5 from 5i: Is value investing dead?

Barkha Rani Dec 15, 2018

Market View

The Dow Jones and S&P500 are down over 2% this week. The arrest of a top Huawei executive has left investors worrying about the US-China trade war. On a positive note, China announced plans to cut tariffs on cars to 15% from the current 40%.  The Canadian dollar was 74.76 cents U.S. The week ended with the TSX down 1.7% and S&P500 down 1.5%.

Only 1 of the 12 subgroups were in the positive territory this week. Consumer staples were up 1.1%. Energy saw the deepest fall by 4.5%, Consumer Discretionary was down 2.5%, and Financials were down 0.9%. Dollarama reported a 2.7% rise in quarterly profit, missing estimates. Total sales rose from $810.6 million to $864.3 million. Bombardier announced that it expects to deliver 150 to 155 business aircraft in 2019. Aphria was the name that came under scrutiny this week. A report was published which shook investor confidence in the company and its recent purchases. Altria announced an agreement to purchase 146.2 million of newly issued Cronos shares at $16.25 per share for a 45 percent stake. This represents a 16.2 percent premium to the stocks’ close on Thursday on the TSX. Hudson’s Bay reported a third-quarter loss that was attributed to increased depreciation and amortization expenses and joint venture losses. Bank of Nova Scotia reported an EPS of $1.77, slightly missing the estimates of $1.78. Cenovus Energy said that it would reduce its capital spending in 2019 by 4%. The most heavily traded shares by volume were Aphria, Aurora Cannabis, and Nevsun Resources.

5 from 5i

Here are five reads we found interesting last week:

-Is value investing dead?

-Exploring what buyback should mean for investors

-Looking back at the US economy since World War II

-The forecasting power of an inverted yield curve

-The rule of large companies sustaining their growth

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1 comment


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Dec 16, 2018
Thank you for the article on value investing. I have never found that the book value of a company to be a worthwhile consideration in determining if a company is under or over valued. Perhaps because I tend to only invest in cheap small and microcap companies.