I am significantly underwater in these stocks in my TFSA. Should I sell off the little I have left and redirect the funds. I don't need the money at the moment, but also don't want to throw away what is left. Do either of these have a significant future to warrant hanging on?? Cheers, Tamara
We are comfortable selling U. Although there is some positive short-term growth potential for EPS and revenue, long -term growth prospects are more concerning, and it is becoming a fundamentally weak company. Debt load is high, it is operating at a net loss and the valuation at 28.2x forward price-to-earnings is expensive.
We are also fine selling TIXT as there is nothing significant in the future to warrant holding on. Recent quarterly results were better, and management did reaffirm guidance in the last quarter so it could be an OK hold to see if there are improvements, but there was nothing significant displayed here. TIXT continues to struggle with a high debt load in addition to a drop in large clients.
Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in U.