Investment Q&A

Q: Uber-guru Warren Buffett once said something along the lines of "Better to buy a great company at a fair price than to buy an average company at a great price". After the market pull-back of the last few days, there may be some great companies available at fair or even better prices. Can you name a few?

Q: hi
Joe asked about your top ten juicy dividend payers. Some are barely in the 3% zone.
Are you preferring these because of safety? Growth?
Are the higher yields from the names I listed at risk of cuts? There are quite a few out there yielding 5% +
Thoughts on these higher yield names?
Thank you!!

Q: Hi 5i
I like CMS ETF portfolio choices.
One of your ETFs is SPY.
My question: Does it have to be SPY?
Or can I replace it with ZSP or XSP?
If not, can you let me know your reasons?
shanthi

Q: Hello Folks:
My question is most basic re: bond and equity market price relationships.
I understand for bond yields to rise; either bond prices must trade lower or new ones issued with higher yields.
Commentators advise because of higher bond yields, people hesitant about equity market risk are moving money into the bond market.
With fewer people chasing stocks I can understand this could somewhat dampen stock prices.
What I do not understand is the reverse in the bond market.....more money from stock sale proceeds chasing bonds in the fixed income market should increase bond prices depressing yields.
I would appreciate if you can help with this basic finance 101 question.
Thanks for everything
brian

Q: I would like to setup a spreadsheet to track our stocks. I would like it to be easy to update and be able to track my sector weighting’s and gains and losses. I use the Royal Bank Direct Investing to keep track of our holdings.
Are there any templates for setting this up?
We have separate accounts for 2 TFSAs, one RIF and one Cash account. Some equities are in several accounts. Should they be consolidated into one account when setting up a spreadsheet so that I can determine our sector allocations?

Your direction and suggestions would be greatly appreciated. I realized that this is more than one question. Thanks.

John

Q: What do you think of DIV here?

Q: Trying to decide between the two What do you think or is there a better choice.. Would like e dividend Thank you

Q: Hi Team 5i --- Me oh my what's up with SEV? Down 50% from their high and with rumours of a takeover one would think the stock would be ramping up not down - your insights pleeze :-)

Q: I have been wondering for some time about market valuations and your recent comment about inflation being bad for markets has raised it again for me. If a market is doing reasonably well and inflation sets in could there be a reset of stock valuations. If so what sectors could get re-evaluated and is it across the board in a given sector or specific to certain size market caps?
Thank you
Clarence

Q: Were do you support leval for this company it is down 20% this tear
Stan

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