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Compiling comments that experts make about stocks while on public TV.

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Paul Gardner, CFA , Partner and Portfolio Manager

Avenue Investment Management

Address
47 Colborne Street
Suite 300
Toronto, ON
M5E 1P8

Contact Info
Telephone: 416.482.2004
Toll Free: 888.482.2007
Fax: 416.482.0007
Email:
Website: http://www.avenueinvestment.com/


Date Signal Chart Symbol Company Opinion Price
2015-01-20 N/A Must be logged in to use chart A Commentary A Comment -- General Comments From an Expert

Interest rates. As a portfolio manager, he looks at risk/reward. One part of him asks does he want to lock in 10 or 30 year rates at 2%, but that is crazy as the risk/return is not in his favour. The problem is there are so many ingredients in the cake called inflation. It started with Japan, has moved to Europe and is now washing on the shores of North American deflation. There are no wage pressures, oil is down which hits the inflation index, an economy that is growing but not to capacity and you have technology that is a great dis-allocator of inflation (machines are taking over production). Rates should track up from here, but really not that much further. He thinks rates are going to stay low for a long period of time. There is every indication that we are going to replicate Europe or Japan.


Price:
$0.020
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
_N/A
2015-01-20 COMMENT Must be logged in to use chart ACR.UN-T Agellan Commercial REIT

Yield of around 8.5% and have about a 90% payout ratio, which is not overaggressive. Just sold 2 Toronto properties Valleywood and Parkway, and they want to focus on the US in office and industrial. There has been a bit of a recovery in the share price. They are more focused on their strategy now. He thinks we are at the end of the bull market in the REIT space, so he can’t get excited about this type of investment.


Price:
$9.380
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
No
2015-01-20 COMMENT Must be logged in to use chart AX.UN-T Artis Real Estate Investment Trust

Office and industrial out West, but is more in Manitoba. Really good management. Valuations are on the higher side. Have some assets in Minnesota which gives you a little more diversification. Management team adds a lot of value to the bottom line. Trades at about 15X price to AFFO. Has always been rumoured as a possible takeover target, but he doesn’t think that is going to happen for quite a while. Gives you a 7%+ yield.


Price:
$15.120
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
Yes
2015-01-20 COMMENT Must be logged in to use chart BCE-T BCE Inc.

Fantastic assets. Liked their acquisition of Bell Aliant. They have so much free cash flow. Will spend their next several quarters lowering the leverage of the balance sheet. Sold his holdings about 4 months ago, but still owns bonds. He likes the fibre play, which he feels is more dynamic than the cable. Have good media assets and good pipelines. He would have no problems owning this.


Price:
$57.410
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
Yes
2015-01-20 TOP PICK Must be logged in to use chart BEI.UN-T Boardwalk REIT

Was down about 15% because of the oil price decline, but is now back and is only down about 10% from its high. He added to his holdings on the downturn. One of the best management teams in the business. There is little to no vacancy in Calgary and Edmonton. Even if it slows down, there are still going to be rent increases, and there is no rent control in Alberta. They have a lot of capital sitting on the sidelines. Yield of 3.27%.


Price:
$62.430
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
Yes
2015-01-20 COMMENT Must be logged in to use chart BNS-T Bank of Nova Scotia

Leadership has changed in the last 1.5 years. What impact does this have? The quick answer is extra risks as there are always risks with a change in leadership. However, this is a Canadian pillar and when you are talking about change in leadership, everything is in place there. You’d really have to find an incompetent CEO to blow up the balance sheet and that is not happening here. ROE is still around 13%-14% and they are cheaper than a lot of the premier banks, so there is some opportunity. He has always shied away from there holdings in Latin America.


Price:
$61.640
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
No
2015-01-20 SELL Must be logged in to use chart CAR.UN-T Canadian Apartment Properties

Had issues with their properties because it was GTA focused, but have done a lot to clean up the balance sheet, and has done a lot to expand out west. A problem he has is that a lot of their properties are under rent control, so if they have in inflation in negative territory or 0 or 1%, they can’t raise rents. Prefers the free and open market in Alberta. However, they do have more exposure out west and it has done well. With interest rates being lower, it means they get their funding incredibly cheap, and they can keep buying and renovating properties at very low costs. Dividend of around 4.5%. If you own, consider selling.


Price:
$27.480
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
No
2015-01-20 COMMENT Must be logged in to use chart CRR.UN-T Crombie Real Estate Investment Trust

About half their tenants are Sobie anchored grocery stores. A very conservative story and hasn’t moved that much. Trades at a lower valuation than others. He thinks there is a shot that this improves and goes up, maybe 5%. You are basically getting dividends of around 6%.


Price:
$13.060
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
Unknown
2015-01-20 HOLD Must be logged in to use chart CSH.UN-T Chartwell Seniors Housing

Retirement homes. Have spent the last couple of years making it a cleaner story. Retirement space is very complicated because they have to deal with government, demographics, senior citizens being unable to pay, etc. What you want is a story that is not as complicated as that. This is the right time to still own this as it is a great cash flow business. Occupancy rates are on a higher trend. About a 7% yield.


Price:
$12.240
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
Unknown
2015-01-20 SELL Must be logged in to use chart D.UN-T Dream Office REIT

Had been solely focused on B category real estate out West. During the 2009-2010 crisis, they had subpar real estate and got hurt. They then focused on buying office in Ontario. It used to be 70% weighted to Alberta, but is now about 40% out West which is good. However, it missed its targets and had some small vacancy issues. He still has trouble with it owning office space in the towers in Toronto and the industrial and office space in Alberta. Has never liked this story. He would look to sell.


Price:
$26.860
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
No
2015-01-20 DON'T BUY Must be logged in to use chart HR.UN-T H&R Real Estate Inv Trust

About 500 properties with a mix of office, retail and industrial. He tends to shy away from REITs that are all over the place. It really gets hard to understand how it is going to do. Trades around 16X AFFO, which is on the high side.


Price:
$23.610
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
No
2015-01-20 PAST TOP PICK Must be logged in to use chart LNF-T Leon's Furniture

(A Top Pick Feb11/14. Up 31.75%.) Has held this for 11 years and it just keeps clicking away. Not well covered and a little expensive. With oil prices down there is more change in the consumer’s pocket, which could lead to higher furniture sales. They acquired the Brick and are finally getting some synergies out of it, which is probably going to drop to the bottom line. He thinks there is expansion at the EPS level. Also has valuation in the real estate they hold. It might have a little bit more room, but he would be really cautious at this level.


Price:
$19.160
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
Yes
2015-01-20 PAST TOP PICK Must be logged in to use chart MEQ-T Mainstreet Equity Corp

(A Top Pick Feb11/14. Down 8.32%.) He still likes it. Incredibly cheap trading at 20% discount to NAV. They own properties in Edmonton, Calgary and Surrey BC. There is a new LRT going in and they own a lot of the properties nearby. A longer-term play. Doesn’t pay yield.


Price:
$33.500
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
Yes
2015-01-20 COMMENT Must be logged in to use chart NLY-N Annaly Capital Management Inc.

A mortgage-backed securities lender in the US. Highly levered. They lend and then get free funding from the Fed and distribute out 100% of their earnings. Because you are getting 13%-14%, all you want it to do is just stay stable. If you think the Fed is going to raise rates, it generally hurts them. On the opposite side, they have the underlying security of US housing improving every day. 2 out of 3 years you will make 14%-15%, but you could be down 20% in one year. You have to be very careful. This probably would not be the greatest timing to get in.


Price:
$10.450
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
No
2015-01-20 BUY Must be logged in to use chart NPR.UN-T Northern Property REIT

This is mostly multi-apartment dwellings out West, specifically Yellowknife and Fort McMurray. With oil down, this is a REIT that got hit hard. The last couple of earnings releases were weak. Had shown some increase in vacancies and they have development pipelines which wouldn’t be a good thing to have with oil down. A conservative balance sheet, they don’t pay out too much and it has capital to deploy. He started looking at this and started buying a small position. Trading at the lower end of valuation. You kind of have to hold your breath hoping that the oil dynamics won’t impact vacancies that much, because the Alberta market is tight.


Price:
$23.900
Subject:
FIXED INCOME, LARGE CAP DIVIDENDS AND REITS
Bias:
UNKNOWN
Owned:
Yes
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