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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: I am thinking of selling my long term holding in KXS (held in RRSP) in favour of NOW. I acknowledge the obvious difference in size and risk. I would like to continue to position in a consistent performer with visible earnings growth in the cloud-based enterprise SAAS space. The recent poor subscription guidance, significantly lower margin expectations and the “cockroach theory” has made me contemplate the change out of KXS. NOW would appear to be an emerging platform company with a much larger TAM than KXS. Would you be ok with this considering my objective of consistency or would this be an over-reaction on my part as KXS has been good to me (thanks to 5i)?
Read Answer Asked by Stefan on March 10, 2021
Q: I purchased Docusign last year and until very recently it seemed like a great choice. It’s sharp decline that began in late February has been significantly steeper than the tech sell-off in general. The shares are now right about where I paid for them and a hair away from succumbing to the old adage “never let a gain turn into a loss”. The steep sell-off has me worried that it is a precursor to the street expecting disappointing earnings when they report this Thursday. I know what the consensus forecast is, but what does 5i’s crystal ball predict for their upcoming Q4 earnings and the market reaction?
Read Answer Asked by Steven on March 09, 2021
Q: When do you think we are going to see the market sell off settle down in some of these names? Is this panic selling by retail investors or a more troubling move by smart money out of these names entirely? I'm just finding it hard to imagine that the prospects for these companies changed as dramatically as the share price in recent weeks. Take NVDA for instance. I thought it was everyone's darling a few weeks ago when I bought it over $100 higher. I'm holding but it's hard watching these things fall so dramatically each day without reprieve it seems. Thanks.
Read Answer Asked by Jason on March 09, 2021
Q: Please feel free to disregard this question if it is outside the scope of this fantastic service.

High growth tech stocks such as Unity, trading at a high multiple of future sales, have been pummeled due to a rise in the yield on ten year treasuries. Future earnings will be worth less, so this makes sense. I understand this relationship directionally but not quantitatively. I would like to understand the relationship better in a quantitative way, a sensitivity analysis if you will. Can you offer insight into how a 1, 2 or 3% increase in ten year rates effects the value of future earnings? And in turn what is an appropriate adjustment in stock price for a stock trading at 10, 25 or 50 times future sales?

Thanks.
Read Answer Asked by Joel on March 08, 2021
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