Investment Q&A

Q: I bought this stock at $42 in July and it's currently at $31. I don't mind holding a losing stock if it has potential and I'm looking at a longer holding period of 7 - 12 years. Do you think this company has value for that period of time and should I hold? Is there too much competition for its market and if so how do you think it would fare? If you were to switch to another U.S. Company in the tech sector for that time frame could you give me 2 or 3 names you think would do well over time?

Q: What are your thoughts on Wajax? Is it worth holding for the dividend or does the risk of further downward slide outweigh the benefit of the dividend. My book value is about $46 a share.

Joe

Q: With Suncor attempting to entice exhausted shareholders with a 0.25 SU share exchange offer, COS loyalists are fortunate to have an influential shareholder in Seymour Schulich.

Schulich was quoted in saying:
“I ain’t selling at that price,” he said of Monday’s bid, adding that he believes Canadian Oil Sands is worth $20 per share. “If they succeed, I’ll go to court to get a valuation.”

My question is what options do COS shareholders have if SU were to be successful in this takeover chicanery? Could someone like Schulich order an independent valuation and let a judge decide what is fair for shareholders?

Here is link to article:
http://business.financialpost.com/news/energy/suncor-energy-incs-4-3b-hostile-bid-for-canadian-oil-sands-ridiculous-seymour-schulich

Q: Re the ETF question, another company making money on ETF's is Blackrock, which has the ubiquitous i-shares in Canada as well as in the US.

Q: Sector rotation today with oil having an outsized move to the upside and many high quality non-commodity related stocks (CSU, CCL.B, CTC.A, DOL, GIL, L, T, MG, etc etc) with an outsized move to the downside?

I'm thinking of adding another oil company to join WCP as my only oil holdings (currently WCP is less than 2% of the portfolio). What dividend paying name would be on the top of your list today (small cap, large cap, doesn't matter) for a long term hold.

In your opinion, would your #1 ranked oil name be more attractive, from a valuation perspective (assuming a $45 floor for oil) than your current #1 ranked pipeline?

Thanks.

John

Q: In his recent article on etf investing Cullen Roche's closing comment is: "making markets in index funds is hugely profitable". I wonder if there are companies specializing in this area that you could name that would be worth researching. Also, of course, do you agree that they have potential for a profitable investment.
Many thanks
Mike

Q: Hi team, please give me your opinion on the below allocations for both Consumer Discretionary and Staples stocks (this is about a 10-15 year time frame and part of a $200,000 portfolio):

Consumer Discretionary (13% of Portfolio)
ACQ.TO, BYD.UN, CGX.TO, DH.TO, ECI.TO, GC.TO, IT.TO, KBL.TO, MG.TO, MRE.TO, PEO.V

Consumer Staples (12% of Portfolio)
ADW.A, ATD.B, CSW.A, DOL.TO, L.TO, SAP.TO, TPK.TO

Any stocks to take out of these lists or perhaps add to?

Q: For sector allocation, I have the following:

Consumer Cyclical 27.21%
Consumer Defensive 11.67%
Energy 9.10%
Financials 10.07%
Healthcare 8.0%
Industrials 11.97%
Tech 21.98%

Is this too high in cyclicals, wherein I hold Boyd, Disney, CCL Industries and Starbucks, in roughly equal weightings.

If so, which sector should I rebalance into, to optimize what's happening in the market right now?

I'm working with all 5I-approved companies, so the worry is not about individual stocks, but the sectors as a whole.

Thanks as always.

(And thanks to Geoff for correcting my "dyslexic moment" yesterday on Concordia. Obviously, my morning coffee had not kicked in. Very red-faced member, here. : )

Q: In view of the decline in share price, would this be a good time to add to MG or, because of the TPP, is it best to take a wait and see approach.

Q: I currently don't have any exposure to the healthcare sector. Would you please make a couple of recommendations.
Thank you

Q: Can BIP.UN as listed on the TSX be held in a TFSA without any tax implications ? Joe

Q: Bill Carrigan on Market Call maintained that there was a rotation from Health Care etc. to hard assets--energy in particular. Even though I can't see much of a future for energy or gold, the stocks still seem to be acting like there is a rotation to them while health care and IT are underperforming.
Do you have any observations?

Bryon in Elmira

Q: Hi 5i,

There are a couple of things I don't understand about this recent rally.

It seems to me that it is due to the US potentially slowing down, and hence delaying interest rate increases. If this is true, are we to expect this rally to end soon (since a slower US economy must eventually be bad for stocks) or does this rally have legs?

Also, if the rally is based on delaying interest rate increases why are companies like SunLife rallying. I thought these companies were going to benefit from rate increases so the current environment should be negative for them?

Any help you can give me to clear up my confusion would be appreciated.


Thanks,

Q: ABT announced a substantial issuer bid to purchase CAD$50 million in value of its common shares for cancellation. The offer is being conducted as a “modified Dutch auction” with a price range from C$7.75 to C$9.00. The offer expires on Oct 20th 2015 (extended from Oct 5th).

The stock closed today at C$7.47. Why would the stock be trading below the minimum auction price? Do you view this as an arbitrage opportunity to purchase the stock in the open market and then tender the shares for auction?

Q: What are your thoughts on MarketSmart GIC's? And what would be a good alternative?
Thank you in advance for your thoughts.
Janice

Q: I have just over 1% of my portfolio in a total of 3 pref. issues and would like to get up to 5% to take advantage of rate reset prices. Considering to add to TA.PR.H or buy ENB.pf.G or EMA.pr.F. What issue would you prefer or if you have another idea that would be helpful.

Q: In the October portfolio there is a positive 36.4% return in 2015 for SYZ. I think this is incorrect and the return for 2015 should be a negative value.

Q: My comments about BPE are: In 2014 we used Turbo Tax (TT) to submit our taxes. TT increased my return twice in price until reaching their "Business Rate" because I had one form T5013 for BPE. My wife's return went through with no problem but when I submitted my return there was a statement issued "We're sorry the Canada Revenue Agency was unable to accept your NETFILE return".After trying to correct and send with no success I contacted CRA who directed me to a Tax Advisor. She tried and was unable to resolve and re-directed me to another Sr. Tax Advisor who also tried to resolve my/their problem with no success. He advised I contact TT.
After a long wait I did chat with someone from TT who gave me some vague answers with no specifics and ended our chat abruptly. At this time I decided to delete form T5013 from my return and file and submit the form later. CRA help desk advised I wait until receiving my Notice Of Assessment which I did. I then sent in form T5013 with a letter of explanation and was re-assessed. I don't need the hassle again and will never again use Turbo Tax. Regards Gord

Q: Hi, Peter publish at own will.
No comments

A quick run on numbers (US) Health care

EPS growth
q2 15 8%
Q1 15 10%
q4 14 11.8%
q3 14 12.4%

Revenue growth
Q2 15 11.6%
Q1 15 17.6%
q4 14 22.3%
q3 14 16.3%

Q: Hi 5i:

Further to your request regarding this info: I received a message from my discount broker with the following:

"RBC Direct Investing TM. would like to inform you that the following New Issue has just been announced.

Exchange Income Corp

Short Description: Treasury Offering of Common Shares - RE-OFFERING
Price: $24.40 CDN per share.
Settlement: Settlement: October 8, 2015."

I looked for announcements and could not find anything at that price. I ended up wondering if maybe it was just the broker dealing some of their shares at a discount after participating in the recent offering at the higher price. Hope that helps.

No need to publish this if someone else has already responded!