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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: Along the same lines as my previous question about FNMA, does SLM (Sallie Mae) offer superior quality? Conceptually, I am optimistic for its prospects, given the state of the interest rate; however, it was "tarred with the same brush as Fannie Mae and Freddie Mac" at one time. Is it an Investment or, more properly, a speculation at this point?
Read Answer Asked by David on May 30, 2018
Q: Greetings,
I see you believe ISRG to be one of the best managed companies in the US. I take that as a strong recommendation! Are they managed similar to CSU ie they don’t issue stock and the executives are made to purchase company shares? They appear to have little competition so I conclude they must develop their own technology instead of buying other companies to acquire their technology. How would you asses their growth - is it driven primarily due to organic growth or acquisitions? They appear to have a large cash hoard - are they buying back shares, planning to introduce a dividend or keeping it in reserve for acquisitions? You note growth is likely to be muted for the next 2 to 3 years so, all things being equal, is it reasonable to expect the share price to languish for the next 24 months or so?
Thanks
Jim
Read Answer Asked by James on May 30, 2018
Q: Goodmorning 5i,
I have noted your positive views on Premium Brands and have been considering purchasing it. I don't want to have too many stocks and so I have thought of selling Conagra in order to purchase it. This is also because companies like Conagra seem to be having trouble negotiating the change in habits and diets of people today. Although analysts seem to think it has a little brighter future at the moment. I generally have a well diversified and relatively conservative portfolio. My concern is that pbh seems to be quite narrowly focused in comparison to a company like CAG. Do you think this would be a reasonable switch?
thanks for the great service, as always
Read Answer Asked by joseph on May 29, 2018
Q: We have a 3.5% weighting in JNJ. We like it for its exposure to the USD, its steady dividend income, its blue-chip size and very modest share price growth. However I am concerned about the potential losses arising from their "baby-powder" lawsuit. We have owned the stock for years. I am thinking about switching out around 2% weighting into PFE. Its dividend appears to be higher and its chart seems to be better.
Reading over 5i responses on JNJ you seem fairly sanguine about JNJ so I hesitate to sell. We are retired but not currently spending our USD dividends - they are kept for foreign travel.
I must say I like XBI's chart. However its dividend is much lower so potentially we would need to sell stock if we needed USD. XBI should lower our risk profile as it is an ETF which is probably a smart move.
My questions are...
1) Would you recommend selling all our part of our JNJ or just do nothing?
2) Would you recommend purchasing PFE or XBI or both?
Please deduct as many credits as you feel my question(s) justify.
Thank you for your assistance.
Jim
Read Answer Asked by James on May 28, 2018
Q: Greetings 5i,

As a generally conservative investor with a long time horizon (I am 36), I am very partial to "less exciting" blue chip stocks with a high potential for long-term stability. And while I am in no rush to add any single positions at this time, I would like to ask your opinion of two large cap names to augment my research. Please feel free to deduct as many credits as you deem appropriate.

Could I please have your opinion on UPS and MMM as potential "buy and hold" names for a long-term time frame?

Thank you.
Read Answer Asked by Lucas on May 28, 2018
Q: Greetings 5i,

I have been considering adding a position in DWDP, as I view it as an excellent diversified blue chip in the materials sector (which I view as the weakest sector in my portfolio). Moreover, as a fairly young investor (I am 36), I also view their holdings as very appealing long term prospects, as I cannot envision a time when practices like agriculture and chemical manufacturing will not be essential. However, given the impending breakup, I am unsure how to proceed, and would like your advice. Please feel free to deduct as many credits as you see fit.

First, could you provide your overall assessment of DWDP as a buy and hold name for a conservative, long-term portfolio, where neither funds nor proceeds will be needed for the foreseeable future?

Further, would you recommend purchasing the shares as they are now (perhaps a half position to start), or would it be prudent to wait for the breakup to occur, and reassess at that time (I am not in any rush to add to my portfolio, but do not want to miss out on an opportunity either)?

Finally, is it known what will happen to held shares once the breakup occurs (I was unable to find any stated plans in my research)? If not, could you please explain the most likely scenario in your opinion?

Thank you.
Read Answer Asked by Lucas on May 28, 2018
Q: Greetings 5i,

I currently hold a full position in BCE, and consider it one of my "core" holdings. Moreover, I very much like the prospects of the telecom sector as a whole, given its (at least in theory) ability to hold up well under adverse economic conditions. Thus, I have been considering adding a position in either AT&T or VZ to diversify my geographical exposure to the sector. I have a fairly long time horizon (I am 36), and am in no great rush, but would, nonetheless, greatly appreciate your insight into each as a long-term "core" addition to a generally conservative portfolio.

Thank you.
Read Answer Asked by Lucas on May 28, 2018
Q: Was considering a position in Equinix. I’ve read that the company lowered it’s Adjusted Funds From Operations (AFFO). Would you say this is reflected in the stocks chart. I understand that AFFO is typically used for Reits. Would you look at Equinix as a tech stock or a reit? Would it be a good time to buy, do you think they have a good future, do they have a good moat?
Read Answer Asked by Anthony on May 23, 2018
Q: Hello 5i Team,
Thanks for your great calls on MU-Micron (up 6% in pre-market today) in one of your responses to members' questions & PHO-Photon.
Please let me know your opinions :
WWE recent increased 28% in three days due to new deal with FOX: buy more, sell or hold
OXY: buy to replace EQNR-Equinor ADR (New name of STATOIL) - we bought in November(up over 35%) in our US- RRSP account. Reason for switch for same growth, OXY has no dividend tax withholding and lesser currency fluctuation.
RMBS-Rambus: buy, hold or sell.
Thank you for the great work.
Read Answer Asked by Nhung on May 23, 2018
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