Investment Q&A

Q: In regards to TD - now that they have cancelled the First Horizon deal they will have an "excess capital" position. Is one possible use of that "excess" be to declare a special dividend. Is that even allowed by regulators - has a CDN bank ever declared a special dividend? What do you think they will do.
Thanks
Reg

Q: Trisura just annonced preliminary results for Q1. Could you comment please.

Thanks

Q: Would you endorse a switch from GSY to CM if one was looking for a more stable name with still good upside from current stock prices and a solid dividend yields

Q: Hi!
I just read piece about CIX in the Globe here: https://www.theglobeandmail.com/business/article-ci-financial-us-expansion-leave-canada/ .

It is a far from flattering description of CIX (says the CEO is overpaid, and the CEO overpaid for the US businesses, too much debt).

I have a couple of questions.

1) The article said that the CI will delist from the NYSE and be listed only on the TSE,
This seems like a bad development. What do you think?
2) Also, there is the talk about the IPO. Well, what does that exactly mean for share holders (ideally)? Would the IPO lead to a pop in CI's share price?
3) Would it end up being a dilutive transaction?

Maybe I am being pessimistic, but the outlook for CI seems...unprofitable...and I fear the worst (permanent loss of capital).

Q: What do you see in the medium term for TD? With a dividend approaching 5%, does it not invite investors to jump in? What am I not seeing here? If we get into, or deeper into, an unpleasant recession can you see TD share prices dropping significantly from current levels?

You have regularly note that the big banks have not historically reduced their dividends. If TD share prices do drop, the yields will be alarmingly high. It's been decades since I studied economics and I don't seem to be any smarter. Perhaps you can help.

thanks

al

Q: Would you buy NVEI here or is it too expensive?

Q: How much of TD's $1.2T of deposits is in their US banking operations? And does this amount include their ownership in Schwab and other banks they have a stake in?
Is this something to be concerned about, given the potential for a further run on the banks. Thank you.

Q: In the wake of turbulence there is often opportunity - is that the case for "brave" and NOT risk averse investors in the regional banks of the US? If so, what key metrics would you use and do you see some larger and safer opportunities within the regional bank space - maybe this could be an article you could write for clients?

Regards
John

Q: Hi Peter and company,

With Pacwest being the latest troubled regional bank, are there any high quality regionals being sold down in sympathy? Feel free to suggest any others not included above.

Thanks for the great service,
Angelo

Q: I noticed that Brookfield DTLA, a BAM subsidiary, has defaulted on a series of office building morgages with their preferred dropping from $30 to $0.50. Also I have read frequently that Brookfield's financial structure is highly integrated and complex.
Do you see see any risk here or should I maintain my position. Thanks

Q: Hi Peter,

Paul Holden of CIBC Capital Markets raised his recommendation of Royal Bank of Canada and National Bank of Canada to outperform. He cited their capital levels, earnings diversification, and lower relative credit risk as the basis for his favourable recommendations.

However, he acknowledged there are risks to that assumption and that central banks could overshoot by tightening too aggressively and thus tip economies into recession; or they could move too cautiously and allow stagflation to take hold.

Holden’s models show the Big Six banks, could see their Fiscal 2023 earnings per share tumble 33 and 31 percent, respectively, in the recession and stagflation scenarios.

“Canadian bank stocks are not being priced for the same economic risks that have already been incorporated into the bond market and U.S. bank stocks. We are not calling for a 2023 recession as our base case, but we cannot simply dismiss that possibility as inconsequential. Our analysis shows there could be (roughly) 30 percent downside should a recession scenario transpire,” he wrote.

Do you agree with Paul Holden’s recommendation concerning the Royal Bank and National Bank as the best of the Big Six banks to own today? Please explain your rationale.

Second, in the event of a recession or stagflation scenario in Canada, do you agree with Paul Holden’s prediction that the Big Six bank stocks will tank by about 30%? Please explain your rationale.

Thanks

George

Q: I am about a 1.5 years away from retirement. Across all my my registered portfolios I have all 5 major banks, pretty well in equal %. An independent financial advisor suggested cutting this back to 2 banks.

My question to you is can to rank these 5 banks in order of what you would consider selling?

Thank you.

Q: Tonight, I saw on TV that TD has become the target of short sellers.
Is this something to be worried about?

Q: This person took the words right out of my mouth, as the saying goes. Well done 5i

"Q: You have taken some heat on WELL and some other small caps, so I thought we would throw in a comment for some balance. In mid March I was thinking of taking a flyer on FRC and you were very cautious about such an idea. You said, and I paraphrase, 'we don't like stocks than can potentially go to zero'. That was enough to keep me on the sidelines. Now, FRC is down about 65% since then, and might not make it through the weekend. I wanted to thank you for your advice, and sometimes the 'don't buys' are good as or better than the buy ideas. Thank you for your service and keep up the good work."

Q: I see that CI sold some companies and that they are looking at selling others where they have no control with high %,. Of investment.This should bring debts lower.What effect will this have on their price and is there listing in US still going ahead.Will the dividend continue
.

Q: Can you comment on this company? Is it a good investment thanks

Q: Hi Peter and Team,

My understanding from the news is that Brookfield defaulted on some buildings recently. Given the significant tightening of interest rates, the collapse of a 6th bank, and the increased reluctance for institutions to lend and drop in liquidity, how do you feel about the safety of levered companies involved in realestate and commercial realestate?

Have you looked at what obligations Brookfield has that might face mark-to-market losses? Are people confident that the assets and therefore the equity are properly valued?

The building defaults seem like a "canary in the coal mine," don't they? Developers walk away from the building because it costs more to finish it than the building is worth, right?

Thanks!

Q: Could you explain this equity .How safe is the payout?and how much is there down side risks?
On another note ..any idea who bought the shares @ spb in the dump?

Q: You have taken some heat on WELL and some other small caps, so I thought we would throw in a comment for some balance. In mid March I was thinking of taking a flyer on FRC and you were very cautious about such an idea. You said, and I paraphrase, 'we don't like stocks than can potentially go to zero'. That was enough to keep me on the sidelines. Now, FRC is down about 65% since then, and might not make it through the weekend. I wanted to thank you for your advice, and sometimes the 'don't buys' are good as or better than the buy ideas. Thank you for your service and keep up the good work.

Q: Can you tell us when GSY reports, and what the numbers might be.
Also, can you tell us if GSY is expected to increase earnings this year and next, or is this too difficult to accurately forecast with the changes from the budget.
Thanks