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Compiling comments that experts make about stocks while on public TV.

2017-10-12

Opinion for Loblaw Companies Ltd (L-T)

Signal Price Bias Subject Owned
COMMENT $68.720 OPTIMISTIC NORTH AMERICAN - LARGE & ETFs Unknown

There is an impact for a stronger Cdn$ being able to purchase from the US, however, most grocers have currency hedging arrangements to offset currency fluctuations. The amount of purchases from US are much lower than you would imagine. It could be as low as 10% or lower. The stock is trading at about 10X Enterprise Value over EBITDA, which is in line with historical norms. Pays a 1.5% dividend yield. There are mounting costs as well as mounting competition. Food deflation hasn’t really helped. Minimum wage hikes are estimated to be about $90 million in additional costs per year. Healthcare reform is lowering drug generic drug prices, therefore pushing down margins. Too many headwinds face this company.

Stan Wong
Director & Portfolio Manager, Private Wealth Management, ScotiaMcleod http://www.stanwong.com

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