
TSE:CHR
He trimmed at $8. They extended their Air Canada contract, but took a cut from total income they'd receive, thus reducing cash flow from that contract every year. That's the trade-off. CHR is offsetting that lost revenue with an aircraft leasing business which is a little riskier. Not his first choice in putting new new money.
One of his largest holdings. They fly Air Canada's regional routes, a deal signed through 2035 and have ratified the pilot agreement. Pays a good 6% yield with a stable free cash flow. Also, they lease regional planes internationally, which adds to growth. They can grow, and they have capital behind the company. Really likes the story. If the coronavirus does pressure this stock, then buy the dip.
(A Top Pick Feb 14/19, Up 25%) A bond on Air Canada in essence as this is Jazz airlines. They have a contract with their pilots until 2035. They do not have fuel sensitivity or for currency. ROE is 20%. There is room for the dividend to grow. Yield 6%
It has a very solid contract with Air Canada but they are facing a price decrease this year. They hope to replace it with air craft leasing. He is waiting to see how it works out and in the mean time you are getting a pretty solid dividend.
If coronavirus affects Air Canada, it might affect them to some extent, but not significantly. Dividend is OK. Yield is 6.2%. (Analysts’ price target is $9.38)