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iShares S&P/TSX Capped Financials Index ETF (XFN $71.31)
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Aritzia Inc. Subordinate Voting Shares (ATZ $90.93)
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Sagicor Financial Company Ltd. (SFC $8.17)
Q: Hello Peter and team,
What do you think of Sagicor Financial and Aritzia? Also, the banks PE seem to be high in comparison to the past. Do you feel it is time to trim the positions in the index? Appreciated.
What do you think of Sagicor Financial and Aritzia? Also, the banks PE seem to be high in comparison to the past. Do you feel it is time to trim the positions in the index? Appreciated.
5i Research Answer:
ATZ continues to execute well with very very solid same store growth. It is growing fast in the US and is managing its growth properly. We like it a lot. SFC is small, but very cheap and doing well. Next year earnings growth should be in the 15% range. Estimates have moved up a bit in the past month and the stock is doing well. Bank valuations are a bit high, especially BMO and RY. But the worry over loan losses is abating, and they have reported good results. We might not want to be at 31% like the TSX but continue to view the sector in a positive light overall.