Investment Q&A

Q: HI Peter. Thanks for your great service. My question today is I am going to sell RBF 1340 formerly PHN bond. I would like to replace it with stocks that consistently and regularly increase their dividend for the past 5,10 ++ years. They would be inside a rrsp fund. I have a company pension and receive cpp and oas. Please suggest 5 to 6 stocks. Thanks Frank

Q: Hi Gang,
I'm looking to add 2 more stocks to complement my TFSA with cash availble.Current holdings are: ALA+4%;BEP.UN+5.5%;BHX.B+2%;ET-2%;FTG+15%;HCG-28%;MTR.UN+7.55;PHM-38%;PUR=1%;TNC-15%.
Would you dump PHM &HCG and take the loss and redeploy or hold for a eventual turn around which my be years?

Q: Hin5i
HCG is buying back shares again, according to recent news.
Can you tell me what their per share free cash flow for 2016 is estimated to be?
Is there enough to pay the dividend and repurchase shares, or is this more a case of "financial engineering" ? i.e. are they using debt for the buyback?
I'm a long-time holder of the stock. I don't see much happening with it unless they can turn around originations and start showing some growth, even if it is modest growth.
Do you agree?
Thanks and keep up the great work.

Cheers
John

Q: Good afternoon,

Would you increase holdings in hcg at this time; the model portfolio is slightly underweight on the equity as am I. With the stock repurchase plan announced, would you go to 5-6% of total portfolio?

Thanks,

Eric

Q: HCG is now down over 50% in my TFSA. I keep telling myself, "don't think about what it WAS worth, think about what it is," but my emotions keep getting in the way of my thinking. Given HCG's current prospects, is this a reasonable place for a senior to leave a now much smaller portion of her portfolio, or should I just take my losses and look for a less volatile stock? ( It seems volatile to me, but perhaps that's those emotions again) Many thanks

Q: Greetings: In one of your recent answers you indicated that best current GIC rates are in the 2.75% range. The best rates I see in Vancouver (2% one year, 2.5% fiver year) are with Oaken Capital, part of the Home Capital Group (Home Trust, Home Bank). Is Oaken Capital a pretty good provider? Are those rates in line with what I should expect? I intend to set up a laddered series with about $100K
Thank you

Q: I view EQB as a mini HCG. EQB stock has performed well this year and is near its 52 week high where as HCG has not. Why do you think EQB has performed better this year? Which do you think is a better buy at this time?

Q: would you move from Canadian Western to Home Capital?? Thanks Jim

Q: Hi 5i, as a long in HCG ~3% of retirement account, been doing some land title searches online and google'ing this morning. My comment count on Seeking Alhpa is now a grand total of one (1). I posted the response below to the comment section. Additionally, some links at the end showing what kind of secretive and nefarious characters William Walker and Robert Wilkins are (this is completely tongue in cheek).

"sorry if someone made a similar post I haven't read to the bottom of the comments.....
There is an assertion above that one could do a historical search of the database and hypothesis that it would turn up more dirt, but hasn't been done. Anyone can subscribe to teranet for ~$1500 a year and search this database online traveling. I live in Toronto, Ontario, Canada. Additionally, you can pay per search online basically the same rate as doing this in person. Most real estate lawyers, and commercial and residential brokerages already have these subscriptions in one form or another. I just did a bunch of searches to satisfy myself as I'm long HCG ~3% of my retirement portfolio. So if any shareholders or short positions want they can do now, or ask a friend that has access. Also in the comment section someone makes a note about the difference between a sale transaction and a mortgage transaction appearing in this searches. Both mortgages registered on title on a property and purchase and sale transactions are searchable. Also, for more info on Wilkins and Walker, can search by the names they go by day to day, Bob & Bill respectively. Here are some links for those interested:
http://www.hamiltonnews.com/news-story/5427075-meet-the-nominees/
http://www.thespec.com/news-story/4281815-heritage-themed-boutique-hotel-coming-to-ancaster-s-wilson-street/
https://www.hamiltonchamber.ca/hamilton-chamber-of-commerce-ancaster-division-announces-nominees-of-2013-ancaster-community-awards/
http://www.lferguson.com/around-ancaster/"

Q: if hcg lost 30 to 40 percent on the equity of a house and put that into context of the vancouver housing market,with some of their clients inability to pay their loans i could see their being a valid concern. why not wait it out grab some shares at tax loss season in 2017 or later

Q: Peter and team,

Home Capital has responded to the short report (at least it appears they have) and the market appears to like the response. What are your thoughts on the release? Does it go far enough to make you feel "warm and fuzzy," in response to the allegations of the short report?

Thanks,

Marc

PS. Congratulations on the enormity of you success... its helping my savings grow and my wife feel more comfortable in our financial future :)

Q: Any particular HCG is getting clobbered today?

Is this becoming another CXR? I have learned (the hard way) that if shorts are in, it's better to get out. I'm down 42%. Is there anything that will actually make the stock recover?

Thanks

Q: I read the short report on Seeking Alpha. While some of it is the usual junk these guys spew out, they did seem to find a nugget with the loans transferred to the related party (if that's actually what happened).
Could you give some potential reasons why such transfers would occur?

Thanks.

Q: Why the big drop today? Is their story still intact?
Thank you for an excellent service.

Q: With a ~7% drop today and a 3.5% dividend .... and looking to be close to oversold, would you buy HCG today - or wait to see if there is some bad news we have not heard about?

Thanks.

Q: A fact that should help strengthen your confidence in HomeCapital management. Look at the LinkedIn profile of a new board member: Brenda Eprile. She has 12 years at the Ontario Securities Commission as Executive Director. Then, 11 years at PriceWaterHouse (partner). Certainly, she is a top choice for the board of a company involved in non-prime lending. I would also add that someone with a profile like this is careful with career moves, wouldn't want to end her career being associated with a fraudulent financial. She must have done some homework before joining.
https://www.linkedin.com/in/brenda-eprile-fcpa-icd-d-a9221b30

Q: What are your thoughts on the bear report? Seems to me they are making some compelling arguments. The loan loss provisions are extremely low when you would think they would be higher considering sub prime clients. Also, the deposits are 80% GICs... if there was something that spooked them they could see capital drying up. Let me know your thoughts on those two comments. Thanks

Q: It seems that every time Home Capital starts to move up a little there's another short attack to push it back down. I know you rate it quite highly, but is there really a future upside? I've held it for 2 or 3 years now, and am getting tired of waiting.

Is it better to replace it with another name? I already own FSZ, BNS and TD in financials. Thanks

Q: Time to purchase?

Q: Hi there, further to my earlier question - I saw on Market Call Tonight and that report was from the same short sellers that discussed CXR. Considering where CXR is today, should we be concerned about the future share price of HCG?

Thanks!