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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: Been awhile since last comment on this,could you provide any further update or opinion.
Read Answer Asked by terrance on November 20, 2015
Q: Can you please explain what is happening with slyce? It looks like it stopped trading today due to a potential takeover. What is your recommendation for those of us still hanging on?
Thanks!
Read Answer Asked by Lois on November 20, 2015
Q: Hi Guys,

Can you comment on RFC's latest quarter?

I know there's fear of Alberta exposure, future car sales in Canada and loan losses continuing to increase, but is this company not starting to look incredibly cheap? I'm thinking of initiating a 3% position.

Mike
Read Answer Asked by Michael on November 19, 2015
Q: Given your familiarity with Wi-lan, I am hoping you will have equal insight into Memex, Inc. (OEE.v) Although very much a micro-cap, with all that implies, what is your opinion of its potential?
Read Answer Asked by David on November 19, 2015
Q: I've held this since IPO and have been happy to collect the dividend. Now the stock is trading bellow the IPO cost that I paid and I am wondering if I should sell or continue to hold. Is there much more downside risk from here and are there any positives that will help the company to increase revenues and earnings in the next 12 months.
Read Answer Asked by Joseph on November 19, 2015
Q: WI-LAN has cut it's div.s and stocks drop like a stone do you think it has a chance to rebound . Please give your take on this company .

Thanks JIM
Read Answer Asked by James on November 19, 2015
Q: I am under weight in the technology sector. From your portfolios what technology stocks might you recommend at this time (I own DH)? I am good with either income or growth stocks.

Is there a stock not in your portfolios that you may recommend over the others?

Thanks
Paul
Read Answer Asked by Paul on November 19, 2015
Q: What do you think of their latest results, and is this a good company for income and growth.
Read Answer Asked by don on November 19, 2015
Q: I read today that if I wouldn't buy the company today perhaps it is a good reason to sell. In the case of Flyht Aerospace, I have lost 74%. So just to clean up my investments a bit I thought of selling. At the same time, I have no need to sell so could hang on for several years if there was a perceived value with FLY. I see that they have changed their executive. I don't know if good or just loss of confidence in the company by their old senior executive. Any thoughts you have in terms of action I should take are appreciated.
Read Answer Asked by ED on November 18, 2015
Q: Could I get your opinion of URE, they appear to be a low cost producer. Are you familiar with management.
Read Answer Asked by Doug on November 18, 2015
Q: Hi guys, I have done very well with the consumer discretionary sector both in Canada & the U.S.A. My problem is that it has grown to 25% of my portfolio (each name is between 3 to 4%). What is your forcast for the sector in 2016 and should I trim now or wait until they reach 6 to 7%. Should you recommend trimming, what sector looks interesting to you to this time.

Thanks,

Jim
Read Answer Asked by jim on November 18, 2015
Q: Thinking about switching from Saputo (SAP, about a 2.5% position) to A&W. I'm a little under water on Saputo, I can use for a capital loss.

SAP is trading at around a 20-21x multiple, so in my opinion, chances of it running $3 or $4+ more in the short term is fairly limited. Plus, the Saputo family has a 34% voting interest so, I'm guessing, chances of a takeover are fairly limited in the immediate future.

These are the reason's I wouldn't mind selling SAP for a more efficient use of my funds. However, I am having difficulty valuing AW.UN in comparison with SAP. I like AW.UN's monthly dividend. I like the fact that it seems to be a well run business. And I like the fact its just about the perfect size for a large number of players in the food services industry to take them out. However, like I said, I am having difficulty valuing AW.UN. I'm wondering if you can help me out? Is it cheap, fairly valued, or expensive against the backdrop of its growth profile?

Thanks.

John
Read Answer Asked by john on November 18, 2015
Q: Hi Peter and Ryan, What would be an appropriate Weighted Average Cost of Capital (WACC) to use to discount GIL's future free cash flows to firm? I am getting a very low WACC estimate of only 4.41% primarily because GIL's Beta is only 0.39. My other assumptions are as follows,

Risk free rate 2.4%
Market risk premium 5.75%
Beta 0.39
2.4% + (5.75% * 0.39) = 4.64%
Resulting cost of Equity 4.64%
Equity weighting 92.1%
After-tax cost of debt 1.7%
Debt weighting 7.9%
(4.64% * 0.921) + (1.7% * 0.079) = 4.41%
Resulting WACC 4.41%

To me WACC of only 4.41% seems too low. Where do I go wrong with above calculation?
Read Answer Asked by RAJITH on November 18, 2015
Q: Hi Peter,
The results out today from GRC look quite spectacular, at least on the surface. I have a small position, and added some more today. I wanted to get your thoughts on 2 things: the sustainability of the 10% dividend, and method(s) to estimate fair value for the shares, given that revenue and earnings will likely be quite volatile and unpredictable over the next months/years.
Thanks for your excellent service!
Read Answer Asked by Ed on November 17, 2015
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