DM Monthly Newsletter – Nov 2016

U.S. ELECTION REVIEW – This is why we shun the forecast game that fuels the financial media and in which so many managers are willing to partake! If asked for predictions, we would have been 0 for 2 on the US election, never having fathomed a Donald Trump presidency and certainly not guessing that stocks would be up at the market’s open. In light of the unexpected landscape that greeted us this morning, here are some of the points that will inform our thinking going forward:

• Clearly, that market is placing significant weight on the “pro-growth” aspects of the president elect’s platform….
• Within DM portfolios, there isn’t  yet a stark delineation between “winning” and “losing” groups….
• Bond yields have risen….

Click here to read more:  dm-monthly-report-nov-16

Q3 Portfolio Commentary

Relatively speaking… – The third quarter wasn’t supposed to go this way. July opened with stocks still reeling from Britain’s wholly unexpected decision to part ways with the EU and the feeling was widespread that this episode would mark a definitive tipping point in the market’s path. As it happened, though, equity benchmarks defied expectations, with the S&P 500 and TSX gaining about 4% and 5%, respectively, over the three month interval.

Click here to read more: dm-portfolio-commentary-q3-16

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