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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'm down 15 percent with ENB and 20 percent with RUF.UN. To maintain the same spaces for long term holding and for tax loss purpose, is it advisable to trade ENB for TRP and RUF.UN for CAR.UN?
Thanks.
Desiree
Read Answer Asked by Desiree on February 08, 2018
Q: I would like to start by stating that you are very patient, answering similar questions about same stocks over and over. My question is no different. I have been considering a position in Enbridge and have been hesitating for some time now.

Its price has decreased quite dramatically in the recent past and this may (or may not) be a buying opportunity. From all the posts I`ve read, and there are many, it is clear that this is a buying opportunity (but so was it at $50+). Some concerns that I have follow:

Debt. How much debt is too much? I've made (big) mistakes with GE and others. I am trying to learn from my errors, from your input and from the community at large. My understanding is that the leverage ratio is quite high. Interest rates are on the rise. Debt (with the exception 2015 to 2016) has continuously increased during the last 5 years (where it is almost twice as large today as it was 5 years ago). In 2016 the company increased its cash balance by approximately $1B (vs prior year) but still has about $65B in debt. How long will it take to possibly pay this off and with rising interest rates are we at risk of potential default in the future? I am a long term investor and would hope to avoid surprises down the road.

Retained Earnings. This number has dropped consecutively over the last 5 years. I do not think this is a positive sign.

P/E ratio. In my opinion, this is not a growth company and has quite a high P/E ratio. Albeit net income and cash flow have increased, revenue has not really changed much over the last 4 years. At end of 2016 its revenue was a bit higher than 2013 but lower than 2014. Numbers should increase at both the bottom and top.

Any additional commentary, over and above that already expressed in numerous other similar questions you've responded too is appreciated. We must be missing something. You must see something that we don't see. It is also possible that we are over analyzing this. I mentioned a few concerns above (ex. P/E ratio) and could have found other concerns but you may be looking at specific ratios/mgmt/new business/..., otherwise every company would probably have problems. Finally, would you be a buyer of this company at this time and/or would you be buying a competitor in its place/why?

Thanks again. I am quite sure there are many people like myself that read your input, use it to make investment decisions but even more importantly, we use it to further our own abilities to make sound investment decisions, and we thank you for that.
Read Answer Asked by Walter on February 08, 2018
Q: Today in a question from John he asked about spreadsheets, I too was looking but in fact Action Direct can provide the info he is looking for. Under the My Portfolio tab, click on Analyze and Rebalance, in there you can create a group of all your accounts. Once you have a Group, sector weightings and position size is one click of the mouse. I wouldnt waste my time or yours with this submission except for the fact this knowledge has been a bit of a game changer managing my portfolio - keeping sector weights and position size in line.
Read Answer Asked by Charles on February 08, 2018
Q: Uber-guru Warren Buffett once said something along the lines of "Better to buy a great company at a fair price than to buy an average company at a great price". After the market pull-back of the last few days, there may be some great companies available at fair or even better prices. Can you name a few?
Read Answer Asked by Bryan on February 08, 2018
Q: hi
Joe asked about your top ten juicy dividend payers. Some are barely in the 3% zone.
Are you preferring these because of safety? Growth?
Are the higher yields from the names I listed at risk of cuts? There are quite a few out there yielding 5% +
Thoughts on these higher yield names?
Thank you!!
Read Answer Asked by Carlo on February 08, 2018
Q: Hello Folks:
My question is most basic re: bond and equity market price relationships.
I understand for bond yields to rise; either bond prices must trade lower or new ones issued with higher yields.
Commentators advise because of higher bond yields, people hesitant about equity market risk are moving money into the bond market.
With fewer people chasing stocks I can understand this could somewhat dampen stock prices.
What I do not understand is the reverse in the bond market.....more money from stock sale proceeds chasing bonds in the fixed income market should increase bond prices depressing yields.
I would appreciate if you can help with this basic finance 101 question.
Thanks for everything
brian
Read Answer Asked by Brian on February 08, 2018
Q: I would like to setup a spreadsheet to track our stocks. I would like it to be easy to update and be able to track my sector weighting’s and gains and losses. I use the Royal Bank Direct Investing to keep track of our holdings.
Are there any templates for setting this up?
We have separate accounts for 2 TFSAs, one RIF and one Cash account. Some equities are in several accounts. Should they be consolidated into one account when setting up a spreadsheet so that I can determine our sector allocations?

Your direction and suggestions would be greatly appreciated. I realized that this is more than one question. Thanks.

John
Read Answer Asked by John on February 08, 2018
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