DM Monthly Newsletter – Oct 2016
IN Q3, PREY BECAME PREDATOR – It’s not uncommon for Canadian companies to be swallowed up by their larger, often foreign, peers. Names such as Alcan, Inco, and Rona have met such a fate in recent years and in DM portfolios, we’ve lost great firms like St. Lawrence Cement, Teranet, and Shoppers Drug Mart to acquisition. Though the hefty premiums that these deals usually carry are a nice bonus in the short term, we often find ourselves lamenting the loss of a difficult to replace cash flow producer once the dust has settled.
In the third quarter, however, the shoe was on the other foot in our Canadian equity mandates, as several of our positions announced significant purchases.
Click here to read more: dm-monthly-report-oct-16
Cardinal Update – September 2016
RISK: SO FAR, BUT NO FURTHER – On September 12, Agrium (AGU) and Potash Corp. (POT) announced a merger plan to create the largest crop nutrient company in the world, three times the size of its nearest competitor. While impressive, we believe the merger increases AGU’s exposure to commodity prices and raises the risk profile of the company. We feel that the merger will result in a company that does not serve the best interests of our clients, thus leading us to exit our position in the company…….
COMPANY FOCUS: WPP PLC – We have recently added WPP PLC (WPP) to our buy list for Canada Plus and Foreign accounts. London based WPP is the world’s leading advertising agency holding company by both market
capitalization (£22.1B) and revenues (£12.9B)……
Click here to ready more: cardinal-update-september-2016
DM Monthly Report – Sept 2016
Are We Really At The Brink Of “BOND-POCOLYPSE”? – Doomsday predictions for stocks are pretty commonplace, so much so that it’s often hard to keep track of who’s calling for which crash when. In recent quarters, though, fixed income markets have also been caught in the crosshairs of scaremongers, with several commentators and asset managers warning that we’re in the midst of an unsustainable bond bubble that will inevitably burst with costly implications.
Click here to read more: DM-Monthly-Report-Sep-16
Cardinal Update – August 2016
Where the Real Value Lies – Recent market moves have delighted many of our clients as they have seen the market value on their accounts continue to march upward, albeit in choppy fashion. We enjoy having happy clients, but fear that rising market values distract some clients from the real value in their accounts. Market values go up and go down, at the whim of the marketplace. What value there is today can be drastically diminished tomorrow. Market value is the wrong measuring stick. Recall that investing and wealth is the ownership of strong, profitably growing companies.
Click here to read more: Cardinal Update – August 2016
