Investment Q&A

Q: Hi Peter

What did you think about the earnings report. Was the lower reduction in working capital a red flag?
Could you please also comment on their knew joint venture

thanks Gord

Q: Hi 5i - a general portfolio management question:

Assume that I start with 20 stocks at 5% each. I have CPG, DH, CXI and AYA that are all down from the ACB. Say that those stocks mentioned are now varying from 2-3.5% FMV - assuming that I still like those companies (and the overall weighting in the sector makes sense), should I be putting new money in those stocks to bring the FMV back up to 5%? I am averaging down, but also re-balancing the portfolio - any suggestions?

Q: Are there any other roll-up companies that you see as potentially being at risk of a short attack? None of the tech consolidators have been hit - could they be next? I bought a fair bit of puts on OTC and GIB.A today just in case.

Mike

Q: A lot of short selling chatter around here. There is the case of Globo Plc a UK listed small-cap that immediately denied any wrong-doing last week before suspending their shares to formulate a response. Well the response was that the CEO and CFO resigned after dropping the bombshell that up to 60% of revenue was fictitious. Unfortunately I am still a holder of these suspended shares but fortunately a very small fractional position which was always thought of and treated as a "spicy ingredient" in my overall portolio. Sometimes there's really a fire behind all the smoke blown around by short-sellers.

My question is once the shares start trading again what would you imagine to be the response - with a potential 40% of revenue being "real" would you think this will survive ? An impossible question really but whatever opinion you have to offer is fine.

Q: Peter and Team,

What stocks in the Model Portfolio might fall into the category of "Roll-up companies" that seem to be getting attacked by short sellers lately?

Q: Well, BNN just reported that BYD.UN, EFN, CXR, STN, and to some extent CSU, are being talked about for shorting. Apparently the "theme" is to attack "growth by acquisition" companies. This is getting really frustrating!

Q: On August 26, 2015 you indicated that the price drop of npr.un is due to the confusion of the investors with respect to the merger of npr.un with the true north apartment reit.Further, you indicated that it is not a "bad" deal. Meanwhile npr.un dropped another 7% since August 26, 2015. So far the stock dropped 40% during the last 12 months.
Do you still advise your members to hold this stock? Is the dividend approaching 9% safe? Are there any other new developments with respect to this stock?
Thanks

Q: I have been invested in the markets for over 40 years, so i have had a few ups and downs to deal with, but so much has changed in the last few years, with now most of the trades being made by computers and the internet giving anybody that wants to say anything about a stock, right or wrong, it's getting more difficult to be a long term holder of a stock. Sure if you have been a long time rising stock, you can handle a setback, but lot's of investors get into a stock just before maybe some short seller hits the stock and you are down a lot. Yeah, people say if you like the stock it's a buying opportunity, but that's a tough one if you are now fully invested in the stock. It just seems now, that just about anybody can drive a stock down, with a jittery market. So which one do they pick next, you can hope that it is not one of yours, so maybe just hold cash and buy the stocks the shorts drive down.

Q: What do think of Goeasy.
I would have thought it would be doing better in a sluggish economy..
Maybe something has changed at the Co?
Would you add to possition now?

Q: Glenn Chamandy is on the board and owns almost 5 million shares.Is this a good gold company option rather than the big caps. Mines are in Quebec also.

Q: Good morning,

Could you explain the following concepts and how they are used to interpret what is happening with a stock:

1) Overbought (example DOL)
2) Oversold (example VRX)
3) Short interest (BNS @ 2.5%)

Many thanks

Q: Further to Antoine's question, first valeant, then Davis Henderson and now Boyd is down 10% today due to rumours of a short selling report about to be published. This is ridiculous. I have positions in all 3 and now down significantly. I can't compete against insider manipulation and human greed. I will be reducing equity holdings and increasing GIC's etc. The stock market is not regulated enough to create an equal playing field. Any advice on Boyd is appreciated. thanks

John

Q: Boyd down over 10% on the day and still falling. What is going on?

Q: Another Canadian roll-up targeted by shortseller. Boyd Group hit today, chatter that is on short attack $BYD.TO.
Frustrating --to say the least on these rollup companies

Q: Hello Peter and Team. Could you please provide any insight or views? Shares continue to gap down with every passing month since its summer highs. EFN has been a darling in the CDN financial space. Is there expectation for soft earnings?
Thanks

Q: Hello team, Any reason for the big drop? Any chance EFN can also be a target of the "short sharks" due to it's big debt?
Thank you!

Q: Hello Peter & 5i team,
First Valeant, now DH Corp ; what is going on ? We are facing a very unhealthy investment environment.
It seems that Canadian Securities regulations are not as constraining as those in the USA and short sellers take advantage of this with impunity ; but it obviously will take ages to sort this out.
In addition to that, it also seems that short sellers have a template approach to identifying vulnerable companies in Canada : (1) higher reliance on growth by acquisition and less on organic growth, (2) higher relative debt level, (3) complicated and less transparent ownership structures. Valeant would fit the bill, but DH ?
Both management teams have intervened, but to no avail : DH was up today by 11% at the open but is now down 5% in mid-morning.
I am exasperated by the situation even though the portfolio of stocks I currently own is up by 10% so far in 2015; however, making a major overhaul of the portfolio in reaction to the current environment would smack of paranoia.
Your soothing comments would be most welcome.
Regards,
Antoine

Q: Is EFN about to be the next company hit by a short sellers report. Price action is not indicative of any other related market events other than the next Canadian company in line.

Q: would you recommend buying dh here?

Q: Is this a good time to be buying DH? I have 4.6% weighting of this stock in my portfolio