Investment Q&A

Q: CRH Medical dropped >28% on Friday. I see they repaid their loan to Crown Capital as planned and have taken out a new credit facility (to 2020), reducing their interest expenses from 12% to 2.5% and providing cheaper capital for a future acquisition (3.5%), http://investors.crhsystem.com/1881-2/.

This would seem to be a big positive - quite apart from the recent re-imbursement issue which doesn't seem to realistically reflect the actual impact of any changes (i.e. is more benign than the market has anticipated).

So why the 28% drop? I got in at $4.47 - your advice, please? I'm tempted to buy more but I am/ should be an income investor (ha!).

Thanks as always,
Heather

Q: Do you know if the Mawer New Canada Fund sold a significant part or all of its position in CRH ? If so, when did they do it ? Also when will the decision on the new reimbursement rates be final ?

Q: TD Waterhouse Action Notes Summary Report dated July 7 2017 about "Questions regarding the sustainability of CRH's reimbursement rates have contributed to a two month slide in CRH's stock."
Here's the meat of it.
" We expect a relatively benign outcome to the 2018 fee schedule, partly because of CRH's limited exposure to CMS funding. Our sensitivity analysis indicates that a 5% cut in the Medicare reimbursement fee could cost CRH ~1% in adjusted EBITDA. ....
CRH has limited exposure to MEDICARE- We expect CRH's operating performance to be largely insulated from CMS for two reasons. First, Medicare only represents 10 to 15 % of CRH's revenues. Second, CRH's dominant payers (the private insurers) employ different reimbursement protocols from Medicare. We estimate that commercial payers reimburse the 00810 code at 3X-4X the rate of government payers.
TD Investment Conclusion
We are maintaining our buy rating but reducing our target price to $10.50 (was $12).
Our rating is based on three considerations: 1) leadership in a defensive, growing segment of the U.S. healthcare services market: 2) high margin cash flow streams and: 3) expansion opportunities within CRH's core anesthesiology market.
Hope this soothes a bit!

Q: What is your opinion about this company?

Q: Please comment on LGT's purchase of 51% of the shares of Fer Pal Construction. Do you think it will make LGT more profitable?
Thank you
Jim

Q: I know that you suggest Sun Life for a Canadian life insurance company, but how would it stack up against the potential of other life insurance companies in the US? Brian Acker recently recommended Met Life saying it was much cheaper than Sun Life. How would you compare Sun Life to US companies? Overall what Life Insurance companies would you invest in regardless of Canada or US?

Q: Hi 5i Team.

I am thinking of adding to my position on HD (currently representing about 2% of my portfolio) and would like to have your comments on this company going forward. Also would you please comment on its PE ratio as well.

Cheers,
Harry

Q: Any idea why Cineplex is so week recently? What do you see going forward and opinion of adding to this right now?

Q: Hi team,
Following your lead and selling off ZRE for CSH.un. Is a TFSA the best account for a REIT to be held?
Thanks

Q: I hold ENF. I recall that, in the past, you have expressed a preference for ENB - perhaps the former being more for income and the latter being more for growth. Is this correct? Is there any other reason to prefer one over the other? (Perhaps I should consider switching.)

Q: I own a lot of ER and am under water . Could you please provide your current opinion on this stock as I am considering averaging down. Thanx Robbie

Q: Within the last month I took a half position in CSH.UN, and a quarter position in DR (both in my RRSP). I am down about 6% on both. If you were to add to one of these positions today, which one would you choose, and why? Or just wait as they have negative momentum.

Paul

Q: I invest for dividends, dividend growth and some growth in stock price. I am currently holding ala but am thinking of switching enb or enf. Would you make this switch and if so which Enbridge holding ? I have a diversified portfolio.

Thank you and thanks for providing this great service

Q: Some news out on WSP Global I haven't heard? Stock is down heavily on an up day.

Q: I have looked at gold and precious metals ltd. ASA. US (closed end mutual fund). What are your thoughts on asa for a small holding 3 percent to diversify?

Q: Please comment on the release of 2018 CMS reimbursement rate and its impact on CRH going forward.

FJ

Q: Hi there

Any ideas for the big drop in CRH Medical today.

Much thanks

Stuart

Q: CRH is getting hit hard this morning. Why ? Is it our Short Sellor again ? RAK

Q: I am recently out of university and have gotten a full time job with a defined benefits pension plan. I have 25-30 years before I am going to retire and want to start developing my first portfolio. I have lots of room in my TFSA and RRSP. I have a moderate risk tolerance given the pension plan.

I currently have $50K to invest. I would like to build a portfolio with a mix of some of your balanced and growth model portfolio stocks.

A few questions for you:
1) How many stocks would you recommend be a good starting point for me? Or would you suggest that ETFs would be a better approach for me given the amount of money I have to invest initially? From reading the forums I get a sense that I need to ensure a certain amount of portfolio diversity.
2) If I were to invest today, what stocks would you recommend from your BE and growth portfolio for the long term (20+ years in my situation).

Feel free to dock as many credits as you feel appropriate.

Thanks so much for your service. I have learned a lot since becoming a member and look forward to being a member for a very long time.

Q: Good morning
A fundamental question regarding rising interest rates. Does a period of increasing rates typically encourage an inflow of foreign investment into domestic equities or an outflow? Based on your past experience, how has the TSX performed under increasing rates?

Thank You
Clarence