Stockchase Insights

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Solid M&A pipeline. Trades at a premium. Continued growth post COVID. Headwinds from global trade complexities & inflation.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Consolidating US operations for more growth. Uncertainty around commercial real estate with inflation. Continued growth post COVID. Trades attractively based on cash flows.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. ‘Sponsored’ by Constellation Software. European software acquiror. Steady cash flow, good execution. Likely going to be a ‘sleeper’ stock. Headwinds with inflation, rising interest rates.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Debt Can Kill a Company. Endo International PLC filed for bankruptcy protection this week. This is the company that took over Canada’s Paladin Labs Inc. about a decade ago. Endo shares are down 91 per cent this year. The problem? Very high debt. Endo has US$8 billion in debt after a large acquisition spree. Cash flow in the past 12 months? Just US$80 million. It paid US$560 million in interest charges in the past 12 months. The lesson here: Debt can kill a company, sometimes quickly. Make sure the companies you own can service their debt. Times are not always great, and a company must be able to survive before it can prosper.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Lowered EBITDA margin guidance. Revenues expected to double in 2022. Trading at lower valuations. Rising interest rates adding pressure.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Industry tailwinds. Operates in a specialized market. Expanding profit margins. Strong organic and inorganic growth.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Solid cash flow and earnings growth. In a fast-growing competitive sector. Strong backing of parent company. Improved margins and valuations stable.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Dividends Rule. We discussed in a prior column how many companies are increasing their dividends, even with a possible recession ahead. That’s great, but even better is that dividends provide a big part of an investor’s return over time. The amount can vary depending on who is doing the academic study and the timeframe chosen, but BlackRock Inc.’s global equity team not that long-ago suggested 90 per cent of equity returns in the United States over the past century have been a result of dividends and dividend growth. We do not think it is that high, and S&P Global Inc. claims it is around 30 per cent. Regardless, dividends certainly help investors grow their portfolios. What’s more, a dividend helps you keep your stocks during rough market periods. Of course, the longer you hold an investment, the greater its potential compounding impact on your portfolio. The lesson: Own some dividend stocks.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Recovery in hospitality segment. New 11-year agreement with Alberta. Valuations cheaper than historic.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Restructuring to help significantly. Simplified ring to help debt load. Trading lower than other REITs. Restructuring to help debt load.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Sales 30% ahead of estimates. M&A pipeline active, investors expect more. COVID helped sales growth. Impressive quarter results.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. In today’s financial market, it feels as though there are too many economic headwinds to keep track of, and investors and non-investors are all well aware of the pending and actual economic woes. We believe that the business cycle is currently contracting and so are forward earnings. Going forward we expect to see continued weak PMI (Purchasing Managers’ Index) readings, thereby driving the PMI moving average lower.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. We think TCL.A continues to have potential as it transitions its print business into digital media operations and through acquisitions. However, given the lack of growth we have seen over the years and the slow growth expected, we think there are other names today that can pay a similar yield, while showing better growth. This is in part due to the market sell-off, which has resulted in many quality names having higher dividend yields. We view the recent rally in TCL.A shares as an opportunity to sell and raise cash for future opportunities.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Dye & Durham Ltd (DND) stock was down 26.2% on the month and 69.63% YTD. It is a leading provider of cloud-based software and technology solutions to improve efficiency and productivity for legal and business professionals. There have been no earnings announcements since May 12th and so the movement in the share price in August is due to the collective views of the shareholders. We need to await evidence that management has got its expenses under better control before the stock price will get on a rising trajectory.

CAE Inc (CAE) stock declined 32.07% on the month and 26.32% YTD. It is a technology company which digitalizes the physical world by deploying simulation training and critical operations support solutions. On the positive side, the order backlog increased 26% to $10.026 billion. This is a solid long-established global operation which should deliver results in future to support a higher stock price.