Q: Hi 5i Team,
My expectation is that the CAD will continue to weaken based on many factors including the trade war, weak economy and continual decrease in interest rates and that there will be good opportunities in the resource sector for companies that have assets based in Canada but sell their their commodity in USD (ie companies like AEM have or CNQ). Would you agree with this thesis? If so, what other resource companies would fit this profile?
Thanks as always,
Jon
My expectation is that the CAD will continue to weaken based on many factors including the trade war, weak economy and continual decrease in interest rates and that there will be good opportunities in the resource sector for companies that have assets based in Canada but sell their their commodity in USD (ie companies like AEM have or CNQ). Would you agree with this thesis? If so, what other resource companies would fit this profile?
Thanks as always,
Jon
5i Research Answer:
We would agree. AGI, TECK.B, CS, CNQ, BN, TFII, CP, WCP, FNV we think would be other decent considerations here. FNV only has a portion of business in Canada but still likely gets a currency benefit from the other countries it operates in.