CCL Industries (B) (CCL.B.TO)

Had owned this from $36 to over $200, but sold it recently and bought Winpak (WPK-T) which he likes better. It has more organic growth and trades at a lower multiple. CCL has done a great job integrating acquisitions. A very well-managed company, but finds it very expensive right now.

A great company. It has been a wonderful company to be invested in for years and years. It is difficult sometimes for institutions, because it is not the most liquid stock on the board. It is a cash flow machine. They take the cash and they make acquisitions in what is quite a fragmented industry. There are lots and lots of companies that they can buy. Their acquisition in India is quite interesting.

An outstanding CEO who has created an enormous amount of value. Their core business of labels is outstanding. They generated outstanding returns. Keep in mind that some parts are cyclical and some parts are declining. It is really the core that matters. Over time they will be able to continue to improve margins across segments, and have healthy organic growth. Dividend yield of 0.8%.

This has a history of moving higher, normally from around November of each year through until April. Technically, the stock is in an upward trend and is outperforming the market.

Great company. They continue to grow by acquisition as well as organically. 1998 was the last time they issued stock. They are going to do a 5 for 1 split, which is being voted on in May. The splits have nothing to do with math, but everything to do with psychology. Dividend yield of 0.79%. (Analysts’ price target is $325.00.)

Sell or hold? People can make mistakes by holding onto stocks too long and letting them get too big for the portfolio. Bad stuff can happen even to the greatest names. Trimming is never the worst idea. You have to judge your emotional tolerance to risk versus your risk tolerance to the entire portfolio and your comfort level. He likes this and if there were a pullback, he’d be happy to buy a lot more. Thinks there is lots more runway for growth.

(A Top Pick Aug 29/16. Up 12.19%.) A tremendous Canadian growth story in the last number of years. They are in containers, polymers. Recently announced an acquisition of Innovia which is likely to be 14% or 15% accretive to earnings. Innovia is the undisputed market leader in polymer banknotes. Polymer banknotes are still in their infancy, so while Innovia has a 95% share of the market, polymer banknotes only have a 3% penetration amongst all banknotes worldwide. Lots of runway.

This has done tremendously well. Recently announced a fairly large acquisition of a UK company that is involved in making plastic banknotes. They have a consistently high ROE. If your time horizon is greater than 3 years, this would be a Buy.

(A Top Pick Aug 29/16. Up 8.21%.) This has been a tremendous “shareholder value” creator. It is in labels, printing, containers and packaging. Had a very nice bump in December when they announced the largest acquisition in corporate history of Innovia.

A packaging company for a lot of consumer products. Has done extremely well over the last couple of years. As long as the Cdn$ stays weak, it is a nice tailwind for them. There are some US competitors, so there may be some US legislation coming down which may drop the US tax rates from 30% to 15%, which would make the US competition a lot more competitive.

He believes the uptick will hold because the acquisition will be accretive. In this case their acquisition is about a new way to grow rather than about new cost cutting. This is a decent stock to own. He thinks they will gradually pay down their new debt.

The biggest reason for the decline is because of the rotation from consumer staples into other areas. It has been executing very well. Trading at reasonably high multiples, so if there is any sort of rotation or poor performance, the stock price will be under pressure. Given their track record, he thinks they will get back on track. If you have a horizon more than 6 months, you could do very well with this.

A great company. At times, it is a more defensive play. If we are into a world of a more cyclical environment where industrials, technology and financials are leading, it may underperform a little. They’ve done a wonderful job of building this business. It could be a company that will be used as a source of funds.

There is an uptrend over 3 years plus. You want to buy it at the bottom of its trend channel, which is where it is approaching. A couple of dollars more and it will be there.

There is a rotation going on. CCL.B-T shows up in a materials index, so if the index is running, managers need a source of cash so sell this one.