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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: Can you comment on Brian Madden's recent comments about Shopify the last few times he's been on BNN. He likes the company but says their disclosure is a bit manipulative in that it is excluding stock based compensation and that compensation is about 10% of revenue. He feels they are intentionally leaving that out to make their numbers look better while lining their pockets while the company is still not profitable. He's the first i've heard bring this up, thoughts?
Read Answer Asked by Adam on February 10, 2020
Q: What are a couple of your favorite Consumer Cyclical & Defensive stocks on the Canadian and US markets.
thanks
Joe
Read Answer Asked by joe on February 10, 2020
Q: Hi Guys
I hold BPY.Un amongst a few other Brookfield entities including Bam.a. I was thinking of adding more to BPY.UN and just have a question about it's book value. I know the company is never going to be sold but just kind of wondering what is realistic for book value for BPY.UN and what your screens show. When I look up book value it changes considerably from source to source and I think that might be in part because it has US and CDN listed shares. For example Scotia iTrade pegs the Price to Book at .6. So from your sources what would you say the book value is, in either CDN or US dollars - whatever is easiest for you? Also is there any kind of catalyst you can think of that would move the stock price closer to book value?

Thanks so much Stuart
Read Answer Asked by Stuart on February 10, 2020
Q: I have read the q and a's on the proposed split but I am still confused so please bear with me if this is a repeat question. I currently hold 100 shares in my US Rrsp account as the dividends are paid in US dollars so this avoids any exchange fees. I understand that I once the conversion occurs I will own 40 shares of the new company. Should I sell before the conversion to maximize my US dollars and buy Bep in my Canadian Rrsp account? I guess I just need to understand the implications. Thank you.
Read Answer Asked by Maggie on February 10, 2020
Q: Hello,

My value screen surfaced Israel Chemicals Ltd. recently. It has quite decent fundamentals.

So how does an NYSE-traded company with $6B (2018) in revenue and a market cap of $18B that is a significant miner of bromine and potash and exporter of fertilizers ... not have any North American analysts following it as far as I can tell, and seemingly low trading volumes? Is it because it is based in Israel and also trades there?

I'd appreciate hearing your perspective. Thanks as always!
Read Answer Asked by Marc on February 10, 2020
Q: Hi, I'm currently holding these stocks for Tech (21% of portfolio):
SHOP,KXS,GIB.A,FB,GOOG, LSPD, CSU, XLNX

I've been looking at TEAM, TTD, AYX but haven't pulled the trigger. Would any of these overlap with my current holdings? Which one would you purchase to compliment my current holdings? I know its highly personal as well, but what would be your max sector allocation? I'm a long term growth investor. Thanks!
Read Answer Asked by Keith on February 10, 2020
Q: Any thoughts on Peleton as an investment?

My understanding is that they are not yet profitable, but they are still expanding their exposure in North American households through an increase in their subscriber base. A recent BNNBloomberg article also indicated that they have made plans to improve the breadth of their exercise machine catalog, through offering multiple price points on the exercise bicycles that they sell (I also see that they sell treadmills in the US, but it seems as if they have not added this as a purchase option on their Canadian website at this time), as well as potential plans to offer rowing machines in the future. I have read separately that they made a recent purchase of a Taiwanese company by the name of Tonic, in order to secure their supply chain for equipment, and that they have established a relationship with a company by the name of Affirm, in order to offer monthly payment plans for their equipment.

The company is now trading at $27.86, about 4% below its IPO price of $29. I would imagine that the most meaningful revenue source for Peleton would be from its subscription base rather than its equipment sales, as subscriptions are recurring and maintaining video/interactive conent would probably not require as much in terms of input costs per dollar of revenue as would manufacturing exercise machines for sale.

My main concerns regarding this company is that the potential for competition is profound (both in terms of manufacture and sale of equipment, as well as in their subscription program for fitness training). On the positive side of things, they have built up brand recognition and loyalty, which is not easy; and goodwill is an important part of any company's valuation.

I would be using the proceeds from the sale of my holdings in Cineplex to fund this investment (about 2% of portfolio), so it would not change my exposure to the Consumer Discretionary sector.

As always, I look forward to your response. Thanks so much!
Read Answer Asked by Domenic on February 10, 2020
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