Investment Q&A

Q: Hi 5i Team,
Can you please comment on Rogers Sugar's earnings release today? There are so many adjustments to their numbers that I find it difficult to gauge how good a quarter it was. I hold this stock primarily for income. Can you please comment on the safety/ability to grow the dividend, and free cash flow trend over the past few quarters?
Many thanks,
Brian

Q: together these 5 stocks make up 10% of my portfolio. not a terribly large weighting but enough that i have felt the recent decline. I understand the correlation between interest rates and these companies that are viewed as bond proxies. Since Jan 1 2018 BCE is down 5.5%, BEP is down 7%, BIP is down 8%, TRP down over 9%, ENB down over 10% (all return % are excluding dividends). ENB is now yielding over 6% if their Q1 2018 dividend is extrapolated for the FY 2018. my question is at what point does one consider the decline overdone and step into one or a few of these? a 6% yield on ENB is looking attractive to me but do you think there is still more downside risk in these names?

Q: Hello team,

Do you think the sell off on these fine dividend payers is done? I want to buy some blue chip dividend payers (I have none) but I wonder if the impact of future rate hikes is already/completely priced in for these types of stocks. What do you recommend: wait a bit longer or just buy now? I am afraid of buying now and watch them go much lower than their current price. At what price(or multiple) each of these would be a pounding-the-table buy? Would you please order them in terms of your preference for a very long-term hold.

Thank you very much indeed!

Q: Hi:
I'm currently underweight in bonds, and all my current bond holdings are in Canadian dollars. I am considering the iShares TIP. Could you please give my your opinion on this ETF? Thanks

Q: So many questions related to income and share prices as interest rates increase: here’s one more.
Could one justify selectively adding to the ENB-BCE- KWH- FTS - TRP -T types of stocks as share prices drop... and we therefore see higher dividend rates?

The strategy is to own these companies almost forever (unless something unforeseen or disastrous happened) and enjoy the dividends.

From my vantage point this seems to make more sense than buying bonds or low rate gic’s for income.

Your thoughts please with this dilemma. We of course have already seen the share prices drop and are wondering what to do with cash on the sidelines currently.

Q: I have Sherritt bonds 8% coupon in my TFSA expiring Nov. 2018. I got a proposal from the company to buy them back. Here is the proposal:

Option 1: Auction tender - The company is offering to purchase their debentures of SHERRITT INTERNATIONAL CORPORATION at a purchase price not greater than CAD $950.00 nor less than CAD $752.00 in cash increments of CAD $1.00, for a maximum of CAD $75,000,000 in value of its shares. All shareholders tendering at or below the purchase price will receive the same amount. If more than CAD $75,000,000 were to be paid, shares will be paid on a pro rata basis. Subject to proration. Tax consequences: Disposition

Option 2: Purchase price tender - The company is offering to purchase its 8.00% Senior Unsecured Debentures due 2021 of SHERRITT INTERNATIONAL CORPORATION. The purchase price for its 8.00% Senior Unsecured Debentures due 2021 of SHERRITT INTERNATIONAL CORPORATION will be the lowest price which will enable the company to purchase common shares for a maximum of CAD $75,000,000 in value of its shares. If more than CAD $75,000,000 were to be paid, shares will be paid on a pro rata basis. Subject to proration. Tax consequences: Disposition.

Option 3: Do Not Participate. (Default Option)

What would you advise?

Q: Hi Team, I realize that dividends are an important part of any portfolio and I know that 5I regards "Drips" very highly and I agree. Since I have no recollection of the investment world with high interest rate, how is "Dripping" affected in a rising rate market in the long run? Especially the utilities and the Bond Proxies.In the past how have names like TRP, FTS, EME performed. The higher yielding names in my portfolio in the utilities space are T and AQN. Should I keep dripping them? I am not worried about the other sectors stocks with dividends just the utilities.Thank-you in advance! Sam

Q: Other than the year 2009, the chart on this company appears to grind up to the right. Would consider this stock to be a good candidate for long term income? It does appear to have a low trade volume, so would that indicate difficulty in selling the stock if you wanted to get out?

Q: I'd appreciate your updated opinion on the company. Would you rate it a buy at current levels?

Q: Can you recommend 2 or 3 bond funds in Canadian $ that would be the least volatile and offer a return for a 3 to 5 year hold? I would prefer one Canadian and one U.S. or international. This would be my sole fixed income holding. Thanx

Q: I am slightly overweight the semi-pipeline sector with TRP, ENB, IPL and KEY, totalling just under 20%. I am thinking about selling KEY and either holding the cash or putting part of it into IPL given IPL's recent price and yield. KEY and IPL total about 5.5% of my portfolio. I also intend to sell some TRP when it gets back over $60. I am a patient investor with no need for funds (ever) but I will be 70 this year. How would you compare IPL and KEY in this scenario? Thanks. Great service and I've tried a lot of others.

Q: What's your favourite Canadian value stock that yields at least 4% ? Thanks

Q: Hi 5i, I would appreciate your advise/evaluation of lbs and lcs (Lifeco Split Corp.). Also, please tell me what is the actual fee I would pay if Management fee is .60%,Managment expense ratio is .95% (exluding preferred distribution) a service fee of .40% (paid quarterly). Many thanks, J.A.P. Burlington

Q: Because I cannot contribute new funds to my LIRA, I have a number of high-yield stocks to generate income that can be reinvested in growth. Full position in PDC for diversification and smoothing effect, half position in everything else. How safe are these utility and REITs dividends with 7-9.5 % yields? Alternative suggestions for 10 year plus strategy? (Please deduct as many credits as required)

Q: Now that ENF is at a 52 week low, is it considered a bargain, and decent, safe stock for dividend income, and dividend growth? The yield is now 8.07% with a price of $27.98. Or, can you suggest other stocks with a similar yield?

Q: Can I get your opinion on Gibson , the market does not seem to like the latest corporate plan or is the selling pressure from other market factors.
Thanks Bill

Q: SALES BY INSIDERS
I have seen some insider selling activity for the above noted companies. A few officers of Enbridge sold over 50,000 shares each in December. As well, I noted a few ALA directors sold over 15,000 shares each last month.
Do you view these insider selling activities as unfavourable?

On the other hand, another Energy company (IPL) had favourable insider selling activity, in my opinion, since there were only buyers and not sellers.

Q: These are my biggest looser,please advise hold or sell or buy more?.

Q: Hi Guys,

Interested in your insight regarding the downward movement on this name after being acquired by Cara. I can't help but think Cara's voiced expansion plans to the U.S. would add some interest on this name.

Could you also provide a date for Q4 earnings, I cannot seem to find it.

Thanks very much

Q: Your opinion on Enbridge please for a long-term hold.