Will SCI increase the ante for Loewen (LWNG) today? Message Board

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Strategies & Market Trends : Will SCI increase the ante for Loewen (LWNG) today?

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To: Thomas J Pittman who wrote (5)	11/23/1996 5:02:00 PM
From: John Wasikowski	of 21

Thomas, You have picked a great sector. I will fill you more tomorrow. I'll give you a teaser. The funeral/cemetery public traded companies: SRV Service Corporation International LWN Loewen Group STEI Stewart Enterprises ECII Equity Corporation International CRSV Carriage Services That is the order of bigness. Currently SRV is making an effort to buyout LWN. It will be a protracted battle. They hate each others guts. All the companies are growing at 20% a year. I personally would stick with the top 3. I have owned shares in all but CRSV. I have made money in all of them! The demographics are compelling. Most funeral homes are independently owned and extremely profitable with high barriers to enter the field. These big guys spend there money buying out locations where the owners want to retire and cash out; no kids that want to run the business. They keep everybody on board so changes are apparent to consumers. All the companies engage in purchasing locations close together to lower operating costs and increase purchasing efficiences. In this industry it is called clustering. They also buy cemeteries and build funeral homes on the same property; increases market share and profits. This is called combinations. In addition, all of them are aggressively selling pre-need funerals and burials. this captures market share and puts cash into the pipeline. they is a great money business! And on top of that, the baby boomers have hit age 50 so the demographics for this industry will look better and better each year from now on. The "safest" one in my opinion is Stewart right now. Not engaged in the takeover battle and is plugging away quietly at a 20% EPS growth rate for the future. The top three companies have deep and significant management depth. I have made a lot of money on these babies so far, and the train is still pulling out of the station! More later... John

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