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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: It appears from the news release that the rights dividend allows a holder to purchase a debenture. There is no indication of allowing and existing debenture holder to switch issues to a non redemptive issue.
This is exactly the way csu sold its original tranche of debentures.
It also states that this issues is an additional to the previously issued debs,ie no series 1 and 2
Am I missing something

Under the rights offering, the company will issue the rights in satisfaction of the rights dividend that will entitle the shareholders to buy up to $700 million of unsecured subordinated floating rate debentures, Series 1 of the company.
The Series 1 debentures will be issued as an additional tranche of, and will form a single series with, the outstanding $282.2 million of unsecured subordinated floating rate debentures, Series 1 of the company. There is no minimum principal amount of debentures that must be issuable upon the exercise of rights.
The company plans to use the net proceeds of the rights offering to pay down debt under its existing credit facility and use any remaining proceeds for future acquisitions.
The rights will be issued in satisfaction of the rights dividend in the amount of one right per common share.
The rights will be exercisable until 4:30 pm Toronto time on Sept. 29 at $133 per $100 principal amount of Series 1 debentures purchased, plus accrued interest in the amount of $0.217 per $100 principal amount of Series 1 debentures purchased on account of interest accrued on the Series 1 debentures from, and including, Sept. 30 to, but excluding the issue date.


Read Answer Asked by Leon on August 25, 2023
Q: Hi 5i,
AJG's GICS Sub-Industry classification is "Insurance Brokers".
Can you help suggest some Canadian listed Insurance Brokers stock that might be worth looking at for a TFSA and or NonReg account.
Read Answer Asked by Ian on August 23, 2023
Q: Hi Team,
For an 18 year old who just opened their TFSA and starting with $6500, what stocks or ETFs (CDN and/or US) would you start with? There are no trading fees so there is no worry to buy 10 names if that is the best way forward.
Thanks
Read Answer Asked by Marco on August 22, 2023
Q: Hi
Wondering if these two companies are moving along on much the same pathway as CSU was in its infancy, wrt valuation metrics, trading volumes, share price, market cap etc?
Also why is LMN trading twice as many shares per day then TOI given TOI market cap is 8x LMN? Is it more well known even this early? Why is the volume so low?

Thanks
Jeff
Read Answer Asked by JEFF on August 18, 2023
Q: Upon reading and re-reading the announcement by CSU of the “warrant dividend”, I am still confused and have several questions. I like to understand what I am buying and/or being given, and I don’t fully understand that in this case.

1. Do these warrant dividends cost me anything? I am fairly confident the answer is NO, but please confirm.
2. Is there anything that I need to do, or will the warrant dividends magically show up in my account one day?
3. Once I get the warrants how will they appear in my (RBC) investment account. They won’t be listed on the TSX or any other exchange until the “Company Redemption Right” is exercised so I am not sure what to expect to see.
4. If the warrant dividends are not trading, what value can you ascribe to them? Just use the nominal fair market value of C$0.0001?
5. When the dividend warrants can be traded, will they be traded like a regular stock?
6. When I sell a dividend warrant in a non-registered account, are the proceeds from the sale considered a dividend, interest, or a capital gain? I guess since it is a type of dividend, I speculate it would be treated as dividend income.
7. Is this something that is good, bad, or indifferent for a CSU shareholder?
8. Is it possible to give an example of how this would work from the point of view of a CSU shareholder and the debenture holder. Assume today’s price of CSU and CSU.DB
9. Based on your experience with this type of situation if I could sell my warrants today, what price range would you speculate they are worth?
10. Have you seen this done with other companies? If yes, which ones, and how successful was it for the warrant dividend holder.

A lot of questions, but take as long as you need to answer them.

Thanks,
Paul
Read Answer Asked by Paul on August 17, 2023
Q: I always kick myself when I come to realize a missed opportunity and tell myself that next time, i'll recognize the trend and take advantage of it.

This is me asking that question now.

What 5 US and 5 CDN positions, in your opinion are very much out of favour right now but have quality fundamentals with an excellent chance for share appreciation over the next 3 years?
Read Answer Asked by Robert on August 15, 2023
Q: Hi,

What do you think of this assessment and it's impact on the stock long term?


Tim Shufelt's opinion:"management’s assessment that insurance premium increases must perforce catch up with costs, allowing carriers to fund labour rate increases over the long term, and even though labour rates are not directly tied to written premiums over the short term, political action to curb the magnitude of premium hikes represents a growing risk in our view.”
Quoted from TD Waterhouse citing the GLOBE AND MAIL

Thanks
Read Answer Asked by Jean on August 15, 2023
Q: SJ: Organic growth in infrastructure related biz's seems to have slowed from 27% to 10% in Q2 which was not as robust as Q1. Inventory and receivables seriously gobbled up cash flow, down substantially in Q2 and negative in half. Hence shares were down 4% yesterday (after indicating up).
What do you make of this?
Read Answer Asked by Keith on August 11, 2023
Q: According to the July 18 news release from CSU:

"The Company’s quarterly results will be disseminated via press release and made available on the Company’s website ( www.csisoftware.com ) and SEDAR, after markets close on Friday, August 11, 2023."

Is it normal for companies to release their results after market close ON A FRIDAY?

Politicians want to release bad news at the end of the day on a Friday, especially before a long weekend. So I am wondering if a company would follow suit by releasing bad news at the end of the week after the market closes.

I am not expecting bad news, but I can't recall a company like CSU releasing their results after the markets are closed on a Friday.

Your comments?
Read Answer Asked by Paul on August 11, 2023