Investment Q&A

Q: Hello,
Renewable energy will be the in the high demand in future. So which stock you prefer to hold on US & Canda side for better growth.
Thx,

Q: I am currently have a large position in Atco and it has been going down a lot since Covid. Going forward, what is your view of continuing to hold ACO.X vs a swap into FTS, ENB, AQN, or CU. Could a swap in either one or into a combination of these be of benefit for a long-term hold for a risk averse investor? What is your recommendation given the current valuations, recovery potential and future growth outlook?
Many thanks!

Q: Hi,

1)In the next 2-3 years do you think REITS or utilities will do better (some growth, less volatility)?
2)Can you suggest 2 CDN reits and 2 CDN utilities you feel comfy with>
3) Can you suggest 2 US reits and 2 US utilities you feel comfy with?

Q: Straight up, which of these two stocks would be the safest investments over about a three year period, thanks?

Q: Curious about your choice of companies with strong environmental platforms (not energy companies), with good ROEs. Looking for companies that have positive effects on climate change. Thank-you!
Ellen

Q: Peter,

I own Atco, Algonquin Power, Fortis, Canadian Utilities , Emara and Brookfield Infrastructure. My concern is I am missing out on the renewables / green space companies. In the utility space what other recommendations you would give to ensure I am covered.

Thank you
Paul

Q: My question relates to sector allocation. Specifically, I am significantly overweight in Utilities (23%), but underweight in Energy (3%). That said, most of my utilities are related to renewable energy (AQN, BEP/BEPC and NPI, as well as FTS which is starting to tilt toward renewables). Does it make sense to 'assign' a portion of these stocks to the Energy sector? And if so, what percentage of each would you suggest could be reassigned? Thank you.

Q: what are your top TSX choices in the renewable energy space for the next three to five years? Please give your arguments for this selection. Thanks

Q: HI, There seems to be a growing consensus among market watchers and strategists, that Utilities are likely to shine in coming months and years. In this sector, specially the companies which have more exposure to Renewable and Green energy seem to be the favorites. One of the reasons cited for this view is a possible Biden win in coming US elections. We presently have about 9% sector weighting, equally divided between AQN and FTS, but wish increase to may be 15%. Over recent weeks, rising valuations have also reflected this optimism, although, for some more than others.( e.g.,Boralex from $27 to now $41). Which of above companies, in your view, have best potential for growth and prospects for consolidating their position in Green energy ? Also, from valuation perspective, which ones will be your favorites, for more capital appreciation over next few years ? It would help, if you could rank them in preference and explain your reasoning. Thank you for your great insight, as always.

Q: Could you please offer your thoughts on these three going forward. AQN has lagged peers in renewable energy over the last six months and I noted from past question responses that its future growth rate is expected to be comparatively low. Is there a problem here? After the recent rally in BEP, Boralex and others are they no longer attractive in valuation relative to historical multiples? Where would you put your cash at this point and are any of them attractive from a growth/valuation perspective?
Thanks for your insights.

Q: I am planning to take some losses as offsets to capital gains from previous years. In some cases, I am considering replacements as well. Please advise of any concerns with, or suggest alternatives to, the following sale (purchase) plan.

Sell HWO, PSI & IPL (buy PPL and AQN - already own ENB, ALA & KEY)

Sell SU & CJ (buy CNQ and PXT - already own ARX). I also have a sizeable loss on VET, but consider that is presently so far below comparables, that I should wait for some recovery – or sell now and move on?

Sell HR.UN (buy another REIT, possibly TCN.UN and/or ERE.UN - already own IIP.UN & NWH.UN).

Sell CHR.

Thanks - Don

Q: I have a small (30K)cash account that is currently divided into three, with equal amounts in cash, AQN and ENB. I am adding more money to the account and would like to either add another position or add to one of the two securities I already have. Please advise. I do not have to worry about diversity. I just want a good, fairly safe, dividend payer.

Q: Retired dividend-income investor. Long term holder of TRP. Would the recent decline in share price be attributable to the Biden-Trump debate #1, which analysts say Biden won (therefore putting Keystone XL at further risk) and/or the movement towards the change in sentiment (carbon-based vs renewable energy)?

I normally am a long term holder of core positions, with trimming/adding when rebalancing is required. I was due to add, once TRP came back down to $58. Now it is at $55 and I have adjusted my "adding" target to $50. I am not too far below a full position (at roughly 85%).

I do not plan to sell TRP believing that as the pandemic subsides, the oil & gas industry will recover. However, I am beginning to wonder that I may be better served to allocate these "top-up" funds to the renewable part of the energy sector instead. I also own AQN and FTS.

Your thoughts? Thanks for your help...Steve

Q: Thanks for your response on the renewable power /clean energy participants; it prompted a closer examination of earnings expectations and current rating for each. With certain exceptions it seems to me that i) rerating and price enhancement took place mostly in 2019, ii) that for the most part valuations are now generous and iii) that the participants are primarily utilities such that, absent special situations, sustainable earnings growth will be modest when compared to growing industrials and others with which we have become accustomed. The discount issue then hinges on valuation methodology; their pe/peg ratios are excessive unless the conventions applying to utilities are very different from generally accepted norms, and I am not familiar with accepted cash flow ratios for the sector if these are appropriate and used. What is the generally accepted pricing criteria for these names and customary ratio ranges. Thank you again.

Q: Please rate the above for survival and continued Div. payout in the next 5 years, based on cash- flow that well covers the dividend . I am a senior and need income. I have a position in all the above and would like a rating best first. Please insert your suggestions for the above criteria.
thanks
Yossi

Q: Retired, dividend income investor. Currently own AQN, FTS and TRP. If I wanted to add a 4th name (with a focus on renewables), what would you recommend? It would be mostly in a taxable account, with possibly some in a TFSA account. Or if AQN and FTS are enough names, should I just add funds to them? If AQN-FTS are not enough names, would you consider BEPC or BIPC? I like utilizing the dividend tax credit.
Thanks for your help...Steve

Q: It looks as though renewable power is becoming politically accepted, with the above as assumed potential sector participants. What is the anticipated growth rate for each and to what extent have each potentially already discounted the coming year's anticipated growth in value. I Look forward to your response.

Q: Hi 5i team,

PA suggests I up my utilities by 5%. I was thinking of adding two stocks one being AQN at 2.5% to 3%. Can you please suggest a few large and mid cap companies that would complement AQN.

Thank you

Q: Hi 5i
In order to adjust utilities weighting up in my portfolio could you suggest a couple of each of Canadian and US please?
Thanks
Mike

Q: It seems the Liberals are going to heave a whole lot of money at likely renewable energy and infrastructure in the coming months. Does 5i have some suggestions where some of its subscribers would place some investment funds?