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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: Hello, split shares have dropped quite a lot recently. Most are well below the $5 threshold (DF-$3.08, DGS-$3.50, FFN-$3.52), where monthly dividends ($0.07-0.08) are distributed. Most of the companies that are being held in split shares are bank stocks and other high quality Canadian stocks.

I am trying to better understand the risks of owning split shares. I estimate the only circumstances I would not collect dividends are when:
1) the prices of the equity inside the split shares never go back to the normal level, and
2) the dividend-paying equity inside the split shares cuts and suspends dividends.

What other risks can you think of? Do you think the risk outweighs the rewards?

Thanks
Read Answer Asked by Esther on August 12, 2020
Q: MKL has been described as a "mini" Berkshire Hathaway. Looking at specialty insurance sub-sector for value component of our portfolio - some growth with a margin of safety for long-term holding. Would you advise MKL or another with similar attributes for an initial position?
Read Answer Asked by sam on August 11, 2020
Q: Four months ago you said..........

"PNNT insiders have been large net buyers of stock over the past six months. The stock is 5X earnings, but quite small at $182M market cap. Indicated yield is 26.4%, with the last dividend paid April 1. The dividend was cut in late 2016. PNNT is a finance company, providing loans to US middle market companies. Investors are concerned about defaults in a corona world, and the stock is down 58% this year, pushing yield higher. The company has 135 investments; some are doing well (groceries) and some are shuttered. The company recently gave a shareholder update, and it is good to see insiders backing their generally positive remarks. Still, we would put this one in the extreme risk category, on size alone, as well as a possible dividend cut or elimination."

what is your current analysis and opinion of PNNT
Read Answer Asked by JACK on August 06, 2020
Q: Hello 5i Research
Thank you for all the questions and answers that you post every day. I start everyday reading all the post to keep me informed.
I currently own visa and MasterCard in my RRSP , do you recommend switching to SQ or/and PayPal at this time?
Thank you for your great service.
Claudio
Read Answer Asked by claudio on August 05, 2020
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