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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: In just over 2 weeks with no particular changes in the world or the North American economy, including the market positioning or financial results of CRH; the stock has dropped over 35%! Is there something I just can't see or read into the latest Quarterly report or is there something relative to the MI positions that are not apparent in the Statements??
Read Answer Asked by Robert on April 28, 2017
Q: Cohodes said to Bloomberg he is getting ready to announce another company that he's going after. Says "It’s a doozy". I had to look up what that means: unique. It's not EQB, it's another one. I don't think it's CIBC, because it isn't "unique". What are your top 2 guesses for this company? My guess is Genworth, because it's the only mortgage insurer in Canada and so, is "unique" in my opinion. But the carry cost to short it is over 5.5%, so there might be a better choice I have not thought about.
Read Answer Asked by Matt on April 28, 2017
Q: Peter & Team, I think we do have a problem at CRH and it has to do with the minority interests (MI's) in that they are getting way too much of the business, possibly because of mix or maybe the joint ventures are the better operations.

$000
Earnings

                    Q1 '17               Q1 '16
Net Income        $3302                $ 3031
Att. to CRH          1542                  2956
Att. to MI's         1760                 75

CRH net income down almost 50%. How is it possible that the MI's can be getting more of the profit than CRH shareholders?

and

Cash flow

Cash flow provided 7991                 5524
Paid to MI's             4011                  627

Share to MI's             50%                  11%

Cash paid to the MI's is more than their share of the profits.

Year ago this was not an issue. Now it is!

What should we do here? The business as a whole looks fabulous, it is in a good space with strong and meaningful secular tailwinds, it has a huge 35% conversion of sales to cash flow, but something looks very wrong with the business model and the sharing of the cash and profits.

Kindly advise. Thank you. Keith
Read Answer Asked by Keith on April 28, 2017
Q: With the amount of interest in ETF'S both in this service and your dedicated ETF service could you issue an analysis as to the hype of a market meltdown driven by ETF'S. This view is getting increased support. I am sure their would be significant member interest.
Read Answer Asked by Warren on April 28, 2017
Q: Currently I own the shares of IPL in my income portfolio. I see that PPL and VSN outperformed IPL in term of price appreciation.
Should I sell my IPL shares and buy one or both of the above mentioned stocks, or should I keep my IPL shares and add either PPL or VSN to my income portfolio. Will this be too much exposure to the same sector?
Between PPL and VSN which one do you prefer?
What is your recomendation?
Read Answer Asked by Jacob on April 28, 2017
Q: There is a link to an article in today's Globe by Meb Farber that calls into question the generally accepted wisdom that companies that grow their dividends are superior investments. (at least I think it is a generally accepted theory) Is this a theory that you have come across before or do you think that his argument has merit?

http://mebfaber.com/2017/04/26/dividend-growth-myth/

Appreciate your insight.

Paul F.
Read Answer Asked by Paul on April 28, 2017
Q: I note that buyouts are increasing among the small cap stocks. Today alone Lumenpulse and Canam are going private at nice premiums. IRD also gone this month. I am not sure if this is the start of a trend. Are there any companies you would consider as buy-out targets in the next 9 months? I have my eye on Ten Peaks.
Read Answer Asked by Murray on April 28, 2017
Q: Hi team! While looking into the emerging AR/VR markets, a small Canadian company - YDreams - recently came to my attention. While doing some research on the company I've noticed their share price has been tanking over the past three months, but I can't seem to find any explanation for the downturn. I like the fact that they are more of a pure-play in the space, but I don't know enough about their financials to consider buying yet. Can you find anything I might have missed?

As always, I appreciate the input!
Read Answer Asked by Mark on April 28, 2017
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