Looking for investing ideas? Here’s your weekly digest of the Globe’s latest insights and analysis from the pros, stock tips, portfolio strategies plus what investors need to know for the week ahead.
The highs and lows for cannabis stocks
Cannabis company investors probably could have used a little edible relief from the markets’ roller coaster ride this past week. First there was the Ontario government’s announcement that private store sales of marijuana would be delayed until next spring, which sent cannabis stocks plummeting on Tuesday. The next day came the news that Constellation Brands is boosting its stake in Canopy Growth to 38 per cent, paying a hefty premium on its shares, which lifted other marijuana stocks along with Canopy.
Still, Canopy closed the week at $44.18 a share, lower than the $48.60 apiece Constellation paid. As Tim Kiladze writes, that could be because the $5-billion deal headline isn’t all it seems: On top of the new shares, Constellation is also getting 140 million warrants, and those securities are worth a lot. Exactly how much is a secret between the two companies, but according to a commonly used financial formula, it could be $800-million. Once these warrants are factored in, Constellation’s net investment looks to be worth less than the headline $5-billion figure.
Read more: The Globe’s investing stars and dogs for the week
Wealthsimple launching zero-commission trading platform
Wealthsimple Inc., Canada’s largest robo-adviser, is launching a new trading platform that will allow investors to buy, sell and track stocks and exchange-traded funds with zero trading commissions, Clare O’Hara writes. The Wealthsimple Trade mobile app will provide users access to unlimited zero-commission trades of more than 8,000 publicly traded stocks and ETFs listed on major Canadian and U.S exchanges. Wealthsimple’s zero price tag for stock trading is a first in Canada.
Read more: Zero-fee investing is on the rise, but it won’t make you a successful investor
Buffett’s Berkshire boosts stakes in Goldman, Apple
Berkshire Hathaway added to its stakes in two of Warren Buffett’s most favoured industries as the billionaire investor widened bets in banking and the airline industry. Berkshire boosted investments in Goldman Sachs, US Bancorp, Delta Air Lines. and Southwest Airlines in the second quarter, according to a regulatory filing. It also added to its position in Apple.
Though a minor part of its portfolio, Berkshire also increased its stake in Teva Pharmaceuticals. Teva shares got a lift this week after the U.S. Food and Drug Administration approved its generic version of Mylan’s life-saving allergy injection, EpiPen.
Read more: Warren Buffett’s investing continues to evolve even at 87
Why the rally in AutoCanada shares may be just beginning
If AutoCanada’s 27-per-cent decline on Aug. 10 appeared shocking, spare a thought for long-term investors who have been riding an 87-per-cent decline in the company’s share price over the past four years, David Berman writes. Then push aside your sympathy and consider buying this nose-diver, because its fortunes can change in a blink. Wednesday’s 16-per-cent rally, when the overall market was deep in the red, provided an early indication of what can happen when the market recognizes a good deal.
How much bite do FAANG stocks have?
After the dotcom bubble burst in 2000, many investors vowed to never invest in the tech sector again. But there are some huge differences between 2000 and today, Gordon Pape writes. All the FAANG companies – Facebook, Apple, Amazon, Netflix and Alphabet (Google) – are profitable. However, their business models and prospects are quite different, so they do not move in lockstep; each stock must be assessed on its own merits. Here’s a look at each.
Read more: These eight stocks are buying back shares and score highly with top investing strategies
What investors need to know for the week ahead
Canada’s big banks start releasing quarterly earnings this week, with Royal Bank of Canada on Wednesday and Canadian Imperial Bank of Commerce on Thursday. Also reporting: BHP Billiton, Lowe’s, Newcrest Mining, Target, Alibaba, Nexus REIT, CannaRoyalty and NexGen Energy. Economic data on tap include Canadian retail sales for June and U.S. existing home sales for July on Wednesday, and U.S. new home sales for July on Thursday.
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