Investment Q&A

Q: ENF recently completed its announced $1.5B acquisition (drop down from ENB) and with the the recent run up in its stock price I'm wondering if it is fully valued or perhaps over valued. CIBC has a recent $25.75 12 month target while RBCDS has a $23 12 month target. Are there better risk adjusted values elsewhere?

Q: I have about 100% capital gain on several good dividend paying stocks but I read that investors may shift to another sector soon. How do I protect my long held capital growth. Example-ARX-book $12.32\ IPL.UN-book $11.27\ BTE-book $10.04. Thanking you ,J.T.

Q: Hi Peter, I am a 50 year old, long term, buy and hold conservative investor and have about 35% of my portfolio in various pipeline and mid stream stocks including ENB, ALA, PPL, KEY and IPL.UN. I am building my portfolio to provide me with retirement income from dividends that will continue for many years to come. I have been concerned with the latest research coming from various sources regarding the potential for the U.S. to be energy self sufficient in future years and wonder what the effect might be on my portfolio positions. I try to minimize my risk and hope that this potential development will not have a negative impact on these stocks. I know that the future is very difficult to predict but would appreciate your insight on this topic. Many thanks.

Q: Hi Peter & 5i: In your answer to john's bonds question you referred to investments "exposed to" fixed income securities. I'm interested in how an eventual move off the bottom for bond interest rates will impact valuations of different kinds of equities. Aside from the obvious link to income stocks, that to some extent trade off of their yields, what kinds of companies have material exposure to fixed income securities, in terms a foreseeable negative impact on a company's growth, profitability, cash flow, or other relevant valuation metrics? For example, Cdn banks. I've heard that banks generally benefit from rising interest rates. But given their involvement in the fixed income market, would parts of their businesses suffer in a significant rates-driven market shift from bonds to equities? Thanks!

Q: Hi Peter- This question is about Fairfax Financial Rate Reset Preferred Shares. FFH.C can be called in Dec./2014. Between now and then you will get 8 dividend payments totalling $2.88. It currently trades at $25.87. There will be a loss of 87 cents meaning that your profit is $2.01 share or 3.9% over 2 years.
FFH.G gets called in Sept/2015. There will be 11 payments totalling 3.44. It is trading at $24.70, so add a 30 cent gain for a profit of $3.74 a share or 5.5% per year over 2.75 years.
The one that seems to be too good to be true is the FFH.PR.E which expires in between these two in March 2015. It trades currently at only $23.11. A gain of $1.89. With 9 payments totalling $2.67, you have a total gain of $4.56 on an investment of $23.11 or an amazing 8.8% average annual return over 2.25 years. What am I missing? You have 3 pref issues with a relatively close annual dividend and relatively close call date but with extremely different market values. Same company. All Rate Reset. Is FFH.E a buy?

Q: good morning,checking out versen(vsn)as a long term hold.
can i get your input.