Investment Q&A

Q: According to your people at 5i Research, the fact that a stock is considered to be expensive is not a reason for an investor not to buy it. You have argued that the stock can continue to remain expensive throughout its climb to higher and higher prices. A stock that exemplifies your position is Constellation Software (CSU). On the other hand, Shopify (SHOP) was also considered expensive in its heyday and then declined dramatically in early 2022. What aspect (or aspects) in SHOP’s case made it more vulnerable to a sharp decline compared to CSU?

I ask this because I’m considering buying shares in TransMedics Group (TMDX) which you have described as a high quality business but “expensive on valuation” (August 28, 2024). In your opinion, will TMDX have the same consistent growth curve as CSU or is it more like SHOP and should therefore be considered as having a higher probability of falling off a cliff at some point in near future?

Q: Hello

Any comments on ADF announcing today of new orders worth $50 mln ?
Do you think, this will help stabilize the stock, near term ?

Thanks

Q: On Sept 11, Otex announced it has received authorization for the OpenText IT Management Platform (ITMX) from the Federal Risk and Authorization Management Program (FedRAMP®) (https://finance.yahoo.com/news/opentext-management-platform-achieves-fedramp-142600427.html ) .

You mentioned before that OTEX may need time to integrate previous M/A. With the FEDRAMP approval, would it be a buy now? Or would you consider stronger stocks to be better total returns over the next 3-4 years? Please rank the attached companies (knowing that they're all very different).

Thank you so much for your insights!

Q: could you please explain1. the concept of compounding your 2 favourite Canadian companies (excludingCSU). . your 2 favourite US companies thanks Richard

Q: Hi 5i team,

What would be your current 5 best (highest conviction) buys in each of the following categories please.
1. small cap
2. mid cap
Hold target is 3-10 years or longer.
I prefer these categories as they seem to have the most torque (in the right environment) albeit also the most risk.


Cheers,
Steve

Q: With the markets at all time highs, are there certain stocks you think people can scoop up or add to that have good growth opportunities at a reasonable price? I know 5i is not usually worried about buying companies at 52 week highs, but it is still something difficult for me!

Q: What has driven SMTC to its breakout share price. What are your current thoughts. Is it a buy?

Q: What are your comments for current new money in these small caps

Q: I own both Propel and Goeasy. Goeasy I've owned for quite some time, Propel I have been adding to slowly for the last 4 months. I would like to continue to own both. Would you balance the two out by selling some Goeasy to equal out the value of the two? If not, what sort of ratio would you suggest.

Q: Hi Peter, my son was looking at starting a FHSA investment portfolio. I was thinking of having him start with a small position in NVDA as one of his holdings, would this be a good suggestion seeing that the shares have fallen since the split or would there be better stocks for such an account and if you could suggest some it would be appreciated. Thanks

Q: Hello Peter,
Given your last reply on well at 16 times forward earnings, is this stock mis priced by the market? I would think for growth company, investors would pile into the stock given the current decrease in rates which help small caps.. Any comments? Also, do you think xsu can go much higher or has it rallied already in expectation of rates going down? Lastly, i know you don't believe in market timing but when some stocks surge due to recent announcements on lower rates, is it worth selling and buying it back when markets settle.. much appreciated.

Q: Hello 5i
Could I have your current assessment of Belden? It has done very well over the last 18 months. Can the growth continue? Any red flags?
Thank you
Dave

Q: Hello, can you please share your top 3 names ideally in the tech or industrials/manufacturing sector that most closely resemble Axon of 2-3 years ago:
- Lots of growth opportunities
- Business model with high recurring revenue
- Potential to be industry leaders
- Expensive for good reason
- Chance at doubling over the next 5 years
Are there others you think could grow into that type of business?
Thank you!

Q: Hi 5i,

I am looking for growth. If I can only have one which do you believe has the most potential? NVO for its incredible weight loss drugs or Uber now that it has dominated the car-hailing business.

Thanks
David

Q: Hi 5i Team - The guest on BNN Market Call today, said that WELL has to grow into itself since it's trading at at 100 times 2025 (I assume earnings). At the same time he praised it for its strong organic growth with 98% returning revenue and 37% revenue growth. I'm a little confused by these numbers. Could you perhaps put them into a perspective that I can understand. Thanks.

Q: Any explanation for the big jump in RDFN? Is it compelling at current levels?

Q: Hello 5i,

We have a little cash to add to our equity bucket. We have a 1/3 positions in IWO, IJT, and IJH. Would you recommend we add to those positions or do you see more value in a new 1/4 position into XSMO or GSC prior to the rate hike?

Are small caps too risky for a TFSA?

Thank you
D&J

Q: Hi

Do you think this stock is over sold?
Would you add to a position?
If yes when....wait a few days?

Thank you

Mike

Q: Does the company explain the nature of the delay from one customer? Delay in placing an order, accepting the finished order, paying? Can we be confident that is just a delayed transaction?
I've seen examples where an event like this turned out to be more serious than it first appeared.

Q: Just a follow-up to your recent answer on ADF, does any “single customer” type risk exist with this company or do they have a broad base of clients? Thanks,