Investment Q&A

Q: 5i Team:
thanks for all the help in 2016 !!.
The idea is to capture the electrification process of our society. It is a slow, but secure process/trend, in particular if use of electric cars increases, and robots and so on. This means more elect power will be required. Are Fortis (despite increase in interes rates) and Stella Jones good candidates ??. If not, are there other safe companies to capture the trend.
Also, if interest rates go up, would not ECI benefit more ?, as more people would preffer to rent than buy due to increase cost of capital.
thanks again ! Should I start buying now ?

Q: Own half positions in each of these stocks - ALA and ECI - and plan to simplify by consolidating into one holding. Which would be your preference - for income with some capital appreciation?

Q: Hi Peter and Team!!! A Merry Christmas to you all!!! A quick question, it is my impression that ABT and ECI pay out more dividends than they take in in earnings. Is this correct? And if so is it a problem and may the dividends be possibly cut? Cheers, Tamara

Q: A couple of years ago I transferred 25% of my sdrsp into a sdrif so I could set up the basic structure and start adjusting to appropriate holdings to produce a revenue stream and a bit of growth. I will transfer the remainder of the RSP in 3 years. I have gradually been selling stocks that do not seem to fit and have been moving the proceeds into some of the 5i income portfolio. I currently hold 9 of them, as follows :
ABT, BCE, BEP.UN, BNS, ENB, ET, FSZ, XHY, WSP

I have some cash available and would appreciate your suggestions for which 3 or 4 of the remaining ( ADW.A, AGU, AW.UN, CPD, CVD, ECI, L, SPB VNR, ZRE) you would suggest I acquire. Also, given possible year end/new year movement and events, could you shine up your crystal ball and give any comments on what timing might be best for those acquisitions?
Please note: I hold IPL (6%) as well as ENB (8%)– would you recommend IPL be changed to VNR ?

(I also have a fully funded TFSA with a growth tilt and a non-registered account with a dividend/growth tilt and OAS/CPP gvt pension).
As always, THANK YOU to Peter and the 5i Team for being there ... May your Christmas' be Merry and Bright !

Q: Your response to Brian on Dec 15 included the following comment: "if you own 85% of your portfolio in high dividend stocks, then this is more of a concern".

I am a retired, conservative, dividend-income investor, with a pension, CPP, annuities, the above listed stocks and 3 income producing MFs (RBC Cdn Equity Income, Sentry Cdn Income, Sentry Global REIT).

I fit the 85% easily. I believe my portfolio is diversified by sector and by security. I also believe the securities have, for the most part, sustainable and growing dividends. I am a "buy-and-hold investor with reasonable tolerance for volatility.

Your comments and concerns please, along with any recommended improvements. Thanks...Steve

Q: In my experience, Enercare is a stable equity, with a reasonable payout and a history of rising dividends, with few surprises. Anything to account for recent ongoing weakness in it's common stock [rice?

Q: Further to my comment on Dec 2nd: I checked, and TD Waterhouse synthetic DRIP, as you thought, will not be giving the ECI discount on shares. It has to be done through the company itself to get the discount.

Q: Which of these 2 stocks would you recommend for an initial position? Could you comment on each of their growth prospects,debt levels dividend growth/stability and their prospects with regards to their forays into markets outside of Canada? Also, what might be an attractive entry level for each. Thanx.

Q: Further to my previous FYI post re ENERCARE and your response (thanks!).

I have since received a response directly from Enercare indicating that "they are building cash to deploy in their regular growth program (to build out the rentals and also the sub-metering business). It’s not necessarily to pay down debt in the short-term."

This just for further clarification directly from the company. To me this is better than issuing new shares directly into the market as it rewards current Shareholders with the 5.0% discount which to my knowledge is a fairly generous discount as compared to other discounts in the 2% - 3-% range.

Q: With reference to the new DRIP that was instituted. In your response you thought it was to pay down debt. The dividend was raised 16% in early 2015. If paying down debt was the priority why approve the raise in the first place. Is this new program indicative of a change in managements assessment of the company. Seems to be confusing signals. What would your take be on this move.
As always your considered opinion is greatly appreciated.
Mike

Q: Just couple of points as an FYI to 5i Members who hold Enercare (ECI):

1) Evelyn Sutherland (CFO) has just been named as an WXN (Women"s Executive Network) 2016 Canada's Most Powerful Women: Top 100 Award Winner.

2) A new DRIP program will be instituted (with a 5% discount) effective with dividend payable on December 30th, 2016....

TORONTO, ON--(Marketwired - November 18, 2016) - Enercare Inc. ("Enercare") (TSX: ECI) today announced that it has adopted a Dividend Reinvestment Plan (the "Plan"). Canadian resident shareholders will be entitled to register for the Plan effective with Enercare's monthly dividend expected to be paid on or about December 30, 2016.

The Plan will give Canadian resident shareholders a convenient means of increasing their investment in Enercare by electing to receive common shares ("Shares") instead of cash dividends on some or all of their Shares. Plan participants will benefit from acquiring Shares at a discount to the prevailing market price, and without having to pay any commissions, service charges or brokerage fees. Under the Plan, Participants will be issued Shares from treasury at a 5% discount to the then prevailing market price, unless Enercare notifies shareholders that it will satisfy the issuance through open market purchases, in which case Shares would be issued at prevailing market prices. Shares acquired under the Plan will be automatically enrolled in the Plan.

Enrollment in the Plan is optional and will not affect a shareholder's cash dividends unless they choose to participate in the Plan. Further information on the Plan is available on the investor relations section of Enercare's website at http://www.enercare.ca. Shareholders who hold their Shares through a broker or financial institution and wish to enroll for the Plan should contact their broker or financial institution directly to learn more about the specific procedures and deadlines for enrollment in the Plan applicable to them. Registered shareholders may enroll in the Plan online through Computershare's self-service web portal, Investor Centre, at www.investorcentre.com.

Enercare also announced today that, in connection with the Plan, it will change its policy of determining the record date for shareholders eligible to receive a dividend such that the dividend record date will be on or about the 15th day of the month in which the associated dividend payment is made. This change is being made to facilitate the administration of the Plan and will be effective with its dividend payable on December 30, 2016. It will not affect Enercare's previously announced dividend payable on November 30, 2016 to shareholders of record on October 31, 2016.

I assume the savings to the company will be used to pay down debt?

Scot

Q: Peter and team:
I hold all equities in your balanced portfolio and a couple from your growth in a portfolio worth about 450K (Thank you). I currently have about 35K to invest and would like to choose one stock from your growth and two from your income to "round things out".
At current valuations and looking at a 10 year plus time frame could you please rank each of the four equities per group. Sector allocation is not a consideration.
Please deduct 2 credits and Thank you as always for a fantastic service.

Phil

Q: FFH and ECI have set new lows. Their charts are ghastly and their RSI numbers are in the oversold category, especially FFH. I am now at the point where I am debating adding more funds to these stocks (buy low, right?) or selling them and moving on. Currently they are a small part of my portfolio: FFH 1.2% and ECI 1%. I can see that ECI has fallen with income stocks, but I would appreciate your views on the collapse of FFH stock.

Q: I was wondering what is going on with Enercare's price this week it's gone down over 7% since last Friday. I hold ECI in my income portfolio and I wonder if I should add to my position with this drop?

Q: ECI had a great quarter yet, the stock has been dropping, my purchase price is $15.58, should I sell?
I have some cash and wondering if it is time to buy some energy stocks. Like to have your advise, thinking pipeline PPL, ENF, SU and or other dividend paying energy stocks you would advise/like.
Many thanks, J.A.P. Burlington

Q: Any insight into the big sell off in Enercare shares. The results looked good and so did the outlook. The selloff is happening two days after results were declared so probably not based on the results.

Good to add at these levels ?

Q: Your thoughts on today's earnings report, as well as the payout ratio and growth prospects for Enercare. I have an overweight position. Many thanks

Q: Good Day - What are your top 5 income stocks right now for long term (with distribution of approx 5% and above)?

Q: THE LAST THREE YEARS HAVE BEEN GREAT FOR ENERCARE WITH THE STOCK ALMOST DOUBLING IN PRICE AND THE DIVIDEND GOING UP VERY NICELY AS WELL. WHAT DO YOU THINK SHAREHOLDERS CAN EXPECT OVER THE NEXT THREE AS FAR AS DIVIDEND GROWTH AND DO YOU EXPECT MORE ACQUISITIONS IN THE FUTURE? THE COMPANY HAS SURE IMPROVED SINCE ITS DAYS AS CONSUMER WATERHEATERS. THANKYOU

Q: I'm an income investor who purchased 5000 shares of ECI at $16.57. As I am holding about 7% of my portfolio in ECI, I am wondering if now is the time to sell half of these shares and invest in some real estate as this is an sector I don't have any holding in.