Investment Q&A

Q: Portfolio Analytics indicates I am over allocated and perhaps over diversified in Financials: BAM.A 2%, BNS 2%, TD 4%, X 2%, BRK.B 4%, MA 6% and Industrials: CCL.B 1%, CNR 4%, NFI 1%, FDX 3%, HON 3%, LMT 6%.
Which positions would you recommend trimming or eliminating?

Q: Hello Peter,
If you owned these as full-positioned laggards in your portfolio, but were also a patient, long-term investor and appreciated the dividends, which of the following would you currently hold, sell or add to at this time? FSZ, AW.UN, CSH.UN, T, EWJ, HCG, MX, KBL, APR.UN, ZPR, NTR, TECK.B and CN?

Q: Morning 5i,

As someone hoping their is a significant pull back. Seeing the overvalued stretching....

I am looking to add some diversification and growth with the "safest" possible.

My picks are;
BAM.A
BYD
REAL
OTEX
GSY
ATD.B
NTR
CNR
Is their additional ones that you can suggest or a couple swaps that are "better" overall.

Thank you for all the tireless fun!

Q: Hi 5i -- my son (age 26) has recently started working in a well-paying job in the US. He's saving a good portion of his salary and has asked me what he should be investing in. No debt. He's looking to invest for long-term growth for retirement in 40 years or so. About 1/3 of his holdings right now are in Brookfield Asset Management, 1/2 are split between VIG and USMV, and the rest is Berkshire Hathaway and CN for his non-registered accounts. Right now non-registered savings are $75k.
His 401k is separate in Vanguard SP500 index fund. He is a believer in pay yourself first and has been able to save and invest 5,000/month US!

He's looking for good growth stocks or funds that will increase steadily over the long term. He's earning enough now that he doesn't need dividends in the short term but he's not opposed theoretically if everything fits together. Any thoughts on what he should be investing in? Thanks.

Q: I'm looking to start a new position in one of the above. They are both trading very close to each other in valuation. CN is bigger with more reach so I was leaning that way but wanted your take. Why would you go with one over the other? This would be in my TFSA.

(I feel like I have enough spicy growth names in my TFSA and am looking for something I can let sit for 20 years and not think about.)

Thanks

Q: Hi Peter,
Like many, I'm interested in possibly buying a couple of stocks that have been hit by COVID but that should recover well when the world gets back to normal. However, I want to do this in a conservative way - with larger, stable companies with low debt and strong balance sheets; assured 'survivors'. Can you please suggest six North American stocks (other than banks) that I might consider. And would you see CGI (GIB) qualifying under those terms? Thanks as always.

Q: Hi guys,

Wondering your thoughts on truck based shippers like tfi and ups as compared to railways? With a 5+ year time horizon, what has a likely higher rate of return overall and success probability with the economy ahead?
Thoughts on whether to invest now at all versus waiting 1 to 3 months for more earning to sink in?
Thanks
Peter

Q: For growth, your thoughts between WSP and CNR. Please briefly outline your reasoning.

Thanks

Q: A highly rated analyst has rated CNR a "sell" according to TD. I've held it a long time - should I sell it? If so, what would you suggest to replace it? Thanks.

Q: After reading your special report and market update today, I'm curious if you would also be looking at CN or CP following lots of volatility for them. Would this be an opportunity? and would one of them look more attractive to you than the other?

Q: Hi Peter, Ryan, and Team,

We have a 2.5% position in CN, and are a bit underweight in the industrial sector. Would the ongoing rail line blockade and slight decline in share price represents a buying opportunity? Or would a new investment into WSP, for example, be a better strategy? (Our other industrials are CAE, SIS, and TFII). Thanks in advance for your valued advice.

Q: Can you please comment on $CNR Earnings and how the Market might react.

Thanks Valter

Q: Hi, what is the outlook for CNR in 2020? I have a small position, about 1%. It has not moved much since 15 months ago and I would sell unless there was growth expected in 2020. If sell, I would move the funds to another sector, possibly buying gsy. Many thanks for the great service.

Q: I like to add one a{blue chip )income stock sector not material if any of the three which one ?
if not feel fre to name a couple

Q: What do you think of cnr as a long term investment. I can bring up charts that only go back as far as 1996, roughly the same time when we were on the cusp of a commodity boom. Do you think the trend it’s been on will continue.

Q: I have a substantial amount of CN shares. Would it be prudent to exchange my cn shares for cp rail shares. In my opinion, the Ceo of CNR (Ruest) has done a terrible job of managing CN Rail. The 6 month performance of CN is -3.5% while the market has been on a tear. While CP is up over 4.5% in the same time period. Not sure how much business CN has given up with the strike either.

Q: Given the fact that CNR has announced layoffs due to a slowing economy how do you this affecting the stock's performance over the next few years. Thank You.

Q: I think I need to increase my Industrial exposure by adding one more company. I have 4% in each of CAE, CNR, WSP. Perhaps one more at 2 or 3%. Any suggestions?

Q: Hi Guys

I came across this good review (printed below) of the book Railroader by Howard Green. The book outlines Hunter Harrison and what made him, and makes, an outstanding CEO. Wondering looking at current CDN companies which stand out as being lead by outstanding, visionary, numbers driven CEOs.

"Book - Railroader

Every so often there is a book that gets circulated around our office that sparks both conversation and action. Railroader, written by Howard Green, recently ignited this spark. You may recognize Howard Green as the founding anchor at Canada’s Business News Network (BNN). Green chronicles the life of Hunter Harrison, the brash railroad expert who grew up on a railway spending five decades in the industry and rose from a labourer to the CEO of multiple railroad companies. Canadians specifically might remember Harrison as he has his fingerprints all over historic Canadian institutions. He ran and turned around both Canadian National (CN) and Canadian Pacific (CP) (as well as Illinois Central and a brief tenure as CEO of CSX before his death in 2017). Howard does a great job providing in-depth and genuine insight into the life and, more crucially, the thought process behind Harrison’s decisions.

The book was engaging from our point of view because we have met with hundreds, if not thousands, of management teams and we’re always on the lookout for what Hunter Harrison embodied. How was Harrison able to rise from lowly labourer to successful CEO multiple times over? Harrison knew more about railroads than anyone else. He grew up on a railroad and did every job along the way. Harrison was described as having an “encyclopedic knowledge of the industry” and used it to transform the businesses he led. There are instances in the book that describe his ability to identify a problem just by the smell. In other words, he had an edge.

Harrison was also a “numbers guy.” He measured everything that could be measured. He was the first to implement computers in the day to day operation of a railroad and went on to pioneer Precision Scheduled Railroading, now an industry standard. When Harrison would look at the railroad’s daily printouts, the numbers would jump off the page and he could see what the issues were. As Green describes, “Soon he was scrutinizing the return on assets, capital spending, depreciation, cash flow and revenue. He also wanted all of the regions on the railroad to be cognizant of these numbers.” The combination of knowledge, measurement, and execution would show up in the railroad’s operating ratio, the industry standard in evaluating performance, which Harrison would improve far beyond what industry experts thought possible, at all of the railroads he led. He knew what trains were capable of when everyone
else couldn't even imagine their potential. The ability to transform a commodity business to a service-based business that customers are willing to pay a premium for is truly remarkable.

Stuart

Q: Just a short comment on the rails, having been employed at one for my career. These two companies may see volume drop off, but they also have the ability to reduce capex and headcount. In an environment of less traffic, their operating ratio gets easier to reduce. In my mind, very defensive stocks to hold