Air Canada (AC.TO)

(A Top Pick Feb 05/19, Up 42%) Integrating Aeroplan went smoothly and low oil prices helped. Taking out Air Transat would really be accretive to AC. But the grounding of the Boeing 737 could impact AC by creating tighter capacity and higher plane tickets. The biggest concern is the overall economy, though he expects the economy to remain positive.

(A Top Pick Jul 27/18, Up 89%) Great job of investing in their business, expanded internationally, grown loyalty plans, new AmEx platform. Great modern fleet. Acquiring Transat. Too late to get in now, based on the economic cycle.

Its fair market value is much higher than its stock price. He's followed this a long time. Historically, AC has peaked out twice. If it breaks out over $40, AC could reach $55. You could short the stock when it gets there.

Airlines have been very volatile. He is cautious with the airlines. AC has been doing well and their recent Air Transat acquisition should be good if it indeed happens. There is a good prospect of growing earnings over the next couple of years. However, if you believe there is going to be a recession soon, then avoid this stock.

It will be interesting to see what happens with the acquisition of the Air Transat airline. Everyone is very cost competitive so he does not like airlines. There might be a bump here. If we are serious about climate change, then air travel is a major contributor. There may be a little money to be made short term on the news, but long term he would not touch them. With the Acquisition of WestJet, things are really getting shaken up in the Canadian Airline industry.

Likes this chart and he has recommended buying AC around $32. The Onex-Westjet news pushed this up, but it will trend down a little. A strong chart.