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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: In the balanced portfolio, there are 25 Companies. Of these companies, which do you anticipate raising or restoring their dividends, and which companies do you feel are ripe for M&A, either way, to buy or be bought?

I see that TFII has been active, as well as SIS raised the dividend by 4.3% yesterday.

Thanks for taking the time to provide the insight.
Read Answer Asked by Kelly on September 17, 2020
Q: Hi,
I'd like to know how you would view debentures on SHOP, how the balance sheet is holding up and where the estimates for revenues going forward are. I am concerned about today's drop and whether or not it is worth holding, or ditching prior to the announcement regarding price for the secondary issue and debentures. Is there anything about SHOP I am missing here? I'm kind of curious as to why it has experienced a 22% decline in the last 3 to 4 weeks, when the tech sector in Canada is down just over 11% in comparison - does this indicate SHOP is falling out of favour compared to its peers? I noticed that in the US, ETSY has had a similar drop, but AMZN, EBAY are less. I had been under the impression that with SHOP's recent work with WMT and many small businesses moving online recently any pullbacks would be less, but maybe SHOP is just that volatile? As always I appreciate any thoughts or comments you have.
Dawn
Read Answer Asked by Dawn on September 17, 2020
Q: As per my portfolio analysis I have reduced my position in tech and industrial. One area Where I don’t have an investment I.e. communication services I’ve taken A partial position in BCE. I need to add health care. What is your opinion of the above? What would be your top pick in this area.
Read Answer Asked by Roy on September 15, 2020
Q: Two part question about CSU: some time ago there was an announcement of a transaction where a company acquired by CSU would be "spun out" to CSU shareholders. Can you provide details of what is to happen? when is it to happen? do you expect CSU's share price to decrease as a result? What tax consequence will there be to CSU shareholders?
Secondly, I recently read the following:
"Our Strong Sell is based on our conviction that it
is difficult to create shareholder value by
continuing to add shrinking legacy software
businesses to 100’s of other shrinking legacy
software businesses. With organic topline
contraction and fading operating leverage, we
see CSU’s “never-ending roll-up” finally hitting
hard limits. In our view, CSU is too reliant on the
assumption of customer stickiness for legacy
apps with expensive support contracts in
dozens of niche/vertical markets. We see these
apps increasingly dislodged by less expensive,
more inherently agile, cloud alternatives. A
Covid-19-driven economic downturn would
likely intensify this competition, as it is our
experience that, rather than preserving the
status quo, tough times drive customers to
overcome inertia and accelerate paradigm
shifts in enterprise IT."
What is your assessment of this?
Thank you for your excellent service.
Read Answer Asked by Leonard on September 15, 2020
Q: I own both SHOP and LSPD. As LSPD moves beyond services to restaurants into services for other merchants, I am wondering how much overlap there is between there two businesses. Is it advantageous to own both?

Thanks as always.
Read Answer Asked by Ken on September 14, 2020
Q: Hello and Good day,

I would really like to see some type of historical listing? under the porfolios tab to capture the changes that were made to the model portolios over the years. Example: NFI, RHT. Price the shares were bought and sold for a loss. The winners are very highly touted and rightfully so, but to the casual subscriber, it almost appears that 5i has never picked a bad one? Maybe you could do it by the year?? Just a thought. Thanks again.
Read Answer Asked by Darby on September 11, 2020
Q: Good morning 5i,

Looking to add two names to my portfolio, with the only criteria being a combination of balance and growth, and with a long-term horizon. Currently thinking of GSY and REAL/LSPD, are you good with these at today’s levels? Listed some others I’m interested in too. Any other of your favourites you’d consider (already own KXS, WELL). Thanks.
Read Answer Asked by Jeff on September 10, 2020
Q: I have been looking to take a position in Lightspeed for some time now, when it was in the $24 range, but it went up too fast too soon. with the current 15% drop and the IPO coming up, would you suggest I buy now, wait until the pricing is announced or until the issue is completed? Do you expect much volatility particularly to the upside in the interim?
Regards
Rajiv
Read Answer Asked by Rajiv on September 10, 2020
Q: Hello team,

A glance at the yield in the BP last month indicated 1.66%. Obviously that number would have been higher had CAE, GIL not cut their dividends and Suncor reduced theirs.

Is this yield in line with the guidelines that 5i uses for this portfolio? Or does one need to adjust to the new reality post pandemic of lower rates for longer?

Additionally, the BP currently has 7 stocks with no dividend and 3 others (Boyd, CSU, ATD) with a smallish dividend. While I get that these stocks would be considered growth stocks, at what point does one get concerned with the likes of CAE, GC, GUD, SU and GIL who have seen a sustained destruction in share price? Thanks in advance.
Read Answer Asked by Kelly on September 09, 2020
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