RE:Couple of questionsI will give this a shot. BTW, I spent most of my life in the investment world.
1. Fiera needs to show good net inflows across most geographic regions for at least 2 or 3 quarters in a row.
Analysis - The PS on last quarter suggested that they will achieve this goal in the current quarter assuming that the activity mentioned turns into mandates won and is not offset by mandates lost or rebalances. And investors need to ignore Pinestone in this calculation. The Canoe announcement is noise. The money was being managed by Pinestone through Fiera. So Canoe was paying Fiera a couple basis points to hand the money off the Pinestone. Of course Canoe and others are going to skip the extra layer of expenses at some point.
2. They also need to show the ability to cover dividends on a rolling 12 month basis for 8 quarters in a row.
Analysis - This quarter will be at least 8 in a row and Q4 is when most of the performance fees are generated so it is the most important one of this calculation.
3. They need to pay down some debt.
Analysis - they paid down a bit last quarter but we need to see even more of this in the next 3 quarters for doubt to be removed.
The Takeover??
Management owns more than 20 percent of this company and it is a cash cow with a 9 percent dividend. Mr Desjardins is 80 years old and went back in as CEO a couple years ago to right the ship. I don't think his family has any interest in just the dividend in the future and would rather have hundreds of millions of dollars in the bank. He built and sold TAL to CIBC. He has good contacts in Canada to find a buyer but I suspect that the international offices they have set up will find the buyer who wants a foothold in Canada BUT I would not rule out a Canadian bank once they are able to reverse some of their PCLs.
Just my opinions. Happy to hear others.
GLTA