(BPF-UN) Boston Pizza Royalties - Ratings and Ratios

Boston Pizza Royalties Income Fund is a trust that indirectly owns the trademarks and trade names of Boston Pizza International Inc. through Boston Pizza Royalties Limited Partnership, enabling the operation and franchising of Boston Pizza restaurants across Canada. As a result, the fund generates royalty income from the sales of Boston Pizza restaurants, providing a relatively stable source of cash flows.

The trusts business model is centered around the collection of royalties, which are typically a percentage of the gross sales of Boston Pizza restaurants. This model allows the fund to benefit from the success of the Boston Pizza brand without directly operating the restaurants. The funds income is distributed to unitholders, making it an attractive investment for those seeking regular income.

From a technical analysis perspective, the stock has shown a strong uptrend, with its current price of $18.54 CAD being close to its 52-week high of $18.77 CAD. The short-term and long-term moving averages (SMA20: $17.67 CAD, SMA50: $17.18 CAD, SMA200: $16.73 CAD) indicate a bullish trend, suggesting that the stock is likely to continue its upward momentum. The Average True Range (ATR) of 0.35 CAD (1.91%) indicates relatively low volatility, making it a relatively stable investment.

Combining the technical and fundamental data, a forecast for Boston Pizza Royalties Income Fund can be made. With a P/E ratio of 11.87 and a forward P/E ratio of 11.26, the stock appears to be reasonably valued. The Return on Equity (RoE) of 11.28% suggests that the fund is generating a decent return on its equity. Given the stable cash flows and the bullish trend, a potential price target for the stock could be $20.00 CAD in the next 6-12 months, representing a 7.9% increase from the current price.

To achieve this price target, the fund will need to continue to collect stable royalty income from Boston Pizza restaurants, and the overall market conditions will need to remain favorable. Any significant decline in sales at Boston Pizza restaurants or an increase in interest rates could negatively impact the funds income and, subsequently, its stock price.