On Tuesday, the S&P 500 was about unchanged while Toronto was down 0.5%.
Linamar was up 3.3%.
Our one penny stock, Ceapro was down 10% after releasing its latest results.
The next update will be for Boston Pizza Royalty Units. On a yield basis it looks attractive but there is at least some possibility it could cut the distribution by a small amount unless its distributable cash per unit begins to grow again in the next quarter or two. It targets a payout ratio of around 100%. Its trailing year payout ratio is 101.6%. In 2013 the payout ratio for the year was 100.7% and the distribution was maintained. If there is a cut to the distribution, it might be only in the range of say 4% (From 11.5 cents monthly to 11 cents.) But the market could react quite negatively to that. On the other hand perhaps Q3 will see growth in distributable cash per unit and/or perhaps they will simply allow the payout ratio to stay above 100% for several more quarters. Sales have continued to be somewhat soft in Alberta. I had thought that menu price increases especially in Ontario would lead to an increase in distributable cash per unit but as of Q2 that has not been the case. Additional annual menu price increases were implemented in June and should benefit the upcoming quarters – unless the higher prices lead to lower customer traffic.