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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: A broker research report on IPL states that "Our target price ($30) is predicated 75% and 25% on our 2015 and 2016 financial estimates,respectively, as follows: 1) 25% EV/EBITDA multiple of 15.5x, 2) 25% relative dividend yield of
175%, and 3) 50% free cash flow yield of 6.5%. Our target price also incorporates a 2.50% 10-year
Government of Canada bond-yield assumption."

They give IPL (our 8th largest holding) a forward PE of 28X and the others we hold in the Pipeline Sector at lesser weights than IPL - for ENB 23X and ALA 25X though the target prices for the other 2 are positive. We all know that brokers' research reports are intended to get clients to trade but I wonder if I should at least reduce IPL holdings to boost the other 2 especially as the PE numbers are quite rich?

Also do you agree with the research numbers and do you perhaps feel that the sector as a whole is pricey? Thanks, J.
Read Answer Asked by Jeff on July 25, 2014
Q: Hi guys , great service been in for a year plus and am very happy.
Can you project what will happen to dividend flat and dividend growth stocks if we see a bump up in inflation and a rise in interest rates.To the point are dividend stocks overvalued historically, in the relentless search for yield.
Read Answer Asked by Greg on July 25, 2014
Q: Any comments on DEE operations update? The stock was up %5 today.
Read Answer Asked by Paul on July 25, 2014
Q: re:SUM Solium Capital

Anything to update since last discussed May 13?

Thanks for all you do

Gord
Read Answer Asked by Gord on July 25, 2014
Q: Is it time to sell my junk bond ETF CHB? I watched this video today by Christine Hughes of Otterwood Capital. Seems to make sense:

https://www.youtube.com/watch?v=xD859cTLrtI&list=UUEmSqcxB2lCJyIjoYysrVEA

What's your opinion on this? I have about 10% of my portfolio in CHB. Thanks so much for all your great advice. Not sure what your policy is on posting links, but If it's not cool, just delete it. cheers
Read Answer Asked by Andrew on July 25, 2014
Q: Hi Peter and team: what is your latest take on VFX, Virtutone? I know its very small; recently they got some debt financing in place, it seems that this will finally allow them to grow revenue faster. However I'm not sure how it may affect their margins, which they are trying to increase. Do you see their game plan unfolding in a positive way? Or do you think their business plan is flawed?
Read Answer Asked by Kel on July 25, 2014
Q: There is little information I can find on Mainstreet Equity MEQ which has been doing well since you last commented in January. Could you please give us your valuable assessment of the company? Thanks for your advice. I have learned a lot since subscribing to 5iresearch.
Read Answer Asked by jacques on July 25, 2014
Q: Re: CSS.to

Don't understand why the board approve unanimously on a deal just around average recent price. What's going on?
Read Answer Asked by Dong Sheng on July 25, 2014
Q: Just announced that Transforce (TFI) has offered to take over Contrans (CSS). Board of Contrans supports the deal at approximately $15 per share. Seems low as Contrans closed on Thursday at $14.74.

Who wins: Transforce or Contrans shareholders?
Read Answer Asked on July 25, 2014
Q: Accord financial (ACD) released earnings. Can you comment on its valuation in light of the earnings?
Thanks.
Read Answer Asked by Michael on July 25, 2014
Q: Perhaps you could indulge me with a few suggestions. I have owned TML for ions, but I see insider buying. Should I sell now or perhaps buy more. I have been successful with CWX on buying because of insiders and am up 20% in 2 weeks. Should I sell it now since I see the future 1/4's may be cyclically weaker. I have also owned TMM forever, I am above water but wonder if I should sell and deploy somewhere else. Now that Sentry has put their person on the board do you forsee upside (as in possible merger or takeover)?
I am wondering because CAT remarks have indicated little business in the mining sector, if I should give up on the golds despite the so called good seasonality of the metal at this time. Would you sell the above mentioned positions and deploy elsewhere, and if so what sectors would be appealing. I could add to health, tech,consumer cyclicals, I will await your comments & recommendations. Thank you so much for your objective evaluations, they are very much appreciated.
Read Answer Asked by Maureen on July 25, 2014
Q: Hi Peter and Group. On july 18/14 Bioniche Life Sciences (BNC) received written approval from the FDA to allow it to submit a BLA for marketing approval of it's drug MCNA based on it's current clinical trial data set. This would seem to be important news. What is your current opinion on the company. Thanks
Read Answer Asked by John on July 25, 2014
Q: I would like your input on PSD Today price at 52 week low. Is this a good entry point? I am longterm investor, don't trade regularly. Thank you
Read Answer Asked by marc on July 24, 2014
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