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Investment Q&A

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Q: I have had my eye on this comp. for a while: never bought because I felt the PE was not justified; now, PE coming down, but, I still have concerns: poor ROE, high Pay-out Ratio, missed last 3 out of 4 Q results - USD strength should be helping bottom line with major acq. this year and debt. higher - probably no dividend increases for quite a while, as well.
Comments please - thank you .... JP
Read Answer Asked by James on November 30, 2015
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

Read Answer Asked by Antoine on October 27, 2015
Q: Thanks for your quick response. I actually feel a lot better knowing it is a short report that created that panic. Usually these type of reports are self serving issued to generate panic for the perpetrators to make a quick short kill. The market is always more crooked than casinos. LOL. Just look at the weekly Monday sell off on crude oil and oil stocks! you can set a clock on that one by now.

Anyway my real question is - if that report is nothing but exaggeration, can the report issuers be sued by DH shareholders sold for losses because of the panic it created. I love nothing less than seeing these short sellers and their panic generating side kicks get hauled away. What are the investors rights in this regard. Thanks.
Read Answer Asked by Victor on October 26, 2015
Q: I'm holding DH. It is selling off heading into this week's earnings. Should I read anything into that? When a stock is dropping going into earnings, is that a predictive pattern? What are consensus numbers for DH for these earnings? Finally, does DH have internally generated earnings growth or will they need to continue to grow by acquisition in order to justify their PE multiple?
Read Answer Asked by Noel on October 26, 2015
Q: Hate to sound like a nervous nelly, but why is DH being sold down so aggressively of late - such as today? As well of late the volumes are large and the drops are big.

I know you assure me earlier there is nothing of note from its operations. I know earnings release is tomorrow, is someone trying to create a panic before then?

I bought more today anyway, just to go against the grain (or take a deeper plunge and catch the falling knife - whatever).

What's your take?
Read Answer Asked by Victor on October 26, 2015
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