Investment Q&A

Q: Hi All,
I have been receiving a pending approval status on my Investorline account, most recently on a buy order for BYL this morning. For the 5i team what is happening and should I have to wait for approval on a do it yourself platform. For 5i readers have you experienced this as well. Given the quick price movements such as this morning it is difficult to buy at the lows when this happens, can anyone recommend a platform where this does not happen.

Thank you,
Mike

Q: Peter & Associates

Using Enbridge Inc. as a bellwether, yearend numbers from 2000 to 2009 produced the following averages: A mean P/E of 16.5, (several years in the 13 range) a growing dividend with an average yield of 3.1 % representing 50% of earnings and 75% of 10 year TBs when they ranged from 5.4 to 4 %. A check of a recent brokerage report places its debt level at 60% which seems well in line with those over the referenced period.

Clearly the dynamics have changed. Might what is playing out in industries which traditionally need constant access to new capital, be it common or preferred shares are seen as better planning tools providing them with greater option flexibilities than fixed income alternatives? Whereas interest payments must be made, dividends must be declared? With concerns being expressed, a 10 year rate over 3% could do more harm than good, is ENB oversold and at this price too good to be true? It would seem rates would have to rise a lot to actually come into competition with the yields ENB equities offer.

If someone were investing in an ENB for yield, it would seem logical to suggest they would also seek moderate capital risks, far less than what this one has experienced. Is a projected forward P/E of 20 and a dividend over 6% which ENB claims will increase, warning signals? Assuming it is a good bellwether security, how much more downside could this stock potentially see and/or how likely/ risky the need to eventually cut the dividend ( common)? Albeit a very different industry and dynamics, energy stocks had to make cuts to reflect their financial realities; even non CAD banks went through well documented challenging times. The point, no industry is immune from economic realities and their balance sheet realities. Concerns over debt are being expressed as rates rise.

Having a well balanced portfolio is a protection but, so called bond proxies are found in multiple sectors and collectively can add up to an important exposure. There is an expression, things tend to eventually revert to their mean. That said, might we be seeing the start of that occurring since these are not generally seen as growth stocks where earning growth is the offsetting factor to deal with these high ratios?

Would very much appreciate your insight. Thank you.
Mike

Q: Suggestion about dividend payment history. I use the charts of online brokers as far back as they go and in the events i put dividends. Put the cursor on the bubbles and I see the changes. The records go back 10 years +.

Q: Hi Peter, Ryan, and Team,

In your recent answer to Cyril, (Feb. 2, 2018) in which he asked about your recommended sector weightings for 2018, you suggested the following:
"For a general, growth focused investor: Real estate 5%. Financial 10%. Healthcare 5%. Info Tech 20% . Materials 10%. Utilities 5%. Energy 5%. Cons. Disc. 10% Cons. Staples 5%. Industrial 20%. Telecom 5%."

In general, how often should one balance sector weightings? Specifically, in my case, I find that, as an example, I'm quite a bit overweight in Financials, but am reluctant to sell any when they've recently declined (although I'm in the black with all of them except for AIF). On the other hand, there seems to be some "bargains" in some of my underweight sectors such as consumer cyclicals, industrials, information technology, and materials. Unfortunately, I only have a little excess cash to invest, so I'd really appreciate your guidance on what to do with my dilemma.

Your advice is very valuable. Thanks in advance.

Q: Are there any reliable websites or software programs that will record and show records of dividend payments over time? Any suggestions from readers would be much appreciated as well.

Thank you
Paul

Q: Hi Team, I have done some reading on Blockchain technology and sense that it is an area to invest in and although many people would agree with me everyone seems confused about where exactly to start an investment. Gambling companies handle a lot of money in every form, across a lot of venues so security must be a number one priority for them. It appears eXe has a contract to develop a process for online gambling payments using cryptocurrency to convert monies back to good old cash. Is this a stock to start an investment in or does the 5iR Team have any other cryptostocks they might recommend? Thanks, Chris

Q: how do you think HPI or HPF will react to rising interest rates or a down turn in the market.

Q: Greetings:
In one of your recent answers you stated that a particular company had a p/e of 33 and expected growth of 25%. In order to stay even, if investors pay 33x don't you need growth of the same multiple. Please explain.

Thanks,
BEN.

Q: Hi 5i: I'm still considering a purchase of AFLAC. The news regarding employee complaints seems no worse, though a few legal firms have made it a point of announcing that they are investigating. Re its quarterly report, I find it hard to decide how well it's doing given the tax effects and yen currency effects. What is your assessment? Do you think it's buyable yet?

Q: How big of a position do you recommend for a company of this size ? I have a long time horizon with new money to add every month.

Can you please comment on their distribution network ? I suppose it is easier to growth the commercial side of their business. Thank you

Q: What do you think of this company?

They seem to have a clean technology for extracting lithium and have been buying other companies that have claims in northern quebec.

Would you consider this a good buy at this time considering the drop in the share price this week?

Thanks

Q: Can you please comment on Crescendo track record and how long have they been involved in the company ? 10% of a $100M company seems small. Is it a fair comment ? Also, concerning their product and competition, what is their competitive advantage and is there a lot of competition ? thank you.

Q: You commented last week to Patrick about TBT.
I think that recent negative returns were related to the latter stage of the long bond bull market. This has been reversed quite impressively since january. Bill Gross was probably right from hindsight in his call for a new bear bond market.
So, as a growth investor, the idea of increasing returns on an otherwise meagre income from the fixed income part of my portfolio is quite appealing, and does not come out of worry on the market, but from seing an opportunity, and using it with reason.
Then, if I want to benefit going forward, like the next 6 months, of the general bearish trend on bonds that I believe fundamentally justified based on trade, currency and other issues, would TBF be a better bet for one holding that view?
Thank you

Q: Some context please to a common expression you hear on BNN.
When advisor/analysts on BNN say they will buy a stock on a "dip" or a "pullback", what do they mean? A 1% drop, a 5% drop, a 10% drop.
I am retired and looking for dividend payers as my source of income. Of course everyone wants to only buy LOW, but not always possible. I like to add to strong positions but wonder when that is advised.
Cheers.
PS I submitted this question early yesterday before the market drop so my question seems even more timely....for some reason it didn't show up in your question section

Q: GUD. Why is GUD your current favorite healthcare in Canada ?

Q: Rank the above companies and explain why?

Q: Hi 5i,

Can you please comment on the ER this AM?

Thanks!

Q: Are the U.S. futures that are published ahead of market opening a reliable indicator of the direction of the market for that day? How well does the futures prediction correlate with the actual market openings?

Q: Hi there, I purchased some shares of COV based on your recommendation and it has done extremely well since. Would you be inclined to take profits at this point? I have about a 50% gain. Or would you let it run further? Do you foresee it continue to run up based on your metrics?

Thanks so much!

Q: Sunniva: low share count, with a price near its low. Dr Holler is involved. California and Bc operating facilities. Does $10 look attractive as an entry point?