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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 an Investment Brief from ARC they outline their concerns regarding BCE and its' payout ratio. Specifically they feel that if the Special Annual Pension Contribution and M+A expenses were deducted from Free Cash Flow then the payout ratio would be in the 84%-88% range (rather than the stated 69%-72% range). This may limit the ability to continue to grow dividends.

Should this be something to be concerned about? It is currently about a 2.5% weighting in my portfolio. If I were to exit BCE, either partially or completely, would Telus be the only real alternative in the space?

Thanks for your wonderful service.
Read Answer Asked by Brian on November 08, 2016
Q: Some information I learned from my broker last Friday while asking them about the status of the exchangeable shares: (A) the process has multiple steps and the shares had just been "released". If I understood correctly, this is the last step of the process (B) Broker says many shareholders called Wednesday/Thursday/Friday to cancel the tender, finding the process confusing.
Read Answer Asked by Matt on November 07, 2016
Q: As a senior retired investor I have most of your Income Portfolio and BE Portfolio. My question is about my fixed part. I had some bonds come due and also some GICs. Since the rates are so low I am at a loss to know where to put the fixed part of my portfolio. I am tempted to just buy something like BCE and Fortis and let them collect dividends, which is more tax efficient. I understand these are still stocks and not fixed income. Your suggestions would be appreciated.
Thanks
Read Answer Asked by Shirley on November 07, 2016
Q: You recently answered a question on DH's current debt (short and long), outstanding debentures and cash on hand (see below). Where can I find this information on DH and other companies myself? Thank you.

5i Research Answer:
DH has $80 million in current loans, $1.4 billion on long term loans and $428 million in convertible debentures. There is $48 million in cash as well. DH did address the debt, and it is a priory in terms of trying to pay it down as much and as fast as possible.
Read Answer Asked by LARRY on November 07, 2016
Q: I'm confused with todays announced financial results. Can you provide some clarity.
Thanks
John
Read Answer Asked by John on November 07, 2016
Q: Hi Team,
If GUD does purchase Paladin, would that likely lead to GUD going from being equity concentrated and cash rich to being diluted or taking on significant debt with lower levels of cash? I am assuming ENDO would only want a cash deal given it's high debt levels. GUD would have to issue debt or equity presumably to close a deal.
Thank you, Michael
Read Answer Asked by Michael on November 07, 2016
Q: My 25 year old Son started a new job with a group retirement or savings plan, the plan suggests for an aggressive investor; 60% Canadian, 25% foreign and 15% specialty equities. They offer asset Allocation Funds, for instance the Aggressive Growth has a 10 year return of 6.24% with an MER of 2.018, also several individual Funds like the True North Fund (Fidelity) with a 10 year return of 8.3% with a MER of 2.313% The other managers of individual funds are; GWLIM, Mackenzie, Beutel Goodman Montrusco. I,'d appreciate 5i's opinion on what advice to give a young investor on how to pick from the limited options all of which have 2% + MER fees.
Read Answer Asked by Charles on November 07, 2016
Q: Greetings Peter and 5i team: Along with every other investor, I suppose, I am interested in companies that have consistently created shareholder value over the long term with a history of dividend growth and superior ROE relative to their competitors. I am wondering if in today's environment there are any mid-cap or larger companies outside of the financial and energy sectors that fit that criteria but with a reasonable P/E relative to their historical valuations? I am thinking that based on previous Q&A that Magna might fit the bill right now? Any suggestions greatly appreciated, thanks.
Read Answer Asked by Stephen R. on November 07, 2016
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