Q: Happy new year!
I am thinking about adding RE and SGY....
Could I have your opinion please.
Thank you!
I am thinking about adding RE and SGY....
Could I have your opinion please.
Thank you!
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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: Peter - you have in the past written about the power of 10-baggers. I think I remember a piece when you were at Sprott where you astutely pointed out that a couple of investments could be wiped out, provided a portfolio contained a couple of huge winners. I wonder if you might offer your five most likely 10-baggers in the next 1-2 years, knowing full well that such wins are always elusive.
Q: All my holdings are Canadian, but I would like to get some exposure to the US while keeping in Canadian dollars. An actuary friend of my husband told us that Manulife tends to move in a leveraged manner with the US markets because of its pension portfolio. Would this be a good way to get the exposure I am looking for, or are there better ways?
Q: hello, i was hoping to get your latest opinion on crescent point as oil prices continue to look to be going lower. wether it would be a buy, sell or hold. or any expert opinion you have. also i would like to ask the same of Raging River TSE.RRX . thank you. also with oil prices lower, are there any buys in this sector that look attractive ? thanks for your time. - Brian.
Q: Below is an email received from my discount broker TD and wonder if you could shed some light on it.
If in fact this is valid could you provide some details and recommendations on companies that would be appropriate for an RRSP
Monday was another day of falling oil prices and energy stocks. Yet the great slide in oil prices has also created an irresistible opportunity, says Hanif Mamdani, lead manager of the $3.6-billion PH&N High Yield Bond fund with RBC Global Asset Management: Energy bonds are on sale for bargain prices.
Specifically, Mr. Mamdani, one of Canada’s shrewdest fixed income investors, has been drawn lately to the senior debt of high quality, Canadian oil patch firms he believes have the balance sheet, management intelligence and experience to ride out the effects of the ongoing oil supply glut. He won’t disclose what or how much he’s bought but says it’s “material.” “It’s turning into a fairly compelling opportunity,” Mr. Mamdani says.
Here’s how he sees the play in the oil patch: spreads on senior bonds for firms such as Precision Drilling Corp., Baytex Energy Corp., Western Energy Services Corp. and Trilogy Energy Corp., have jumped by between 300 and 500 basis points since July, giving them annualized yields of nine per cent to 11 per cent. In many cases, the bonds come due in four to five years.
“These are solid companies that have very reasonable balance sheets,” he says. “Many of them generate free cash flow even at [current] crude oil prices. They’re run by extremely competent managements that have been through many cycles and have vast amounts of their own wealth invested.”
In some cases, low oil prices don’t have a uniformly negative impact. Take Precision: it has slashed capital spending plans, but while it isn’t spending money to build new rigs, it will continue to collect cash for rigs already in service. That can be used to retire debt or support its dividend. “At some point people will realize Precision bonds are yielding 10 per cent for a company with low leverage,” he said.
In other words, a compelling opportunity: all investors have to do is buy the bonds and hold them to maturity, and they will earn nine per cent or more so long as the companies don’t default. Should oil prices rise, risk premiums fall and the bonds appreciate in value, those returns could rise to as high as 20 per cent, Mr. Mamdani figures.
And how likely is a rebound in oil prices in the next four years? Consider the precedent, says Mr. Mamdani: Low prices should crimp supply and stimulate demand, while economic growth sops up the surplus. The price of oil may not have bottomed, “but to assume [the very bottom] will be the time to buy energy stocks and high-yield bonds is naive,” he says. By then it will be too late.
If in fact this is valid could you provide some details and recommendations on companies that would be appropriate for an RRSP
Monday was another day of falling oil prices and energy stocks. Yet the great slide in oil prices has also created an irresistible opportunity, says Hanif Mamdani, lead manager of the $3.6-billion PH&N High Yield Bond fund with RBC Global Asset Management: Energy bonds are on sale for bargain prices.
Specifically, Mr. Mamdani, one of Canada’s shrewdest fixed income investors, has been drawn lately to the senior debt of high quality, Canadian oil patch firms he believes have the balance sheet, management intelligence and experience to ride out the effects of the ongoing oil supply glut. He won’t disclose what or how much he’s bought but says it’s “material.” “It’s turning into a fairly compelling opportunity,” Mr. Mamdani says.
Here’s how he sees the play in the oil patch: spreads on senior bonds for firms such as Precision Drilling Corp., Baytex Energy Corp., Western Energy Services Corp. and Trilogy Energy Corp., have jumped by between 300 and 500 basis points since July, giving them annualized yields of nine per cent to 11 per cent. In many cases, the bonds come due in four to five years.
“These are solid companies that have very reasonable balance sheets,” he says. “Many of them generate free cash flow even at [current] crude oil prices. They’re run by extremely competent managements that have been through many cycles and have vast amounts of their own wealth invested.”
In some cases, low oil prices don’t have a uniformly negative impact. Take Precision: it has slashed capital spending plans, but while it isn’t spending money to build new rigs, it will continue to collect cash for rigs already in service. That can be used to retire debt or support its dividend. “At some point people will realize Precision bonds are yielding 10 per cent for a company with low leverage,” he said.
In other words, a compelling opportunity: all investors have to do is buy the bonds and hold them to maturity, and they will earn nine per cent or more so long as the companies don’t default. Should oil prices rise, risk premiums fall and the bonds appreciate in value, those returns could rise to as high as 20 per cent, Mr. Mamdani figures.
And how likely is a rebound in oil prices in the next four years? Consider the precedent, says Mr. Mamdani: Low prices should crimp supply and stimulate demand, while economic growth sops up the surplus. The price of oil may not have bottomed, “but to assume [the very bottom] will be the time to buy energy stocks and high-yield bonds is naive,” he says. By then it will be too late.
Q: Hi team:
I made a small profit by investing in the above thanks to your advice
With the drop in crude oil prices, will it decrease the value of Bep.un ? thinking of taking some of the money off the table
like to hear your opinion, thanks
I made a small profit by investing in the above thanks to your advice
With the drop in crude oil prices, will it decrease the value of Bep.un ? thinking of taking some of the money off the table
like to hear your opinion, thanks
Q: http://email.seekingalpha.com/track?type=click&mailingid=2798555&messageid=2800&databaseid=&serial=2800O2798555O1420497134.b35c9666ac01032ec25c6b2b2ec0e005&emailid=1079842&userid=1079842&extra=&&&3000&&&http://seekingalpha.com/article/2798555-canadian-oil-sands-5-price-target?source=email_rt_article_readmore&uide=1079842&uprof=46
Mr. Hodson, does this January 5, 2015 article by Mark Liew make sense ? COS at 5$ and eventually no dividend at all. In a complete chaos situation, everything is possible, but anyone can imagine anything. What is a common sense likely outcome ? Otherwise, I believe COS' reserves are there for 40 years or more, not 20 years. And what's the value of long time predictions when the overall context may change in a year or two ?
Mr. Hodson, does this January 5, 2015 article by Mark Liew make sense ? COS at 5$ and eventually no dividend at all. In a complete chaos situation, everything is possible, but anyone can imagine anything. What is a common sense likely outcome ? Otherwise, I believe COS' reserves are there for 40 years or more, not 20 years. And what's the value of long time predictions when the overall context may change in a year or two ?
Q: I'd like to start a DRIP plan for my son
What is a good choice for a DRIP plan stock?
What is a good choice for a DRIP plan stock?
Q: In your coverage summary for Dec 2014, you list TCN with a rating of C+. However your report on the company from Dec 2013 rates it as B. I checked your coverage summary for Nov 2014 and Oct 2014, and the same mistake is there. If it is not a mistake then I can't find a report with a later date showing it rated as C+.
Paul J.
Paul J.
Q: A couple of questions on the financials. Your Jan/14 report showed $360 million in cash. The most recent quarter you noted shows $1.3biln ($14 cash per share).That's quite a jump for a company with a market cap of $700mil I am wondering where all the cash comes from?
Your report also mentioned $8 of book value. Equity as of the most recent quarter is $1.1biln with pref stock of $206mil. Does that mean $12.50 of book value?
The current ratio is just over 1, is that normal for this kind of business?
Finally you mention principal trading as a risk.Is this represented in the $1biln of short term investments?
Thanks
Mike
Your report also mentioned $8 of book value. Equity as of the most recent quarter is $1.1biln with pref stock of $206mil. Does that mean $12.50 of book value?
The current ratio is just over 1, is that normal for this kind of business?
Finally you mention principal trading as a risk.Is this represented in the $1biln of short term investments?
Thanks
Mike
Q: We plan to invest $5500 in each of our TFSAs for 2015.We do not have any investments in the following sectors--consumer staples,materials and utilities.Could you suggest 2 or 3 stocks for each of these sectors.
Q: In the event that CXI does not get its banking license, what are the implications for this company? Is the license approval imminent? Does anyone really have a timeframe on this or could it drag on for years? (I'm not certain how long a process, or how arduous, it is to be granted a banking license.) I was thinking of selling my Surge Energy and replacing it with CXI to see if I can inject a bit more torque into an account that has seen a 50% loss, but I don't want to be selling/buying a pig in a poke. (Any suggestions would be welcome, including a different company.)
Thanks for your advice! Happy New Year to all at 5i!
Thanks for your advice! Happy New Year to all at 5i!
Q: A&W Food Services of Canada Inc filed an "Early Warning Report" this morning wrt A&W Revenue Royalties Income Fund. The text is long; can you explain; what impact might this have on the current share price.
Q: Good morning and Happy New Year to all at 5i.
My RRSP was recently transitioned to a RRIF. I understand that an "in-kind" transfer of a stock held within the RRIF can be made to a non-registered account (and of course taxes must be paid when doing this.) My broker (Scotia iTrade) informed me that I can opt for an in-kind transfer using the stock's lowest price, or highest price, or closing price for that particular day. What are the relative advantages and disadvantages for each option? Also, in answer to another member's question, you said that in general, it's better to sell the 'lower' stocks; would this advice also apply to an in-kind transfer? Thanks as always for your advice. Joining 5i was the best financial decision I ever made!
My RRSP was recently transitioned to a RRIF. I understand that an "in-kind" transfer of a stock held within the RRIF can be made to a non-registered account (and of course taxes must be paid when doing this.) My broker (Scotia iTrade) informed me that I can opt for an in-kind transfer using the stock's lowest price, or highest price, or closing price for that particular day. What are the relative advantages and disadvantages for each option? Also, in answer to another member's question, you said that in general, it's better to sell the 'lower' stocks; would this advice also apply to an in-kind transfer? Thanks as always for your advice. Joining 5i was the best financial decision I ever made!
Q: I noticed your caveat about AYA with regards the ongoing insider trading investigation. As I recall (never having owned a stock that was under one) these investigations can take a remarkable long time to get to first base (if the "raid" is considered putting the ball in play)even. Surely months if not years. With the growth that AYA has displayed (a good Q4 expected) it seems likely(to me)that a recovery of the share price is a reasonable assumption. Would you comment around these observations for me please?
Q: We have a 1.5% position in WSP Global and 1.5% in Stantec (STN) and no holdings in the Transportation sector. Do you have a recommendation re adding to WSP versus buying Trimac (TMA) or Transforce (TFI), or other thoughts.
Q: Happy new year Peter and 5i,
Once again it is time to add funds to our grandson's RESP [14 mos]. Currently his holdings are: XTC 20 % of portfolio up 35%, DHX 19.4 % of portfolio up 92%, AYA 25% of portfolio up 285% [wow]. We reduced his holdings by 50%, and AVO 8.1% of portfolio down 42%. We would appreciate your opinion of new picks and assessment of current portfolio
thanks again
Once again it is time to add funds to our grandson's RESP [14 mos]. Currently his holdings are: XTC 20 % of portfolio up 35%, DHX 19.4 % of portfolio up 92%, AYA 25% of portfolio up 285% [wow]. We reduced his holdings by 50%, and AVO 8.1% of portfolio down 42%. We would appreciate your opinion of new picks and assessment of current portfolio
thanks again
Q: Hello- Do you think and investment in the large US banks might be a good idea right now? Of JP Morgan,Citi, Wells Fargo,Bank of America,
Goldman Sachs or others, which are a few of your favourites?
Thank you.
Goldman Sachs or others, which are a few of your favourites?
Thank you.
Q: Please provide your recommendations for Bri-Chem. At current price do you recommned an investmen in this company?
Do you know the level of debt of the company and asscoiated risk. Do you think company can survive in low commodity price environment ? If I would like to select one company in Oil Field Service sector which is the one 5I recommends and why?
Do you know the level of debt of the company and asscoiated risk. Do you think company can survive in low commodity price environment ? If I would like to select one company in Oil Field Service sector which is the one 5I recommends and why?
Q: Last year I asked you what foreign stock market would be the best performer for 2014 and suggested ishares Japan or Germany as options to buy. You went for Brazil which didn't work out too well, while my own prediction for Japan was only slightly better. What is your prediction for the country ishares to buy in 2015?