Mr. Justin Hupet CFA

GLG News by Mr. Justin Hupet CFA, Consultant

Genworth MI Canada: Successful IPO, But Mixed Market Reaction

July 9, 2009

Analysis of:What to take from Genworth's IPO | www.theglobeandmail.com

Genworth Financial (NYSE:GNW) completed an IPO of their Canadian operations in a bid to raise capital to pay down debt at the parent company.  The mortgage insurer’s Canadian offering raised at least C$850 million (44.7mm shares priced at C$19 per share and the underwriters have the option to sell an additional C$127mm (6.7mm shares) up until August 6th).  If the option is exercised in full, Genworth Financial would have a 56% ownership interest in Genworth MI Canada (TSX:MIC).  This is the largest IPO in the Canadian marketplace since 2007, when gold miner Franco-Nevada raised C$1.3bn, and is only one of a handful of IPO’s completed in Canada YTD.

Institutional Investors Participation in Recent Equities Market Rally: A Canadian Perspective

April 20, 2009

Analysis of:financial times ft.com | www.ft.com

The major Canadian equities market index, the S&P/TSX Composite Index, is up 5% YTD (up 25% since March 9th, 2009) ; with the overall value traded down 27%, and volume up roughly 18% compared with the same period last year on a year-over-year basis.  The number of transactions is up 26% YTD vs. the same period last year.  The TSX Venture exchange (which consists of micro and small capitalization companies) is up 24% YTD.  The consensus among institutional investors in Canada, as elsewhere around the globe, remains divided.  A few things likely need to occur before the majority of the naysayers move toward the other camp, such as; a visible and sustainable improvement in the global economy, a broad-based recovery in corporate earnings, a steady and meaningful increase in the prices of commodities, a slowdown or reversal in the recent rate of increase in the unemployment rate, more balanced conditions in the housing market, and a significant positive shift in consumer confidence.

Hedge Funds Need A Survival Strategy

March 26, 2009

Analysis of:Pensions seen fueling hedge fund industry growth | www.reuters.com

Hedge funds lost more than $700 billion in second half of 2008, and 2009 might be even worse given the current outlook for the financial and economic environment.  Hedge funds need a survival strategy and more metrics need to be shared on both sides of the conversation between the hedge fund and institutional client.  Those hedge funds that survive need to offer, among other things; repeatable performance, fair fees, top-notch client service, robust risk management, transparency, sound operational infrastructure, and a safety guarantee for custody of and institutions assets.

Recent Moves by the FED and Treasury: Do They Raise More Questions Than They Answer?

March 25, 2009

Analysis of:Confidence Returning to Equities | www.bloomberg.com

Critical questions remain unanswered, and these questions will in all likelihood not be cleared up until the plan begins operation, such as:  Will investors (through auction via FDIC) offer high enough bids to entice bankers to sell illiquid assets?  Will regulators force banks to participate regardless of where bids are at?  How quickly will the plan be implemented?  What loans are eligible for the auction?  Is this whole process too bureaucratic?

Suncor's Acquisition of Petro-Canada: Merger Creates Canada's Biggest Energy Company with Global Stature

March 23, 2009

Analysis of:Suncor, Petro-Canada agree to $19.2B merger | www.financialpost.com

Merger creates Canada’s biggest energy company with global stature. The new combined entity consists of the largest Oil Sands resource position. Both companies were in need of cutting costs given tough economic and industry conditions. Suncor itself was looking ripe for a takeover given the depressed share valuation (down roughly 35% over the last 12 months) and relatively low price of crude as of late, and is getting a “good deal” with the acquisition of Petro-Canada.

Sun Life's Indonesian Acquisition: CIMB Will Boost Presence In Priority Growth Region

March 19, 2009

Analysis of:Acquisition Sun Life, CIMB team up to form joint venture | www.thejakartapost.com

Yes, I think the CIMB acquisition will significantly help Sun Life in tapping into Indonesia’s insurance sector where the company has had a presence since 1995 through P.T. Sun Life Financial Indonesia (which has four telemarketing centers, eight bank partners, and 3,800 agents).  Indonesia remains a key priority geographic region for both large Canadian insurers (i.e., Sun Life and Manulife), as it is one of the fastest growing insurance markets in Asia.  This transaction will increase Sun Life’s presence and reach in Asia, where they intend on continuing to build and grow their franchise consistent with the company's long-term strategy. 

Canadian Banks: "Steady As She Goes - Weather-Beaten By The Economic Hurricane But Not Broken"

March 6, 2009

Analysis of:Canada banks' long history of steady dividends | www.financialpost.com

Canada's banking system is currently the soundest and most stable in the world.  For those with patience, the ability to foresee past the current environment and have a longer-term time horizon, shares of Canadian banks represent significant value and upside potential.

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