Investment Q&A

Q: Good Day,
With these companies taking huge hits lately isn’t this the time to be greedy when others are fearful? Do these companies deserve full positions with a long term outlook?
Thx

Q: Should I hold on to NFI or sell, as the share price is dropping.

Q: Good morning 5i Team

NFI share price peaked in late March and has been been dropping since. The slide has accelerated since the Q3 report. Having read the report and listened to the call, I can't figure out what is causing such a sharp selloff. Here are four things that are noteworthy but still don't justify it in my mind:
1) new manufacturing plants (increased competition in the future)
2) Slightly lower backlog
3) Revelation that for every 10 new units sold, NFI typically takes 7 units in trade, and the re-sale value of trade-ins is declining, hurting margins.
4) Today's news (that the market has probably known for over a month) that 70 jobs will be moving to the US to accommodate the 70% US content rules.

I guess a fifth would be the overall market decline.

I've been watching NFI looking for an entry point. This looks like a good time but I feel that I must be missing something here. I would appreciate your thoughts before I pull the trigger.

Thanks. As always, your insights and guidance is much appreciated.
Peter

Q: Hi Peter, Ryan,

We have a few dogs with the downturn but we also cashed in all of our high runners in early October. Your insight is invaluable in our portfolio management strategy and we understand the decision to buy or sell is in our control. On that note, we have been buyers the past two weeks when a stock drops 25%-40% (i.e. KXS today at $67.99). Can you comment on the following opportunities (BYD.UN, WSP, NFI, CCL.B, PBH, SHOP, ENHG) to purchase now with a 3-5 year hold inside RRSP's.
1. Please rank (based on your expertise) the above stocks from best to worst as of today to add to an RRSP.
2. Which of the above, if any, are considered "prime" to purchase today.

Thank you
Jerry and Debbie

Q: Do you do a detailed competitive analysis when you research a company? If so, can you provide such for NFI. My specific concerns are the new plants being added to the US that will compete with NFI, 2 that will be online by next year:
- Novabus' new North American assembly plant
- Gillig is in the process of building a new plant in California
An additional 3 new entrants have announced their intention to enter the NA market

Thanks

Q: Do you think nfi will recover in the near future or should we take our gain and reinvest elsewhere?

Q: I have a full 5% position in NFI. I understand the market likes to react to expectations and I’m ok with this. A 13% drop today was too much in my opinion so I picked up a few shares.
My question is about volume. NFI is a 2.4 billion market cap company and approx. 1 million shares traded today being roughly $39 million.
Such a small % of market cap I see the drop today as irrelevant to the real share value.
So back to my question, is there a point where volume as a % of market value is something to guide us in either a down or up market? And I’m looking not as a trader but a long term investor.
I hope you understand the question.
Thanks
John

Q: The share prices of both TSGI and NFI have recorded significant declines recently. However, I feel the growth prospects for both companies are solid and, as such, consider this to be a good buying opportunity for a 3-5 year hold. Do you agree and, if so, would you ease in with 1/2 positions at this time or take full positions and simply put them away for a few years?

Q: Hi,
In what order would you choose the listed companies to sell for tax loss harvesting.
And would you hesitate to re-purchase any of these in 30 days?
And would now be a good time to sell them? Or would it be better to wait a week or two.
Thanks,
Mike

Q: You have already responded about the earnings - my questions is more about strategy. Both these stocks broke their intermediate trends (using 200 MA) sometime ago (I think you called it a technical breakdown) . But both price and now earnings momentum are horrible why hold? I realize in the long term maybe okay but when things get this ugly (down more than 20% from their high) would it not it be better to allocate capital some where else - rather than have dead money? Thanks

Q: Both companies missed and are getting punished today. Would you consider them buying opportunities and would you add to existing half positions in either? Thanks

Q: NFI seems to be down quite sharply this morning. Can you comment on their quarterly results and future prospects.
Thanks
Phil

Q: Tough to perform better than market when stocks get crushed like this. Are these turns or over-reaction?

Q: Kindly give us your take on the Q3 results just released. As well please comment on the guidance for the year and the sustainability of the dividend.

Q: Would you see a switch from NFI to GDI as worthwhile right now for a growth-oriented portfolio? Also considering TFII.

Q: Regarding each of the above,please advise if you consider each of these dividends is safe and also if the dividend tax credit applies. Thank you.

Q: I am a retired, conservative, dividend income investor and have 1/2 to 2/3 positions in each of these securities. I trim-add to my stocks when my asset allocation needs adjusting (recently topped up BCE, BNS). I am considering topping up these 4 stocks, but am fully aware that Tax Loss Selling Season will soon be in full swing. Having said that, all 4 of these stocks have already been beaten up a fair bit.

I know you are NOT a market timer, but does your crystal ball foresee further downside as we work our way through the next 2 months of Tax Loss Selling? Using TCL as an example, you just added 1% to your position. I am sure you must have had quite an internal 5iR discussion about "when" to add that position vs. your 10% cash position at that time and the need to deploy some of it. OR...is it as simple as...this stock has been beaten up so much, it has excellent value now, we know we can't time the bottom, so let's just buy it now?

Thanks...Steve

Q: Would be a buyer of NFI at this time or wait until December?

Q: I have substantial capital gains on both these securities in both my cash account and in my TFSA. I propose to make some transfers in kind from (in Dec.) and to (in Jan.) using the holdings in the cash account. I would like to sell some of one or the other of PKI or NFI from the cash account now and use those proceeds to buy the other in the cash account. The question is -- of these two, which do you think has the better prospects over the next 24 to 30 months? I appreciate that I'm dealing with different sectors and will keep my diversification in mind. Thanks for your thoughts, they always help. Bill

Q: What's your view on the NFI announcement last night? Thanks.