Savvy Trades and Investments

[maxluke1]

RTMAF/RTMNF - thanks so much for detailed thoughts. Definitely agree with you. It's absolutely foolish for management to do nothing. There's been some similar thoughts, but far less rigorous than yours, floated on the Stockhouse forum (not sure if you browse that site ever). Those guys seem to think the family ownership is causing problems, but who knows...

One thing to note:
The Canadian consumer/economy is very likely going to take a much bigger hit than the USA economy with rising interest rates. Hard to say how much at this point, but it's not pretty. The change in the CAD to USD exchange rate reflects this.

From my perspective, the main reason is that ~25% of mortgages here are variable rates (I think they are termed adjustable rate mortgages in USA). Plus, the longest fixed mortgage people typically get is 5 years, and then they have to renew. The amount of moaning and groaning about rising interest rates here is incredible. It's been only 6 months... For example, it's absolutely stunning how many folks took on variable rate mortgages during the pandemic when 5-year fixed rates were < 2%...

This isn't incredibly pertinent to Reitmans, given the valuation, but the cloud over the whole retail sector in Canada is something to be aware of.

Source for variable rate mortgages by country:
https://www.bnnbloomberg.ca/the-world-s-hottest-housing-markets-are-facing-a-painful-reset-1.1817601