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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: All things being neutral, what would your expectations be for Covalon's 2018 and 2019 earnings per share? Also, can you give a brief history of their cash levels (maybe for the previous 3 or 4 quarters?)

Secondly, I know you are not fans of averaging down. However, if you WERE to average down, would you take your initial purchase price in trying to determine your percentage weighting, or would you take the current market price? Example, lets say I take a 2% position in Covalon, which theoretically I would want to be my maximum weighting. Shortly afterwards the share price falls 50% (for the sake of easy math). Would I prohibit myself in buying more Covalon because my initial purchase price represented 2% of my portfolio or would I grant myself the option of averaging down because now my weighting in Covalon represents 1% of my portfolio, assuming my portfolio value remained the same.

Thanks and good luck to the staff's kids for their new school year.

John
Read Answer Asked by john on August 31, 2018
Q: Further comment about press releases sent directly to investors from Covalon CEO Jeffrey Mandel: I own that stock. If memory serves, the stock hit a high of 9.15 on August 6 and then appears (in my naive understanding) to have become the victim of a short attack. Trading was halted and IIROC then asked the CEO what material change(s) -- if any -- might account for the abrupt drop -- which hit a low of 6.26 (nearly 40%). As an investor, I took Mandel's first direct emails (which began at that time) as reassurance to investors not to panic and dump the stock. COV has recovered somewhat since then, but I'm assuming that Mandel might be sensitive to the potential of another assault against his company (e.g., SHOP) and may want to inform investors directly of positive progress being made -- which include the last couple of messages that just arrived in my inbox.
Read Answer Asked by RANDALL on August 29, 2018
Q: Since buying COV, I've started receiving regular emails such as these 2 yesterday:
"Covalon Announces Another Milestone Quarterly Profit on Excellent Third Quarter Financial Results"

"Covalon's excellent earnings listed on Globe and Mail small cap movers list"

I have never received these types of emails on this regular of a basis from other companies that I own. Should I be concerned about the promotional nature here?
Read Answer Asked by Andrew on August 29, 2018
Q: Hi Team

In Healthcare I own SYK GUD and COV. I would like to buy another US Health. Which of ILMN or ISRG would you recommend today. I have read all your recommendations but just cant decide...looking for the most growth of course. Dividends do not matter.

Thank you
Read Answer Asked by El-ann on August 28, 2018
Q: Hello,
I would like some names to consider (2 or 3) for the healthcare sector.

I already own GUD in Canada (TFSA). This is for my RRSP so I am looking for a more conservative name.

I know you don't cover the US but would like names from the US or even international for geographic diversification. Also, for personal reasons, I do not want any drug companies (pharma or biotech).

Thanks as always for your help.
Dan
Read Answer Asked by Daniel on August 27, 2018
Q: Hi Peter and Staff
I know you are not as familiar with the US. A family member is thinking of a small investment in his portfolio of ARNA Arena Pharma in the US.
Would you be able to give some comments on your thoughts and whether for a younger person not risk adverse how far devoting a half position to this company would be any wiser than a casino visit?
Thanks and have a great day
Dennis
Read Answer Asked by Dennis on August 24, 2018
Q: There are not many Canadian stocks in the healthcare sector. Telus is now in the Electronic Health Records business, and Loblaws now owns Shoppers Drug Mart. Would you consider L and T to be partially healthcare?

Do you have any stock suggestions for healthcare in Canada? If not, could you recommend US or European stocks that would be advisable?

Thank you,

Fed
Read Answer Asked by Federico on August 23, 2018
Q: My question is on VIVO. It's a rebrand from former Abcann Global and apparently your system has not yet updated so I couldn't put it into the box above. Just wondering if you have any further insights in regard to this stock. I recognize that it is just one more entry in a large field of cannabis "wannabees". They suggest on their website that they have some proprietary technology in regard to cannabis production that might give them an advantage but I'm not sure how much credence to put in this claim. Generally, please give your opinion on VIVO currently in regard to valuation, management and forward guidance, to the extent that you are able. Also, do they have any free cash flow at the moment and what is their debt level like. Thanks.
Read Answer Asked by Donald on August 22, 2018
Q: I have been seeing more questions on TH recently and see no reason not to begin a modest position but I wanted to compare it to two companies you have endorsed and which I own. Do you see more or less upside in TH vs RHT and COV? Could you rank these three according to growth potential and risk? To clarify, please rank 123 based on which have the most upside and 123 based on which are risky from least to most. Deduct credits as you see fit.

Thanks!
Read Answer Asked by Tim on August 22, 2018
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