Welcome.  This is going to be quite a ride.

Breaking up Is Hard to Do

Canada and the US are essential now broken up and just like a reality show sit com on Netflix, the insults are flying.  Just yesterday the Premier of Ontario Mr. Doung Ford, thought he found a pair to throw insults at the US president.  Not very helpful, although it likely felt good, Mr. Ford continues to have a Big Hat but no Cattle.  He doesn’t do anything.  I doubt he has what it takes to actually take action.

Just today I asked him through email to eliminate all Ontario provincial tariffs on Canadians.  Nova Scotia the same.  I doubt anything would change.  Why would the premiers unlock 200 billion dollars a year in trade that Canadians can do with themselves if they don’t have to?

I also was successful in ordering one case of wine from a BC winery last night.  It was my third winery.  The other two wanted a crazy delivery fee plus their websites payment systems were inept.  We as Canadians have been lulled into lack of productivity and laziness because of our proximity to the US.  We need to step it up if we want to survive.

This current break-up is just noise if you aren’t directly impacted.  But what is sad, is the failure of Canadian “leaders” to seize the opportunity, eliminate provincial tariffs and barriers and thrive.  For investing, this doesn’t change anything for me other than happy I have gold and continue to buy it plus the land banking in real estate.  Inflation is now out of control, and it looks like interest rates in the US will have to rise again.  Housing continues to be toast in Canada, and we aren’t seeing any flattening of that drop.  It’s going to be a long painful period, but that is fine if we work to learn from this.  I’m not sure our leaders understand that.

What Changed My Mind

AI has been a significant topic of past letters.  I’ve worked with it for the past two years to help me count bees in my environmental research (AIbeehealth.ca) and also as you know to help crunch investment numbers.  I also developed and started an AI company to basically clone my brain to help people around the planet with stress, and the weight of life they may be carrying (AskHank.ai).

But something has changed.  My platforms that people can use under the AskHank portfolio sit on top of Open AI.  That is the Large Language Model, that listens to my instructions and follows the guidelines to provide answers to specific questions.  But as their model changes I wanted to see if there were other options for a model.

So I asked my consultant who indicated it was quite complicated, so instead I asked AI to create or find me an AI to replace itself.

Here is where it got quite interesting.  Within a couple of days, I was able to create an AI platform that sits in an older computer in my basement that answers my questions and does analysis without leaving my house.  I added a $180 RAM to the computer and that was it.

So I was able to replace the Open AI platform myself.

Let that sit for a minute.  A Seventy year old guy with pretty much zero knowledge in computer programming was able to create something to replace the need for Open AI.

Without boring you, I used three different FREE tools.

Anything LLM, LLM Studio, Mistral, my knowledge and instructions combined to create my own system totally independent of any other models or the web.

With a remote connection, I can access that computer as if it were a server anywhere.

Again let that sit.  Now the next part of the news is that it worked, adequately enough for me to use it to do some analysis.  It’s not perfect, a bit slow so far, but useable.  Each WEEK new versions of Mistral and hundreds of other open software sources are being released.

I didn’t need a server from Alberta or Utah.  I didn’t need one of the other huge systems out there.

I didn’t need Microsoft, Open AI, Elon’s system or anyone elses.

Let that sit for a minute more. Within six months or less this will be easier and easier to do.

AI LLM’s are dead as a business.  I thought they would eventually become a commodity but that has changed as well.  They all will be FREE.  There is no money to be made in FREE.

The second part that is even more changeable is the fact that AI is becoming obsolete.  It is too smart for humans and in many cases has surpassed it’s usefulness because of that.  A significant number of high IQ humans have always dropped out of life.  There intelligence far surpassed the ability of most of us to understand them.  There skills or pockets of giftedness are also far beyond what most of us understand or need.

So two changes in investing that is supported by this new information.

Software unlike AI is not dead.  Software as a solution solves a human problem.  AI may help it be more efficient, or cost effective, but the use and the original case still exists.  Over engineered solutions are not helpful.  Fine tuning with AI is more likely than replacement of SASS applications.

Chips and data centers are being over built in my opinion.  If I can have a three year old computer run in my basement as a server, what does that say about the need for these complex models in huge data centers down the road.

We don’t need them.

Just like the abandoned battery plants in Windsor Ontario, you will be able to buy them for a buck or two.

So there is my Change for this month.  Ai as we know it is dead.  The need for huge data centers will gradually become extinct.  AI for the sake of AI is useless.  Using it daily thinking it is helpful for most of us dulls our senses and brain.  It’s a tool.  The AI crash is coming if it is not already upon us when you read this.

Now I thought of shorting the market on the LLM’s but there are not any pure plays that are publicly traded and it goes against my investment philosophy.  Twenty year old hank did puts and calls, Hank at 70 does not.  While I still use Open AI as the engine for the Ask Hank platforms, I continue to research a variety of other options.  I have proven that the knowledge base I’ve developed can work with any engine, regardless of where it sits.  That is an exciting development for the advancement of Ask Hank as a company.

What I’m buying, holding or selling.

I purchased more shares of COVEO given their beaten down price and what I believe to be an undervalued company.  I have their analysis in the folder for this month as well as their annual statements that I used.  I also took a small position in Judges Scientific plc and purchased more shares in Canadian Apartment Properties Real Estate Investment Trust.

I came close to making another error that I will now explain.  With the price of everything continuing to go up and the increase in government debt sky rocketing, I do believe interest rates need to be in the 10% range.  They are not of course.

So I looked at a way to purchase an equity or option on that belief.  Now again, I was pulled into the options world, and for one day purchased TBT the ProShares UltraShort 20+ Year Treasury ETF.  What this does is go up significantly as interest rates rise and bonds drop.  It is adjusted daily and highly risky.  I was a momentary idiot as I call it.  I kept the position for a day and then vacated it.

Here is why.

It was just dumb.  Even though we are talking “just” $13,000 purchased as insurance, it was very risky.  While I am about 95% sure costs will continue to rise, what I can’t understand is the ability of the US President and others to manipulate those rates.  Sure enough despite the evidence the FED chose to keep rates the same on July 29.  Despite that decision, interest rates rose and bonds dropped.  The Fed doesn’t know what they are doing.  This leads me to the 5 statements you need to consider to maintain and improve your mental health.

Life is not fair.

Bad things happen to good people.

Some things in life you can’t control.

You did the best you could with what you knew at the time.

If government leaders truly knew how to do something well they wouldn’t be in government.

#5 has been keeping me more sane than usual lately.  The Fed has no clue and the president can manipulate or pressure people to achieve his objectives.  That is clear.  Evidenced by his selling advanced tweet information to hedge funds and investors for just $100,000 US as discussed.  It’s a fixed system, so knowing that prices are rising means, yes someday interest rates will rise.  But being right at the wrong time is still being wrong.  I have no idea when the fix will be up and true markets will return.  I need to investigate how I slipped into idiot investor for a day.

I sold the TBT ETF’s for a few hundred dollar loss and just purchased some more COVEO stock.

Stock Analysis

So in keeping with buy what you know, I had a look at Telus recently.  I use their service on my phone.  I’m also interested in their digital platform linked to healthcare.

The full analysis and annual statements used can be found in the attached folder.

You can find the one pager in the Appendix.  Not something I’m comfortable buying right now.  Too much debt, bad management and some stock dilution.

My possible Compounding List

I started to dig deep to find stocks that may resemble a similar patter to Constellation Software.  I took a small position recently in Constellation when the company got smashed because of AI issues.  Here’s the list I’m working on.  I took a very small nibble on Fisher Scientific, but nothing to speak of.  I still have to work on the others and will share my results in future newsletters.

Possible Compounders

1.      Fisher Scientific

2.      Halma

3.      Constellation Software

Failures: Telus, Perimeter Solutions, Bridger-Total stench and stink, details in the folder below

I have included my work sheets, company reports and other information in the link below.  If you want to run your own askhank.money analysis, just download the three years of financial statements from my folder below and enter the stock price. 

You can find my work and the documents here:  https://www.dropbox.com/scl/fo/3k53vuz1yaui5v7b56pf2/AOMRhVFCyj-A3AHU2rYsIVY?rlkey=1xyx8enmskuo0d9ck1pqd8p66&st=a82qyj4b&dl=0   

In the October edition I’ll have the results of my research on using AskHank.money to research 150 public companies, in the past to see how good a job askhank.money can do in picking losers and winners.  Till Oct. 1 Bee well.

Hank

This information is for Educational Purposes only.
Do not make portfolio changes without speaking with your financial advisor.
I am not a financial advisor.

Ask Hank™ — TELUS One-Page Summary

Date: August 11, 2026
Current Share Price: C$13.36
Analysis basis: 2023, 2024 and 2025 audited financial statements plus Q1 and Q2 2026 interim statements. No estimates or outside financial data used.

What the Numbers Say

Cash flow is the attraction. Trailing free cash flow was approximately C$2.313 billion, equal to roughly C$1.47 per share. At C$13.36, that produces an 11.0% Hank Cap Rate.

Growth quality is weaker. Revenue compounded only 0.96% annually from 2023 through 2025. Common equity declined slightly rather than compounding.

Dilution matters. Common Shares increased from approximately 1.468 billion at year-end 2023 to 1.575 billion by June 2026, an increase of roughly 7.3%. The small NCIB did not offset total share issuance.

Debt remains the central financial risk. Net debt was C$25.963 billion and leverage was 3.5×, above TELUS' stated long-term objective of 2.5–3.0×.

The dividend reset changes the story. TELUS reduced its annualized dividend from C$1.6736 to C$0.75. At the current price, the new yield is approximately 5.61%. This preserves significantly more cash for deleveraging, but the reduction confirms that the previous capital-return structure had become too demanding.

TELUS Digital is the major capital-allocation scar. Q2 2026 included a C$2.135 billion non-cash impairment of goodwill and intangible assets associated with TELUS Digital. It materially reduced common equity and must be taken seriously even though it did not consume current-period cash.

Related-Party / Governance Review

Routine disclosed items included key-management compensation and pension-plan administrative services.

The item requiring the most monitoring was TELUS' C$157 million cash purchase of a commercial parcel from the TELUS Sky related real-estate joint venture.

Key-management compensation increased to C$82 million in 2025 from C$70 million in 2024, while H1 2026 compensation was C$59 million versus C$44 million in the comparable period.

Specific related-party landscaping, paving, HVAC or similar contractor payments were:

Not disclosed in the uploaded financial statements.

Munger Inversion — Why Not Own It?

The case against TELUS is straightforward: slow revenue growth, high leverage, dilution, a dramatically reduced dividend and a major TELUS Digital impairment.

The counterweight is also straightforward: the business continues to produce substantial operating cash flow and the current price produces an approximately 11% free-cash-flow yield.

Graham Check

Using audited 2025 EPS of C$0.73 and book value per share of approximately C$10.18:

Graham Number ≈ C$12.93

Against a current price of C$13.36, TELUS is approximately 3.3% above the mechanical Graham value.

Graham conclusion: roughly fair value, not an obvious deep-value bargain.

Ask Hank™ Bottom Line

TELUS at C$13.36 is a cash-flow value situation, not presently an elite compounding situation.

The strongest number is the 11.0% Hank Cap Rate.

The weakest combination is 3.5× leverage + dilution + weak revenue compounding + the C$2.135 billion TELUS Digital impairment.

What would improve the score is not a story or forecast. It is measurable evidence in future filings:

Lower net debt. Lower leverage. Stable or rising FCF per share. No material dilution. TELUS Digital stabilization. Common equity beginning to compound again.

Ask Hank™ Score: 56.5 / 100

Classification: Value appearing — hive still under repair.