Stock price when the opinion was issued
Steer clear. Generally, retail is a tough industry. Not good insulation from online competition. Wary of retail that's not specialty. Would prefer HD, ORLY, or dollar store segment, but wait for pullback.
Tends to be a more economically sensitive retailer. Could benefit from rate cuts and an uptick in discretionary spending. But rate cuts would intensify competition. Good portion of profitability comes from its financial services (credit card) business.
A contrarian idea, which is how you make outsized returns. Has assembled a nice portfolio of brands over time. Nice job steering customers away from online competition by focusing on bulkier items. Price down due to recession fears. A reversion-to-the-mean play, aiming for 60% return back to all-time high of $215, plus impressive dividend. Yield is 5.2%.
Consumer pullback in spending during a recession is not a risk unique to CTC.A. All retailers face this. Very good profitability, strong balance sheet, trades at 12x earnings.
Can't tell what the impact of a trade war will be; they receive a lot of Asian goods. Also, this is consumer-dependent which is a risk. They are selling Helly Hanson at a profit and will reinvest funds in tech. They're buying back shares. Not a bad business and are profitable, but will never have a high PE, currently in their historic range. More of a trade, not a long-term buy.
Over the long term, great Canadian business that's gotten really efficient about how they retail. Consumer recession might happen; not right now, but it is a concern. Incrementally, will be a better business over time. Tariffs will have an impact on some of its stuff, but which stuff and how much? If his team can't figure it out, they tend to just stay away.
Kind of an up-and-down stock over its history. Resistance about a year ago, and looks to be attempting to bounce off that. Now you have to look for the next level of overhead resistance, which may be ~$195. Moves right now show it's very probably a near-term trade. How high and how long remains to be seen.
The 3-year chart has a bouncy look to it, perfect for swing trading. Short-term picture looks as though the stock will pop a bit, but the longer-term picture implies that it's on its way down toward either the middle or the lower part of the trading band.