cgx

Up 11% in the last 4 days...

llpresident wrote: ↑

Aug 24th, 2017 4:33 pm

I don't think you can apply that to this stock. This isn't JNJ. The past five years it has a higher P/E because it was growing. The PE needs to adjust for its new reality. There's plenty more room for it to fall IMO

Up 11% in the last 4 days

Nobody know nothing, eh?

P.s. I used it as DI stock, so not so bothered with price drop, actually it's even better to re-invest...

asa1973 wrote: ↑

Sep 6th, 2017 9:40 am

Nobody know nothing, eh?

P.s. I used it as DI stock, so not so bothered with price drop, actually it's even better to re-invest...

Assuming it turns around.

llpresident wrote: ↑

Sep 6th, 2017 10:51 am

Assuming it turns around.

really doesn't matter for div investing - if it will go lower, I'd buy more, if not - I'd buy smth else. The lower it goes, the higher yield it has. And I'd agree on Rodbarc analysis on it in long term (as div stock, again)

asa1973 wrote: ↑

Sep 6th, 2017 10:58 am

really doesn't matter for div investing - if it will go lower, I'd buy more, if not - I'd buy smth else. The lower it goes, the higher yield it has. And I'd agree on Rodbarc analysis on it in long term (as div stock, again)

I don't follow that logic. You're suggesting that a stock continues to fall over the long term, and you continue to invest in that company and their failing business model. If they turn it around, then you're right, great investment. But if the stock continues to fall, possibly cutting it's dividend, well then you have just sustained a significant capital loss which greatly outweighs those prized dividends you were collecting.

llpresident wrote: ↑

Sep 6th, 2017 11:04 am

I don't follow that logic. You're suggesting that a stock continues to fall over the long term, and you continue to invest in that company and their failing business model. If they turn it around, then you're right, great investment. But if the stock continues to fall, possibly cutting it's dividend, well then you have just sustained a significant capital loss which greatly outweighs those prized dividends you were collecting.

The logic here is that falling price != falling business model. Price fluctuations (especially short-term) do NOT reflect long-term business prospective. Rather buying possibilities.
Yes, the worst scenario would be falling price with cutting dividends (due to failed business model). However, I do not expect them to fail in next decade at least. Taking to account monopoly on cinema market, restrictions on "alternative" media (Netflix, Hulu, Sling), in next ~5y at least I do not see real threats to them.

P.s. It's quite different in US, however. More competition, more online content...But Canada is not a US in this aspect as well.
All other precautions work here as well - do not buy over "normal" P/E, do not put all eggs in one basket etc. It's ~10% of my DI portfolio and few % overall, so I'm not sleepless over them in any case

emanon86 wrote: ↑

Sep 5th, 2017 2:55 pm

Up 11% in the last 4 days...

Dude, you jinxed it!

llpresident wrote: ↑

Sep 6th, 2017 11:04 am

I don't follow that logic. You're suggesting that a stock continues to fall over the long term, and you continue to invest in that company and their failing business model. If they turn it around, then you're right, great investment. But if the stock continues to fall, possibly cutting it's dividend, well then you have just sustained a significant capital loss which greatly outweighs those prized dividends you were collecting.

No decision should be made with the performance of 1 quarter. Look at year over year. Look at the cash flow estimates and guidance (which is what sustain dividends, not stock price). That 's the best indicative if a solid foundation is in place for a turn around. Price means nothing. I expect next quarter to be bleak too. But I expect recovery to begin in FY18. They only report results 4 times a year, look how patient one needs to be. As of now, with the information that is available today, and with the tracking record that CGX has in place, it 's an opportunity. We will only know if this was a good decision a few years from now. And all we need to do is monitoring execution and allocate capital accordingly.

Another good example of how the stock price can fall and stay down without impacting dividends : Corus. As long as cash flow sustain the dividends, price can go in any direction. Many times it doesn't reflect the value of the business.


Rod

Another 2 or 3 quarters of similar trends and maybe $29xx seems plausible

hoping for better movies in the coming months.. cant believe it dipped like $35 around 1030am and back to $37 end of day.. lol.

Cineplex is a monopoly in a shrinking business.
It is not well run.
If they cannot run a monopoly how can they run a restaurant that will have to compete against other restaurants.
The experience is bad with its overpriced food.
My work used to have a Christmas party next door at the cineplex game room but people had enough with the bad food.
We go bowling and people are happier.
It is time for ceo Ellis Jacob to go.

took another beating today, up to $37 ended at $35.87

Wow, it's down to $29.55.

...and will keep going down even further.

The dividend payout ratio for cineplex is terrible. At current earnings the dividend is not sustainable. Expect a cut in the near future if business continues to perform at average.