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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: Just a comment for some additional perspective on the automatic share transaction plan of CSU's CEO: If today's share price action was a result of the announcement that the CEO may be selling up to 100 shares per week for a year (up to 5,200 shares), then the sellers who were bailing out are just being nutty. At the rate of 100 shares per week, it would take him approximately 84 years to divest himself of his current CSU shares position. Now there's an investment horizon for you!
Read Answer Asked by Lance on February 26, 2019
Q: Starting a new investment account. Given the recent market up tick what 5 stocks would u recommend. Medium risk minimum 3 year hold. Not a fan of energy stocks. The
Trudeaus have done me in twice.
Read Answer Asked by David on February 25, 2019
Q: Hi, Any comments on this PR. Thanks
TORONTO, Feb. 25, 2019 (GLOBE NEWSWIRE) -- Constellation Software Inc. (“CSI”) (CSU.TO) announced today that Mark Leonard has notified the Company that he or entities controlled by him (“Leonard”) intend to enter into an automatic share purchase and disposition agreement (“ASPD”) with a registered broker in Canada.

Under the terms of the ASPD Leonard will sell 100 CSI common shares per week when the price exceeds $1,000 per share, and intends to purchase 100 common shares per week when the price is less than $800 per share. Leonard anticipates starting the ASPD shortly, and continuing it for one year.
Read Answer Asked by rajeev on February 25, 2019
Q: Hi, It was nice to watch Peter's BNN appearance on Wednesday. Very thorough and objective !! And, yes a US stock pick was interesting. Enjoyed the show.
It was also very reassuring to see Constellation Software as a Top Pick, even with the recent bounce. Clearly shows your conviction in this superb company, from the early days. Your comment about memebers' questions, which is the next comparable company with similar attributes - " The next Constellation Software is Constellation Software, itself" confirmed your confidence. We have a large position across all family accounts and have benefitted tremendously over time. Thank You.
My question is - How do we ascertain, if there has been institutional interest/buying of a stock, over certain time period ?
Yesterday, Canaccord Technical Analyst repeated Constellation as a Top Pick and mentioned that they have seen institutional buying and volume going up over past 6-8 weeks, which is healthy and a strong positive indicator.

Thanks again for your insight.
Read Answer Asked by rajeev on February 22, 2019
Q: I own all of the above in roughly equal weights in my TFSA. I am attempting to replicate your Balanced Equity Portfolio. I am also trying to get more defensive. I think I am overweight in the Info Tech sector. I am looking at a 5 year hold. I have cash to buy another position. What would your advice be - hold the cash or make a purchase. If purchase what would be your recommendation for defensive position?

Thanks for your help.
Read Answer Asked by Ron on February 22, 2019
Q: Hi 5i, I own CSU,COV,KXS, PLC (-3%), and PHO (-12%), however overall I'm 30% up (thank you), I have an extra 11K to add to my TFSA, would you recommend 1 or 2 stocks to complement my tfsa holdings. I'm 3 years away from retirement, medium risk. Would you get rid of any of my holdings?
thank you
Read Answer Asked by Fernando on February 19, 2019
Q: Thankyou very much for recommendation of CSU. Your unwavering conviction in this stock enabled me to keep it and add to it on declines, which can be difficult to do for a conservative ETF investor. Do you have another favorite Canadian stock , or stocks, with nearly identical qualities, that you would suggest ? Sector is not a concern. If more than one, please list in order of preference. P.S. my wife says thankyou. I sold some shares to buy her a very special Valentine gift.
Read Answer Asked by Allan on February 15, 2019
Q: I am looking to add half a position of another tech company [currently I hold only Constellation. What would you recommend for a conservative investor [aged 72] with a pension and balanced/income portfolio.
Read Answer Asked by Ellen on February 15, 2019
Q: I was just about to buy CSU when I noticed a good report and it shot up 12%! Is it too late? I'm looking for two long term holds, minimal volatility, for a 2.5 % position each. What two do you like and why?
Read Answer Asked by Graeme on February 15, 2019
Q: Noticed the special dividend of $20/share and read the companies brief comment that while still seeing an attractive acquisition pipeline they have excess capital requirements for 2019 hence the dividend. Managements track record is pretty impeccable and their reputation as capital allocators is second to none but is this a small cause for concern going forward, especially as they rely on acquisitions for most of their growth? I'll gladly take the $20/share but would have thought there were more acquisitions out there or maybe even some debt could have been paid down? Maybe I'll pose this question to CSU on their Q&A site as well but what are your thoughts?
Read Answer Asked by Richard on February 14, 2019
Q: Please comment on CSU's Q4, including your thoughts on the normalized accounting effects of the bargain puchase gain.
Also, the $20 special dividend, about $400 million total, is 5 years of the usual regular quarterly dividend.
Do you see this as a sign their acquisition plans are slowing down or are they just reaping some rewards?


Read Answer Asked by sandy on February 14, 2019
Q: I think I recall reading a Q and A about companies that have issued shares very seldom. However, I wasn't able to find the question thru text search. Could you provide the names again? Thank you.
Read Answer Asked by Harvey on February 06, 2019
Q: Most equity investments I make are made with a long term view (buy and hold). My recent readings of investment material have concluded in many cases that one of the best indicators of long term successful and rewarding investing is to invest in excellent company management. I would consider some examples of excellent management would be JNJ and closer to home BAM. Both of which I currently own.

Given the great many risks (domestically and internationally) currently threatening even a conservative approach to investing. I am looking to identify up to 10 large companies that have clearly demonstrated excellent consistent management capability. Your consideration in helping me with this by identifying some qualifying companies would be most appreciated. My thought is that at least 5 out of 10 would be Canadian and would be large companies.

Thank you
Read Answer Asked by angus on February 06, 2019
Q: Thanks 5i for your unbiased insights and for introducing me to many new Canadian growth stocks that I had been unaware of.

Question on Constellation. CSU seems to have some conflicting attributes for a typical tech stock. It trades at a very high PE ratio, 58, yet a low beta of 0.53. Can you explain why this stock trades at such a high valuation with such low volatility?
Read Answer Asked by David on February 06, 2019
Q: Hello 5iR Team, Many brokerage houses have developed the portfolio structure of identifying a short list of their "Highest Conviction" stock picks. Then they separate them from all of their other "BUY" rated stocks and/or stocks they have selected to put in a portfolio.
Yes, I know you have your three model portfolios but choosing a few stocks from these portfolios or something different forces everyone to concentrate and co-operate to develop the ultimate 5iR focus list.
Is this a concept the 5iR team has considered?
Would it be possible to ask at this time can the team give me what 5iR thinks are its' Highest Conviction ideas for 2019? Thanks Team. Cheers, Chris

Read Answer Asked by Chris on February 04, 2019
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