Laurentian Bank

Canadian Banks He owns Laurentian bank and is holding it for the dividends. In a recession, he expects the Canadian banking sector will get killed. He would likely move to holding the preferreds as he expects a recession by 2021 as it will be safer. You might do better looking into European banks that could create better capital appreciation and dividends. Taking some money off the table, early in the New Year, would make sense. He would be cautious about shorting any Canadian banks as you have to cover the dividends.

(A Top Pick Jul 27/17, Down 6%) They're transitioning as they invest a lot in tech to optimize the bank. The dividend is safe. But it'll take several quarters before seeing the benefits of optimizing. The toughest part is behind them (closing branches), so expect a better share price ahead.

(A Top Pick Dec 07/18, Up 20%) LB is in the best-fiscally run province in Canada, and LB's risks are fairly low. The stock has had a good move lately. A definite hold. It's cheaper than the bigger banks based on book value, and pays a fine yield.

(A Top Pick Aug 20/18, Up 1%) Most of the banks have done nothing over the last year. Falling interest rates tends to squeeze bank margins.

They should be doing well with a strong Quebec real estate market, but they are not. There's a ticking time bomb in their mortgage book. They are also unionized, so they pay higher costs. They compete against the big banks, which is tough. Reading between the lines, there's something worrisome with LB.

(A Top Pick Aug 20/18, Up 1%) Likes it because Quebec is the most fiscally responsible province. Montreal real estate is on a roll. Quebec is turning out as a good place to be. Nice yield. Mortgages have been an issue, plus Americans are down on Canadian banks. Hang on and get well paid to wait.

Canadian banks are fine, and LB is below its average. A definite buy.

It is a smaller bank, a regional player. It is tough in Canada to complete with the top 5. It is the only bank that is unionized. It could be caught in the culture by a bigger player. But the banks in Canada should do well in general.

(A Top Pick Jul 30/18, Down 1%) LB isn't far from its valuation. Quebec is the strongest province, fiscally. LB struggles because it had mortgage accounting issues, which hasn't faded yet. He sees good potential and still holds it.

When things turn for a small cap, things can get ugly. LB has trouble growing--head office troubles, mortgage troubles. Buy a big Canadian bank instead. Avoid this.

A weak regional bank plagued with operational problems. It won't match the dividend growth of the big banks. This has "value trap" written all over it. Buy one of the big 5 instead.

Tempting here. Super nice dividend. Trading extremely cheap at 0.7 time book. But last quarter they largely missed. Contraction of the consumer loan portfolio. ROE at 8% is anemic for a Canadian Bank. Many problems are self inflicted. 60% payout ratio is high for a Canadian Bank (others are at 45%). Riskier name. He wouldn't buy it until earnings start to stabilize.

They've had issues with mortgage lending and loan portfolio in the past few quarters. But others, like RY (that he owns) offer a good 4.5% dividend and offer a lot less risk.

The smaller the bank, the more it'll get hurt in a recession. Go big in banks.