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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: Can you give me a few names with the safest dividends and yielding over 3.5%? In evaluating dividend safety do you prefer to calculate the payout ratio vs earnings, operating cash flow or free cash flow? If FCF do you average CapEx over a few years or use depreciation as a proxy for stay in business CapEx?
Read Answer Asked by Andrew on May 16, 2017
Q: 5i ...was wondering if you could explain a little about a company being shorted. Once the stocks value has reached a certain level is the 'heat' then taken off that company or do they continue to hammer it with a 'told you so' attitude. I have made some money on EIF and enjoy the dividend but do not want to watch all evaporate. TY for explaining.
Read Answer Asked by Alan on May 16, 2017
Q: Team 5i, would you kindly rank these 4 REITs? I just turned 64 and now want to focus more on Dividends and Asset Protection as opposed to Growth. I like the High Yields. Are they safe? Any other suggestions are most welcome.

Thanks as always!
Read Answer Asked by Austin on May 16, 2017
Q: The company actually earned 16 cents per share for the Q. Because they did a convertible debenture financing, they now have to show fully diluted results as well ( being 8 cents a share) if the debenture is converted. At a conversion price of $8.75, while the share price is now $6.15 that s not likely to happen, and if it does, then the debt level will be greatly reduced. If the conversion gets converted that would only happen if the company's earnings ( or a takeover, buyout) drove up the share price. I think the results were fine. And they would have been better but for the timing of delivery so the 2nd q ought to benefit from this delay.
Read Answer Asked by Murray on May 15, 2017
Q: I'm looking at the latest financials for Crius. I'm seeing a big drag on cashflows from investments in working capital. It looked similar in the previous Q1, essential this working capital issue is eating up all their operating cash. Further they are "lending" out money at high rates which is draining their investing cashflows. Finally they are borrowing money to pay the distribution. This doesn't look very sustainable to me. Can you help me make sense of this cashflow statement? Where is the actual money? When I look at the adjustments they make to derive distributable cash I don't agree that normalizing out the working capital investment is a good approach, looks like this is just part of the business. What will change as they grow to make this company capable of actually paying this dividend?

Thanks,
Rob P.
Read Answer Asked by Rob on May 15, 2017
Q: I am considering this ETF. What would be the principal drivers of performance for this ZCM? My understanding was that the return of corporate bonds more closely parallel equities compared to government bonds, but I see that in 2015, ZCM still managed to eke out a positive return despite the overall decline in Canadian equities. I also note that it has produced a positive return every year since inception. How closely correlated to stock returns do you expect ZCM to be? What is the likelihood of this product generating a negative return in any one calendar year, and what kind of scenario might have to play out in order for that to happen?
Read Answer Asked by Walter on May 15, 2017
Q: I am getting nervous about commercial real estate in the US. I think we are in the early stages of a sea change in that malls are struggling/closing due to the shift to online retail. Stocks like AMZN and SHOP are rocketing because of this shift. One of the stocks I have owned for a while is BAM.A. Although it has infrastructure and renewable arms the bulk of its revenue is from real estate. Because they own General Growth they have a large number of malls in the US. My question: should I be shifting my BAM.A money into BEP or BIP or BBU to get around this secular shift that will presumably start affecting the company going forwards?
Read Answer Asked by Michael on May 15, 2017
Q: My belief is that you earn more with quiet, boring, steadily growing stocks than ones with a lot of fast rises and fast drops. I like a certain degree of stability which does not include dropping 10% or so when the stock misses earnings slightly, such as Enercare has done today, for example (a stock I considered boring). Which Canadian stocks do you think best fit this category? Or do any?
Read Answer Asked by John on May 15, 2017
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