Aecon Group Inc (ARE.TO)

(A Top Pick Jan 18/17. Up 31%) This has a takeover offer on the table. At the time, it was compelling on a valuation basis relative to its peers. The infrastructure assets look very good, but had also thought he saw a turnaround coming in mining and energy.

A Chinese company is offering to acquire this at $20.37. There is still uncertainty. If you own, he would consider selling some of your holdings.

(A Top Pick Sept 28/16. Up 13%.) About to be taken over by a Chinese buyer, but he tends to think the government will step in and block the sale. He likes the whole space. He would come back to this in a heartbeat if the deal fell through.

It is trading at a bit of discount to the price being offered by the Chinese. There is some doubt that maybe they will not be allowed to be sold to the Chinese. He does not own it and has another pick in the group. You have probably made money on it and could sell half to lock in profits in case it does not happen. It is 80-90% and not 100%.

They are very well positioned to take advantage of more public infrastructure spending. They were looking at selling the company a while ago, but if it were to be sold, it would be closer to $20 than where it’s trading today.

Chart shows a series of higher lows, but no higher highs. Like all construction stocks, this is very volatile. 2 words of advice. 1.) Don’t put too much of your portfolio into a stock like this. 2.) If there is good news and the stock picks up, remember to take your profits. Dividend yield of 3%.

The longer term trend is up. It is coming off the bottom of its trading range. As long as it stays in the general uptrend, it would stay with the story. You have to put up with the volatility.

A good company. Results are a little weaker than what he would like. They used to earn a 9% ROC, but is now down to 5%. It doesn’t look that cheap right now.

(A Top Pick Sept 23/16. Up 1%.) Had thought at the time that 2017 was going to be an off year, but anticipates very good growth for infrastructure beyond this year. They just put themselves up for sale. Trading at around 6.4, and he thinks it should fetch a multiple of around 8.5 if it gets sold. Very good balance sheet.

(A Top Pick Feb 17/16. Total return 7%.) Convertible 5.5% bond due Dec 1/18.

He doesn’t know the seasonality of this particular stock. However, the company has been in the news in the last little while, as they have put themselves up for sale. The technical impact of this is very positive. The stock had been in an upward trend for the past 8 months, and on that news, it broke into a new high. It has overhead resistance at around $19.30. Looks quite interesting at current prices.

He is positive on the construction side. Prefers SNC Lavalin (SNC-T), who also has a broad range of services to offer. Anybody in that business is going to do well in the next little while.

Has just announced that it is exploring a potential sale of the company. If you own it, he would wait to see what happens. Construction is a lumpy business.

The breakup value of the company is around $21-$22. He would hold on for sure right now because they are entertaining offers. The stock is not up that much yet. Watch it like a hawk and if you see it at $18-$19, then that is when you consider selling. He holds SNC-T. ARE-T is primarily Canada and is cyclical. It has the most energy exposure.

Convertible 5.5% bond due Dec 1/18. (Top Pick Feb 17/16) He got out several quarters ago. It had run up and was just yielding 4%. He could reload if it ever came off.