The Canadian Investor - Shopify & Franco-Nevada Deliver Big on Earnings

Episode Date: August 14, 2025

In this episode, Simon and Dan dive into a jam-packed earnings episode covering some of Canada’s biggest names. They break down GoEasy’s record quarter and cautious shift toward secured lending, Franco-Nevada’s strong gold-fueled results and the latest on Cobre Panama, WSP Global’s steady growth despite Asia-Pacific weakness, BCE’s first full quarter post-dividend cut, and CargoJet’s new deals with Amazon and DHL. They wrap with Shopify’s standout results, growing big-brand adoption, and AI-powered merchant tools.   Tickers of stocks discussed: WSP.TO, BCE.TO, SHOP.TO, GSY.TO, FNV.TO, CJT.TO  Check out our portfolio by going to Jointci.com Our Website Our New Youtube Channel! Canadian Investor Podcast Network Twitter: @cdn_investing Simon’s twitter: @Fiat_Iceberg Braden’s twitter: @BradoCapital Dan’s Twitter: @stocktrades_ca Want to learn more about Real Estate Investing? Check out the Canadian Real Estate Investor Podcast! Apple Podcast - The Canadian Real Estate Investor  Spotify - The Canadian Real Estate Investor  Web player - The Canadian Real Estate Investor Asset Allocation ETFs | BMO Global Asset Management Sign up for Fiscal.ai for free to get easy access to global stock coverage and powerful AI investing tools. Register for EQ Bank, the seamless digital banking experience with better rates and no nonsense.See omnystudio.com/listener for privacy information.

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Welcome to the Canadian Investor podcast. We are back for a news and earnings episode. I'm back with Dan Kent here. Pretty jam-packed, full-on in earnings. which is great just before we take a couple of weeks off from recording at least we have plenty to talk about during the earnings but the rest is sure we are doing extra work right now so everyone so you are getting some fresh new content even though we will not be recording for the next couple of weeks you'll still get some fresh new episodes so I'm doing

a solo one we have one you and I plan that will be going over how we look at businesses and kind of how we do the overall process of finding companies and what things will look at when we review and analyze them. And I also have one coming up with Dan Foch where we look a bit more at the macro picture and how real estate is going in Canada and some of the policy changes. So lots of stuff coming up in the next few weeks,

but earnings are full and furious right now, right? Yeah, it's kind of been hard to pick what ones to talk about because there's so many coming down, like, big quarters from a lot of Canadian companies. Portfolios just going crazy right now. It's been a crazy 2025 after like a, you wouldn't think so considering the, the 2024 we had. But they just, they just keep going north. Yeah, yeah, exactly. It's pretty crazy.

And I still think we are seeing a lot of signs of market peaks. But that's okay. You can go back to the episode that we talked about if you want to know some of the signs there that we may or may not be seeing the current market. So let's get started here. We have GoEasy. So the Canadian subprime lender looks like a pretty good record, a pretty good earnings report for GoEasy.

And I will just put it out there. I had tweeted, I think it was probably April or May, that I wouldn't touch this stock when it was around 140. And clearly I was wrong there, at least in the short term, it's $210. I think today around there. So they've performed very well. My reluctance for this company still remains because it's a subprime lender.

And employment has been holding pretty well in Canada. But we're starting to see some signs that it actually is slowing down with the recent employment report. I think we lost something like 40,000 jobs, if I remember correctly. And then the U.S., you're also seeing some softness in employment. So there's still, I think, in my. you a lot of risk for this company, but they seem to be crushing it right now. So do you want to go over that? Yeah, I mean, it was, it was pretty easy to kind of come to that. No pun intended. Yeah, it was pretty easy because last quarter they reported, I would say a really bad quarter.

Like I've watched Go Easy since, I mean, 2018 probably. And last quarter was probably one of the roughest they've reported in quite some time. And it obviously took a decent hit in share price. but it's rebounded in a big way. I would say it's mostly still kind of soft results, but the forward outlook is probably looking a lot better. And, you know, it was a record quarter on most metrics, forego easy, which is pretty crazy considering the environment. But loan originations were up 9%.

Loan growth came in above guidance. Revenue increased by 11% with earnings flat year over year. And this is like these numbers, like 11% revenue growth and flat earnings growth are really not typical of GoEasy. This has been a company that's grown at a much faster pace for quite some time. So there is a slowdown in that regard, but we had talked about this before we started recording. Like I think this is kind of the company tightening up on credit a bit, probably taking a lot more high quality loans, which I'll talk about in a bit secured loans relative to unsecured loans that just kind of, you know,

kind of tightening up because they do know probably the macro environment is not the best right now. And as a result, the company's yield on their portfolio, it actually increased quarter over quarter. So when you compare it to the second quarter of 2024, it actually increased, I believe it was 50 basis points. But it's still down overall when comparing the first half of this year to the first half of last year. So I think the lowering of that yield is due to the company acquiring more secure and lower risk loans and then obviously it's it might still be a little bit of a trickle effect from I believe this was like probably in in late 2023 or early 24 from the the government kind of capping the maximum APRs but yeah and just a quick note I know

we like we talked about that a lot but secured loan that just means it's backed by some kind of assets it's secured against an asset unsecured it would be just based on your credit worthies typically yeah yeah so you'll have you know obviously the best type of secured loans you can probably get are helox which is the company has been growing quite a bit in this regard and then you have those other secured loans like automobiles automobiles probably wouldn't be as good obviously you have you know a home is kind of a it's a more liquid appreciating asset typically whereas an automobile you know banks don't really want to get into the business of selling you know automobiles when the loans don't get paid like that you know

know it's a depreciating asset not as good but it's still a secured loan nonetheless so it is backed by something the company's charge off rate declined the lower end of its guidance 8.8% so it was 9.3% last year in terms of allowances for credit losses they ticked up but not a ton they came in at 7.92 percent and because of the higher provisions and just the lower overall yields on a year over year basis operating margins dip by 120 basis points so 1.2 but they're still pretty strong 39.3 And the reason I say the company is probably tightening up a bit is because applications for loans were up 23% year or year, however, you know, like loan originations were only up 9%. So I think the company is getting a bit more selective when it comes to loans. And in terms of their secured loan exposure, it increased yet again.

It came in at 48%. So, yeah, we had explained what those secured loans are. And obviously the more secured loans, a bank can add to the loan book to higher quality loan book, it is because, you know, you have some sort of asset to go on when the loan, you know, isn't going to be paid. You have somewhere to go to get some money back, which is, you know, shareholders are probably going to appreciate this because a lot of, you know, historically, a lot of these alternative lenders have been filled with a lot of unsecured loans, which during good times is very good because the yields on these loans, especially for. from, you know, alternative lenders are sky high, but, you know, it's definitely a good sign that they're kind of locking in a bit more security here. Pretty solid quarter, especially after last quarter, as I had mentioned. The one thing I will say is, is I was a bit surprised by the reaction post earnings.

Like, I think it went up, I think it was like 10 or 15%. Like, go with these numbers, at least at this point of time, they're kind of similar to the big banks. I mean, revenue growing in the low double digits, earnings flat. I think even the big banks are still posting. growth in earnings. You're paying around 12.6x trailing earnings for a company like Go Easy while you're paying around 14x for National, which is, again, it's currently sitting at all time highs as well. But it's posting similar growth, which kind of tells me that the market

is probably pretty bullish on Go Easy's future, so much so that, you know, valuations are similar despite, you know, it's hard to argue that Go Easy's loan book would be much lower quality than a bank like National. And I do agree, like, you know, This will be the case of the economy doesn't roll over and we kind of tread water. Some prime lending, I mean, with the current cost of living crisis we're facing here, is probably going to continue to thrive overall. And I mean, if they can kind of normalize the decline in yields and, you know, continue, you know, maybe the environment improves and they start, you know, issuing more loans.

I can't see anything stopping this company moving forward. It's just, it's been a crazy growth story over the last, you know, 10, 15 years. Yeah, I'll still, I'll double down on what I said. It's still not a company I'd bet on at this point in the cycle. It's a company I'd be more open to invest in when, which I think is a when, but I guess we'll see it could be a six months, a year, a couple years, five, 10 years. I guess, you know, it's really hard to pinpoint.

But when there's a significant downturn, the economy, the unemployment starts rising pretty rapidly. That's the kind of company that I think then it would become pretty attractive. Clearly, the earnings will take a big hit if and when that happens, but that's usually the point you want to bet on companies like this is when things look as bleak as possible. That's when you want to start an investment, not when things look pretty good to good like we are seeing right now and a lot of loan origination, even though there's probably, like you were saying, there's more applications then the loan's actually being approved and originated, but it is a company that I'd look at more when things look pretty billy.

Yeah, and I mean, like I said, last quarter, it didn't look good at all, and we've seen how volatile companies like this can be. I mean, we're at 210 now, just one quarter ago. We were at, what do you say? I think it was down to like 140. So, yeah, it all really depends on the economic environment moving forward. Like how long they have to tighten up credit, you know, how the more secured loans they add, obviously, the more their yields are going to fall.

And, you know, for a high growth company like this, obviously, you don't, you don't want them to go too far in that regard, because then obviously the yields are going to fall. They're not going to be able to grow as much, but you do, they're creating a bit of a nicer mix here overall. I still like the company. I mean, again, like I, when it was 205 bucks a year ago, I kind of thought it might have got a bit, you know, overvalued to a certain point, but I'm still a fan. Yeah.

Okay, yeah, no, I think in terms of in this space, it sounds like, and from what I've read and heard, it sounds like they're very well managed, but it's still, again, this space that's really risky. In this kind of market, I like having some cash on the sidelines. It gives me the flexibility to jump on opportunities when the right stock goes on sale. But just because the cash is waiting, it doesn't mean it shouldn't be working for me. That's why I use EQ Bank. They offer some of the best interest rate among Canadian banks, so my money's still earning while I wait. You can even get a boosted rate by setting up direct deposit for your payroll and depositing

$2,000 or more per month into your EQ Bank account. Your cash stays liquid and ready to go when it's time to invest. And if you're not in a rush to access your funds, EQBanks notice savings accounts and GICs are great ways to grow your returns even more. It's a smarter way to park your cash. Visit EQBank. to learn more and keep your money earning even while you wait. Want to buy a stock but don't want to shell out hundreds or even thousands for a single share? With Questrade's new fractional shares, you can invest any dollar amount and build a diversified portfolio instantly. No delays, no trade fees, no excuses. Want to put $10 into a stock trading

at $100? No problem. Quest trade has you covered. They're the first broker in Canada to offer real-time commission-free trading for U.S. fractional shares in ETFs. It's simple, powerful, and finally available in Canada. Head to quest trade.com to open and fund an account. Use code TCI and you get $50 to get you started. Calling all DIY, do-it-yourself investors. Blossom is an essential app for you. It has been blowing up with now more than 50,000 Canadians plus and growing who are using the app.

Every time I go on there, I am shocked. The engagement is amazing. This is a really vibrant community that they're building. And people share their portfolios, their trades, their investment ideas in real time. And it's all built on the concept of transparency because brokerage accounts are linked. And then once you link your brokerage account, you can get in-depth portfolio. Insights, track your dividends, and there's other stuff like learning duolingo style education lessons that are completely free. You can search up Blossom Social in the app store and join the

community today. I'm on there. I encourage you go on there and follow me, search me up, some of the YouTubers and influencers and podcasters that you might know, I bet you they're already on there. People are just on there talking, sharing their investment ideas and using the analytics tools. So go ahead. Blossom social in the app store. And I'll see you there. So let's move on here to Franco Nevada. I'll just say it right now. It's a company I own. I think you own it as well a little bit now. Yeah. So I mean, I've been saying about it for a while. So I may have been wrong on Go Easy, but I've been very right on this one. So I'll just say that. So I do have, and I'm happy to say when I'm right, I'm wrong. And if you've been listening to

the podcast for a while, you know that I'm very honest, which I, you know, my good and bad moves, I'm not like some of the YouTube influencers that will only talk about their good moves. I'm more than happy to say when I was wrong. So revenues were up 42% to 369 million, which is a record high for them. Now, they actually started the call. So the CEO was like it was a record high Q1, so last quarter, and another record high this quarter. So you know it's a pretty good earnings report when they start off the call like pretty early on. And that's what they say.

And they sold 2% more gold equivalent ounces or geo. It's a term I'll be using. I'm just going to provide a quick refresher here. Geo is simply a way to convert everything that they produce as one unit of measure because they don't only get gold. They also produce silver, for example. They have some oil royalties as well. So just to make sure that it's easy to convert everything into one. So they just convert into geos.

They also generated a record amount of operating cashwell during the quarter. Net income also hit a record high and was up 211% for the quarter. The average price of gold sold was 3,279 during the quarter, which was a 40% increase over last year. And that was a reason why I actually, in the joint TCI update that I did in early August, I was giving the case here for Franco Nevada because the price that was being obtained during Q2 of course we didn't know for sure but from some rough calculation it's actually the amount I was I think I was a few dollars off the average price of gold per ounce during Q2

was pretty close my calculation that I did to the 3279 and my point was that look when the price right after the earnings release of Q1 the stock price for Franco Nevada was actually the same that it was two, three weeks ago, despite gold rising significantly since. So, of course, it always trades out of Piamum, so you have to keep that in mind. But my view was that, you know what, maybe the market is not fully realizing how good of a quarter it will likely be by Franco and Nevada. And that's what we've seen. I mean, it's been consistently up now since they've released earnings a few days ago,

despite the price of gold kind of trending sideways. So I think that was one thing that I highlighted. And that's why a few weeks ago, so end of July, I actually added a bit more to my position because it just felt like there was a decent amount of upside, especially if you compared it to when they released Q1, which was, I think, end of April, early May. Yeah, and the one interesting thing is I remember, like, waking up to this, and I think they actually opened, like, down 4% after this quarter. And then obviously, people probably read the call or listened to the call, and it ended up closing green on the day. Yeah, it's just been a crazy good run for Franco. And I know a lot of people, like a lot of people don't want to get into miners, I guess, to a certain extent or gold to a certain extent, you know, in case it is peaked. But the one thing I'll say about Franco, if you go back to 2012, I believe it was when we went through another like huge gold bear market, like it barely moved from 2012 to 2019.

Franco Nevada still managed to go up by 300% over that time frame. Whereas if you look to a minor like Barrick, it ended up losing 42% from that seven-year time frame. Like, I think a lot of people maybe look at Franco and don't really understand the streaming model to a certain extent, which kind of shelters it. It doesn't completely prevent it from, you know, falling gold prices, but does shelter it to a certain extent? Because actually, I made a video on this company not too long ago, and a lot of people were saying that, you know, gold is peak so they don't want to don't want to enter like a company like Trankle but it's yeah the

business model is it's a lot different than you know a traditional miner yeah and in my view there's still more tailwinds for gold I won't go into into that much detail look I'm not a gold bug specifically but I think there's a lot

of value and a monetary premium added to gold and with the uncertainty that we're seeing the likely money printing and quantitative of easing that we'll be seeing in the coming years by governments around the world, to be honest, and just the amount of record deficit, to me, it's like a no-brainer that the tailwinds for gold will remain very strong. Whether it's kind of peaked in the short term, very possible. But like you said, the business model is that their operation and their costs per ounce remains

extremely low. So they could essentially, like the price of gold could drop by half and they'd still be profitable. Like that's not that. Yeah. That's essentially, that's, I think, Yeah. I think that's one of the main things, the difference between a minor and something like Franco. I mean, when you have a minor and the price of gold drops 50%, I mean, their operating costs won't drop all that much. So their margins take a big hit, obviously. They're making less per ounce and they're having to pay similar amounts to get it out of the ground. Whereas, you know, Franco, with that royalty model, I mean, it's just taking a chunk of the top line anyway. So, I mean, obviously it's going to take less, but it's not exposed to. a lot of the volatility, a lot of these miners who tend to operate in like massive boom and

bus cycles. It just isn't really exposed to that as much. Yeah. Yeah, exactly. So for the price of silver, that was actually a seven per 17% increase over last year. Their cost per geo increased from $264 to $299. So the cost per gold of equivalent ounces, which was a 13% increase year over year. Not a small increase, but again, when you compare it to the price that they're getting, it was a 40% increase per for the price of gold, so the GEO sold versus a 13% increase for the cost. So, I mean, you don't need to be a mathematician to say that this is playing in Franco Nevada's favor. And the price at which they sold, the GEO increased at a much faster pace is why they saw their margin increase at a whopping, increase a WAPE, increase a

whopping 43% and during the quarter they completed four new royalty and streaming deals. That's always something to keep an eye out for these streaming companies as you want to ensure that they steadily add to their streaming and royalty portfolio because at the end of the day, obviously those assets, you know, over time they get depleted. They won't go on forever. So you want to see them to actually increase that. And this chart I'm sharing here from the investor relations. slide deck that they provided. It's just really a good snapshot of how much money they're essentially

printing here because they provide the cash cost per geo, which in Q2 of 2024 was 264 and then $299 for the latest quarter. And then they also provide the margin. So it was a bit over $2,000 just a year ago and then 2980 in terms of margin specifically so they it's just a very good model we just see this chart and it's hard not to not to like it now in terms of the big update and i think this is probably why the company was up has been pretty much up since the earnings call is just the update on the Cobre Panama situation. So just a quick recap. So the Cobre Panama was run by First Quantum, which Franco and Nevada has a streaming interest for that mine here for precious metals. And essentially the government halted production from the mine back in late 2023, November of 2023. And there's

been ongoing arbitration, legal action, and so on. But now they've actually dropped the arbitration and which was a requirement from the government of panama i think first quantum also did that as well so it seems like they sounded the most optimistic they have regarding this project since it halted so if you listen to the call you'll see that they definitely sounded more optimistic it's still unclear whether the mine will restart or not but just a drop in arbitration was a key demand for the government of panama and we'll have to see where that leads in the coming months or years but they said on the call that there seems to be more public support for mine reopening and I researched some polls and it does seem like there is more and more support and

I also looked at the amount of jobs that could come for Panama from that project itself and it's a very major project and very important for the economy of Panama like it could be a two to three percent increase in jobs for that mine alone like two to three percent increase in jobs for the whole country like that is massive the project is still held it and in preservation and safe management mode which means that it's just basic operation to keep it safe but there was also a shipment that was sitting in storage at the mine that was completed which will provide an approximate 10,000 GOs for Franco Nevada that will be accounted for in the next quarter so Q3 and for additional context here if people don't really realize how big this could be if it does restart

And I don't know what percentage you want to attribute maybe for an investment thesis. At least for me, I'd probably put like maybe a 10% chance at this point. Like it's still, I don't know if it's still a likelihood. And if it does restart, maybe it's a modified contract as well with the government of Panama. So they could end up producing less than they had before. But the last year that was in operation, they produced just shy of 130,000 GOs, which was not a full year or two. so even if you discount that to some extent and you say okay maybe if they only recoup like half of that it's still a significant boost to their production because they're told geo forecast for 2025 for franco nevada is between 465k and 525k so depending on if it's restarts of course but if it does restart depending how much they can get out of the mine this mining project it could be a boost of 10, 15, 20, 25% to their geo output, which would be very significant and would be a big, big boost

for the company. So I think it's really the market starting to price in a higher probability of the mine restarting eventually. It's very difficult to prize, but I think that's probably why it's going up. Yeah, I think 10% would probably be a safe guess. Obviously, like, we really don't know. but I mean I would say like even like a year ago it was I would say it would have been a 1% chance so because I think it got shut down like environmental issues and all that type of stuff so yeah even in the case that it would get reopened I would be concerned that there would be probably further issues down the road I mean you never know but yeah the government has been open to opening it back up again and when it got shut down I think it was 20% of of Franklin Nevada. I think it was their biggest project.

So it would definitely be a big boost to the bottom line if it gets restarted. And I mean, they kind of have written it off. So, I mean, it's kind of a free roll right now. Yeah, it gets opened. It gets opened. And I think it got Franco Nevada compared to the other streamers. I think it was depressed and priced because of that. And if you look at the company and you just forget the Kobe Panama mine,

it's still like crushing it and that's why like for me it's always been a kind of no-brainer to go there and it was just a bonus if Kobe Panama would reopen so we'll have to see but I'm very happy shareholder it's becoming a decent position I think it's close to 5% now of my portfolio no it's performed very well pays a small dividend it's still you'll still pay a premium compared to mining companies but again If you think the price of gold is likely to continue for the foreseeable future and you think that there's strong tailwinds like I do, but macro tailwinds for the price of gold, then there's definitely worse companies that you can own than Franco Nevada,

especially given some of the excess that we're seeing in highly speculative companies right now that generate little to no profits. So yeah, I think there's worse thing. But again, a pullback is definitely possible here. So let's move on to the next name on. the list. So WSP Global, so the large Canadian engineering firm. Yeah, it was a pretty good quarter for WSP. So revenue increased by 16% year over year. 10.5%ish was from acquisitions and the rest of it was from organic growth. So even a margins, they're now coming in at over 18%. This would be an 80 basis point improvement from last year. If we isolate out some restructuring

and optimization costs they've been spending that they you know they they say are kind of one-time costs which they probably should be the margins actually increased by 130 basis points the company's backlog now sits at 16.3 billion which is around 11% higher year over year and the backlog is now around 11 months of their trailing 12 month revenue so days sales outstanding that came in at 69 days which is actually on the low end in terms of of historical numbers for WSP in the second quarter. So what this means is essentially when WSP issues invoices and recognizes revenue, it takes them around 69 days to collect that revenue.

So the lower they can get this number and not chase money, ultimately, you know, the more consistent the cash flows will be for the company. Their leverage ratio came in at only 1.5x. And this is actually down quite a bit. It was 1.8x last year. So this will effectively be the company's net debt to their adjusted EBIT. And this is pretty important for a company like WSP as it does tend to make a lot of acquisitions. So this leverage ratio is at the midpoint of their guidance, which kind of signals a company should have a lot more room for mergers and acquisitions in the future.

And this is, as I mentioned at the start, I mean, this is where it drives most of its growth at this point in time. Canada remains kind of the best performing business for the company. revenue up 9.6%. It has, you know, Canada is its highest margin business as well, EBITA margins of 24%. U.S. and Latin America grew by 5.1%. EMEA, which would be Europe, Middle East, India, and Asia grew by 3.7%. And its Asia Pacific segment actually had revenue declines of 8.1%. The other thing to note, too, is the overseas business, they have much lower margins. They're in the mid-teens, whereas in Canada, the U.S. and Latin America, it's like 22% plus.

So definitely the larger, more efficient side of the business. The Asia Pacific kind of continues to struggle. It's struggled for like multiple years now. I just think infrastructure buildout in that area is not as popular right now. But the other thing is it only makes up around 12% of the business overall. So the ones that are doing the best are the larger portions of the business. which is ultimately, you know, kind of what you want to see. They mentioned that Australia is actually one of the bigger drags

on the Asia-Pacific side of the business. So transportation infrastructure spending is declining. I don't really know why. I haven't really looked into that all that much. But they mentioned the second half of the year will be better, but they still do predict low to mid-single-digit declines in the Asia-Pacific area in 2025. But the U.S., Latin America and Canada,

segment should continue to perform as they are right now they tighten up their guidance towards the higher end of things so it didn't change its revenue guidance but its organic growth is now expected to come in at the higher end of things so it had guided to 5 to 8 percent they now expect that to come in on the higher end adjusted ebita to come in at the high range obviously with margins increasing like this it's obviously going to tune that towards the high end so their initial guidance was 2.55 billion so they're going to come in you close to that. I mean, I own WSP, so hopefully they come in above that. But, yeah, overall, pretty solid quarter. If it could get a bit of stability and growth, you know, in its Asia-Pacific

segment, it should be an added tailwind, especially, you know, if we see it continue to do as well as well as it has in North America. Yeah, yeah, I mean, it sounds like it was still a pretty a good quarter for the WSP, so one that I have on my watch list that probably stay there for a while because the valuation is still nosebleed. Yeah, it's five years. They're up 226%. That would include dividends. I mean, they've gone on quite a run. I can't remember when I bought it. It probably would have been a couple years ago. But yeah, it's, I mean, it's just a great company. It's kind of hard to be bearish considering just all the infrastructure build out right now in North America. And I mean, they're just they're killing it it's been expensive but it's it's been expensive for a long time yeah

yeah the peri case is probably like valuation compression yeah but yeah we'll have to see but i don't know i just have trouble pulling the trigger when valuation is that high i think it's it's pretty close to 50 50 public and private spending and i mean it's hard to imagine governments stop spending governments love to spend yeah yeah so uh yeah that's that was one of my the main reasons I ended up buying it. But yeah, very good quarter from WSP. In this kind of market, I like having some cash on the sidelines. It gives me the flexibility to jump on opportunities when the right stock goes on sale.

But just because the cash is waiting, it doesn't mean it shouldn't be working for me. That's why I use EQ Bank. They offer some of the best interest rate among Canadian banks, so my money's still earning while I wait. You can even get a boosted rate by setting up direct deposit for your payroll and depositing $2,000 or more per month into your EQ Bank account. Your cash stays liquid and ready to go when it's time to invest. And if you're not in a rush to access your funds, EQBanks notice savings accounts and GICs are great ways to grow your returns even more. It's a smarter way to park your cash.

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okay so let's move on here to bc so it's the first full quarter after vc announced it was cutting the dividend like we had been seeing saying for probably a year and a half at that point that they should be cutting it revenues were up a bit more than one percent which is the best quarter on their revenue growth basis since q4 of 2023 so it just tells you how rough it's been in terms of a business earnings were up six point six point six percent to 64 million. They announced that they closed the Zipley fiber acquisition on August 1st 2025 and that they updated their guidance to reflect the acquisition. It's also worth noting that about a week ago, they announced that they would sell their security and monitored alarm

assets to API Alarm Inc. The value of the deal is about 90 million guaranteed with another potential 80 million if certain conditions are met. And they have, a loss on the regulatory front, not only them, the big telcos are on the same boat here, where the federal government decided not to overturn a decision from the CRTC to expand old cell fiber access. I think BC it was pretty outspoken because themselves and along with the other big players, they kind of built out that network. And they were critical of this because they're saying, well, it's not really an incentive for us to make future investments with other companies can best.

benefit from it when we're making all the investments. So that's, uh, I'll let the listeners decide what side of the aisle you're on that. Anything you wanted to add there? No, no, I was mostly just looking as you were talking. I was looking how well it's done post-dividend cut. And it looks to be up around 15% since. Yeah. So I mean, it's, it's usually how it goes. Yeah. If you can't afford it, usually you tend to do much better after it's gone. Yeah, exactly. And if you're looking here, So for joint TCI subscribers, they'll see on the video. So I was looking, there's a couple of points here. So you're seeing, in terms of mobile subscribers, you're definitely seeing some growth there,

which is good because that would not have been the case recently. They added just shy of 95,000 mobile subscribers, and they churns or the turnaround declining by 12 basis point to 1.06%. The problem here that you're seeing is, the value, so the ARPU for mobile phone subscriptions is actually, it's gone up a little bit if you're looking from this most recent quarter versus the previous quarter, not the year year, but if you're looking at year, it's actually declining. And if you're looking at the last like three, four years, you'll see that the ARPOO per user is actually gone down overall. So yes,

they're gaining more subscribers, but the value per subscriber is not really trending in the right way. Yes, it's increased a little bit, but we'll have to see whether that continues the right way. So what it's just saying is they're just getting, they're probably getting some margin compression when it comes to mobile phone users. Yeah, I mean, there's just so much competition in the space right now. I mean, you bounce around from the big three telecom players. And I think it's also an element that a lot of people, now that money's a bit tighter, are not necessarily going every two years, signing a new two-year deal with a phone provider to get a brand-new phone.

They're kind of doing the bring-your-own device. Like, I think I was paying, while I was under contract with TELUS, I was paying something like $90 a month, and then I got off my plan and went to Rogers, like I bring-your-own device. I think I'm paying like $45. Yeah. Oh, yeah. It's crazy. It's crazy.

It's crazy. If you're willing to shop and you own the phone, you can get some really good deals because, you know, usually the competitor is what they'll do is they'll say they'll give you a good deal in the hopes that when you get a new phone, you'll stick with them and then they'll make some, yeah, some more money. So I think that's typically going to be the game plan. In terms of, so we'll have to see, I mean, it's good that they added subscribers, but again, there's still some softness in that Arpoo, and that's definitely going to be a good challenge here. added 27,000 subscribers to Fiber Internet. Overall, I'd say it would be an okay quarter. Not great, just okay here. There is some good news that BC has actually been reducing its total debt in the last two quarters, so it's gone from about $40.5 billion to $37.6. The issue there is the interest expense is still increasing a little bit, and that has been something that I've been pretty critical about for BCE is that

they should be using some of that money saved on dividends to pay down that debt more aggressively because the interest expense, I mean, it's over $400 million per quarter. So people can take a minute and just think about that. That's $1.6 billion a year and climbing because they're refinancing some of that debt at higher rates. So it is, it's still a challenge for BCE. The business is doing meh overall, not all that great. So you think they'd want to focus and get something that they can actually have some control over like interest expense, actually pay down that debt so they reduce that expense and help profits down the line. Yeah, they're kind of lucky that they got a buyer for the, what are they, they sold half their growth of the Zipley fiber acquisition because I think they ended up buying it and realizing that they didn't have the money to kind of fund the expansion themselves.

but yeah i think they teamed up with a pension plan i can't remember which one but i think that was it yeah and bc owns all the assets but the pension plan i think it's 51% of the future growth yeah they're giving them funding for it yeah yeah i mean it's they've made some really weird moves over the years i think the dividend cut the dividend cut was the best move they made and and i mean obviously it's it's not going to be an instant turnaround but they they kind of seem to be to be getting there to a certain degree, I just don't really know where the growth is going to come. I mean, you can improve the balance sheet all you want, but I mean, you're only growing revenue by a percent a year. I mean, I guess the growth would come from south of the border. Yeah, trying to expand

down there because it's a pretty tough environment here. Yeah, exactly. So I think that's their game plan. We'll have to see again, they remain pretty heavily levered. So I think they should still be focusing on just de-leveraging that balance sheet a little bit just to make sure that it just to me it's a no-brainer like but again no-brainer is for bc management is yeah well it's not like they think the most they think the most strategically over time it just doesn't make sense to me how they waited for so long like the amount of they could have reduced the debt by a decent chunk if they had cut just the dividend a few years ago but yeah i guess math is hard for executives over there. So I'll just stay at that. So now let's move on here to CargoJet. I know it's a company

that you've been pretty bullish on over the last few months and that you own in your portfolio. So do you want to do CargoJet or Shopify? Do we have room for two more? I would imagine Shopify is If you go quick enough, we might be able to do both. Yeah, I'll go quick. So yeah, I figure I'd talk about this one because I've been pretty bullish on them for the last while. The stock's up around 40% off its April lows and is actually having a pretty good run. So revenue increased by 3.2% and earnings doubled. Earnings are kind of all over the map with a company like this because of a lot of cash outflows they're having to do for aircraft maintenance, new aircraft purchases, things like that, depreciation, all that type of stuff. But if we look to a chart of trailing

12-month earnings per share, it's definitely trending in the right direction. So one of the main reasons I was bullish on this company, primarily just because of, you know, the tariff situation and probably an increase in domestic activity, first from just overall shipments directly to Canada versus, you know, through the U.S. and into Canada. And on second thought, kind of the, you know, potential removal of trade barriers between all the provinces. And it's definitely doing well in that regard. So domestic revenue increased by 14.4% year over year. And charter revenue increased by 21. 1.3. But their ACMI, which is aircraft crew maintenance and insurance, so effectively they

they pretty much rent out the aircraft, the crew, they maintain it and they provide the insurance. That actually fell by 9.6%. And they said the bulk of this was due to some weakness in Europe because of the overall trade uncertainty with the United States. The company does expect to pick up in the back half of the year. It also says it plans to ramp up its e-commerce charters to China. Right now, they're at about three planes a week. They didn't state how much it will increase, but they do expect it to increase in the back half of the year. And I mean, one of the big pieces of news on the quarter and was actually the reason why it went up so much was the deal with Amazon. So they extended their Amazon contract by four

years to go through to 2029 with Amazon having the option to extend it to 2031. So just a quick overview, like Canadian. Yeah, it sounds like Amazon is not in the mood to invest in aircraft. Well, they can. Like, it's, that's why cargo jet is so protected to a certain degree, because in order for them to actually have a charter here, like, they need to be majority Canadian-owned. Canadian, yeah, that's right. Which is why, like, there's so many regulations that prevent these big companies. Like, I would imagine if those regulations didn't exist. Yeah, Amazon would just enter the space, but it's very hard.

I don't know. You think it would? Like, it's very different to manage, like, you know, an aircraft and stuff, I guess, yeah. Or even if you're leasing it out, like, it's very different than having a. a fleet of kind of vehicles like i don't know to me that i'm not sure if that's necessarily something they would want to get into although i could see them get into drones eventually yes yeah and i mean who knows there might be regulations in that regard but i mean like that's the interesting thing about cargo jet it's a small cap stock but it's moat is just it's so wide because regulations just kind of protect any company from entering so they extended that deal to who while

potentially 231 and they also extended their agreement with DHL to 2020, 2020, so 2033, sorry, I don't know, I was misreading that, but DHL gets the ability to purchase up to one million shares at $93 per share, so they issued some warrants to them and they will have to deliver $3.2 billion worth a business volume over the next year. So Cargo Jet has structured a few deals like this, particularly one with Amazon back in 2019. I think they gave Amazon the option to purchase up to, no, you know, 9.9% to the company or something like that. Companies had to lay out quite a bit of capital expenditures in recent quarters to expand its fleet in China and also run a bit of maintenance on

its aircraft. So leverage ratios have crept up a bit because of this. However, it does expect to sell off some older planes over the next while here and pay down the debt. So they should get the leverage ratios back to where they were. The company mentions that the sale of the assets should bring in around 170 million in cash, which kind of offsets the negative free cash flow. They've they've kind of incurred throughout the year. So it is pretty important when you're looking at these companies. I mean, you're going to see them post-free cash flow losses during particular quarters for, you know, heavy maintenance, heavy expansion.

I mean, it's, you kind of got to look at them on a trailing 12-month basis, long-term basis, things like that. But overall domestic activity ramping up, the company is investing more into flights to and from China. And it's not necessarily a long-term hold for me, but more so of a mid-term hold to kind of, you know, take advantage of. a potential ramp up in domestic activity. ACMI is a big chunk of their business. It's also one of the higher margin portions of their business. And if we get some trade deals in that regard, I imagine, you know, activity will pick back up overseas in that regard.

But, yeah, it was a pretty good quarter. I think it did fairly well post-earnings, probably flat. But, yeah, it's an interesting play. Yeah, exactly. It's an interesting play. I keep an eye on it because you won't shut up about it. So that's usually, it's like the same thing like Brayden would never stop talking about consolation. So I keep an eye on that for the same reasons, although I wish I would have bought that.

But yeah, let's move on here to Shopify. So Shopify, I mean, really good quarter. Very good. Yeah, very good. They really just crushed it. A company that I've owned on and off, unfortunately I don't own it now, I sold it late last year, probably should have kept it. when things I thought were getting pretty frothy and what the hell did I know

things would get pretty frothy once again but Shopify is delivering so it's hard to not like what they're doing but the valuation is definitely not for the faint of heart so revenues were up 31% to 2.7 billion GMV which is the gross merchandise volume was up 30% to 87.8 billion that just means essentially the merchandise that is sold on its platform

that's only 7% behind Q4 of last year, which is really impressive because Q4 is the holiday quarter, and that is by far the best quarter of the year every single year. So the fact that they're only 7% behind then is pretty amazing on a GMV, and Europe did exceptionally well with GMV being up 40%. They also mentioned on the call that was interesting is that more and more large businesses are actually adopting the Shopify platform. So they mentioned by name, Starbucks, Canada Goose, and Burton snowboards are migrating to Shopify, which is, honestly, it's pretty impressive, especially because these are well-established

businesses that could very well just run their own platform. And I guess have been, and they just decided it made more sense to go with Shopify. Yeah, it's like Shopify for quite a while, it kind of been like, you know, the small to medium-sized business. attractive as wise, you know, you can get an online store set up and, you know, like a day or two and kind of start selling products. But the fact that, you know, like it's, it might seem like, you know, Canada Goose isn't really all that big, but I mean, it's a multi-billion dollar company that's going on the platform. So it's, it's definitely notable. And on the, it's not your local bakery. Let's just say that. Yeah, exactly. Yeah, which has been obviously during the

pandemic when a lot of them had to shut down those smaller retailers, they turned to Shopify, but Yeah. And I know their gross payment volume, which is like the amount of money, it's their gross merchandise volume, but the amount of money that goes through Shopify payments, like that's increasing as well. And obviously, that's better for Shopify because they're, they get a take rate from that, obviously, because they're, they're kind of operating the payment platform and that. But it's, it's a much larger chunk of revenue than it used to be, which is, which is obviously going to be more profits. Yeah. So I'm sharing here, the gross payment. volume so you it was 41 i believe 41 billion i'm just making sure i have the right yeah so it was 41 billion last year for the same quarter and now it's 56 billion or almost 57 for this quarter so yeah the kind of uh probably close to 40 percent increase just over one year and that that shop pay right that uh you see for a lot of merchants so that's that's actually the Shopify platform. So again, still impressive. And they're integrating, I think what's really cool

is they're integrating AI into their business in all different kind of way. They mentioned AI agents to search their entire catalog of brands for a specific item. Apparently now you can just search for a specific item that'll bring you all the different options from different vendors and then you can just have one main cart regardless if you buy a pair of underwriting, wear from let's say the lemon and you buy shoes from Nike doesn't matter you can all have in the same card so which is good because it's really helping the user experience and they also have some new tools available that leverage AI for merchants they have tons of new tools available including some that allow merchants to quickly get data to improve their operation which is probably

why it's becoming such an attractive platform because you can really improve your efficiency especially for smaller businesses, but I'm sure the larger ones will also be benefiting from that. And in terms of the payment side that you had mentioned, they also partner with Coinbase to offer USDC. So that's a U.S. stable coin, which they're offering via the shop pay payments. Their point of sales, so they're offline business as they describe it. So things that are competing with, I would say, like a square, for example, or even lights, would be another company they're competing against there.

That was up 29% and this is why I think Lightspeed will have a very hard time in the future. This is like this company, Shopify is the reason. Like if you want to single out one company and forget about Square, Shopify is the reason. Like they have such a massive ecosystem.

They can offer so much more than I think Lightspeed will. Not that Lightspeed is not a good solution, but when you have a kind of growing massive company that's investing heavily that has a lot of resources in the knowledge to know it how on how to do it and all these other option that they have including shop pay how can you compete with that unless you're competing on pricing if you're a company like light speed yeah they they've definitely kind of ate their lunch i guess you would say i mean it's they're just such a more efficient better platform, I guess. I mean, in regards to the AI developments, I mean, yeah, like way back in the day,

I helped somebody out on the retail side of things online and like doing product descriptions and all that type of stuff. I mean, they're platforms now. I mean, you can effectively put the product on and it'll know what it is and it'll auto output that, which I mean, they just do so many things that save merchants so much time, which ultimately makes a subscription that much stuff. stickier because I mean time is money ultimately and if they can make it easier to get a shop up and running which it's crazy easy right now they're just going to get more and more clients especially big clients yeah yeah exactly so I think it's just going to be difficult for companies like light speed in that point of sale yes they do omnichannel so yes they have like a suite of offering don't get me wrong but I think it's just knowing enough about the two businesses it's not comparable. of the other things you can do.

It may be a bit better still light speed for certain niches like golf courses and stuff like that. Maybe a hospitality. Maybe that's a little bit better. But I would not sleep on a company like Shopify potentially bettering their offering to capturing some of those other markets

that may be where Lightspeed probably has a bigger presence over time. So I just, I find it a bit hard to like own a company like Lightspeed when you can own that. company like shopify that's yeah it's where i'll end it here yeah and it's yeah it's the largest company now again in canada that was uh one of my one of my bold predictions but it's got to hold it first hey i don't know we'll see rbc tends that maybe they'll finish a year strong so we'll have to see yeah the one the one thing i will say about shopify because i've had a lot of comments on people because obviously it's getting back to those 2021 prices yeah and a lot of people are kind of

talking about how expensive it could be. And they kind of look at that chart and probably think, oh, it's back to 2021. It must be as expensive as 21. It's not even close. Like back in 2021 at those peaks, it traded at 50x EV to revenue. And right now it's at 18. So yes, they're the same price, but valuation, it's not even like you could argue that like 18x enterprise value to sales is still expensive, but it's not as expensive as it was back in COVID. It's, It's grown a lot since then, whereas, you know, that COVID situation was probably a bit of a bubble in regards to a lot of lockdowns, a lot of merchants using the platform and that being expected to grow moving forward and it ended up not growing moving forward. But, yeah, valuations are not the same as they, as they once were in 2021. Yeah, and I would assume, too, that I'm just looking at free cash flow basis, like they're pumping way more free cash flow than they, they, they, they.

were doing back then so if you look well they were probably cash burn back in yeah they're generated well they were generating i remember them generating it for a little bit so for the most part they started being free cash flow positive back in 2019 although barely and then generating around which i around 400 million 500 million 2020 and 2021 then free cash flow negative for 22 and then back in free cash flow positive territory and then back in free cash flow positive territory and just kind of just going from there. So 23, they were looking at $900 million, $1.6 billion last year, and then the trailing 12 months, $1.8 billion.

So, yeah, not looking too shabby for Shopify. Yeah, it's not the same, well, it's the same company, but it's not the same prices. A lot of people were paying in 2021, that's for sure. Oh, yeah, you're looking at a way more profitable company than back then. So, no, I think this is a good point to end it. It was a fun episode, definitely. jam packed. It's always fun to get a lot of earnings. I rather have too much to choose from

than not enough because then we have to get pretty creative. But I hope you enjoy the episode. If you'd like to see the full videos, our portfolios, my parents are portfolio update, which is coming probably today the day you'll be hearing that or Friday the 15. Usually it's the 15, but we are renting a cottage for a few weeks. So I'm probably going to get it out a bit in advance you can get there at that there as well and i try to get back to people within a day or two max whenever they have questions i'm usually checking on the platform so it helps us support us and the pricing will be increasing from nine dollars we haven't finalized the actual price but it will be going up in early september so if you're looking to get the subscription get it now and

you'll be grandfather into the price so aside from that we appreciate the support you also last thing I forgot to mention, you get the ad-free podcast on there that you can add to your podcast which I know a lot of people enjoy. So thanks again for listening. We'll be back for a regular episode on Monday. The Canadian Investor podcast should not be construed as investment or financial advice. The host and guest featured may own securities or assets discussed on this podcast. Always do your own due diligence or consult with a financial professional before, making any financial or investment decisions.