.
The company's wholly-owned general contractor Stuart Olson announced three new contracts on Monday and Tuesday; one for a new school in Calgary, another for a hospital extension in Lethbridge, Alberta and a third to complete expansion at Bow Valley College in Alberta. Churchill also announced a new share buyback plan on Monday that allows the company to repurchase up to 10% of its public float.
Despite all that positive news, Churchill shares continue to drop, falling 13% over the past two days. The stock is down 70% since mid-May.
Blackmont analyst Avi Dalfen wrote in a note to clients:
Notwithstanding global macroeconomic conditions, we continue to expect Churchill Corp. to benefit from more western Canadian infrastructure projects like these, which constitute the majority of its revenues.
Still, he cut his price target on the stock from C$25.50 to C$18, given the recent contraction in peer-multiples of more than 50%. The analyst maintained his "buy" rating.