Investment Q&A

Q: Thoughts on the 1/4 and guidance ? Thank you.

Q: Do you have suggestions of preferred shares from Canadian issuers that you would consider attractive at the moment?

Q: Do you like this security for a 10% forward yield and eligible for dividend tax credit? I understand it has recently reset to pay $0.15 per month ($1.80 annually). Only in February 2022 it was paying $.05 per month explained by the rapid increase in BOC rates. Is this a financial problem for BCE? I believe it is redeemable by BCE at $25.

Q: Hi 5i!

Love your insights provided across your site. Keep it up!

I know you’re not fans of split corps, but I have to ask (as an observer of this stock), what is happening the past week to FTN?

Q: We’re seeing more and more municipalities in BC ban natural gas installations in new houses as a climate change tactic. Fortis talks about getting more supply from renewable gas but they won’t be selling to new homes. That don’t have gas appliances. Do you think this will eventually amount to a material concern for Fortis and other gas suppliers?

Q: Thanks to 5i I have owned SHOP since 60$, it is now 12% of my portfolio, I know you still like the company but would like your thoughts of what it should be trimmed to, the 6-8% range? I did trim back a few years ago but its still in the 12% range.

Thank you
A.

Q: I’m looking at your recent comments that SIS still has good long term prospects in spite of their new issue to pay off debts. Having looked at their 7% drop I was thinking about adding to my position, but I see it is still selling at 25x earnings!
Do you think this price is justified? And would you expect there to be more price volatility up or down in the near future, ie meriting holding on for more price correction?

Q: Hi, Your thoughts on their 1/4ly report please.

Q: I had 4000 shares that i tendered on the Dutch Auction but only received $9200. In view of the total under subscription, why did i not receive the full amount of $10,600

Q: Just curious if you can enlighten me on the liquidity/risk of individual preferred shares? Are they liquid and what would you be looking for at this stage of the interest rate cycle. They seem to be beaten down pretty good, and the yields are compelling. Also, would you do perpetual fixed or floater/resets and why? thanks

Q: I was interested in Stifel’s recent bullish long term forecast for commodities. Do you share in their enthusiasm, and can you suggest a favoured ETF and several preferred stocks in the sector. Thanks, Don

Q: I believe rates in Canada have hit their ceiling, alternatively the consequences get dire for many reasons. With this belief what would be your top 3 stocks for the next 12-24mths, particularly as rates begin to decline. Thank you as always.

Q: NVD: If one feels Nvda is due for a price correction, ie drop, would Nvd be a vehicle that would be suitable.
Does it have the decay that many short ETFs suffer.
Thanks

Q: Is AAPL price expected to fall further? I sold off 10% a week ago. It went back up to $189 but down again 4% overnight to USD 176 due to China not approving iPhones as work phones.

Would it make sense to sell AAPL stock now and buy it again when the price stabilizes? What would be a decent entry price for AAPL?

Q: What is your opinion of this company. Would the possibility of a recession or soft landing disuade you from buying at this time. Thanks for your expertise.

Q: In an earlier question, you responded:
BEPC and BEP.UN are economically equivalent. The only difference is BEPC is a Canadian corporation and its dividend gets the full dividend tax credit.

Trying to understand why, as of noon Wednesday, BEPC is down 1.75 while BEP.UN is down only .75. Why are they moving so far out of tandem?

Q: What drives the value of a Canadian dollar against the US dollar? We used to be a petro currency but the Canadian dollar is continuing to fall even with WTI oil above $86.00. Some were saying that our dollar follows the US S&P 500 but that doesn't seem to be happening either. Finally some say we weren't as aggressive as the US with our interest raises. I would appreciate your views on this topic. According to RBC the cost of a US dollar for average buyers is1.3955 as I write. Are there cheaper places to buy US dollars besides banks? Thanks as always,
Dave

Q: Hi there I own ABBV thinking of selling and switching to MERCK for a bit more growth and dividend yield of each is comparable. What do you think?

Thanks!

Q: Good morning 5i,

I’ve been reading up on the Telesat/MDA story and find it fascinating. I wonder if it could also be lucrative for a small investor such as myself?

From reviewing the financials (to the limited extent I understand those documents) and other materials relating to MDA, my impression is that it presents a real investment opportunity. It does real business and it appears from its recent contracts that its revenues over the next few years could rise significantly. At its current revenue base it appears its debt is well covered and its balance sheet looks healthy.

Telesat, to me, is less clear. It seems the recent announcement that MDA will build the satellites for the Telesat Lightspeed project at significant savings to the previous plan is propelling the recent steep increase in share price. But beyond that euphoria, is the company on solid footing?

The MD&A of March 2023 states:
“After decades of developing and successfully operating our geosynchronous orbit-based satellite services business, we are now poised to revolutionize the provision of global broadband connectivity by developing what we believe will be the one of world’s most advanced constellations of LEO satellites and integrated terrestrial infrastructure, Telesat Lightspeed.
Leading into 2023, we remain focused on increasing the utilization of our existing satellites, the development of our global Telesat Lightspeed constellation, and identifying and pursuing opportunities to invest in expansion satellite capacity all while maintaining our operating discipline.”

Nowhere though have I been able to find any prediction of the revenue that will accrue to Telesat from deployment of the Telesat Lightspeed constellation. A service I subscribe to notes that future earnings can’t be reliably calculated by extrapolating past data or using analyst projections (there aren’t any) and it doesn’t look like management has offered anything either. Who are Telesat’s customers and what are they going to pay for getting aboard the Lightspeed train?”

Telesat’s balance sheet appears highly leveraged and its debt isn’t well covered by operating cash flow. If Telesat Lightspeed is a truly transformational project I’d have expected to see something, somewhere, discussing the money it will make for Telesat and how it will reduce the debt and increase shareholder value, but as far as I can tell – nothing but crickets.

I would greatly appreciate your advice regarding MDA – are there risks/concerns that I might be overlooking?

Regarding Telesat, do you know of any revenue projections that I’ve overlooked and, if not, is it odd none are being made? Also, any other comment you have regarding Telesat would be appreciated. Is something really big about to happen here? It seems the process should be far enough along, given that billions of dollars have been committed by lenders, governments and the company itself, to answer that question. But maybe not, and maybe it's all still highly speculative ...?

Thanks, 5i, and please deduct as you see fit.
Peter

Q: Hello, Based on 0.33 CSU.RT, purchase and cost of 3.03 rights being 0.33x3.03= $0.99. We can acquire new CSU debentures at a total cost of $133+0.99=$134 appx ( FV $100 and Debentures with no right with management to redeem ). Does it sound accurate ?

Questions:

1. CSU debentures ( existing ) are currently trading at $137. What do you expect the trading range of New Debentures, which will be listed after Oct 6 ? My assumption is that new debentures could trade at a higher price than $137, due to No Management redemption right ( All other terms, interest etc being identical to present debentures ).

2. These debentures will pay interest based on 6.5% + 0r - Rate of change of CPI, over preceding 12 months, as at Mar 31, each year. Looking at the present and projected inflation scenario, if the rate of increase of CPI, declines over time, compared to current high rate, the annual interest rate for debentures could see a decline. Would this not cause the Debenture ( like other Bonds ) market value/price to decline ?

Please correct these assumptions and provide your thoughts. Thank You