Investment Q&A

Q: Hi, I have your balanced equity portfolio (minus goldcorp), a few of your income stocks and 10 growth stocks. All of these are held in TFSA/RRSP. Up until now new money has been going into new positions in order to complete the portfolio. Now I have new money to deploy which will be in a non-registered account. Rather than new stocks I plan to just buy more of the ones I have in the model portfolio but am looking for advice on how to approach this. Obviously I won't have enough to add to all 20 names. I was thinking I'd start with 5. Obviously this means I'll be overweight in those 5 but not by a large amount. Does this approach make sense? How should I pick the 5? I notice in another answer you suggested ATD, CCL, MDA, AYA and DSG for someone starting with the portfolio. Should these also be the ones I add to? And then in what order should I deploy additional money when its available?

Best,

Carla

Q: Good Evening
What is you view on the recent purchase of Transalta assets and the issue of shares at $9.50?

Thanks to all

Q: I was thinking of buying some SIO. I noticed your last comment on this stock was May 21,15. Are you still negative in-regards to this stock. I understand they are starting to get all their ducks in line. Would appreciate your comment.

Q: Do you think this is a good time to buy?

Q: Hi there,
I am sitting on some US$ in my trading account. I basically follow your balanced portfolio plus some of your growth picks. I can't decide what stocks or ETF's to buy with my US $. My American holdings consist of Disney and VXUS. I realize you don't cover American stocks. What would be your top 5 picks in the US market. I can handle a moderate amount if risk and have the ability to hold long term if needed.
Thank you,
Kerri

Q: Good morning.

I woke up to see that my PBH Convertibles are being called in early along with a whole bunch of other in the past few months.

As a result I have almost 25% of my RRSP's in cash. My RRSP's are currently made up of 80% convertible Debs, PBH, AI, and HXS and MAW150.

Can please make some suggestions re RRSP investments with the idea to maximize return and minimize downside risk. I am open to CV debs, ETF's etc. etc. and any other ideas that are appropriate for a registered plan.

I am over 65.

Thanks very much.

Q: Why has cpd been so volatile lately?
Never been so volatile before.
Is this a good entry point here?

Q: Hi 5i Team RNW-t is the dividend safe? Payout ratio please?Any growth for a two year hold?Alberta Investment Management Corp just invested $200 million this is a good sign.Also doing a equity raise

Q: I realize that transalta has some challenges facing it. However, the dividend is now close to 12%. Is the dividend sustainable and do you believe there is some price appreciation in store for TA? How will Alberta's new carbon policy affect the company? thanks.

Q: With the new alberta climate strategy, do you think a company like RNW could benefit from this all their asset are in alberta and renewable, with a 8% yield it look very attractive.

thanks

Q: HI guys
Could you comment on this capital share, when I bought it a few months ago I thought that any increase in the dividends in the underlying stocks would be reflected in the split shares, but this does not seen to be the case, is some of the yield a "return of capital? What do you think about this product?. I feel that I bought it for the wrong reasons and am thinking about selling it. I have owned plit capital shares in the td and ry and have done very well with them. Can you any ideas of a split capital share that follows the life-co's. Sorry that this is so long.
thank-you for your time and have a nice day

Q: Hi guys,

Mid day Monday I sent in 2 questions. The first one was entitled RRSP and the second one was on SJ.

You answered the one on SJ but not on RRSP. Did you receive that question or should i resubmit?

Q: Hi 5i Team,

This is just a comment about today's market 6% decline. The Wall Street Journal published a scathing article today about drug makers who don't spend any money and on R&D and sky-rocket drug prices. In my opinion Concordia was unfairly criticized in the article as as being one of the worst offenders.

Thanks, Shane

Q: Technology
The following report was published this am by TD Waterhouse, and I although I have similar confidence I was wondering if you agree. Also what else would you recommend, I currently have ESL which is performing quite well, was considering Kxs and would this be appropriate for an RRSP. Should we be considering a US holding
I look forward to your usual excellent response.

"The technology sector has, in our view, taken over market leadership within the
broader U.S. equity market. Not only do we see relative price strength in the S&P
500 Technology large-cap sector, but also in the S&P 600 Technology small-cap
sector. Other growth sectors do not exhibit this wide breadth in relative price
strength. This has become most evident in the healthcare sector, which has lost
market leadership, in our view, and in the consumer discretionary, where small-cap
names are exhibiting very poor relative price strength. In addition, the technology
sector has historically been highly insulated from potentially rising interest rates
and higher commodity prices, unlike consumer stocks. It also has less relative
sensitivity to a rising U.S. dollar. We continue to take the view that the market is
closely following the sector rotations of the later 1990s — a period when the
technology sector dominated performance (also in a rising U.S. dollar and interest
rate environment). We would not expect the technology sector to enter into a
speculative bubble as we saw at the end of that cycle, but we do expect its relative
strength to continue. We are well overweight technology in both our large- and
small-cap model portfolios.
Following its positive Q4/F15 results (year-end September) and the
subsequent upward revisions to F2016 ($3.43 to $3.47) and F2017 ($3.62 to
$3.75) consensus EPS estimates, we are raising our position in CGI Group
Inc. (GIB.A-T, $56.90) to 3.0% from 1.9%".

Q: Please comment on which REIT provides better value and yield going forward as follows (excluding exchange rate for BPY):
Brookfield Property Partners ($1.06 / $22.95 = 4.62 %)
Boardwalk REIT ($2.06 / $47.10 = 4.33 %)
Canadian Apartment REIT ($1.22 / $26.53 = 4.61 %)
BPY has had a good run in the last 18 months (+40 %) while BEI-UN has declined in the last year due to the oil meltdown. CAR-UN has seen less increase/decrease than BEI-UN.
I have had a good run on BPY-UN and need to trim a little for portfolio management. I am underweight on my allocation for apartment REITs and slightly overweight on office/commercial REITs in my portfolio.

Thanks for the great service.

Q: Hello Peter
I own Alergan stock and Pfizer & Alergan announced today 160 billion merger

The deal values Allergan at $363.63 per share, about 30% more than its price when reports of a deal first surfaced last month.

Allergan shareholders will get 11.3 shares of the new company for each of their shares. Pfizer shareholders will get one share of the new company’s stock for each of their shares.

After completion of the deal, which must be approved by U.S. and European regulators, Pfizer shareholders would own 56% of the combined company.
My question is what should I do with my shares, sell or wait for closing of the deal and what is good and what is bad in this deal for me as a shareholder.

Regards Andrew B.

Q: Noticed SJ was up nicely today and hit a new 52 week high. Couldn't find any news. Any idea why the nice move?


Thanks

Q: Do you have a view regarding today's press release and the carbon tax news from the AB government?

Q: In response earlier today you indicated insiders own 9%. AGM info and 2014 press releases indicate Oakwest Corportation (Beutel Family Office) owns 29%/31% respectively. Would you view Beutel family involvement as positive, negative or neutral?

Q: You thoughts on the asset sale to Bell would be appreciated, in particular how this may change free cash flow (and dividend protection) going forward and is this not also setting up the value of the company in the event of a buy-out?

The sale price for Movie Central, Encore and HBO Canada was $211 million. They state that this was derived by taking adjusted 2015 segment EBITDA multiple for Pay TV of 6.7x.

Fiscal 2015 Corus had $260 million of TV segment profit.

Even ignoring the value of the radio stations (let's say that they wash out against 'Corporate' and other costs in the event of a break-up or buy-out), wouldn't this put the value (based on what Bell paid for the above) of the remaining TV component at $1,530 million ($260 million x 6.7 - $211 million), or above $17.50/share? Or am I taking a too simplified view of the break-up value of the assets?