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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: I am a bit light on Financial companies; 12% of my portfolio I want to go up to 15%. I own TD, BNS, SLF and GSY in about equal amounts. Do you have any suggestions to add another financial company. I am retired and do not want to add a high risk company.
Read Answer Asked by David on April 30, 2019
Q: These companies are all now the subject of an active open Dutch Auction / share buyback offer to purchase for cash. I am interested in your thoughts on the merits of entering these auctions, and if entered at what price point (the offers are between $29 - $35 depending on the company). The shares have all risen with the release of the offer. Will they fall back after the offer closes? What is the longer term outlook for these companies?
Read Answer Asked by Ken on March 26, 2019
Q: Hi 5i and Peter:
POW has announced a Dutch Auction for some shares.
Would your answer be the same for POW as your answer on a Dutch Auction question regarding BPY.UN on February 22nd?
Your answer - "Companies do these when the believe their stock is undervalued, and want to cancel a block of shares at the same time, as opposed to doing a normal course issuer bid (which does not have to be completed). Generally, we are of the view that the company knows its own business better than investors, so almost always advise not to participate. A lower number of shares increased per share earnings and cash flow leverage down the road. In an auction, the company sets a price range. Investors tender with their price desired, or agree to tender at a clearing price. Typically, more shares are tendered, and the company pays the lowest price of the range that will fill its required amount of shares it wants to buy. Shareholders typically get pro rationed and only sell a portion of what they tender (it depends on the popularity of the offer)."
Thank you.
Read Answer Asked by Dennis on March 05, 2019
Q: Hello 5i,
I am down 11% in each Power Corp (POW.TO) and Power Financial (PWF.TO) I am holding each for the dividend as a value investor at 72 years with a 10 year outlook. You had suggested replacing them with BCE or something else in answer to someone else's question. Would that apply in my circumstance or should I just keep holding for dividend?
thank you
Stanley
Read Answer Asked by STANLEY on February 11, 2019
Q: I have been a long term holder of POW and have become frustrated with the performance of the share price and dividend increases. I am interested in replacing it with ENB, BIP.UN, or IPL ? I accept that these companies are in different sectors. It seems the Demarais family cannot enhance shareholder value despite the multiple voting shares they hold. Thanks. Joe
Read Answer Asked by Joseph on February 07, 2019
Q: I'm wondering if (part of) my investment philosophy is wrong? I have some income stocks & ETFs in my RSP (and about to RIF), not because I necessarily need or needed the income on a current basis, but on the basis that the dividends get reinvested in a DRIP for an eventual payoff. Yet even after 5+ years, these two "safe" (?) stocks in particular are down 15 - 20% even after all reinvested dividends?! I'd hate to calculate how much they'd be down if I had taken the dividends and spent them. While they didn't suffer as much in 2018Q4 as some others, they have been a disappointment. Do I need a rethink of my philosophy? Should I continue to hold these two/three? Thanks.
Read Answer Asked by Lotar on January 25, 2019
Q: Good Morning,

Currently hold the following in my TFSA ($30,000): BNS, SLF, AQN, AW.UN, AD, SPB, BEP.UN, GSY, SIS, TOY, TSGI, PBH, MX.

Looking to deploy $3,000 and add one or two of the companies addressed in this question. What would be your order of preference in terms of combination of dividend and some growth. Feel free to suggest others.

Thank you.

Larry
Read Answer Asked by Larry on January 08, 2019
Q: Q: As part of the financial sector of an income portfolio of a retiree would prefer POW or LB for "reliable" income with some (inflation) growth? Thanks.

Asked by David on September 10, 2018
5I RESEARCH ANSWER:
We would far prefer POW here.

Regarding the above question, I would to understand the business fundamentals for why you answered as strongly about LB vs POW.

The purpose of the question is improving my investor education / smarts.

To the naive / superficial investor; they look like stable financial sector businesses with strong track records at paying their dividends.

thanks for trying to educate me;)

Ernie
Read Answer Asked by Ernest on January 02, 2019
Q: Hi Peter:
Season greetings to you and your team.
I would like your opinion on the trade(s) I was thinking about.
1) Sell full positions in POW and NFI.
I've had POW for 5 years and it has done nothing during that time except go down about 20%. However, I also think that at $24.00 it has potentially hit a bottom support number. I would be happy collecting the nice dividend it pays.
I also think based on your recent answers to questions that NFI has potential going forward.
2) If I sold POW and NFI, I would add to the positions that I already have of the other companies that are mentioned.
I'm well diversified and this would not interfere with my sector or geographical weightings or the amount of dividends I am receiving.
I think both scenarios have their positive attributes and would appreciate your thoughts. Do the trade or remain the course.
Thank you very much for your valued opinion.
Read Answer Asked by Dennis on December 20, 2018
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