Latest Expert Opinions

Signal
Opinion
Expert
DON'T BUY
DON'T BUY
September 11, 2018

This offers industrial exposure to international infrastructure. Rather than owning the asset (as Brookfield does), WSP builds it. She prefers WSP to SNC-Lavalin because its income is services related and it doesn’t have the cost-overrun risk that SNC has because of its fixed price bids. She would not buy WSP at this level because it has had a good run and is fully valued.

WSP Global Inc. (WSP-T)
September 11, 2018

This offers industrial exposure to international infrastructure. Rather than owning the asset (as Brookfield does), WSP builds it. She prefers WSP to SNC-Lavalin because its income is services related and it doesn’t have the cost-overrun risk that SNC has because of its fixed price bids. She would not buy WSP at this level because it has had a good run and is fully valued.

Christine Poole
CEO & Managing Director, GlobeInvest Capital Management
Price
$70.960
Owned
No
COMMENT
COMMENT
September 11, 2018

The company has been frustrating because it pays a good dividend but it has had a slow decline in stock price. Management at the right is similarly concerned about the stock price and is adjusting its portfolio--getting out of US retail and into US multifamily. In Canada it is a very high-quality commercial real estate operator with high-quality tenants. Their vacancy rates are very low, the dividend is seen as safe and the stock has been treated by investors as a bond substitute. She expects the portfolio adjustments to lead to an increase in the stock price. Yield 6.8%.

The company has been frustrating because it pays a good dividend but it has had a slow decline in stock price. Management at the right is similarly concerned about the stock price and is adjusting its portfolio--getting out of US retail and into US multifamily. In Canada it is a very high-quality commercial real estate operator with high-quality tenants. Their vacancy rates are very low, the dividend is seen as safe and the stock has been treated by investors as a bond substitute. She expects the portfolio adjustments to lead to an increase in the stock price. Yield 6.8%.

Christine Poole
CEO & Managing Director, GlobeInvest Capital Management
Price
$20.580
Owned
Yes
DON'T BUY
DON'T BUY
September 11, 2018

This is owned 60% by TransAlta and managed by TransAlta. RNW doesn’t have employees, it pays a management fee to TransAlta instead. The price has gone down over the past year, but so have most utilities, as interest rates have increased. The yield looks safe but there is no clear path for growth. Cash flow projections are flat. They sold 12 million shares in June, but are using the money to pay down debt rather than investing in significant new projects. She expects the price to stay flat, so one could invest in this stock for the yield alone. Alternatively, one could look for a company like this that has more growth projects underway. Yield 7.8%.

Transalta Renewables (RNW-T)
September 11, 2018

This is owned 60% by TransAlta and managed by TransAlta. RNW doesn’t have employees, it pays a management fee to TransAlta instead. The price has gone down over the past year, but so have most utilities, as interest rates have increased. The yield looks safe but there is no clear path for growth. Cash flow projections are flat. They sold 12 million shares in June, but are using the money to pay down debt rather than investing in significant new projects. She expects the price to stay flat, so one could invest in this stock for the yield alone. Alternatively, one could look for a company like this that has more growth projects underway. Yield 7.8%.

Christine Poole
CEO & Managing Director, GlobeInvest Capital Management
Price
$12.040
Owned
No
COMMENT
COMMENT
September 11, 2018

They did a big acquisition of a utility in the US and financed it with an equity issue and a bridging loan. They are making asset sales to repay the bridge loan. Of the 2 billion that they had to sell, they have sold off about 1.5 billion of assets so far. They expect to complete the asset sales by the end of the year. She expects them to be able to sustain the yield. She does not see much near-term growth. However, the company is still a little more leveraged than it would like, and it might offer more hybrid securities or do another equity offering to reduce its debt. She expects the completion of the asset sale process to be a positive on the stock. Yield 8.8%.

Altagas Ltd (ALA-T)
September 11, 2018

They did a big acquisition of a utility in the US and financed it with an equity issue and a bridging loan. They are making asset sales to repay the bridge loan. Of the 2 billion that they had to sell, they have sold off about 1.5 billion of assets so far. They expect to complete the asset sales by the end of the year. She expects them to be able to sustain the yield. She does not see much near-term growth. However, the company is still a little more leveraged than it would like, and it might offer more hybrid securities or do another equity offering to reduce its debt. She expects the completion of the asset sale process to be a positive on the stock. Yield 8.8%.

Christine Poole
CEO & Managing Director, GlobeInvest Capital Management
Price
$25.200
Owned
No
COMMENT
COMMENT
September 11, 2018

She has held Yum Brands for years. When it spun off Yum China, her clients acquired some Yum China shares automatically. Yum China is strictly in China. It pays royalties to Yum Brands for its KFC and Pizza Hut brands. When she invests new money, she invests in Yum Brands, not Yum China. Yum China’s stock dropped significantly today. They have a good presence in China, as a first mover in their space, but the Chinese market is very competitive. The stock price has been volatile because of rumours that the company would be taken over by a Chinese group. With the 12% drop today, this might be a good time to step in to this stock. She had confidence in the consumer in China and this is a company within that space. However, her preference is with the parent, which has exposures to other growing markets such as India and Russia, as well as China. She prefers that diversification and the simplicity of the royalty model.

She has held Yum Brands for years. When it spun off Yum China, her clients acquired some Yum China shares automatically. Yum China is strictly in China. It pays royalties to Yum Brands for its KFC and Pizza Hut brands. When she invests new money, she invests in Yum Brands, not Yum China. Yum China’s stock dropped significantly today. They have a good presence in China, as a first mover in their space, but the Chinese market is very competitive. The stock price has been volatile because of rumours that the company would be taken over by a Chinese group. With the 12% drop today, this might be a good time to step in to this stock. She had confidence in the consumer in China and this is a company within that space. However, her preference is with the parent, which has exposures to other growing markets such as India and Russia, as well as China. She prefers that diversification and the simplicity of the royalty model.

Christine Poole
CEO & Managing Director, GlobeInvest Capital Management
Price
$31.940
Owned
Yes
COMMENT
COMMENT
September 11, 2018

She holds this for some of her income investors, and she likes the yield. It has a consistent record of increasing dividends. The stock price has pulled back with rising interest rates as have other telecom companies. The dividend is safe, and she expects the business to grow by 4 to 6% per year. Yield 6%.

BCE Inc. (BCE-T)
September 11, 2018

She holds this for some of her income investors, and she likes the yield. It has a consistent record of increasing dividends. The stock price has pulled back with rising interest rates as have other telecom companies. The dividend is safe, and she expects the business to grow by 4 to 6% per year. Yield 6%.

Christine Poole
CEO & Managing Director, GlobeInvest Capital Management
Price
$53.240
Owned
Yes
BUY
BUY
September 11, 2018

This is down year to date and has lagged the group. This was the only one of the large Canadian banks that missed estimates last quarter. The bank did some big acquisitions and offered equity at the $76 level (close to the current price of $75.12) to fund acquisitions. She thinks the price is attractive--the bank is well managed, they’ve put money into the wealth management area, which she expects to be a long-term growth area. She owns some ScotiaBank. It has not been a core holding but she is buying now, viewing the current price as an entry point. Yield 4.5%.

Bank of Nova Scotia (BNS-T)
September 11, 2018

This is down year to date and has lagged the group. This was the only one of the large Canadian banks that missed estimates last quarter. The bank did some big acquisitions and offered equity at the $76 level (close to the current price of $75.12) to fund acquisitions. She thinks the price is attractive--the bank is well managed, they’ve put money into the wealth management area, which she expects to be a long-term growth area. She owns some ScotiaBank. It has not been a core holding but she is buying now, viewing the current price as an entry point. Yield 4.5%.

Christine Poole
CEO & Managing Director, GlobeInvest Capital Management
Price
$75.640
Owned
Yes