Alcanna (CLIQ.TO)

Has come down a lot and is probably an attractive entry point. Dividend yield of about 7%, which is very attractive. The question is its sustainability.

Debt level is pretty high. New CEO come in and doing strategic review. There are issues about supermarkets selling spirits and wine and it could hurt their revenue. Wait for the strategic review and then decide.

Originally an income trust so it had a high dividend, which is why people owned it. Not a large growth rate stock and given that it has fallen you could hold it for the yield.

This is one you just buy for income, not growth. On a cash flow basis, the dividend is quite secure. The main problem is that there is a bit of a competitive shift in the US. Some of the states that they are operating in, the states around them have changed their liquor laws be a little bit more flexible. Same-store sales dropped 3% in the last quarter, which was kind of worrisome to the market. Sales did increase so it’s not a total disaster.

Doesn’t know the balance sheet, income statement on this one so it is difficult to comment on. However, the so-called sin stocks are tremendous in a lot of ways because people want alcohol. If you can buy into stocks like this when they are beaten down and have good balance sheets and good management, they can be worth buying.

People don’t want to buy a stock that has gone up. If you bought it, buy more. Liquor sales never really slow down. Steady business. 8.5% in a 1% world. Still thinks it is worth it at 5.6% and it will increase.