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He would not be a buyer. The company has a fairly well-defined top, about $2 higher than what it is right now. Also doesn't have a lot of FMV potential. The stock has been struggling to get higher and it hasn't been dynamic. Thinks that when it hits technical resistance and FMV resistance at the same time, it's toast. If you own, you could hold it for another $1, but that would be it.
Has a very weak balance sheet. If there is a very weak balance sheet and a very high market valuation, which this company has, then going to the stock market to raise money is always an alternative. As long as Tesla has a poor balance sheet, that is an alternative. However, there are no visible earnings, so you are fundamentally buying this on a wing and a prayer. The stock is in a trading band, suggesting that the next low is $271.
A "buying opportunity" or a "run for the hills"? This is an interesting study. Had thought that since Pure Industrial (AAR.UN-T) got picked up, investors might look at this one which has a nice dividend, well covered and well run, and think it might be the next REIT that got picked up.
Has outrun its earnings and FMV potential, so he would describe it as a hopeful speculation. Hopes that the QNX technology will take off in somebody's fleet in the future. Right now, with a number of high tech stocks, you are buying them somewhat on a wing and a prayer. It looks like John Chen is adding the value he said he would.
This company is ahead of itself by a fair degree, in terms of its price versus its intrinsic value. As a consequence, this is a speculation from a FMV point of view, and about 40% above FMV. Looking back at the history, the stock and the FMV have had a historic tendency to come together. Earnings are going up at a nice rate, but the stock is going up at a faster rate.
He still likes this very much. Online gambling, in all of its forms, is gaining momentum everywhere. He is still waiting for a couple of US states to approve online poker. This is the biggest company in its field, so it has power and potential behind it. It’s cheap on a FMV valuation.
(A Top Pick May 8/17. Up 25%.) Still has lots of upside potential, but is coming hard up against technical resistance, so is watching to see if it will break out. There is enough potential that it should be able to do it. Needs another $2 or $3 on the upside, and then we get a clear technical break out, and then it would be okay to Buy. Right now, he would be cautious.
(A Top Pick May 8/17. Up 127%.) Still likes the stock. He bought this when it was trading at about 20% of its BV, and after examining it, came to the conclusion that the market was dead wrong. When you get this kind of return, you should take your money out, and then play with the money for free. However, this is still trading at quite a discount to its BV, and its FMV is well over 100% higher than what the stock is currently. Expects they are going to reinstate some kind of a dividend.
Pembina Pipeline (PPL-T) or AltaGas (ALA-T)? He doesn't particularly care for one over the other. In terms of safety, he would probably prefer this one, although the yield isn't as good. It’s trading right up at its FMV, and has more or less tended to for some period of time. Altagas would have to fall 23% to get there. The balance sheet has been slipping, and the dividend is far from being covered, which worries him quite a bit.
Pembina Pipeline (PPL-T) or AltaGas (ALA-T)? He doesn't particularly care for one over the other. In terms of safety, he would probably prefer Pembina, although the yield isn't as good. This one has a dividend that isn't covered, and increasingly you are getting oil/gas companies that are cleaning up their act to get their financials under control, cutting the dividends tends to be high on the list of things to do. Looking at their balance sheet, that would be a good thing for this company to do.
This is on a momentum run, no longer on a valuation run. For the past 10 years, its earnings and FMV have nicely contained the stock price on the upside. However, in this market, some of these companies are now breaking out and going above where they ought to be. On this company, technically he can give you another 10% on the upside comfortably. After that it would come under the heading of Holy Smokes, where do you think you're going.
Trading a little off its BV of about $11, so it’s not horribly valued. If analysts are correct in their earnings, this company is worth an awful lot more than what it is trading at. The issue with automakers is, what is the outlook for the auto industry. The default rate on some loans is rising rapidly, which suggests people have got overextended in this area.
The company is now starting to break up into its component parts to release a tremendous amount of value. Hopes there is still lots of good value left. One of the problems is that their insurance side is still weighing down the company, and they have had to take an enormous write off of $6.4 billion, with more to come in the next 2 to 3 years.
Market. Repatriation of overseas cash for US companies, is not an accurate way to gauge the value of stocks. It would have been much, much better had the repatriation conditions been specifically contingent upon monies actually being for expansion, etc., not to buy back stocks. The much larger picture of the act is that it does very substantial damage to the solvency condition of the US government. There will be kind of a foot race between the good that the tax act did for corporate earnings, and the damage it is doing to the US government. The US is in the worst fiscal condition it has ever been in, except for the last 8 years when it has just been flat lining. There had better not be a recession, because the US can't withstand one.