Trading A Corus For A Dream

Corus

Trading A Corus For A Dream

Hey Hey Hey

This post is a little behind but I decided to let you all know my moves. As you have noticed I have been changing / improving my portfolio the last couple months. I want to keep stocks that, I see myself continuing to buy. If not whats the point of holding them if you don’t like the business?

Corus Entertainment

This month Corus Entertainment had a earning report, and there was some positives that came out with the report, but one thing stood out to me. This report showed that their radio advertising revenue actually dropped by roughly 2%. I really didn’t like seeing that, as I felt that was something they basically had no competition with.

Now this drop may not be a lot but considering this is the one thing, that Corus really dominated and I felt wasn’t going anywhere (like cord cutting) and yet revenues dropped. I sold our shares.

I sold them at just over $5.70 a share and took a pretty sizeable loss on this position. Considering they cut their dividend and the stock saw a low of $3.70 after that, I actually don’t feel that bad about the loss. It worked out better than it could have, if I sold right away.

There still seems to be some positive news in Corus’s future as they are still a cash flow machine, and tv revenues went up. That radio decrease made me think it would be a good idea to move on. While I enjoy listening to the radio while driving, sometimes I do find myself sick of the same songs/ commercials and listening to some podcasts on my phone instead. This trend itself will probably increase with the rise of smart cars and ease of use between the vehicles and phones.




Dream Global Reit

After the sale of Corus, we had some cash sitting around as well as a little bit more in our one tfsa. I felt it would be great to add to our position in Dream Global Reit. So we picked up an additional 107 shares at $12.86 a share. We started a position in them back in December and the stock has went up a bit since then, but I still feel they offer a good value and love the diversification it brings to the portfolio.

Does Brexit scare me with this position? No not at all, that is just noise. If the price of dream global reit drops, I’m sure you will read about me buying more in the future!

Income

Corus was yielding about 4.26% and was bringing in 54 bucks a year after that dividend cut. The new purchase of dream adds $85.64, not a massive difference especially considering I threw some cash in there too.

Conclusion

There has been a lot of negative sentiment on corus for a long time now and I’m glad to finally pull the cord and exit the position. I’m glad I didn’t jump ship right after the cut, but also kinda regret not doubling up my position when it was soo cheap at around 3.50. That would of most likely evened out my average cost and maybe I would of broken even on this sale.

This is something I’m currently debating doing with Altagas. (Another one of my original stock purchases) I only have 30 shares, but its average cost is about 25 bucks. 1000$ into them now would drop that average cost wayyy down and hopefully I could sell when it breaks even.

What are your thoughts on this? Would you average down on a position you would like to sell? Or just take the loss/ keep holding. I do think Altagas is too cheap at these levels, but my goal is to stick to blue chips this year.

Anyways that’s my moves for this month, nothing huge. Trying to stockpile a little cash after the market rebounded so fast.

Cheers

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4 Responses

  1. German says:

    Great move to swap Corus for Dream Global. DRG will do fine regardless of brexit deal. They have top-notch office buildings with great tenants like banks, auto makers and other brands.

    I would definitely add $1000 worth of ALA shares. All the mess they’ve been going thru is behind them. It will take some time to rebound. But the business is strong and they have plenty of utility customers in the States. That’s a huge cash cow every month. You can easily lower your average to under $20 bucks and hold it for a year. I predict $20/share in one year period.

    But mind you, my opinion could be biased because this is what I plan to do as well.
    German recently posted…My Investment CityMy Profile

    • Rob says:

      haha German

      yeah its definately on my mind. would be nice to drastically lower that average cost base and i think the worst is behind them too!

      Dream is a nice addition. I like what they have been doing.

      cheers German!

  2. Sounds like great rationale to sell Corus, always difficult taking a loss rather than sitting around hoping things will improve, but you seem to take these in your stride which is fantastic.

    Averaging down is so tempting for the same reasons – it reduces the average price you pay, which feels like reducing your losses immediately, but only worth doing if you still believe in the investment case. Some of the investments I’ve been most burnt on are those where I’ve ‘averaged down’ (too much!), but still find it a great strategy in general. The fact you want to wait to ‘break-even’ before selling sounds like a red-flag to me, but might still work out for the best. Good luck either way!

    Cheers, Frankie
    Frankie @ Fully Franked Finance recently posted…Fund Update January 2019 – Benny Bounces Back (a Bit)My Profile

    • Rob says:

      hey Frank

      Yeah it definitely sucked taking this loss, but at the same time it wasn’t a massive position, so its a lesson learnt.
      As for averaging down, your right. It could burn me, but it would drastically lower that cost. I think they are a good company but want to focus on dividend growth companies. You cut that dividend, we aren’t going to get along. lol

      cheers mate

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