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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: Hi Peter and Team, this is about the news that COS would be cutting its quarterly dividend by nearly 43 per cent. I have made a quick calculation, and based on the closing price of today of $10.98, the new yield would be of about 7%. Does my calculation make sense? If yes, is it okay to buy COS shares at this price? Thanks, Gervais
Read Answer Asked by Gervais on December 05, 2014
Q: Peter, so many questions around energy stocks. Let me ask questions around your daily routines from the time you wake up till you go to bed :). Do you check the futures market when you wake up and before you go to bed, listen to BNN or CNBC during the day, go thru Bloomberg see commodity prices, check out stocktwits, read broker research reports, etc..Just want to find out what you daily routines are with regard to stock markets. Thanks.
Read Answer Asked by Iskandar on December 05, 2014
Q: http://www.stockhouse.com/companies/bullboard/t.cos/canadian-oil-sands-limited?postid=23197193

Mr. Hodson, at the risk of annoying you, I am providing this analysis with respect to Canadian Oil Sands (COS), which goes along with yours, and maybe further (as it is backed by actual buying of the stock). Was today's price a 35-65% discount and are reserves to last 90 years ? Do you foresee oil and COS substantially higher within the next year ?

Again, this is a private question, but feel free to let other members view your response if you think this is useful ?
Read Answer Asked by Serge on December 05, 2014
Q: Hello,
With what is happening in the oil sector, can you list a few names that you would buy and hold for 5 year plus. I can take some risk (ok with smaller cap) and i don t need dividend. Also, please fell free to add names in other sectors if you feel they are treated unfairly. My approach would be to buy half now and the rest mid january. Thank you.
Read Answer Asked by Pierre on December 05, 2014
Q: On the oil getting whacked theme, have you guys looked a PRE today? Down to $8.20. They are forecasting the following:
A base case average WTI oil price assumption of $70.00/bbl during the year and the 2014 average Brent-WTI benchmark price differential.
Oil price realization is expected to average to approximately the WTI benchmark price assumption.
EBITDA of $1.9 to 2.1 billion and Funds Flow (Cash Flow) of $1.45 to $1.55 billion.

So the company is currently trading at just over 1X EBITDA and 1.5X Cash Flow. They do have debt on the balance sheet but at low rates strategically and are long term. Unless oil stays well below $70 for a very long time valuations like this seem crazy. What am I missing?
Read Answer Asked by Dathan on December 05, 2014
Q: Hi Peter & 5i Research Team,

This might be of interest to other members also. I just happened to log into my TD Waterhouse account at 11.30 pm on Dec 4 and was surprised to see that my stop loss and buy orders for Amaya were "pending cancellation" and no longer active. I immediately telephoned TDW and was initially told that I must have cancelled them myself! When I said I did not, they put me on hold and then came back to inform me that TDW cancelled these orders because Amaya Gaming has changed its name to Amaya Inc. On my request they then reinstated the orders over the telephone. They also said that if I had not called them these cancelled orders would not have automatically been reinstated! Do you know if other brokers do the same? Because if I had not noticed this by chance I could potentially have lost out monetarily when the markets opened tomorrow.
Read Answer Asked by Francis on December 05, 2014
Q: Despite all the negatives about this company and lack of confidence even by the directors (based on their sales of stock), I see the CEO has been continuously purchasing shares from February to the present. He had about 100,000 and now has about 450,000 (direct and indirect). Is he an idiot or should I be following his lead? As always, I very much appreciate your opinion
Read Answer Asked by ED on December 05, 2014
Q: Hi Guys

I think you might have made an Error on the Income Portfolio regarding the return on Silver Wheaton.The Nov return % should be negative not positive.

Thanks Gord
Read Answer Asked by Gordon on December 05, 2014
Q: This one has me puzzled quite a bit.
I am thinking of buying another 2000 shares or so, My weighting would still be less than 3%. Having trouble understanding that Bloomberg reported that QKR could be making a bid for this company at around $1.0 billion. This would value the stock at about $5.00 per share. Good earnings, a fairly high dividend, very low copper cost producer. Do you think the price is falling on this stock because of Lower China growth, thus much lower copper prices(copper prices falling every day), or that the takeover rumor has no merit and it is just that, a rumor. I guess I was putting to much faith into the story. One would have thought that the source was fairly reputable (Bloomberg) Comments please on the rumor
Read Answer Asked by Al on December 05, 2014
Q: Do you see any appreciable difference between the 1-5 yr corporate bond ladder etfs issued by i-Shares (CBO) and by RBC (RBO)? Of the two, RBO seems to be closer to a truer ladder as CBO has 36% of its bonds with >5yr lifetimes. On the other hand, CBO is far more liquid and its credit quality seems higher (RBO has 22% BBB whereas CBO has 0%). On the plus side, RBO showed less price decline in the past year compared to CBO. I would appreciate your comment.
Read Answer Asked by richard on December 04, 2014
Q: Hi 5i team,
I have a core position in ZWB for extra yield exposure to the banks which has performed very well this past year. I have more cash to deploy for yield / "lower" risk and was thinking of starting a new position in either ZEB, adding more to my ZWB holdings or ideally, . starting a new covered ETF that tracks US banks if there is one you are aware of. I look forward to and appreciate your thoughts.

Thanks in advance. Your perspectivce is always helpful / insightful.
Read Answer Asked by Douglas on December 04, 2014
Q: Can you please speak to CDZ's interest rate sensitivity given it is a cdn. dividend-grower ETF. So, if we do see gradual interest rate increases in 2015/16 and beyond, what are some possible outcomes/scenarios for CDZ in your opinion. Thanks.
Read Answer Asked by Al on December 04, 2014
Q: Peter and Team,

Just a follow up on the question asked by another member just a bit earlier. You suggested CBO as a good ETF for corporate bonds.

Here are my questions:
1. If you buy a bond ETF, does the ETF price go down if interest rates go up or is it unaffected because the ETF manager will hold the bonds to maturity any way and get paid par?
2. Will this offer protection against rising rates (and maybe inflation?) due to the 1-year out maturities getting rolled into new 5-year maturities ever year?
3. Is this a better choice than owning a few bond positions outright along with a stock portfolio (assume diversification)?

Just as a comment, in my ideal world, I want to buy bonds that pay me back my money at maturity and give me yield along the way. I want to preserve capital with these choices and am not trying to hit a "home run."

Thanks!
Read Answer Asked by Marc on December 04, 2014
Q: I would appreciate your assessment of the announcement this morning by Kelso Technologies as follows...
Association of American Railroad has approved our new JS165H high-flow pressure relief valve for commercial applications after completing its required two year field trial. The JS165H has been designed for use on general service rail tank cars carrying hazardous and non-hazardous non-flammable chemicals that require a pressure specification of 165PSI. Rail tank cars requiring this technology are primarily DOT-111 tank cars that represent approximately two-thirds of the total DOT-111 fleet in North America.
North American chemical companies have been very supportive of the development of the JS165H as a best available technology and we are now able to supply their needs. Management believes that this development will allow Kelso to increase its market share and continue the momentum of its annual revenue growth.
With this AAR approval Kelso is now able to supply approximately 70% of all PRV applications required by the AAR. The JS165H is well suited for new tank car manufacturers, retrofit operations and repair facilities. The Company is able to produce this product in its current production facilities in Bonham, Texas.
Read Answer Asked by Gordon on December 04, 2014
Q: How important is the acquisition of Studon to sox, can they really afford it, and will this make them a great company. Is this a great company to invest in for a 3-5 year period or are their better choices at this time? I already own a lot of energy and gold companies. Thank you for your help. Always really appreciated.
Read Answer Asked by Rene on December 04, 2014
Q: Hi, you had mentioned that you trusted that GUD would put their recent financing funds to good use. Looking at the micro-cap LAB which is in a similar area and also recently did a financing, do you have any idea what their gameplan might be for the funds from THEIR financing? Do you feel it is just a promotional move, or a positive move for the company?
Read Answer Asked by Kel on December 04, 2014