Investment Q&A

Q: Hope everyone enjoyed the cruise and that it wasn't as choppy as markets!
My question is on Covered Calls in the CDN market and I wonder if you would have 5 stocks to suggest for this strategy. I note that using this strategy in the US market … AAPL, CSCO, DIS have way more activity and choices, but I like this idea for CDN stocks that I already own, per the suggestions from 5i.
Your thoughts please, and welcome back to reality.
Peter

Q: Hello. How do you think Enbridge will fair over then next 1 to 2 years? Do you think it likely the volume of oil moved through their pipelines will decrease (tied to the possibility that Canadian oil producers reduce output from more expensive sources)? It certainly seems like a bad time to sell or trim ENB, but that only remains true if there is a hope for a turn around in that 1 to 2 year timeframe. Thanks so much.

Q: Hello,

If already owned, at this point would you suggest adding more to the ENB position or add some (sector) diversification with other names?
If other name what are your top 2-3 preferences?

Thanks
Marios

Q: What are the payout ratio's for ENB and TRP? Is the metric used for this type of company different than the traditional percentage of earnings ratio?
thx

Q: Enbridge announced 14% increase of dividends and dropped like a rock 3%. Last year ENB about the same time announced about 30% dividend increase and shot up 20%.

So increase is an increase, why the reaction is totally different from last year ?
Do you see any other bad news today and going forward >

Q: What is your opinion on ENB.TO 6 -12 months out ? It seems to be sliding to no end.

Q: I know you like this company and I'm considering buying it, but the negative EPS and ROE makes me hesitate. Do you see this as a minor issue and if so, why?

thanks,
Paul

Q: I am retired and am mainly looking for income and some growth. I own TRP, ALA, IPL and PPL. I am down on ALA, IPL and PPL. I am thinking of selling IPL and PPL for a capital loss to offset some gains and replace them with ENB. While the dividend will be lower with ENB, I am thinking it will have more overall growth, including dividend growth. Thoughts ?

Q: I've been sitting on some cash in my NR lately and would like to pick up some new companies, presently, I am holding CSU, BNS, SYZ, FSZ, BEP and SJ. (equal weights + or -). I'm looking at AYA, ENB, ET,STN,DH,SLF,CPD and SPB. I'd prefer to buy something on sale with a dividend but primarily, I only want to hold high quality companies. Proportionally, I should be able to pick up approx. 4 new positions. Thanks

Q: Can you shed some light on why Enbridge has been beaten down the past few days? Is it a good time to add at these prices or do you foresee more downside. Thanks

Q: For a LIF where the objective is income and capital retention which is the best investment ENB or ENF. And is now a good time to invest in this sector?

Q: I FIND ALL OF THESE PREFFEREDS TO HAVE GREAT DIVIDENDS AT CURRENT PRICES,ALL WERE ISSUED AT $25.00.AT SOME POINT IN THE FUTURE SHOULD THERE VALUE NOT RETURN TO OR NEAR ISSUE PRICE ?OR IS THERE SOMETHING I AM MISSING

Q: I need to add to utilities sector to re-balance my portfolio. You have been recommending Enbridge as the best bet in utilities, is it still the case? In fact, I can add either CDN or US company (have free cash in both accounts), so I am also considering KMI.US - I like the dividend and the stats seems to be better than for CDN utilities. If you had to choose one utilities stock in Canada or US based on a combo of dividend and growth, which one would it be? Dividend is not that important for me at the moment, but it's always nice.

Q: Team

Why does the market cheer everytime Enbridge moves assets down to the income fund? To me it is just financial engineering.
The whole company is worth the same but the parts are moved around.
Enbridge keeps adding debt with new projects but still trades at a premium due to its stellar past. What am I missing?

Q: Would appreciate your input regarding Patrick Horan's recommendation to short Enbridge. This is based on it's high debt load and the consequent effect of a rising rate environment. I know it has been repeatedly targeted but if rates do rise do you see a downside?

Q: I would appreciate your comments on the following analysis that may explain recent weakness in the price of it shares.

The majority of investment analysts following Enbridge Inc. rate its stock a buy. But short sellers have a large position in the Calgary-based pipeline operator and natural-gas distributor. Why the divergence?

Enbridge has been on the Toronto Stock Exchange’s “Top 20 Largest Short Positions” table for more than a year. And during the two weeks ended Aug. 31, its short position recorded the largest increase of all the companies on the table, jumping 25 per cent.

Enbridge’s shares also trade on the New York Stock Exchange. There is a short position there, as well (that has increased). Adding the level for Aug. 31 to the Canadian position brings the total to 30.2 million, or 3.5 per cent of shares outstanding.

One of the few analysts to advise selling Enbridge shares is Darryl McCoubrey of Veritas Investment Research Corp. Why the sell advisory? “Specifically, the marked decline in crude oil prices … could undermine Enbridge’s growth profile and investment appeal,” he notes.

Enbridge’s revenue doesn’t depend directly on commodity prices but it does depend on volumes – similar to road toll booths. Mr. McCoubrey thinks the volumes could drop as oil producers shut down wells in response to low prices.

Q: Your report indicates negative 5-year EPS growth of -8.9% for Enbridge. Would this be due primarily to the number of shares issued growing faster than earnings, because of accounting type write-offs or for some other reason? Is this a concern going forward? Thanks.

Q: Hello Chaps,
Anyone asked about Enbridge's 2nd Quarter Report? Your comments please and thank you.
Rick

Q: I have a non stock specific question but Enbridge is a good example. Can you explain how stocks balance out across borders when they trade in different national markets in different currencies. In the case of a stocks like Enbridge for example how do the various markets reconcile say a rising interest rate environment in the U.S. versus a falling or steady interest rate environment in Canada? There is the currency question but there is also some intrinsic different potential reactions to a steady dividend payer in these different rate scenarios. So how does the Mr. Market "know" what to do? If there is any literature you can point me to that would also be much appreciated. Thanks once again.

Q: Today Paul asked a question in which he included the following statement: [Plus I have PPL, ENB and IPL which you consider as utilities; all in very positive territory.]
Could you please confirm that you do in fact consider PPL, ENB and IPL to be utilities? Even if they are, I notice that their price tends to have close correlation to the price of oil.
Thank you.