Today, Brian Acker, CA commented about whether M-N, XOM-N, GILD-Q, STN-T, ARE-T, AEM-T, TSGI-T, RY-T, CAT-N, POW-T, CNR-T, ATD.B-T, TECK.B-T, FCX-N, ORCL-N, GILD-Q, C-N, WFC-N, AMGN-Q, CTC.A-T, BLK-N, TCL.A-T, VRX-T, CASY-Q are stocks to buy or sell.
Wouldn’t touch this with a 10-foot pole. He was the biggest cheerleader on this company from $50 US all the way up to over $300 Canadian. Had thought Mike Pearson was one of a handful of people who could actually do a rollup correctly. This is a failed rollup, and like all failed rollups, you get a turnaround guy in, who will start selling the crown jewels. There is $30 billion worth of debt, and more importantly there is $18.5 billion of goodwill on the books, which all has to be written off. Predicts this goes considerably lower.
His model price is $226.98. Current price of $355 is a 35% overvaluation. Would buy this at $228, what he considers its BV. This is often mentioned as one of the systemic risks in this market. There are a lot of redemptions from Sovereign Wealth Funds, etc., and this is where all those assets lie. Be very cautious on this.
This went from $3.85 to the current price of $16+. He had been waiting for them to do some write offs. They did a very small one. The stocks are high volatile situations that people seem to be betting on, as opposed to fundamentals. If something should happen to China, this signals all the way back to $3 again.
Markets. We are in a mild deflationary period, and when we get these deflationary shocks, all asset prices spike down and the US$ responds in a very violent upward motion. We had that at the beginning of January/2016. It has been relatively peaceful since mid-February, and the markets are going to be boring until we get another deflationary spike. Had thought Brexit could have been a potential for deflationary spikes. The US election in November could be a spike. Feels the US$ is the place to be.