Investment Q&A

Q: Hi 5i, thx again for prompt feedback on my WELL Q's.

Here are a few comments from TD and RBC analysts, both positive, followed by my new Q.

RBC: WELL Health Technologies is well-set to create value, but RBC analyst Douglas Miehm says the market doesn't appreciate it. After a strong 4Q that largely beat expectations, the stock fell about 10% following an unexpected 8% rise on Wednesday in anticipation of 4Q results. In a report, Miehm says that "the market is currently underappreciating the long-term value creation opportunity in "transforming Canadian primary/Dx care, as underscored by our strong forecasted return on invested capital and internal rate metrics for recent acquisitions." He says that there are multiple
tailwinds in Canadian patient services and in diagnostics services to carry it in the longer-term.


TD: WELL Health Technologies shares were down sharply despite reporting better-than-expected earnings in the fourth quarter, but TD Cowen analyst David Kwan says this could be chalked up simply to algorithm trading patterns after the previous day's gains. Shares were down nearly 13% on Thursday to C$3.71 after reporting higher 4Q profit, a revenue beat and upgraded its outlook for the year. On Wednesday, shares rose 8%, and Kwan said Thursday's swing could be trading patterns playing out. "This could be a case of more algo-driven trading patterns," he said.

My Q: please expand on how impactful these "algo-driven" trading patterns are on stocks, especially small caps. Thx.

Q: Hello 5i
I know the policy is to stay invested through thick and thin. In the past with some companies I was up thousands. I started to see the price per share decrease but 5i wrote to "keep going we will see what happens". By the time 5i got around to throwing in the towel I was down thousands. After, when a company started to go belly up I listened to my gut and got out before 5i gave up the ghost. I saved several thousand by doing that. NOW, with PBH, I am up several thousand. Though the metrics still look good, I want to take my winnings before a disaster happens, however I will still keep the principal invested in PBH.
Question: does this sound like a plan or should I still keep fully invested in PBH?

Q: Good afternoon,

Long-term holder of SIS and barely above water. It seems like the potential has always been there, and decent div, but based off of some of your recent comments I'm wondering if a switch to ATS may make sense - both industrials, yes no Div (but growth trumps div's), and it actually appears ATS is cheaper than SIS on PE (though not on P:book).

3-5 years out, which do you feel has more potential to outperform the other? Thanks in advance. - Jeff

Q: 5i’s Income Portfolio:
You’ve stated elsewhere that this portfolio targets a 4 to 5% income and 6 to 8% return….thats easy to understand.

What is not clear to me is the rationale behind the composition of the portfolio. Sector weightings, for example, do not conform to advice provided elsewhere.

Would you please explain the composition, or point me at a place where you have already done so.

Q: What are some of the negative outlooks of GWO? Is it worth investing in as of today and if so is it primarily for the dividend or growth? And how come lots of analysts are reiterating a hold? What insurance company would you recommend over GWO?

Q: I struggle with ATS and KXS whether to sell or continue to see drifting lower. I know you suggest selling if something fundamental has changed for the worse. People commonly thinking ATS is a growth name, but their backlog is shrinking, still a growth name? Fundamental changed? KXS's growth is declining as well....when it will resume their growth? If sell them, what to buy to replace? Can I have your thoughts? Thanks.

Q: Bit confused over 5i responses given on WELL yesterday. 5i initially said results were good and it appeared from answer that there were no negatives. But stock was taking a big hit. Then new questions came in and you responded that there were some negatives (eg decrease in margins, net income and , cash flow). Obviously these are important as sellers stepped in and continue today so far. Usually 5i provide good insight but I think you guys dropped the ball on this one. The initial response should have hi-lited both the good and the bad. And whether the stock had a good run leading up to earnings shouldn't affect your response. Again, I stress usually you give full and fair insight and assessment but not this time.

Q: Hi there, any further insight into WELL after the conference call?

Are they being unduly punished for any particular reasons after good results, and if so, can you explain why the markets are pushing the stock down so hard?

I'm confused as to why this stock keeps being held down with such good growth over the past few years!

Any further help would be greatly appreciated.

Thanks!

Q: Hi, ATD stock is considered as One of the Best compounders in Canada and is strongly liked at 5i, for a long term ownership. Shares dropped sharply today after soft results, due to lower fuel margins ( It was expected and analysts believe these margins could be volatile and turn any time ) and sequentially lower SSSG, caused by reduced foot traffic ( Inflation impacting purchasing power of consumers ).

Do you believe that above issues could be resolved over time and the sell-off is presenting a buying opportunity to accumulate more shares ?

Thank You

Q: Here is another take on WELL:

Adjusted gross margin 43.7 % down from 51.3%

Adjusted net income $52.4 million down from
$ 53.7 million

Adjusted free cash flow $42.4 million down from $ 48.9 million.

I am in the camp of Warren Buffet and Charlie Munger who dismiss EBITDA. If you’re going to give a financial number before interest , for instance, you may as well exclude salaries ( or anything else for that matter ) as well.

I own WELL but will keep a closer eye on it. Please shot holes in my thoughts. Thanks. Derek

Q: I sold 1/2 of my ATD because it got to over 20%. Do you think a good replacement with the recent weakness would be BYD or do you view the risk as significantly higher? Do you think the selling on BYD after its Q release is over done? What would be a good entry point? Is there another stock you would consider a better replacement for ATD?
Thank you.
John

Q: Well is down following earnings report. Your thoughts please.

Q: Hi There Would there be any reason for the drop in Celestica shares lately . Could you comment on it going forward ? thanks Larry

Q: Where on the 5i web site can I find a sample portfolio(s) pls?

Q: Please comment on the latest results and guidance going forward.Txs for u usual great services & views

Q: Can you comment of report that SHOP CEO is up for a $200m stock bonus? The Globe mentions it may be based on performance of the stock price itself. Does the CEO need this type of incentive considering he already owns 40% of the company?

Q: Over a 3-5 year period which is better for growth, ATS or TVK?

Thank you.

Howard

Q: Hi there, todays news that CTS was awarded 2024 Nvidia Networking Partner of the Year as well as the Canadian Partner of the Year confirms they are deeply involved with Nvidia.

Does this really mean much? I'm sure it definitely brings more awareness of CTS.

But do these types of recognition awards increase business/sales, etc? Especially considering Nvidia is talked about everywhere and all the time now.

Thanks!

Q: Hi 5i
Given recent news and increase in share price would 5i continue to be holders or would they be sellers.... and why?
The sp decline last week was very discouraging but the sp pop monday was very encouraging..... However trying to capture a diminishing upside is a risk since as you say there are no guarantees... I believe your estimated upside was around $40 canadian... As investors how would 5i analyse this decision to reduce emotional element...

thx

Q: Hi Everyone at 5i!!
What are your thoughts on Galaxy Digital? Their earnings report is coming out on Mar26th. Would you happen to know what the earnings potentials may be going forward?

Cheers,

Tamara