Market were up sharply on Wednesday. The S&P 500 was up 1.7% and Toronto was up 1.2%.
Among the bigger gains were: TFI International – up 4.1% to a new high. Shopify – up 3.0%, Alcanna- up 5.6%. FedEx – up 3.5%, AutoCanada – up 7.9%, Linamar – up 3.5%.
I am not aware of any news to explain AutoCanada’s recent increase. Checking insider trading, there has been no insider trading since June other than an August 13 filing when a Halifax-based owner of about 40 dealerships in the Maritimes announces it had taken a 10% position in the company. That entity has apparently added no further shares. Possibly some investors are now following the knowledgeable Halifax entity into the stock. A few days ago it was reported that September auto sales in Canada were slightly higher than the year-ago Spetember results – the first year-over-year increase in I believe at least one year. That is a positive development, but it is hard to understand why the stock is up quite so much. I trimmed my position somewhat today.
Meanwhile Melcor Developments was down 4% today to $5.90. Checking insider trading in that company, I see that several insiders have bought shares in recent weeks and in one case today adn in another case yesterday. They will now be in a blackout period until Q3 earnings are released. I also see that the company itself resumed buying back shares as of August 21. This indicated confidence. The fact that the company is buying back even a few shares (they are limited to very few – 1000 per day- due to the thin trading volume) indicates that the company does not believe it is going to be in financial difficulty. Melcor’s shares appear to be significantly under-valued. The latest report shows that the Edmonton home resale market was quite strong in September. That would seem to bode well for Melcor’s ability to sell single family home building lots. Calgary also reported a strong September, particularly for detached single family homes. Despite my already large position in this company, I added a few more shares today.
After the close, Costco reported same-store sales surged once again in September compared to September 2019.