Stocks - The Best Buys 2

[bluejays]

Originally Posted by DoubleK

This stock market is insane.

Good news: market goes higher.

Bad news (is it really bad news?): market goes higher.

This tug of war back and forth between stay at home stocks and recover stocks must be a dream for traders. For a buy and hold guy like me, it's not creating many buying opportunities.

Yeah, it's been so bloody unpredictable really. If I were to take a complete guess why is because big money hasn't let it drop based on the past lessons learned from market corrections. True panic surprisingly hasn't hit the markets as bad as it probably should. This is truly a once in a lifetime event, and it's incredible how resilient it's been given how badly the economy shut down.

[Jason14h]

Originally Posted by fleury

Yeah, it's been so bloody unpredictable really. If I were to take a complete guess why is because big money hasn't let it drop based on the past lessons learned from market corrections. True panic surprisingly hasn't hit the markets as bad as it probably should. This is truly a once in a lifetime event, and it's incredible how resilient it's been given how badly the economy shut down.

That’s what happens when the government floods the economy with billions and interest rates are at historic lows.

Fundamentals and earnings are irrelevant when money is free

[bluejays]

Yeah, economically, I have no idea how that still supports the stock market when it's emotional based in so many ways. What is unemployment right now, 10%? Pretty rough when it happened within a period of a month. But the markets bounced back well, considering no vaccine found. To me, that's pretty crazy when under normal circumstances if Trump said something stupid the markets took a 5% hit. Now you have Trump doing things to negatively affect the market, plus the pandemic, plus oil, plus daily crap, and somehow the markets rebound. So weird.


My personal belief is that next month when banks release their results it will be a major hurdle. If earnings are bad, I could see the markets going sour, if earnings were so-so, probably an indication of the economic impact not being that bad. I personally see TD doing bad in the States, but I could see RBC doing alright being more Canadian based, which would point to a slight economic recovery. Again, just my thought though (I have no CFA and consider myself a complete amateur investor).

[DoubleK]

I nibbled today, which pretty much locks in the top for the next month.

You are all welcome to short based on my past performance.

[fulham]

Has anyone been touching Canadian cannabis stocks? ive done my due diligence and I feel like there's a couple with some insane potential.

Zenabis was at $3-$4 a year ago. It was hammered hard, yet survived. I bought in at .05 and again at .085

[bluejays]

Originally Posted by fulham

Has anyone been touching Canadian cannabis stocks? ive done my due diligence and I feel like there's a couple with some insane potential.

Zenabis was at $3-$4 a year ago. It was hammered hard, yet survived. I bought in at .05 and again at .085

All cannabis stocks seem risky. Too much supply at times, not enough demand because of government prices from what I’ve heard. So overall I think there’s money to be made in trading but almost as the experts predicted, there will be a consolidation and the big boys will be left standing. Could be a combination of acquisitions or smaller guys going bankrupt but I think we’re seeing a lot of the smaller guys being cash strapped. The big players as well so they haven’t been too keen recently at acquiring the little guys. Just by virtue of that I wouldn’t be too optimistic at a penny stock aside from trading. Who knows.

[Krovikan]

Originally Posted by fleury

All cannabis stocks seem risky. Too much supply at times, not enough demand because of government prices from what I’ve heard. So overall I think there’s money to be made in trading but almost as the experts predicted, there will be a consolidation and the big boys will be left standing. Could be a combination of acquisitions or smaller guys going bankrupt but I think we’re seeing a lot of the smaller guys being cash strapped. The big players as well so they haven’t been too keen recently at acquiring the little guys. Just by virtue of that I wouldn’t be too optimistic at a penny stock aside from trading. Who knows.

I think the big boys will fall as well, with only the small profitable players left standing. I follow a blog that tracks the cannabis industry pretty closely, and everyone is losing massively. To me, it seemed like they raised money at tech valuation heading into a consumer market where revenue growth was never going to support the multiples, then everyone overbuilt their supply instead of building based on realistic forecasts and sitting on their money.

The consolidation by the big players at this point seems to be just a game, get out the good news try and keep our stocks high pretending that this increase in revenue will meaningfully decrease the gap between our small revenue and massive operational expenses.

I am very bear on the Cannabis industry, seems like a house of cards ready to collapse hard.

(I don't have any exposure to the Cannabis industry at this time, and not planning on adding any)

[bluejays]

Originally Posted by Krovikan

I think the big boys will fall as well, with only the small profitable players left standing. I follow a blog that tracks the cannabis industry pretty closely, and everyone is losing massively. To me, it seemed like they raised money at tech valuation heading into a consumer market where revenue growth was never going to support the multiples, then everyone overbuilt their supply instead of building based on realistic forecasts and sitting on their money.

The consolidation by the big players at this point seems to be just a game, get out the good news try and keep our stocks high pretending that this increase in revenue will meaningfully decrease the gap between our small revenue and massive operational expenses.

I am very bear on the Cannabis industry, seems like a house of cards ready to collapse hard.

(I don't have any exposure to the Cannabis industry at this time, and not planning on adding any)

Yeah, fully agreed. The big boys have been doing their own cost restructuring for the past few months, which was exactly as you described - big expansion hopes, with little attention to the core and gradual expansion. Seems to be a disaster for all of them really. I'm not sure any of them will truly be standing when this is all done as all appear to have made the same mistake, with little money to keep up.

[Jason14h]

Originally Posted by fleury

Yeah, fully agreed. The big boys have been doing their own cost restructuring for the past few months, which was exactly as you described - big expansion hopes, with little attention to the core and gradual expansion. Seems to be a disaster for all of them really. I'm not sure any of them will truly be standing when this is all done as all appear to have made the same mistake, with little money to keep up.

There’s some big pockets backing a few . Exports to Europe and the US are the long term play

Plus candies and Drinks !!

[troutman]

People are buying more cannabis than ever before during the pandemic, Curaleaf says

But with unemployment rising and the effect of stimulus cheques fading, recreational adult use could start to wane

https://financialpost.com/cannabis/c...box=1595604895

[Krovikan]

Originally Posted by fulham

Has anyone been touching Canadian cannabis stocks? ive done my due diligence and I feel like there's a couple with some insane potential.

Zenabis was at $3-$4 a year ago. It was hammered hard, yet survived. I bought in at .05 and again at .085

This is all my opinion, I am not a financial advisor, and consider myself a novice in investing.

I finally got a chance to look up Zenabis, I would stay away. They have diluted their shareholders twice this year. And they have warrants outstanding that could add around 50% units. They used the last dilution PO to pay off debt, and the way I read the article, to pay for operating expenses (though they didn't directly state that). This doesn't seem like a growth company, this seems like a company that is struggling to survive.

They are also trying to sell a facility, and are having to reduce their price by 10%, selling a facility into this type of market screams despite to me. They are also taking over a contract to bring Choklat's product to market, from Namaste because of issues between Choklat and Namaste. I am not bullish on this move as Namaste has a 49% share of Choklat, so, what was so bad that Namaste wanted to get rid of the contract? Oh, and Choklat didn't have the professionalism to release at the same time, in fact, Zeabis still hasn't released, so this is fishy.

Now their facials, they miss-classified account payables as property? They went from releasing a 1.5m loss to adjusting to a 7.7m loss... Right now their operation seems underwater, in 2019 they lost more than their gross revenue. I don't see any mention of who audited their financial statements in 2019, and based on the mistake in the last quarter mentioned earlier, I doubt they are audited.

The more I look at this company, the more it looks like they are headed to pink sheets. I wouldn't' invest in this company personally.

[DoubleK]

I've been looking at the ICLN etf and am going to start a position.

What's the best way to buy and hold a us listed ETF? I'm some what familiar with the Gambit to limit exchange fees, but can't quite figure out if it's better to hold in a TFSA or RRSP. If I understand correctly, you pay witholding tax in TFSA but not RRSP. Is that correct?

[Samonadreau]

Originally Posted by DoubleK

I've been looking at the ICLN etf and am going to start a position.

What's the best way to buy and hold a us listed ETF? I'm some what familiar with the Gambit to limit exchange fees, but can't quite figure out if it's better to hold in a TFSA or RRSP. If I understand correctly, you pay witholding tax in TFSA but not RRSP. Is that correct?

I believe that is correct, and only applies to the dividend income, and also applies to any US listed Stock (not just ETF's).

I know for my TFSA, I target growth stocks with little to no dividend. And any higher dividend US Stock goes in the RRSP.

[Johnny199r]

Originally Posted by DoubleK

I've been looking at the ICLN etf and am going to start a position.

What's the best way to buy and hold a us listed ETF? I'm some what familiar with the Gambit to limit exchange fees, but can't quite figure out if it's better to hold in a TFSA or RRSP. If I understand correctly, you pay witholding tax in TFSA but not RRSP. Is that correct?

You are correct. U.S equities = hold in RRSP.

Canadian equities = hold in TFSA.

U.S equities in TFSA = still subject to foreign withholding tax as the U.S gov't doesn't recognize the TFSA the same way it recognizes a RRSP.

[Slava]

I personally feel like the dividend withholding tax is overblown. In the case of ICLN you’re talking about $0.02/yr per share. It’s really a non-concern unless you’re talking about serious money. If you put your entire TFSA there, the tax amounts to something like $65-70/yr? Sure, all things being equal I’ll take the $70, but the TFSA and RRSP are very different accounts.

Anyway...just my thoughts.

[bluejays]

Hey Slava, any idea what theories are out there for what the federal government will do in the new year to make up the lost money? That should take a hit to the market I'd think (with less money to play with).

[Slava]

I don’t know. I feel like everyone expects an election which results in a Liberal majority. Then the tax increases come. GST to 7%, CGE moved to 25% and probably increased taxes on the “rich”. I would think a 7% GST would cover most of this in time though, but I guess we’ll see. The market reaction might be a little more mixed though. Of course increased taxes isn’t great, but a government maybe getting their finances in order is not the dumbest idea either.

[bluejays]

I'm not familar with the CGE concept, but it's something for me to read about. I'm not opposed to a tax increase in this case, as the money has to come from somewhere in this situation (as long as it's not misappropriated). Ultimately I wonder what the stimulus is doing for the economy in the long run from the cheques people are getting vs. the States where there were virtually no cheques written? A bit of an aimless ramble of questions, but I'm just curious how this will all effect the stock market and more importantly the Canadian job situation.

[Slava]

Originally Posted by fleury

I'm not familar with the CGE concept, but it's something for me to read about. I'm not opposed to a tax increase in this case, as the money has to come from somewhere in this situation (as long as it's not misappropriated). Ultimately I wonder what the stimulus is doing for the economy in the long run from the cheques people are getting vs. the States where there were virtually no cheques written? A bit of an aimless ramble of questions, but I'm just curious how this will all effect the stock market and more importantly the Canadian job situation.

The US market has had an unreal amount of stimulus though. They’ve sent cheques to people, but the federal reserve has been actively buying as well. They’ve talked about buying high yield debt, tossed out the suggestion of buying equity in energy (haven’t actually done this, but still!), and this is all on top of their buying program for the last decade or so. I think they’ve put about $7 trillion in, which is just astounding.

There’s a lot of stimulus money floating around, and the market will likely look at another round as favourable if today was an indication.

[DoubleK]

Originally Posted by Slava

I don’t know. I feel like everyone expects an election which results in a Liberal majority. Then the tax increases come. GST to 7%, CGE moved to 25% and probably increased taxes on the “rich”. I would think a 7% GST would cover most of this in time though, but I guess we’ll see. The market reaction might be a little more mixed though. Of course increased taxes isn’t great, but a government maybe getting their finances in order is not the dumbest idea either.

I was mildly annoyed they rolled the GST back in the first place. Would have been happier has they rolled spending back in combination to offset the lost revenue.

Governments, Alberta in particular, don't have a revenue problem, they have a spending problem.