This week’s new 52-week lows… (Dec 05-11)
This week there are still many resources stocks in the 52-week low zone including Petrus Resources which is on our own watch list.
Many ETFs are in their 52-week low too which reflects the state of the market.
Dollarama (set to launch its e-commerce effort tomorrow) can’t seem to stop going lower and lower and makes the list again this week.
Here’s the full list :
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research The guidance was weak, and BB faces numerous challenges. But the company is still undergoing a strategic review, following overtures for a takeover. This remains a possibility, but it is hard to endorse on that alone. Fundamentals remain weak and much worse than expected. The…
Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. Backlog reported looks better with $4-5M in revenue expected in the second half of this year. They have received a large new order from China. They also secured a $5M in equity financing. Risks are high with market cap at $28M and low volume. However,…
Asset trackers. New iteration uses cell, not Wi-Fi. Helps cell phone companies boost revenue, as price of phone plans decreases. Before stepping in again, he's looking for a big ramp up in the trajectory of revenue and earnings.
They are doing distinctive infrastructure, where they are digging trenches to get that last mile to the home. They are doing this in the UK, and have a large contract with one company. He really likes the story, but is waiting to see some revenues and earnings drop to the bottom line over the next…
Vogogo Inc (VGO-CN) TSXV
(A Top Pick May 20/15. Down 93.21%.) The company had some technology that allowed for compliance and payment processing technology. They started in the Bitcoin area, which didn’t work out very well. They then moved on to high risk areas, which would be considered gaming. Recently announced a strategic review of the company, so are…
Chart looks really good technically, recently broken out of its downtrend. Reaccelerating. Testing highs of 2020, and even those of 2018. Stock looks really powerful.
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research EPS of $0.08 missed expectations of $0.086 and revenues of $91.1M beat estimates of $83.64M. This is the second consecutive quarter of disappointing results, and while it trades at a reasonable valuation of 13.3X forward earnings, its high and growing debt levels are a concern.…
Not as bullish on energy services (not as much drilling). Good job at paying down debt. Capital allocation will ensure less activity in drilling services.
It is a liquids rich player with very high liquids content. The problem is that the market cap is below the radar, and the debt is high. It was a $4 plus stock when we had decent gas prices. They are looking to bring their debt down. He thinks the company will survive. They've been…
It is quite a small company. It is hugely volatile. There a lot of problems over the years with the pricing of data coming from India regarding a 10% stake in another company. They have too much debt. The price of the gas they sell has been negotiated. A tough name to predict.
They have two plays. It is pressured because of debt load. Production came down in the third quarter and should now increase. They should knock debt down with the sale of two non-core assets next year. It needs a catalyst before the market will revisit this story.
The company is very cheap in terms of price to book. Their book value was $4 at the end of June. However, they have a debt problem: $211 million of debt compared to an equity value of $369 million. He sees this as a takeover candidate especially now because he is seeing consolidation in the…
(A Top Pick Nov 11/22, Up 14%) M&A acquisitions performing 3-4 years later.4 years of dividend increases. One of largest positions.Debt falling down to better levels.Midstream assets performing well. New CEO also bringing credibility.
Debt concerns? BXE took bankruptcy protection when debt became too much. There is no equity value in it any longer. Companies that have debt that matures in 2020 or 2021 will have issues. He sees no issues with BIR or TVE on this topic. The new Federal relief program for large companies may be difficult…
One of the largest producers of drilling fluids. Rig count has taken off like crazy. 65% revenue from US, with 17% market share. 35% revenue from Canada, with dominant market share. $11 target price in 4-5 years. Strong balance sheet. Diversifying internationally. He buys on weakness. Yield is 2.39%. (Analysts’ price target is $3.53)
Nat gas prices have been slaughtered, which impacts this one. Likes that it managed to cut production. Bit of an overhang in nat gas, so there's an overhang on valuations. He focuses on the larger integrated players like CNQ.
Just beat earnings and have increased production. Cheap valuation compared to peers. But it's getting more expensive heading into 2021. There's no growth here, but that goes with the entire oil patch. The real issue is will they survive. Their balance sheet is getting better, but still high for a blue-chip name. You'll be saved…
One of the largest fleets of generation 3 and 4 deeper coil tubing. Two businesses: coil tubing and tools. Both are being run efficiently. Margin pressure in the sector. Great little story that will be a big beneficiary of LNG drilling. No debt. 5-year bull market target of $3. 2023 will be a pivotal year…
Bottoming phase in early ’09 then a rally. Profit taking at end of summer. $0.40 is support level; If it breaks through $0.67 level he would see a dollar.
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. KEL has strong drilling activity and currently no debt. We have KEL in the growth model portfolio, and we like it for its diversification benefits, being in the oil and gas sector. It is a strong name with a good balance sheet and healthy profit…
Mostly nat gas plants and processing. Critical infrastructure. A great, steady mid-stream business. 10-year lows on valuation. Yield is 5.96%. (Analysts’ price target is $35.57)
Owns shares in company.Prefers names with more exposure to oil.Expecting 75% of free cash flow returned to shareholders going forward.Good management team and reserves.Higher exposure to gas.
Energy is very cyclical. This will lose money when the economy is on the downturn. That happened a few years ago. Unless you are optimistic about oil prices, don't build a position.
Buying shares recently.Strong company with good dividend.Expecting higher natural gas prices.Hedging allows for safety on dividend.Excellent management team.
Companies with challenged balance sheets (high debt in this case) face difficulty in banks continuing to finance growth. He would not own this one.
Also owns drilling and service rig business.Debt free which is good.Has been buying shares.Excellent company with strong management team.Lots of insider ownership.
(A Top Pick Sep 20/22, Up 46.5%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with PSK is progressing well. To remain disciplined, we recommend trailing up the stop (from $20) to $23 at this time.
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research At 8X forward earnings and with investors/analyst attention seeming to increase, we don't think much has to change here. As always, we would use prudent portfolio principles around trimming/re-balancing to limit a single company becoming too much of a portfolio but do not think it…
Environmental services. Processes wastewater for oil and gas, mid-stream processing and storage. Very attractive EBITDA margins of 35-40%. Just bought biggest competitor. Stock's down, as Competition Bureau is forcing divestitures. Company is appealing this, good chance of winning. 9x earnings, share buybacks. Yield is 6.10%. (Analysts’ price target is $8.73)
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. STEP is down 35% this year, but up 59% in 52-weeks. Profit taking is probably part of the issue here. It did beat estimates in the 4Q, but the sector has been quite weak, and the company has recently seen two downgrades by brokers. EPS is supposed…
Cheap at 8x earnings, 3.3% dividend yield. Clean balance sheet. Has done well in the last year. Even if activity remains flat, probably going higher because of the price of oil.
(A Top Pick Jun 22/23, Up 13%) A dominant nat gas company that's well-run. They move gas from Canada to California. Because there are no processing plants for LNG in Canada right now, TOU has been sending their gas to the US to refine then ship to Asia, but receive a much better price. Volumes…
(A Top Pick Oct 24/22, Down 13%) Terrible performance in stock.Largest shareholder of company.Will continue to buy shares.High quality assets.Recent acquisition negative on share priced (issued lots of shares).Non-core Cardium assets on the market.Trading at 28% free cash flow yield.
~7% ownership in fund.High quality oil assets.Recent entered into Montney oil field.Long reserve life (PDP). Experienced management team.Dividend yield is safe.Expecting a $16 share price going forward.
BBI-X is the old ticker. The merger involves a 10 for 1 split. PIPE-X shows a couple of weeks of trading and that is what to go by. They are coming on with new production facilities soon. By the end of the year, they will go to 10 times that. He thinks it is cheap…
🛢 Basic Materials
EBITDA beat by 25%, but market was not excited, since a lot of earnings seemed to be pulled from the second half of this year. Capex lowered. OK leverage. Decent name, decent dividend. There are higher quality names, but this is fine.
It is well positioned for an increase in demand for infrastructure spending. In answer to the caller's question, don't switch it for an energy stock.
It has a great management team and the Yukon is a friendly place to develop. Infrastructure is the issue. Smaller mining operations can deal with this, but lack of power and transportation are challenging. Where copper prices are, this is still too levered -- you need copper prices to go higher.
It seems the hole went right down the throat of what looked like a structural intersection. Also, it was reverse circulation, and the recovery wasn’t that good. An interesting deposit and in the part of Peru that is very dry, which is part of the issue of getting diamond drilling there.
Doesn’t particularly like the deposit. Very speculative. It’s all over the map. There are safer names out there.
He is a geological advisor to them. Consulted on a project in Italy, but it was not what he thought it would be.
Would recommend buying on weakness. EV business will be strong. Expect volatility. Strong for the long term investor. Owns shares. Valuation and story is compelling.
One of his recent “Bottom Fish” that he has put a little bit of tension on. They have the Cheechoo project, about 15 km south east of Eleonore, which is now in production, almost meeting its 300 ounce per year over put. The Cheechoo is a low grade system, but have been discovering that there…
Gold is supposed to be the inflation hedge, but that hasn't happened. He owns no gold, because it pays no yield. Gold is a personal preference. Owning a little is fine, but in bars to be stored in a bank. Don't buy the funds, because you must pay a fee.
Challenges with cartels in Mexico.Long history of development in Province.Socialist orientation of Mexican President a worry.Does not own shares at this time.Concerned about inventory & reserves.Drilling results have been fairly strong.Would prefer companies with larger reserves.
Wallbridge Mining to buy Balmoral It depends on your timeframe--some will take the premium in Balmoral and grab the profit. He expects in two years that the deal will benefit shareholders with lower costs. The Abitibi is a great gold district. If he owned this, he'd hang onto it.
He sold all lumber stocks after the huge runup. But if he had to look at one, this would be it. Over $10 cash per share, with stock at $24, which means over 40% of company value is net cash. Lots of optionality. Intriguing.
Just completed an expansion. A bit more debt leveraged. Fortunes rise and fall with copper, especially with a recession scenario. China's problems aren't helping. Should be back to $3 in next 3-6 months, $4 in a year. Operational issues in Q1. Second half should improve. Sit tight. You could dip your toe in Q4.
It is not a mining company, but a project generator. The CEO has done this for 25 years. He then sells off projects to companies that try to turn them into mines. He gets stock and a royalty in exchange. He has about a 160 properties. Some day the CEO will want to sell the…
Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The sector and in particular the company has shown good momentum. Good cash flow off-sets their stretched balance sheet. Cheap on valuation. Unlock Premium - Try 5i Free
The company has suspended its dividend. They operate diamond mines in South Africa. They are looking into underground, from open pit. The cost is more expensive than thought. The price of diamonds has been reduced, though retail prices won’t change.
Hold until sale to Equinox, or buy more? He holds both to benefit from long-term effects of inflation. He thinks the takeout is great. EQX is well run, a buy, with a $12 price target.
(A Top Pick Dec 15/20, Up 12%) Taken over. He got out when the deal was announced, as the acquirer wasn't somewhere he wanted to put his money.
Highly volatile stock.Good to buy when out of favor.Service style business is the first to be cut when energy prices fall.Good if bullish on energy(risky). Better names for investors (Trican/Precision).
It was a top pick pick a while ago and he sold a bit too early. It is well positioned for an increase in infrastructure demand since its products are needed for enhancing the grid. It is a long term buy but you could wait for a pullback.
(A Top Pick Oct 23/19, Up 10%) A bit of a lagger but he continues to like and hold it. They had some Covid issues but everything is coming together, especially with their leverage. They stayed alive during the worse by mining low grade. They have started mining high quality gold.
Agnico-Eagle (AEM-T) came in a while ago and made a 9.9% stake in this company. The stock went up, but it really hasn’t done much since then. Then Barrick (ABX-T) came in and said they really liked the deposit and wanted to do a joint venture. This is a much better approach that is better…
Likes the managers, but concerned with the topography. A decent-sized gold project. A good speculation.
A good story. Good management. Have a major gold discovery and process near the Galore Creek project where NovaGold (NG-T) halted their development. This knocked them back and they are very undervalued at this point. The road they built goes past Romios property, which helps them.
It's a 10 cent stock, when even the big companies aren't doing well. If you like it, sure go ahead. But there's nothing he can add.
Used to own it and would like to again this spring or summer. Knows the management team and where they're mining, Nevada, very well.
It's never done anything and has disappointed shareholders. He owned shares 10 years and sold it because he got fed up with its lack of progress.
BRP INC (DOO-T) TSE
Trades at 8x PE vs. peers at 12x. They mostly beat their last quarter, generate free cash, take more market share and enjoy robust demand for snowmobiles. A caveat is that in a downturn, discretionary costs like this will be cut. (Analysts’ price target is $138.93)
Stockchase Research Editor: Michael O'Reilly Following reported earnings indicating revenues increasing 22% over the year, we reiterate MRE as a TOP PICK. Supply chain and semi-conductor supply issues are lessening for the automotive supplier. It trades at 6x earnings and under book value. We like that cash reserves are growing, while debt is retired. We…
Pleasantly surprised with the business fundamentals. Aspects of their business are growing. Very undemanding valuation. Continue to hold. It's on his watch list.
It is high quality company and they have added it to the portfolio in the past 6 months. It has been weak because of the sector. They sell storage systems etc. and are very well managed. There is a big backlog in the home renovation sector. It is also buying back stock.
Depends on growth rate. One thing they've struggled with is future growth. He needs to see serious levers for growth that make sense from a risk/reward perspective.
It is unbelievable where this stock is trading at. Acquisitions this year are worth less than half what they paid for them. It was trading at less than half what it was worth. They are trading below the amount of cash they have. It shocks him how far it continues to go down.
This has been a very difficult stock. Recently reported a very bad quarter. He would stay away from this one. Inventory has gone up a lot and their margins have fallen. Cut the dividend totally. Thinks they are in a bit of trouble.
EEStor Corp (ESU-X) TSXV
Doesn't know this company. Loves the space. Names with a good name, like "green" move well. They produce organic foods, and people are looking to eat healthier. Fancy name. Fancy products.
Spot Coffee (SPP-X) TSXV
A micro-cap. He holds debt securities and have been collecting those coupons. SPP is interesting, but highly speculative. They run little coffee shops. The coffee and food are really good. He wouldn't buy it for that reason, but it's okay in a portfolio.
They historically grow through acquisitions, but results have been spotty. New management then focused on organic growth. He hasn't nought it yet because analyst projections are too high for his comfort. That said, the stock is cheap. It's on his radar. Are well-positioned as global food demand continues to rise.
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research Revenue growth is coming back a bit, with lower comparables from last year helping the year-over-year figures. Its debt levels are high, with net debt of $1.9B, and a net debt/EBITDA of 6.8X. Interest costs are $137M (last 12 months) and these will likely rise…
Alcanna (CLIQ-T) TSE
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. No longer backed by Aurora. Multiple attempts to redesign stores. Multiple products sold at steep discounts. Deteriorating margins.
It's illiquid. They've good managers, though, and the stock has moved up, maybe overextended. He likes the story, but it's too illiquid for him. Recent quarters have not been strong. This space had to become good operators when lumber prices went down, and is starting to find momentum with more housing starts.
Phenomenal. Well managed, continues to execute. Trend toward dollar stores with inflation being high. Continues to expand, gain market share, and increase geographic footprint. Wait for a pullback, buy, and then keep holding.
Right now, interest rates are coming down and the yield curve is flattening. There is a risk off attitude. Thinks will go back to rising interest rates, but the rates have pushed this ETF down. Interest rates will probably go up less than prior to the conflict in Ukraine.
Likes this holding, because Canadian and US investors are going to have to start looking somewhere else to diversify a little more.
HPB Energy Bull+ ETF. Immediate leverage to oil price moves. If you have a very good near-term bet that you want to make on oil this would be the way to go but if you are looking for an investment in the oil patch that has a long-term investment implications, then you should go to…
Preferred share market is risky - not a good place for average investor.Not much upside with lots of downside risk.Income oriented investors have better options.Canadian Dividend Index a better product.
If you're looking at a global ETF, remember that 60% of it's going to be US. For an Asian ETF, 52% is going to be Japan. People want diversification. To get decent global exposure, you're going to need to pick up a couple of ETFs, as just one can't do it all. One is XIN,…
Preferred shares act like equities during bear markets. Preferred shares are a challenging asset class - many are callable as rates go higher. He prefers to keep it simple with laddered preferred shares such as with BMO
This is hedged, so there's no currency exchange risk. He predicts int he next five years that international stocks will succeed. ZDM is perfect for this. Really likes it. Hold 10-15% of your portfolio internationally. This is a big cap ETF.
Not a bad idea to start nibbling at the Canadian banks now. Doesn't know the MER offhand, but it is relatively low. You're better off owning the banks themselves, which will eventually rebound to new highs. Prefers TD and RY.
Stockchase Research Editor: Michael O'Reilly We reiterate this Canadian preferred share ETF as a TOP PICK. Preferred shares have generally been under pressure as interest rates have gone up, so this is a good entry point. It has a low MER of 0.5% and an attractive yield. We continue to recommend a stop loss at…
If a long term investor, a good buy. Not a good product for day traders. Don't worry about liquidity. Always a buyer for product.
Good exposure for international oriented investors.Idea of getting European exposure good.Generally out of the money strategy.MER = 0.71%.Portfolio allocation depends on portfolio size.Good for older investors looking for safe product.
LBS vs. FTN An interesting structure, but they have their own at his shop. One is a play on ENB. Very optimistic about the potential for ENB to continue raising its dividend. He also has a real estate split with a mix of long-term value REITs and industrial exposure to access the e-commerce trend.
Likes their ROE which will grow above target, their 3% buyback and strong capital position of $2 billion cash. Less risky than its peers. (Analysts’ price target is $73.10)
Great management and great Board of Directors. They just finished a raise. Doesn’t think there are any headwinds anymore. With a fully loaded balance sheet, they’ve got a great growth in their client base, having gone from zero to 42 with 17,500 payers in the last year. Just signed on an ERP Vendor news cycle,…
SLF vs. TD vs. CM All of the interest sensitives have been under pressure the last couple of months with rates rising.He favours TD. Tightly regulated oligopoly, and a levered play on the growth of the Canadian, and increasingly US, economy. Surplus of excess capital. 10x earnings. Dominant personal and commercial banking franchise. Good-sized banking…
Fate of energy sector directly impacts success of company.High exposure to energy industry through lending.Does not own shares - too risky.Large Canadian banks better for defensive investors.
Owned it a few years ago and cut his losses. Now, cut your losses. This business is struggling as an asset manager, specifically to retain and attract new clients. Also, their key managers, including the CEO, have been leaving. They won't generate much in performance fees, which has been an attraction for investors in the…
It has a good presence in Quebec. They are interested in selling but he doesn't see who would buy them.
Likes the private equity space. Has rallied 30% since June, but still trading at a discount to NAV. Has a long track record. A great way for investors to participate in areas that are closed to them, making private equity public.
Major conglomerate.Prefers to own individual companies in insurance etc.If shares prices fall below $40 - good time to buy.Good brands within company.
(A Top Pick Dec 04/19, Up 13%) He'd buy it again. Nice value stock. Nice yield. Trading at discount to book. Would benefit from rising interest rates, which he expects. Cheaper than all the banks.
Disappointing. In Canada, US, and Ireland. Grew with too much leverage and got caught offside. Cut distribution twice. Cashflows under pressure. Small size, high debt profile. Avoid.
In the construction space his favorite is WSP Global. SOX is similar and he thinks they may be a value trap as there is some concerns about the dividend, the strength of the balance sheet and their ties to the energy sector.
Smaller cap office space REIT focused in Canada. Has a bit more of government concentration so that provides some stability. Has a high distribution yield but it is not fully covered by cash flow.. Analysts have 4 holds.
Blockchain miner. Blockchain is like the internet in 1995-96. Once it gets going, you can't stop it. Technology moving forward is diversifying. Investors can participate in the building of the network. $20 target. No dividend. (Analysts’ price target is $22.99)
It is a company that invests in cannabis opportunities. The most recent is in Australia where it is one of the few companies that is licensed there. They also announced a deal in Jamaica where production is coming on line. It is a reasonably diverse way to participate in the space, but he thinks there…
Invests about 80% in industrial warehouse REITs, with the balance in office and retail. Elevated cost of capital, so it's in secondary markets. Above average leverage, resulting in a higher distribution yield. Limited growth because of cost of capital disadvantage. A yield play, not a growth play, and growth is what you want in this…
End product is desirable, but supply chains have really hurt it. Reported this morning, and the market is cheering that news. High-risk name. Not for the faint of heart, but perhaps it's turned a corner.
(A Top Pick Mar 01/18, Down 22%) This was disappointing. They were trying to grow at the expense of the bottomline. Their growth plans did not come to fruition. The CFO left. He does not see a lot of reason to be involved in this name at this point.
A play on where the next bull market's going to be, and that's going to be cyclicals. A cheaper valuation within the group.
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Buses may be electric, CNG, or clean diesel and electric buses are offered by the company. Over the past five years, sales have shrunk by a compounded annual growth rate of 14.5%, while EBITDA and Net income have grown at a CAGR of more than 100%…
He once owned it. The chart shows declining peaks since 2021, but int he past year shows a higher high and higher low. So, there's some potential. If it challenges its last peak of $3.50, it's a good sign. Are definitely some positives in this stock, so hold on and see if it breaks out.
(A Top Pick May 27/22, Up 21%) Still likes it. They executed very well. Still cheap and have pricing power. Trades at 11x vs. Caterpillar's 14%. Problem is growth is limited. Buy around $36.
(A Top Pick Aug 10/23, Down 9%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with LNR has triggered its stop at $65. To remain disciplined, we recommend covering the position at this time. This will result in a net investment loss of 6%, when combined with our previous recommendations.
He's looking at the space, which is attractive. Off the highs. Business is materially tougher, but we need it. Regulatory issues and scrutiny on EXE. Labour situation also difficult. Likes the price, but wants to see more on the business fundamentals.
This is another company in the cannabis space. This is not a cannabis producer, it is a company that adds value in that space. They are mapping cannabinoids, looking for different formulations to treat different diseases.It is highly speculative, but he thinks there is opportunity for this type of company. He likes the management. In…
Very positive on the stock price, the company, and the partnerships they're announcing. Technicals indicate the stock may head toward 90 cents, but he says higher. Just won a contract from the Ontario government. Covid testing isn't going away. Sales should triple in the next 12 months.
Just announced a discovery in Columbia. Flow tested over 2000 barrels per day. This well could produce up to 5000 when brought into production. A very well distributed stock so it might not jump too fast. Company could get taken out.
Not a lot of love for cannabis or for small caps. Phenomenal execution by management. Sales of chocolates and gummies are doing well. Great growth, strong market share, across the country. Hopes investors will recognize its value once tax-loss selling is done.
Heard good things about their brand, quality production. Small player, so would hope they can do a joint venture with someone. Branding will be tough with regulations from Ottawa, so strong brand now could pay off.
It formed a nice base. It has a strong yield. It is coming out the last few days. We are getting close to a break out.
What 52-week low stock looks attractive to you?
Use this list wisely to identify buying opportunities.
Happy trading !