skip to content
  1. Home
  2. >
  3. Investment Q&A
You can view 3 more answers this month. Sign up for a free trial for unlimited access.

Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: I hold a small amount of AVO and SYZ in my TFSA. I've held both for about a year and I'm pretty much flat, up a little if I take into account SYZ dividend. My concern is that while I am happy with my sector weightings I hold 42 stocks and I'd like to start trimming that down to a more manageable level. As part of the downsizing I'd like to sell AVO and SYZ and add some CSU, ESL, or GOOGL which are already existing positions in my TFSA and each is up substantially since when I purchased them. Appreciate your advice.
Read Answer Asked by Richard on December 07, 2015
Q: hey Peter & Team,

Tired of answering questions about this one? To be honest, I'm tired of hanging on to it while waiting for Fernandes to stop alienating his Management Team and continuously offering excuses to his shareholders.

As of today, I am a little over 50% in the red. It reports in a little over a week and despite my fully understanding your advice to never trade on report speculation, I can't help but feel we are going to hear more of the same.... spending for the future blah blah blah.

Please provide your advice... I am seriously considering sell AVO, eat the loss and replace it with FirstService Corp.

Good idea? Bad idea? Will a rate hike hurt FSV? Any others you would recommend for me to look at?

Presently, AVO is 4% of my holdings and I do not have anything in the Real Estate Sector.

ps... I must admit being a bit nervous of Canadian Real Estate at this time.

Thanks for all you do

Gord
Read Answer Asked by Gord on November 10, 2015
Q: Hi Peter and Team,

I know you've been getting lots of AVO questions, but I want to get your thoughts on what it will take to finally move the stock up. It seems like the results were overall solid, and the fundamentals of the company are very much intact, but it just keeps getting punished. Do analysts and investors just generally dislike this company so much that it'll never get the benefit of the doubt. I'm starting to get a little impatient with it, as I'm sure a lot of others are.

Thanks,

Jordan
Read Answer Asked by Jordan on November 06, 2015
Q: I like AVO's growth but am concerned about AVO's lower reported operating cash flow vs. earnings. In the first nine months of 2015 the company reported $22M of earnings but only $9M of operating cash flow. The difference is due to spending on inventory, which the company is presumably doing to support future growth. However, the Days In Inventory ratio indicates it's taking AVO longer to sell its inventory than it used to. In your experience, is lower reported cash flow vs. earnings a cause for concern for investors? Also, do you think this could be a red flag that AVO is channel stuffing into its integrator network? I'm deciding whether to add a small position (1-2%) in AVO because of its growth potential and what appears to be an attractive valuation on P/E. Thanks
Read Answer Asked by Robert on November 05, 2015
Q: Hi Team,
I've owned AVO for about 18 months. After what seemed like decent numbers this quarter the stock dropped yet again (a stock the market hates). Do you think I would be better off re-deploying my AVO capital into any or all of GUD (Knight) and/or IT (Intertain) and/or DRT (Dirt Environmental)? I own 1/2 positions in all three. I now have about a 1/4 position in AVO.
Thank you.
Michael
Read Answer Asked by Michael on November 05, 2015
Q: For a beginner:
As do many Q reports, AVO mentions 3 EPS figures
1. Basic Earnings per share
2. Diluted Earnings per share
3. Fully Diluted Adjusted Earnings per share.
I would appreciate information as to which of these are the earnings I should pay attention to. When 5i says the "expected" EPS is .18, which of the above type of earnings are being referred to?

Also, a learned gentleman, a business college professor, said on BNN the other day that ebitda is CRAP, and when pressed he said it was always, in all cases, pure CRAP, and has little if any meaning. What do you guys and gals think?
Thanks.
Read Answer Asked by Jim on November 04, 2015
Q: Hello Peter,
I bought this stock at near all time high and thus down quite substantially while holding for a fairly long period now with nothing to show for it.
Your downgrade reflects the risk even if the growth is attractive. For a new investor in the stock the rating is appropriate. But for an existing shareholder here is the dilemma. If I sell, I have the tax loss (which I cannot use now maybe sometime in future) as the only positive. On the other hand, given the steep fall, there could be a nice rebound and therefore an above average return from this point on. What would you suggest? Would I be making the classical mistake of being in love with my loser if I held on? Or should I switch to one of KXS, PEO, QHR, TC in the growth portfolio?
Read Answer Asked by Rajiv on October 02, 2015
Q: I understand management rates poorly on Glassdoor. There is a question of whether AVO is experiencing more competition and margin compression. So my questions are:

How tight is the control of AVO - specifically how much does Mr. Fernandez own? If their products are superior and the share price low, what is the liklihood of a hostile takeover? Is there a big short position in the company?
Read Answer Asked by John on September 03, 2015
Q: I know you answered a similar question back on August 25th - but am wondering if you still have "faith" in this company's ability to deliver, especially with the 10% drop today. The chart looks so ugly - it could keep going down for a while.

I keep on hearing what a jerk the CEO but that he is talented.

If AVO were not still in the portfolio I would have tossed it but am now really at a tipping point: if worth keeping I should probably buy more (?); but if it is likely going to be dead money for 2-3 years, then I should move on to something with more
short / nearer term potential like a CXI - BOS - DRT.

I would appreciate your thoughts on this dilemma.
Read Answer Asked by Donald on September 02, 2015
Looking for more? Sign up for a FREE 14 day trial! No credit card required

We invite you to sign up for a 14 day free trial of 5i Research!
Experience all the benefits and tools we have to offer; stock research, model portfolios, Q&A with our experts, and so much more. Join a community of like-minded investors today!