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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: I thank you for your thoughts on CZO & NLN. However I am still interested in small cap companies and I am more than prepared to take some risks for some potential of mid term gain. What would be your 5 top small cap companies that you would recommend for me to put on my watch list???
Read Answer Asked by Bob on May 01, 2017
Q: What do you think of Street Capital Bank (SCB)? It's been tarnished by the HCG brush, although SCB seems more conservative, especially as it went through a multiyear process to get its banking licence, just this past December. Thus, I would think that things would be in optimal financial and operational order.

Also, I would think that they would actually benefit from picking up business from those fleeing Home Capital.

The share price has already really come off significantly.

How do you see things?

Thanks,
David
Read Answer Asked by David on May 01, 2017
Q: Sorry one company but multiple questions. I know you don't follow Distinct Infrastructure Group closely, but after seeing in Q&A was looking at for a microcap, but after looking to more, almost feel like trying to short. Wondering if you have time to look at a couple of questions.

1) Management took out an expensive $20M loan for acquisitions, made one acquisition for <$3M, took >$1M in Goodwill and the business lost >$200K in 2016. In 2017 they are refinancing and consolidating the acquisition loan into general corporate debt. What do you think of this?

2) The have seen material deterioration in income statement and balance sheet, and continue to issue a large number of shares. Is this normal to grow the business? Or sign that business will grow in size but not achieve profitability with that growth?

3) Do you have any data on material insider buy or selling in past 6 months?

4) Do you see any great risk in shorting specific to the company? ie. control of float being able to influence stock price even with deteriorating fundamentals vs general risk by definition asymmetric upside/downside when shorting
Read Answer Asked by John on May 01, 2017
Q: Hi 5i - I have a well balanced portfolio with good performance thanks to you good folks at 5i. I'd like to put a little bit of 'mad money' into two or three high risk, high reward names, fully understanding the risk of losing it all. Are there any names in the Canadian or US markets that come to mind?
Read Answer Asked by Rick on May 01, 2017
Q: I note that buyouts are increasing among the small cap stocks. Today alone Lumenpulse and Canam are going private at nice premiums. IRD also gone this month. I am not sure if this is the start of a trend. Are there any companies you would consider as buy-out targets in the next 9 months? I have my eye on Ten Peaks.
Read Answer Asked by Murray on April 28, 2017
Q: Hi team! While looking into the emerging AR/VR markets, a small Canadian company - YDreams - recently came to my attention. While doing some research on the company I've noticed their share price has been tanking over the past three months, but I can't seem to find any explanation for the downturn. I like the fact that they are more of a pure-play in the space, but I don't know enough about their financials to consider buying yet. Can you find anything I might have missed?

As always, I appreciate the input!
Read Answer Asked by Mark on April 28, 2017
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