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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: An interesting Globe article on Sunday entitled “This investor purchases ‘small, obscure, ugly and scary’ stocks” lead me to David Desjardins personal site where he talks about his “Net cash value” investing approach and more specifically his recent research report on Western Resources or WRX which he deems to be trading below it’s NCAV.

What are 5i’s thoughts on Western Resources? Anything you have on the company would be appreciated, thanks!
Read Answer Asked by Craig on April 27, 2017
Q: Which one of these 4 companies would you buy today
for growth and long term hold? (disregarding sector)
In which order would you rank them?
Thank you.
Read Answer Asked by Uli on April 27, 2017
Q: Please give your updated (and substantive) opinion on Seagate. Your previous commentaries, although recent, were written before the gap down in STX price today. What are the company’s prospects? Is it strong enough to compete against Western Digital and others? Is STX at today’s lower price a good buy? Is dividend safe? Does STX have the wherewithal to make acquisitionists in a flash memory maker. I am looking more for your insight—your instincts based on facts. Thanks
Read Answer Asked by Adam on April 27, 2017
Q: Can you confirm that ZUB is the better from a performance analysis standpoint. My take is that as both are priced (?) in CAN $, ZBK will reflect changes in the US/CAN $ relationship which are separate from the underlying bank performances while ZUB because it is hedged will be a more accurate measure of the underlying assets behaviour. Is this correct?
Read Answer Asked by Mike on April 27, 2017
Q: I know you commented on DBO on Monday, but the share price has dropped another 10% since then.The share price has been dropping for almost a year now. I was considering giving it another quarter but I feel mgmt is taking the company in the wrong direction with the talk about moving into the Motion Industrial training market, which is very niche. That and the numbers continue to disappoint every quarter. Is it time to let DBO go? Earnings are mid June.
Read Answer Asked by Adam on April 27, 2017
Q: Hi,
I currently hold half positions in GUD and PHO. I would like to top one of them up to a full position. Which of these 2 companies do you think would be best to top up? Or do you think both should be topped up?
Thanks for all of your great advice.
Rob
Read Answer Asked by Rob on April 27, 2017
Q: Hello,

I just want to make sure I fully understand the dividend and tax differences amongst different companies. Could you please list where these different scenarios are best held (TFSA, RRSP, Non Registered), how much they are taxed, and any other important tax information (i.e. which dividends need to be reported, eligible dividends, other common scenarios etc.). This question obviously has many parts so dock as many questions as you see fit.

A) US company with US dividend trading on US exchange:

B) US company without dividend trading on US exchange:

C) Canadian company with US dividend on Canadian Exchange:

D) Canadian company with no dividend trading on US exchange:


Thanks in advance!

Alex
Read Answer Asked by Alex on April 27, 2017
Q: Sorry another comment that Members owning CRH may find comforting and certainly shows the clear difference between it and Valeant/Concordia:

"At March 31, 2017 , the Company had $9,232,240 in cash and cash equivalents compared to $9,507,004 at the end of 2016. The decrease in cash and equivalents is primarily a reflection of cash generated from operations, less cash used to finance acquisitions during the first quarter of 2017"


Looking at the Cash Flow Statement: they generated CF-Op of $8M and acquisition cost was $7.5M. Net Debt did go up ~$3M to fund some distribution to non-controlling interest (need to dig more into note 4 for details).


The main point through is CRH earns real cash and finances its acquisitions mainly from its cash flow and not from out of control debt - as the Motley Fool article was suggesting.
Read Answer Asked by Jennifer on April 27, 2017
Q: Dear 5i
My son is just getting into investing via Questrade (he`s 34) . I`ve given him some ideas that i thought you would have given him particularly pertaining to company`s with solid forecasted earnings growth over the next 1-2 years .
I suggested KXS , SIS , SHOP , PBH , PHO and GSY .
He is interested in EA and MAL. He has $8000 to work with with time .
What would you recommend ?
Thanks
Bill C.
I`m hoping in time he to will be a 5i member as well .
Read Answer Asked by Bill on April 27, 2017
Q: With the information provided, it seems that the company has no choice but to use a LOC with a very high funding rate. How come they can t offer GIC with well above market rates to fund their current needs and stabilize the situation? Would there be no buyer with cdic protection ? Also, why do they need as much as $2B ? Thank you.
Read Answer Asked by Pierre on April 27, 2017
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