Investment Q&A

Q: I understand the general idea of convertible debentures, but specific cases are puzzling to me. For example, AXL.DB.B, maturing June 30, 2017, has a conversion price of $1.70/s, but the stock is currently trading at around $0.07/s.

The debentures are substantially discounted; at today's price, $10000 face value would cost only $4750. But given the conversion price of $1.70/s, the 5882 (10000/1.70) shares you would receive in 2017 would be worth only $412 (assuming the stock price remained the same.)

Yes, the loss of conversion value is somewhat offset by the yield; with its discounted price, AXL.DB.B currently shows a yield-to-maturity of around 50%. But this only nets the purchaser around $2375 ($4750 @50%); $412 plus $2375 is still well-below cost.

If just breaking-even requires a ~600% recovery in the stock price, what, then, could be the incentive to buy the debentures? Or is there an 'at-par' conversion option I'm missing here?

Q: Hi
My question is regarding how fees are charged by bank "portfolio funds" or fund of funds. The MER is reported in the prospectus, but would this be in addition to charges already in the underlying holdings?
Thank you

Q: Hi team:
at 1 point, it was pointed out that it could be a take out target by other US competitors in the same business
Now that Chartwell has exited her positions in the US
How would it affect the above as a take out target ?
I also noted that the XRE (read estate) is on an uptrend from a technical point of view, thanks,

Q: Good Morning Peter and crew: I am considering liquidating a position in Cenovus (taking tax loss for next year) and opening positions in one or all three of Torc, Cardinal or Whitecap. I'm interested in getting your opinion on the relative merits of all three of these, and of Cenovus as well for that matter. I know the three mentioned are all well respected names but wonder if you see advantages in some over others if at the end of 2015, wti oil price was still below $60. Many thanks, Don Lockett

Q: Hi,

Is there a similar ETF that focuses on CDN high yield sector? Also, is it ok do use xhy which is hedged given the 0.80 CDN dollar?

Thanks,
Jason

Q: RE MY POST YESTERDAY CONCERNING THE TD WATERHOUSE OUTAGE, I SENT AN EMAIL COMPLAINT AND RECEIVED A TELEPHONE CALL BACK THIS MORNING. THE UPSHOT WAS THAT I NEGOTIATED FINANCIAL COMPENSATION.GOOD LUCK TO OTHERS.

Q: I own just a few shares of Concordia. . Would a few hundred shares bought in my rrsp at these prices make sense. It just keeps climbing.

Q: You've been lukewarm but trending more positive on Chorus. Some of the base metrics look fantastic:

Forward PE: 7.79
ROE: 43% +
Payout Ratio: under 30
Yield: 7% plus
YTD Total Return: 33%

I know the debt is high but it's not easy to find this combination of metrics. Where are you at these days and debt aside am I missing other negatives?

Thanks!

Q: A recent BNN guest said he was short IPL because it was at 27X earnings - another guest said they had a huge EBITDA bump coming from previous work and had a great long term horizon unless oil falls apart for an extended period. IPL has lagged the other pipelines the past two weeks. Would you bet against this company?
I notice you have done a complete 180 degree turn on Surge and I bought a large amount following your strong recommendations last year. I only own SGY, IPL and SPE (Spartan). Was SGY's debt not a factor last year and due to their hedges this year, do you see any future upside with a modest recovery in oil over the next 12 months?
Thank you.

Q: I set my wife's RRSP Model portfolio last year to match what 5I recommended. Even though her portfolio is not large, she did very well thanks to you. She also has a pension plan from work. I have just finished adjusted this years 5I recommendations, but avoided CCL.B and CSU. Can you recommend a couple of less expensive stocks to replace these two?

Q: Further to John's point on the risk of Surge, my position is now relatively small. I am assuming that the bottom for the stock would be it s book value, since it does own tangible assets. First, what is the estimated book value of the stock and would that be a good proxy for the floor price?

Thanks for the insight.

Paul F

Q: Pli closed today at $ 2.72 - how much of the price do you think is related to speculation regarding the upcoming level 2 drug trials and do they have sufficient funds to complete the trials or wifi they require an equity raise? Many thanks

Q: Hi There

Any thoughts on the latest? Does it look like a permanent dividend cut?

Thanks
David

Q: Re Brenda's comment about TDDI "President's Account":
There is definitely a distinct phone number for holders of these President's Accounts (As far as I know your voice imprint has NO affect on call routing). I am in Montreal and therefore the local # is (514) 289-1272. There could/must be a 1-800 #, but Iam not aware of what it is.

Q: Hi 5i,
I need help trimming back the utilities in my portfolio. I currently hold 11 utilities (out of 33 holdings):

AQN,
ALA,
BIP.UN,
BEP.UN,
CU,
FTS,
GEI,
IPL,
PPL,
RNW,
VNR

All have gone up quite a bit since buying them so I have fallen in love with them all. I already sold EMA, TRP, and KEY (and cried like a baby). Utilities make up about 30% of the value of the portfolio (and that is not including BCE and T). I am worried that rising rates will hit me hard. Which do you recommend I cut?? My primary goal is for dividend growth.

Thanks in advance!

Q: Intially thanks for the excellent recommendation, just wish I was in a little earlier than $71.00
Researching this puppy, located different PE's--1@224.90 and 2nd@90.00. Webroker has 6 buys, and 3 strong buys and today a recommendation to $115.00 plus. Yesterday there was a halt which I could not locate info on.
EPS forecasted of 6.00 2015-16. This is totally attributed to the Covis purchase of 1.2 billion with an 18 drug portfolio,and hersay, they are looking at additional acquisitions which could result in considerable upside for the company. If Covis closes as scheduled, projected to trade at 17.2 x f2015 and 11xf2016. Do these appear reasonable.
This stock without a doubt has been the quickest most profitable stock (15 days) I have ever purchased in my 40 years of trading, and is creeping up to 9% of my RRSP portfolio.
In the event of a market correction or a downturn of 10-20% what are your thoughts.
What's your thoughts on management, and have you met them personally
I am certainly prepared to hold for the long haul, but would not certainly like to this blow up eg fraud, compliance etc
Many thanks
Rick

Q: The chesswood chart looks interesting. Your opinion, please

Q: I use the TD discount brokerage. I established the account almost 20 years ago when I was virtually broke. Since then, I've used the phone #613-783-6322 (Ottawa) they've given me. In the past couple of years, I've gone to "President Account" status, still using this phone # (good memory and too lazy to look up phone numbers) and got through relatively quickly. The question I put out to members is whether TD discount brokerage gives this "less wait time" special status based on the phone number you call (in which case now many more people have it) or the phone # you have on file, or is it associated with the "voice print" sign in.
PS. The best decision (albeit, forced between a rock and a hard place) is leaving the "TD wealth advisor" and doing investments on my own with 5i!!!! I'm so truly grateful! I've done far better than I'd ever imagine.

Q: What do you think of the IPO and will it be worth a look?

Q: Is there any explanation for EWH's sudden rise this week? Is the Chinese economy coming out of its funk? Iron ore prices still seem weak when I look at my LIF shares.