Maxar Technologies (MAXR.TO)

One of the battle ground stocks this year. They made an acquisition that might have saved their business. Overall a good business, big government contracts. Nobody is building and sending 500 million dollar satellites. Now they are putting up smaller maybe 50 million dollars satellites and that is affecting their revenues. Lots of challenges to the name. In the meantime, the name is being kicked around. There is a big short seller affecting the stock.

(Past Top Pick March 27, 2018, Down 26%) Frustrating. It looked promising until a short report was issued and this stock got crushed. Maxar battled that report. Still, investors are on the sidelines. This stock is ridiculously cheap.

It's been hammered but he's sticking with it. The Digital Globe purchases added risk to the balance sheet, but he thinks that will generate a lot of free cash flow and pay down the debt. At 8x forward earnings. They're building a digital satellite system now. Data from outer space will feed a need for this information. (3.5% dividend, Analysts' price target: $78.32)

(A Top Pick July 20/17, Down 25%) It is a global communications and surveillance business. He has a target of $80 and it was time to go at that point. It is now headquartered in the US. They drew the attention of short sellers: Allegations of accounting irregularities; management resigned days before an investor day. You need to make sure the short interest is gone before investing.

They make communication satellites. Orders are big but are few and far between. When the company gets orders, there’s a lot of excitement in the stock and when it doesn’t get them, there’s a lot of disappointment but there’s also a possibility of cost overruns. This is a very volatile business (and stock). He owns some on the possibility that it will bounce back to $70 but he considers this high risk. Dividend is 3.23% but volatility can wipe this out. The stock is down over 40% this year because of disappointment from the conference call which included postponement of orders.

He likes it, but it's been painful for him. The market hasn't liked their debt. Also, U.S. shorts are hurting this stock which he thinks is unfair and allegations are untrue (from Spruce Point). A good earnings report and some cash flow will revive this
stock.

Was going to buy it before the report came out. When short sellers start talking about accounting irregularities, that is a situation you want to avoid. If you own it, it is a tough one. Too much risk and too much uncertainty. (Analysts’ price target is $81.42)

He's been watching it since it's broken down since the spring. It's bottoming now, partly due to a short report last week. Lately, it's been clustering around $46.

This is the old MacDonald Detweiller. The company made an acquisition of an imaging company. They have a new CEO. There is a short report out on this stock based on the amount of debt, concerns about the new CEO, and some accounting issues. The company has yet to respond to the short report.