Reviewing Q1 2018 Earnings – Part 1

Comments on Earnings from Shopify, Kinaxis, BCE and Others.

Shopify 1Q18 EPS $0.05 vs. estimates of -$0.04 (TSE: SHOP)

-“Merchants love Shopify because it allows them to sell anywhere, anytime. It also helps them with the many tasks that come with running a retail business,” said Tobi Lütke, Shopify’s CEO.

-Revenue increased 68% to $214 million.

-As of March 31, 2018, Shopify had $1.58 billion in cash and no long-term debt.

-Shopify also increased revenue guidance between $1 billion to $1.01 billion.

-Shopify is also a Top Pick, and one of the best performing businesses in the portfolio.

Suncor Energy 1Q18 EPS $0.60 vs. estimates of $0.57 (TSE: SU)

-The price of oil has risen considerably this year, providing a tailwind for their business.

-Suncor’s cost per barrel increased to $50.75, hopefully they can reduce costs with higher oil prices.

-Dividend growth 5-year average: 21.1%

Fortis Inc 1Q18 EPS $0.77 vs. estimates of $0.72 (TSE: FTS)

-Fortis is best known for their 43 years of consecutive dividend increases.

-As a proxy for bonds and fixed-income investments, their stock has seen selling-pressure due to rising interest rates. While I believe this pullback is over-done, the theme of rising rates may limit the stock’s short-term gains.

-Long-term investors can hold and consistently see their yield-on-cost rise, but don’t ignore total return and ensure your portfolio reflects your risk tolerance.

-Dividend growth 5-year average: 6%.

Cineplex 1Q18 EPS $0.24 vs estimates of $0.21 (TSE: CGX)

-I’d rather own Netflix. Even with blockbusters being released, Cineplex doesn’t seem like it can withstand the industry shifts that are clearly taking place. The stock price would agree.

-They are actively diversifying revenue, which may become material in the future, but as a potential investor i’d take a wait-and-see approach here.

-The one bright spot here is they increased their dividend 3.6%.

Waste Connections reports 1Q18 of $0.56, matching estimates (TSE: WCN)

-“Better than expected solid waste price growth and E&P waste activity drove strong performance in the period and position us well for the remainder of 2018” said Ronald J. Mittelstaedt, CEO.

-Revenue up 5%, FCF up 19.3%.

-The stock moved up 4.28% following the earnings release.

-Waste Connections is also a Top Pick,

Manulife Financial 1Q18 EPS $0.67 vs. estimates of $0.62 (TSE: MFC)

-ROE came in at 14%.

-Dividend growth 5-year average: 9%.

-Unlike Fortis and BCE, Manulife will benefit from rising interest rates as they can invest their premiums at higher rates.

Kinaxis 1Q18 EPS $0.17 vs. estimates of $0.24 (TSE: KXS)

-“Q1 represented another quarter of strong execution by Kinaxis. We continue to demonstrate ongoing momentum with top tier brands in the automobile market” said John Sicard, CEO.

-The earnings miss is unfortunate but revenue did increase 10%.

-Currently, cash and marketable securities stand at $166 million (USD) and Kinaxis continues to invest in their business.

-Kinaxis is also a Top Pick,

Bell Canada Inc 1Q18 EPS $0.80 vs estimates of $0.81 (TSE: BCE)

-In Canada, the telecommunication businesses have an oligopoly, thus making them attractive long-term investments.

-BCE’s has posted a 5-year average dividend growth rate of 5.7%.

-Much like Fortis, BCE has seen selling due to rising interest rates. Long-term investors can pick up share here which, at the time of this post, trade with a dividend yield of 5.68%.


I currently hold a position in Shopify, Kinaxis and BCE.

Please consult a financial advisor before making investment decisions.

This report represents my views, not actionable advice