A humorous look at the companies that caught our eye, for better or worse, this week
Spin Master (DOG)
Remember when you were a kid and your dad deliberately drove over one your favourite toys because “you never let me play with it!” Well, that’s not the only way toys can inflict pain. Shares of toy maker Spin Master skidded after the company unveiled fourth-quarter results well below estimates, hit by the U.S. bankruptcy of Toys "R" Us and a big drop in sales of Hatchimals. With Spin Master expecting weakness to continue into 2019, investors are finished playing with this stock.
Canadian Dollar (DOG)
Current events quiz! The Canadian dollar tumbled this week after: a) China issued a news release mocking the currency as “the overvalued loonie poonie woonie”; b) Former attorney-general Jody Wilson-Raybould testified that she had been under pressure to talk up the dollar to cut SNC-Lavalin’s costs on foreign purchases; c) Citing a “more pronounced and widespread” slowdown in the global economy and expectations for a weak first half in Canada, the Bank of Canada held interest rates steady. Answer: c.
North American Palladium (DOG)
You want predictable returns? Buy a GIC. You want massive gains one minute and gut-wrenching losses the next? Try palladium stocks. Buoyed by soaring prices for the precious metal that’s used to make catalytic converters for automobiles, shares of North American Palladium had surged more than 130 per cent in the first two months of the year. But with some investors locking in their fat profits on the palladium miner, the thinly traded shares collapsed this week. It’s almost as much fun as investing in bitcoin.
American Hotel Income Properties REIT (DOG)
The ticker symbol is HOT.UN, but American Hotel Income Properties’ units are suddenly very cold. Hit by higher operating costs and renovations that took longer than expected, the operator of hotels across the U.S. reported fourth-quarter results below expectations. With Industrial Alliance Securities cutting the units to sell from hold – citing the REIT’s elevated payout ratio, above-average leverage and expectations for cost headwinds in 2019 – investors should take a hard look at the 12-per-cent yield before they reserve a room.
Abercrombie & Fitch (STAR)
Those smiling, clean-cut kids in the Abercrombie & Fitch ads? They must own a bunch of the company’s stock. Even as other bricks-and-mortar stores are struggling, the clothing retailer posted earnings above expectations as same-store sales rose for a sixth consecutive quarter, driven by a 6-per-cent increase at its Hollister brand that more than made up for a 2-per-cent decline at its namesake A&F chain. Seriously, though. A lot of their jeans have holes in them. Why would anyone buy such a defective product?