July 12, 2018

On Thursday, the S&P 500 and Toronto were each up 0.9% which made for a strong day in the markets.

Constellation Software was up a hefty 4.6% and has continued to be a real winner even when it seems expensive. Similarly, Amazon was up another 2.4%.

Couche-Tard was up 3.15% as analysts further digested its earnings and apparently found them appetizing.

On the other hand, AutoCanada fell 5.1%. There was no news to account for this. Many investors including perhaps institutional holders may be throwing in the towel. In retrospect, of course it would have been wise to sell these shares at higher prices. Investing is almost always a waiting game. I am waiting now to see their Q2 results, their outlook, and any results from the Strategic review. I did pick up a very few more shares today but I don’t want to get carried away buying too many. With the recovery in the Alberta economy they should be selling more vehicles. However, some 46% of their sales in Q1 were from Chrysler dealerships and that company reported a 17% drop in sales nationally in June and 11% year to date. The reasons for the big under performance at Chrysler were not revealed. I believe AutoCanada is still generating ample cash flow and is in no danger financially.


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