Investment Q&A

Q: Peter and Team,

I believe gold is needed for portfolio insurance. It costs you to have it but the day you need it you will be very happy you had it.

My current portfolio breakdown is 86.7% equities including cash and 13.3% bonds. Of the equity exposure, 9.6% is cash, 7.3% gold and silver bullion, and 5.44% precious metals stocks (BTO - 1%, MUX - 0.33%, NGD - 0.83%, SGN - 0.2%, and Goldcorp is 3.1%). All of these are down from higher levels.

My question is about Franco Nevada. I like the company and the business model and am thinking of selling all or some of the stocks to replace with Franco Nevada. I currently have total exposure to PM's of 12.74%. Can you suggest if FNV is a good replacement for any or a group of the above? I think its cash position is still strong and it still makes free cash and pays a decent yield.

Your thoughts?

Q: What are the risks with agt? Is bad weather its primary risk? Could you please give a short mention of its roe, margins, debt etc.
What stocks do you guys think have the most favourable outlook?
Thanks

Q: I recently asked about Firan and the stock has done well, but I recently noticed a very large disposition ~750,000 shares (4.2% shares outstanding) by the company's new chairman - Beutel, Robert Jonathan:
www.canadianinsider.com
This worries me a lot as the shares were disposed at $2.10/share and it seems a very odd time to sell given the stock's positive momentum, USD tail winds, and the fact that its going into a quarter which should be extremely easy to beat materially from the year prior (Q3 2014)...

I realize insiders can sell for a number of reasons and should not always be seen negatively, but this sale seems a little fishy to me.

Should I think about taking profits or ignore the insider sale?

Thanks

Q: You just answered a question for Doris on the relative merits of CGI and Enghouse. You were quite definite in your opinion on the superior quality of ESL management, but you lost me after that. The wording of your answer implied that a large backlog for ESL was not a good thing to have. More importantly however, on valuation, I am getting much higher P/E values and much lower Growth/P/E values for ESL from my usual financial information source.
Am I misunderstanding your answer, or is your valuation based on parameters that I have not considered?

Q: Hi Peter and 5i Team,

I currently own SGY. Because of the decrease in the stock price my position is only about 2.5% (down from 5%). Do you recommend keeping this stock, putting more into it or selling it and buying another stock from your Growth portfolio? Like BOS, DRT, or TC?

Thanks for all your help!

Best wishes,
Terri.

Q: While I'm a shareholder in Boston Pizza for the income, I'm concerned about the risk to a downside in the stock price. With pressure coming from fast-food and also fast-causal, how risky is this to be held for the long term?

Q: Hi Team,
Are you aware of any funds or ETF's that focus on sport companies, teams or anything sport related? Rather than pick a company like Nike, I'm looking for a managed basket.

Q: Hi. I've been watching Trimac for a while and $6 seems to offer some support. What do you think of $6 as an entry point for a long-term hold (5 years or longer)? Thanks in advance for your great advice!

Q: What are your thoughts on SLW at these low prices, both from a trade perspective and for the longer term.

Q: I presently hold BNS(11%),RY(27%),T(16%),TD(14%),and cash(32%)in my TFSA. I'm considering purchasing ALA with the cash balance. Is there a better choice?

Q: Hello on such a fine morning. My memory must be fading faster than I imagined. I seem to remember reading your answer to a question concerning the relative merits of PM and SIS but I can't find it. As I recall, you preferred SIS over PM. If PM is C+ with tendency toward upgrading then SIS would surely be B- if it was covered? Of the two, which one would you own? Is it OK to own both? (Is there much overlap in terms of product mix?) Thanks as always. Henry

Q: Good morning Peter and Team,

I am another unfortunate soul who has a position in G (down 48% at the present). Thank goodness though for diversification, as my overall portfolio is up a lot in large part because of 5i's picks.

Having said that, since gold is normally held in a portfolio to add stability in tough times, and since the Canadian dollar is currently very weak, wouldn't an investment in a US dollar currency ETF such as DLR accomplish the same goal with substantially better safety and much lower volatility? I'm not saying this "theme" would be valid forever, but what do think about it for the next little while?

Thanks as always for your insight.

Q: I wrote you on MIL.us in Oct 2014. Your comment resonated with me and I held on(I have a large capital loss which I cannot use). I am still perplexed about MIL. Biases aside, I would throw MIL overboard. However MIL shows it is as generally an excellent value-growth situation. MIL looks very good on commonly used metrics ---except for momentum.

MIL has proposed to buy a small bank in Europe and is making changes on its board. I am hard pressed to find anything overly negative on MIL-- certainly nothing that would prevent it from winning the passionate love of investors.

Are you aware of reason(s) that prevent MIL’s share price from getting off the mat? Is the attractive dividend vulnerable to cuts?

Q: Could you give your thoughts by running the numbers on the recent news releases and strategic investments made by Knight. My last calculations showed by the recent new releases/reports the company had approximately $6.35 to $6.45 a share in cash. What are your rough calculations for the current cash position and could you try and analyze the revenue growth going forward. I have heard many Bay street money movers have expressed lack of willingness to wait for the CEO to get the cash invested. Thank you Jason N

Q: What is the best source for earnings eatimates on Canadian stocks? I am looking for earnings estimates for Cipher. I've found a few different but am curious what you use. Thank you!

Q: Peter I have large holdings in Interpipe. Pembine and Veresen. I have talked to the companies and they all say the lines are busier than ever. They also told me the div, is safe for years and in 2 cases the dividends will rise, Your thoughts please. They have been stellar performers for me, Thanks Ken

Q: Hello Peter, Saw your recent column on mutual funds. Would you list a few that meet your recommendations? Thanks, Lavern

Q: Would appreciate your views on this company. I bought a small position in April at $23.75. Should I add, hold or sell? It is in my rrsp account.

Q: I own the following tech stocks: CSU, ESL and MDA

I'd like to add two more tech stocks to my portfolio. What would you suggest? SYZ, OTC, GIB, something else?

And should I buy them now or wait for the fall?

Best,

Carla

Q: Hi,

Any good reason why BCI keeps dropping in price? I'm up 40% and wonder if I should sell?
Do you still recommend XTC as a slightly risky growth stock, even with it's recent increase?
Although the two companies couldn't be more different, I can only own one risky small cap, and of the two, which would you prefer for the next two years?