Lorne Steinberg

He really focuses on earnings that came out overnight, as it often gives an indication of what's going on in the economy. Today was a big earnings day for a number of companies, including DIS. 

He looks for a feel of market sentiment. These days, we're in an environment of good news is bad news, and bad news is good news. Investors love bad economic news because it means that maybe the Fed will cut rates earlier. And if we get great economic news, with a strong jobs number, the market goes down because investors feel that a rate cut is a little further in the future (and they'd be correct).

He pays really no attention to it. Short-term movements, who cares? The global economy is slowing down. Rates will probably get cut somewhat by the end of the year. But if it's not until the first quarter next year, so be it. 

Investors and consumers who are hoping to see the rates we had over the last number of years will be disappointed. Those rates were an anomaly. Even mortgage rates today are where they've historically been in Canada for the last 50 years. In fact, they're relatively low by historical standards.

It doesn't. The optimism is really concentrated in the tech and communication sectors. Everybody's forgotten about 90% of the stock market. There are so many great companies today trading at really cheap valuations, with good dividend yields, with growth as well. But they're being ignored. Investors will have to get ready for a market that's going to broaden out somewhat.

Historically, not a great investment over time. Floating rate bonds tend to underperform over the long haul compared to fixed rate bonds. In an environment where we expect rate cuts coming down the pipe, you'd be much better off with a laddered bond portfolio of fixed rate bonds. So, locking in rates for 1-5 years or whatever you're comfortable with.

The closest we have to that in Canada is TD, which is the 10th largest US bank by assets. Not at 50%, but not crazily far off. He sees no indication of change coming. TD has other issues, so the US regulator may not let it make more acquisitions. Don't be concerned. 

Absolutely would buy it here. An end-to-end healthcare company, including recently into homecare. Sizable hit to stock price, selling at 7x earnings. Incredibly well capitalized, lots of free cashflow. Solid dividend. Compelling value.

Some pressure from US regulations on PBM part of the business.

Stock's been completely annihilated. It's only in the drugstore chain business, which has been really tough.

A compelling stock. Phenomenal content. Passed the worst of it. Streaming is improving, will be profitable this year. Dropoff from cable is accelerating. ESPN is a big issue. Bulk of earnings coming from theme parks, booming. Whole slew of film releases coming up. Earnings, on surface, were decent. Still generating big cashflow. Breakup value is double what it's trading at.

He forecasts growth in streaming subscribers this year. Everyone is paying astronomical fees to maintain sports rights. DIS is best end-to-end content provider in their space. Will survive and thrive.

Leader in its space, incredibly well run. Add here. Rare example of a Canadian retailer doing well in the US. Tends to be soft when economy slows. Phenomenal long-term investment. Spectacular acquirers. Incredible value-creator.

Stock's done nothing for him except pay a 4% dividend. A couple of more asset sales to go next quarter. He'd love it if they took the cash, paid down debt, and bought back shares. But management keeps making acquisitions, riskier. Trades at 3-4x earnings.

Coupons are stripped off from the bond. So an investor does not get a regular income stream. They buy the strip at a discount perhaps at $70, and then it matures in 5 years at $100. Pricing is not well understood by investors, so dealers can make some extra money. Harder to judge what you're paying. Why not buy a regular bond, where the market is more liquid and more transparent.

Do not buy them in a taxable account because you're supposed to impute the interest you'd be receiving every year. So it doesn't work.

He exited his small-cap Japanese positions, including this one, a number of years ago. Reason was stocks had a big rally, so he sold and redeployed the proceeds.

Under a lot of pressure. Earnings became losses. Selling at a steep discount to tangible book value. He still follows and pays attention, because if the discount got wide enough he'd be there again.

Tough to turn around such a large ship. Rallied from very low levels. Take advantage of that, sell, and deploy funds elsewhere.

Beer, pharmaceuticals, and other holdings. Recent earnings had pharma put in a really strong performance.

He's a holder and a buyer. Just have to live with the ups and downs. It's back to free cashflow generation, can use to continue to build the business. Turned the corner, but still lots of work to do to transition the media business. 

From a loss in streaming a year ago, it broke even this quarter, poised to generate returns. Streaming is the future, ESPN will soon be added.