Investment Q&A

Q: Which Canadian monthly income ETF would you choose XTR or ZMI? Is there another you think may be better?

thanks,
Paul

Q: BBU has fallen much more than the market in the last month.Actually over 50%.Are there any company specific attributes that would have contributed to this type of drawdown?Kim

Q: Hi 5iR Team, I'm totally confused by your recent addition of ZRE to the portfolios. It is my thought that REITS will be among the hardest hit of all sectors. Mortgages will not get paid, many small businesses will collapse, rents will not get paid, lack of mall shopping will mean some malls will go under, Sr's who depend on REIT income will be effected, etc., etc.. Why would I invest in ZRE? What numbers am I missing in this equation?
Thanks Team. Cheers, Chris

Q: Hi, what do you think of the coronavirus impact on CAE and CIGI?

Q: Looks like a good entry price here, do you feel the dividend is secure.

Q: PKI: is starting to look good "for long-term hold" at some point; however, my concern is their dividend (low P.R.) and debt (very high): if things get worse they will need to conserve cash and worry about debt. repayment putting the dividend at risk, I would think?

Comments please.

Q: Just read your March 17 Stock Market Update article regarding "Where is the bottom???" and the bear Market histories. Very enlightening.

I have been almost entirely in cash for over a month now and noted your portfolio changes. You mentioned Adding a new 4% position of BMO Equal Weight REITs ETF (ZRE) in the Income Portfolio. ZRE has been very steady since inception in 2010 gaining almost 40% over that time period until the recent unprecedented and understandable 37% drop since Jan 31.

My question is where should we park our cash while we wait out this terrible situation? Should we just leave it as cash? Is the BMO ETF a suggestion for a short term hold? I did read your Trade Rationale and was a little confused by your comment "remove some of the 'tail risks' that might be seen if there are issues at any individual company." Am I right in thinking this is in reference to ZRE being an ETF? Apologies for my ignorance.

Thanks for all you do

gm

Q: My queston is regarding the U. S. dollar. Why does everyone keep flocking towards it during times of crisis when they have such massive, massive debt, thanks?

Q: Never owned this resource stock; however, it's B.S. is pristine. With this COVID-19 situation and a high probability of things really slowing down, this stock probably has more downside - or not? My feeling are, you buy this one when there is blood in the street: high PE. The other thing is, they pay no dividend of any consequence, which they could afford. I don't think I've ever owned a resource stock other than O & G.

Appreciate your comments.

Q: I am 88 and have followed the market for many years, and your valuable service since inception. I am leaning towards selling 50 of my 80 equities and following only your Balanced Equity Portfolio rather than my own intuition. Life would be easier!! I hold 15 of the recommended BEP stocks, but do not hold AEM ATD.B BAD CAE DSG GC GIL NFI WSP. I have like others, lost 50% of my 4 million $ portfolio, and am considering trying to utilize my losses. My options appear to be; 1.Selling all my stocks; 2.Selling only my losers and all those not in the BEP; 3.Buying back immediately those in the BEP that I don't presently hold, and the rest after 31 days.
4.Waiting for a turnaround before any buybacks. Your opinion will be much appreciated on which of these or no action or a better strategy suggested by you can achieve my goals of reducing my portfolio to the BEP total and utilizing my present losses at the same time, and does it make sense in timing in this meltdown environment ? Many thanks in advance for your consideration.

Q: SBUX: closing stores for 2 weeks. May be longer depending on how this COVID-19 pans out, I realize. On my buy list at some point. According to CIBC Investors Edge they have no debt. - is that right? Low P.R. and ROE of 22%. Buying back an additional 40M shares in addition to remaining 16M, for a total of 56M.

Do I have the right data going forward. Additional analysis appreciated.

Q: You have been very bullish on GSY, and even continue to recommend it highly. I currently hold 1.6% of my portfolio in GSY (down 50%) and am keen to add more given your strong feelings. However, I also note that you recently mentioned it has negative cash flow...can you expand on this, how they manage this, and how one can still be bullish on a high-growth company with negative cash flow? I'm also showing debt at ~ 2x market cap with a 6.5% dividend? The market thinks this is all unsustainable, convince me otherwise please!

Cam

Q: Your thoughts on XHY in a RRIF. Would you consider selling and using the cash for something with more upside potential. Thank you Barb

Q: Hi team,

Thank you for your response to my SWP question. I wasn't aware that they suspended the dividend, so that was definitely valuable information!

My question is regarding debt. Could you please describe what criteria you use when evaluating a companies debt load?
I realize that many factors go into this evaluation, but do you have a quick rule of thumb that you like to rely on?
Or perhaps a rule of thumb provide members for companies in todays economic environment?

Thanks again!

Q: It would helpful if you would explain to your clients the meaning of liquidity. For example if one were to try to sell ECN.PR.A the bid is 13.80 the offer is 16.50. More sellers than buyers. The market isn’t working as it does under normal conditions. People just want to sell irrespective of what they would do under normal circumstances. Don’t let fear overcome common sense. This too shall pass.

Q: I have a larger amount of cash in PSA and CSAV. Is this safe or is it safter at this time in cash, with the return so low?
Thanks for your reply.

Q: With a highly leveraged ETF like JNUG getting wiped out 90+%, what is the risk/reward of having a small position at current levels? If the sector sees a recovery and the fund returns to even close to where it had been there's potential for a small investment to be worth something if you took profits and sold the position. On the other hand, if there is an extended downturn, what is the risk of just holding the position aside from opportunity cost? Thanks.

Q: May I please have your thoughts on initiating a position in this company? Thanks.

Q: I have held the above stock, (TD) for several years and recently sold,, as it has easily been the most volatile stock in my portfolio. I am thinking of spreading the risk by investing in a good bank etf or reinvesting in one bank when the situation calms down. What are your thoughts, and if the etf route is best, which one or ones would you recommend.

Thanks, David

Q: DOO was downgraded to market perfom from outperfrom from BMO with
the target going from $72 to $26. Such a drastic change! I am guessing
it is virus related. If this is the case, wouldn't they slash pretty much
every stock this drastically? Thanks