Category: Weekly Commentary

11 Jan 2019

Issue 2 – Investing in Senior Living

We often hear about real estate investments such as single-family homes, apartment complexes, and industrial, retail and commercial buildings. What we don’t hear as much about are retirement homes and long-term care facilities. Yet, with our aging population, they are a vital part of the real estate market.

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Click to Read Macro View

by Hubert Marleau

 

Click to Read Palos-Mitchell Report

by William Mitchell

04 Jan 2019

Issue 1 – Canapux: Potential Innovation for Canadian Oil Exports

2018 was a very challenging year for the Canadian oil market. Pipeline shortages led to an oil glut which caused WTI-WCS differentials to widen to never-before-seen levels. This lack of takeaway capacity created a strong demand for exports of crude-by-rail (CBR).

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Click to Read Macro View

by Hubert Marleau

 

Click to Read Palos-Mitchell Report

by William Mitchell

28 Dec 2018

Issue 52 – Happy New Year

Dear Clients,

Over the years we have had our fair share of successes and have also encountered some obstacles along the way that made us stronger. However, I have never lost sight of our goal. We thrive to make sure we are providing the best service and long-term performance to our clients. No matter how the markets behave, Palos will continue to be transparent, client-focused and performance-driven.

Palos Weekly Commentary, Macro View, and Options Corner will return with new editions on January 3rd 2019.

Due to holidays on December 25th and 26th, all prices and performance are as of December 24th, 2018.

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Click to Read Macro View

by Hubert Marleau

 

Click to Read Options Corner

by Robert Mendel

 

Click to Read Palos-Mitchell Report

by William Mitchell

21 Dec 2018

Issue 51 – Happy Holidays & Thank You

Dear Clients,

Over the years we have had our fair share of successes and have also encountered some obstacles along the way that made us stronger. However, I have never lost sight of our goal. We thrive to make sure we are providing the best service and long-term performance to our clients. No matter how the markets behave, Palos will continue to be transparent, client-focused and performance-driven.

Continue Reading in PDF

 

Click to Read Macro View

by Hubert Marleau

 

Click to Read Options Corner

by Robert Mendel

 

Click to Read Palos-Mitchell Report

by William Mitchell

13 Dec 2018

Issue 50 – Canadian Wide Oil Differentials Have Disappeared

On December 2, 2018 the Alberta Premier, Rachel Notley, announced that they will be imposing cuts to oil production. The proposed cuts will take effect sometime in January 2019 and would equate to approximately 300,000 barrels per day. Canadian oil prices immediately reacted to the news positively. As of December 12, 2018, differentials are back to their average.

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Click to Read Macro View

by Hubert Marleau

 

Click to Read Options Corner

by Robert Mendel

 

Click to Read Palos-Mitchell Report

by William Mitchell

07 Dec 2018

Issue 49 – ATCO eats Horizon’s Lunch

On December 03, 2018, ATCO (TSX:ACO/X) announced that they were awarded a modular supply contract for LNG Canada, the contract is for 4,500 beds. I was hopeful that Horizon North Logistics (TSX:HNL) would win at least half. Unfortunately, and to my surprise, it all went to ATCO.

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Click to Read Macro View

by Hubert Marleau

 

Click to Read Options Corner

by Robert Mendel

 

Click to Read Palos-Mitchell Report

by William Mitchell

23 Nov 2018

Issue 47 – 2019 Probability of Rate Increases Is Falling

The market is now pricing in a 35% probability of two rate hikes in 2019. This is down from 57% a few weeks ago. There is good chance that the December rate increase could be the last one for a while. On December 19th, 2018, I’m of the opinion that the FOMC tone will be more dovish than hawkish, which leads me to be bullish but conscious on interest rate sensitive assets like Utilities, Energy infrastructure, telcos, real estate or companies that are asset heavy.

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16 Nov 2018

Issue 46 – Oil vs Natural Gas

Oil prices have fallen like a rock for 12 straight days. This is a new record, and never seen before price action. The headlines are having a serious impact on prices, from president Trump tweeting “oil prices should be much lower based on supply” and OPEC increasing production by 1.5MM Bbl/day to replace lost oil from the expected Iranian sanctions.

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02 Nov 2018

Issue 44 – The Selloff Brings Long Term Investment Opportunity

If we haven’t hit bottom on the Canadian market, we must be getting there soon. In the month of October, the Canadian market corrected by approximately 10%, and don’t forget the Canadian market prior to the October sell off was pretty much flat for the year. What is intriguing with the Canadian market, is even before the selloff of the market, it was already inexpensive compared to its 5-year average. Here are some interesting numbers, the forward P/E and the actual P/E for the TSX prior to the selloff were approximately 15.5x and 17.5x respectively.

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06 Apr 2018

Issue 14 – Superior is Slimming Down

On April 3, 2018, Superior Plus Corp (TSX:SPB) announced $72 million in non-core dispositions. The sales included their U.S. wholesale refined fuels business and some fuel terminal assets. The dispersal of the lower margin wholesale businesses will allow the company to focus on its significantly higher retail business. Superior also sold some US retail distillate assets. The sale proceeds add to SPB’s war chest. The cash generated will be used to acquire more strategic assets for their core businesses: energy services, specialty chemicals, and construction products distribution.

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