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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 realize this is a question you've already answered, but seriously, CRH is down over 15% today on a moderate downgrade to perform from outperform? I've never seen a single downgrade, even one that downgraded a stock to sell affect a stock this severely. Is it possible there's more at work here? Is this stock mainly held by timid retail investors who are simply following its momentum (which it no longer has)? Are there institutional investors involved in this stock, perhaps one which is trying to leave quickly?
Read Answer Asked by John on November 28, 2016
Q: Although I am using CRH in the heading this question is really applicable to any number of situations where a share price drops on an analyst's "downgrade", especially when there is no material news on the company e.g. - management malfeasance, loss of a contract etc.

I am not particularly concerned here about the company's future and fully expect the share price to go back to where it was relatively soon, especially in light of the fact that the target price is higher that what it was trading at and that the consensus price is much lower that the new target.


But I am left wondering why this or any other stock would have dropped so much. Is it because it was an RBC analyst and as a matter of course, all RBC brokers are instructed to put in sell orders (their clients are probably all up given the recent share price increases) to show clients the value of their firm's research (and then start buying it back when the price drops) or are there trading programs that always sell on downgrades or is this a particularly "good" analyst with a wide following or am I just being too cynical?

As I said, this isn't just about CRH and RBC. Or is every situation so different that you can't generalize and this is just "noise" that should be taken with a grain of salt?

Appreciate your insight?

Paul F.
Read Answer Asked by Paul on November 28, 2016
Q: Do you think CRH has risen too quickly recently and is a sell candidate? I note that the 3 month return is 75% without a lot of news. I have owned the stock since the $3 level and I am talking myself into selling. I recall the Auto Canada, Badger and Patient Home Monitoring debacles and this feels similar. Too well liked, excessive momentum.
Read Answer Asked by Chris on November 25, 2016
Q: I would like to have your opinion as to which one (or three) equities , based on growth and weighing risk, you would pick for an aggressive TFSA. Thank you.
Read Answer Asked by daniel on November 24, 2016
Q: Hello Peter and Ryan,
All three stocks are hitting all time highs. This is a good sign. They all seem to have good fundamentals and technicals. Given that they hit all time highs, if i want to increase my position, is it best to wait for a pull back or just allocate the money and in the long run getting them 4 or 5% cheaper won't matter much. Please advise. Thanks
Read Answer Asked by umedali on November 17, 2016
Q: I got into CRH after reading your comments on it (and other reports on the website), and added more before the earnings report, so kudos to you. Now that the stock has moved up so much, however, I am trying to figure out how one can tell if it has moved up too much, too fast. My question, then, is how do you tell when it is overvalued?

I know this is a difficult question for a stock that is small, with high growth, and depends on acquisitions, but nonetheless, one has to make decisions and I am struggling with it. I only have a half position in this, so its not a huge risk for me, and I love to watch the daily moves and growth in cash flow.......but I don't want to be married to any stock beyond all reason. Your thoughts would be appreciated.
Read Answer Asked by arnold on November 09, 2016
Q: Good day,

I know that your focus is not the US but the landscape is changing with the election so perhaps you could just be a sounding board. I have a large position in JNJ (for growing yield and broad diversification), a full position in EXE (for yield), and a 3% position in CRH (for growth). JNJ trades at a premium, justly so. I was thinking of swapping these holdings except maybe EXE for CVS, NVO and DHR. DHR is now focused since its spin off of Fortive and has been a long-term outperformer (it is devices and consumables). NVO (drugs) and CVS (broad healthcare) are great growth stocks that are beaten down compared to JNJ and together offer comparable yields. What would be your thoughts?

Thanks!

Derek
Read Answer Asked by Derek on October 07, 2016
Q: Recently I've sold some non performing stocks as well as stocks that were a very small portion of my portfolio in an effort to concentrate my portfolio on some higher quality, better performing stocks and I've come up with these 6. Wondering if you could rank these based on risk from less risky to most risky. I'm fairly conservative, tend to hold good quality companies for long periods (5-10 years) and I don't like a lot of volatility - I'd rather get a 5% return and sleep at night than a 10% return and stress about it.
Read Answer Asked by Richard on September 13, 2016
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