August 22, 2017

On Tuesday, the S&P 500 was up 1.0% while Toronto was up 0.2%.

Toll Brothers was down 2.6% to $37.27 after reporting earnings. In may ways the earnings were strong, but the market found some aspects disappointing. I continue to view Toll Brothers as a good investment. The company itself bought back substantial shares at an average of $39.02 in the quarter. In the past I have found the company to be astute in buying back shares at good prices and so I think the fact that they are buying at $39 is a positive indicator. The company has recently been growing its revenues in the range of 20 to 25%.

Ceapro declined another 10%. This is a penny stock and it could certainly continue to decline. If its research and development of new products pans out then it could do well. But that is likely to take at least one or two years. I plan to hold onto my small position in this company. I don’t think I will add even at lower prices until I see some improvement or at least an end to the recent declines in revenue.

Statistics Canada reported that investments in new home construction increased in every province except Newfoundland in June. In that regard, the Canadian economy continues to do well. In Alberta the investment in new single family homes was about 23% below the June 2014 level but was above the June 2011 level. New housing construction in Alberta has recovered somewhat from the recession lows. But I would not expect it to return to the 2014 peak level anytime soon.