Canadian Tire Corporation Ltd. (A) (CTC.A.TO)

Canadian retailing has been one of the weakest sectors on the TSX. Rising wages is one factor. CTC pays 12x 2019 earnings, so it's still reasiably valued. He's worried about the major acquisition of the skiwear company, Helly Hansen. This is different from Sportchek or Mark's Work Wearhouse. He wants to see how CTC absorbs the skiwear company first. Skiing is a different business for CTC, so he doesn't see the fit.

Performed well, but has gone sideways. Fantastic locations have let them do well in the past. Amazon is a problem. Competition is going to get tougher. Take profits and put the money elsewhere where there’s potential for growth, not in retail.

They had good quarters until last quarter which was disappointing. They have a large financial subsidiary. Not a good place to be if the yield curve is inverting. Not her favorite name.

It is not vulnerable to the WMT-Ns or AMZN-Qs of the world. The multiple has always been reasonable. However they announced a big acquisition in the fashion industry. They paid a hefty price. This diversification strategy might divert them quite a bit so he does not hold it.

He thinks the fact that they spent a billion dollars on the acquisition of a ski wear brand was a sign of desperation. How do you compete against Amazon (AMZN-Q)? The next 10 years won’t look like the past ten years for this company.

This is the voting stock. It is more thinly traded and appears to be less expensive per share so it might be the stock someone would buy now if they were going to own shares.

Has done OK over past couple of years. Fallen below the 200-day moving average, so he would stay away. Has a 10% growth rate. Instead, look at names in the US or at Couche-Tard.

He owns Amazon only in the retail space, due to the growth prospects. This is not a sector he feels any urgency to be in.

One of the well kept secrets that you don’t often hear is regarding their acquisition that they got a lot of grief for. They have a long history of incorporating brands, however. (Analysts’ target: $186.29).

The Canadian success story in retail. It's recently had a small setback. Its multiples are expensive. It can't sustain its rate of recent growth. It's vulnerable on the downside. Also, retail is changing so much nowadays. At least Cdn. Tire can hold its own in Canada.

He has not been a fan of the Canadian consumer space. The consumer space is problematic. If saw more of a pull back in the economy, trade and jobs, Canadian Tire might be interesting.

He does not own any Canadian retailers. He thinks it is actually one of Canada’s better retailers. The multiple is not particularly cheap and he personally favours purchasing on Amazon instead. He would continue to hold if you own it.