Investment Q&A

Q: I have owned HCG since 2000.This is a stock I thought I may never sell, but due to circumstances I have considered selling especially after your advise to get out. At what price would you sell as the stock can go up or down 15% in a day? I do not think putting a market price would by wise. I was considering selling at $8.00 per share but the next day the shares were down to about $6.75. Today they are trading at $7.75.

Q: David Taylor was interviewed in the Globe and Mail today. He feels there is value in HCG. His optimism rests on the book value of the company, which he estimates is between $15 and $28 a share. Do you feel this is a reasonable estimate of book value? If so could there be a significant opportunity for brave and patient investors?

Q: Would you recommend investing in this preferred at this time (given the drop in its price recently), and would you consider the preferred as a safer investment vs investing in the common shares. The reset is Canada 5 year bond yield + 4.78% (September 30, 2019). I am not sure, but are there any more Canada bonds to be issued going forward? If not how will the rate be set in the absence of further Canada bonds being issued..

Q: I understand that you guys don't like this space. I'm warming up to it and would like to take advantage of HCG's collateral damage. Pls rank the above and describe how they fund their deposits. Thanks!

Q: This company trades on the NYSE but is headquartered in Canada. It has been a disappointment for shareholders, especially after it shifted its business model a couple of years ago.

Do you have any insight into the soundness of its business model or opinion on its prospects?

Q: This high yielding lender has held up reasonably well considering home capital. It's earnings come out may 4. In your opinion is it a fairly safe hold, an opportunity or too small so likely to be caught in the recent contagion. Thanks for your advice Tom

Q: Hi, I'm looking for growth companies in the Financial sector, either Canada or US. I already have major banks covered, and not a big fan of the "payday loan" type companies that finance at very high rates such as gsy. Do you have any recommendations here, in the context of likely 2 small interest rate hikes per year in the US for the next couple of years, and generally positive economy?

Q: Do not own this stock, but will this not be a perfect storm for a class action suit. I can't believe the sites are not full of lawyers advertising.
Thanks

Q: Peter and His Wonder Team
I must admit that most financial lending or managing institutions who specialize in some type of financial engineering make me nervous...Canadian Banks excluded! Please give me your assessment of this company...would you classify it as a respectable contra play or just a bad idea? Ha!Ha!
Dr.Ernest Rivait

Q: As an investor looking for dividend income above growth and while there is "blood in the street", I am looking at buying FN for a 1.5% weighting in my portfolio.

How is FN different than HCG in how it raises capital. Does it have different strengths/weaknesses?

Would you buy now, wait, or not touch? Thanks

Derek

Q: can insiders buy at this time.

Q: EQB is dropping in sympathy with HCG, what is your opinion on it?

Q: This is related to HCG. Investors are pulling their deposits out of Home Capital. How concerned should I be as I have deposits with EQ bank and Achieva. Do they (and others offering high deposit rates) fall in the same 'concern' bracket? Each is under $100k so are covered by CDIC.

Q: I own some Home Trust notes ( due May17 and Dec18). Are these at risk? Why has the price dropped if they
are due in only a few weeks, is this a bond market looking to take advantage of fear?

Q: The authorities knew if they dd anything home capital would have issues. I thought it would skate through with a fine and a few firings. Why bring down the whole company? Check the mortgages determine the default rate and then decide what to do.Announce action everyone deserts Home Capital gics and the company swirls into the bowl. Hoop insider probably knows the default rate ponies up the money.Please explain.

Q: In March and February your comments about this company were generally positive. Yet just recently you said that this company was the most likely candidate to be booted out of the balanced equity portfolio. Sounds like you views have changed in the past four weeks. Can you explain the apparent shift in your position please. Thx.

Q: I would like to buy some preferred shares of the canadian banks.
Would you recommend one bank over the other and which series.

thanks,

Q: Hello,

I have read a suggestion that perhaps OSFI or the government might "encourage" a big bank to purchase home capital. Any insight as to what a potential price could be? What metrics do you think someone could base a bid on?

Regards,

Robert

Q: Hi Team,
Would you please comment on Canadian Western Bank !
Time to do a half position ?
Thanks as always,
Tak

Q: Hello Peter,
With regards to the question posed to you for HCG by one of your members, i can relate to the frustration and disappointment that your team did not see it coming. However, at the same time, as investors, we have to realize that you can only advise based on the data you have available. Past data can be used as input to determine Future company or sector trends, but cannot guarantee success as no one can predict the future. I think it is best to focus on how we can avoid such stocks in the future given great metrics in the past (HCG had high ROE, decent PE etc ) and all of a sudden we start hearing issues with the company. Can you please shed light on what investors can watch for to avoid such pitfalls? I am using your service, watch BNN, read newspapers and other letters along with placing stop losses to minimize downside. From what i have seen, it is best to stick to decent paying dividend stocks like BCE, SLF, Banks, etc Growth stocks just seem to have too much hidden which comes to surface later or they are targets for short sellers. Thanks for your valuable input.