Savvy Trades and Investments

[gilead23]

RTMAF thx it’s been a rocket since the .65 lows.

I’ve sold about 1/3 of my peak position but I’ve been doing it since about 3.00 CDN. I bought a crap ton when you could still buy it for around 1.10 US after that .75 quarter. I was overweight and needed that trimmed.

I’ve sold a bit today as well.

As far as fair value: Clearly I don’t think it’s insanely undervalued or I wouldn’t have let those go.

The real question here is in a normal non-recessionary environment are these results sustainable? If so I think a cash adjusted PE of 6 is more than fair given zero debt and the very valuable montreal real estate carried at well below market value. So figure a fair value of $7.

So now you apply a probability they can sustain results. Let’s say it’s 60%.

So $7 x 60% of the time is worth 4.20.

If that doesn’t happen and they show some poorer results they still have cash and real estate as a floor. Assume those are good enough to hold you at 2.50.

So 2.50 x 30% of the time is worth .75.

That gets me to a swag of what’s fair of about 5 bucks Canadian or 3.75 us at current exchange rates.

Play with percentages to get your own numbers. Funny thing is I had $5 CDN in my head and when I tried to quantify it for this post that is roughly where I wound up.