CRH Medical Corp. (CRH.TO)

He is generally negative on the rollup space, because it is a business that relies on having a high valuation in order to acquire other businesses. As soon as that game stops, the stocks can have a long way to fall before finding a bottom. This one is a little different in that they managed to not get caught up as much in the selloff. Because of that, it’s price momentum is quite good. Valuation is reasonable, which is unusual for a rollup. He doesn’t have a position in this, but it is on the cusp of being a Long for him.

It is in the right space. Technically it has been a tough go for medical last year. It is one of the few sectors that is in a secular bull market. There is a downtrend that may have broken. This would be one you could add to. There will be some resistance until $5.10.

Colonoscopy clinics. His 5^th largest holding. Just delivered an excellent quarter. Very attractively priced, and run by a very honest management team. A very clean model of a health care stock. ROE is about 33% and P/E ratio is around 11%. Doesn’t believe there will be any equity financing, so no dilution going forward. Can’t think of a better company to own.

A great little company, and thinks they are going to continue to execute the way they have. Made a big transformational deal in 2014, and now are adding on small deals as they come across them. Doing this all with cash flow. You should continue to see earnings numbers increase as they make acquisitions. Has broken down on a technical aspect, but he is watching it closely, and at some time would like to add it to his portfolio.

He is looking for support and resistance, and this is in the very tight channel. At $3.59, you are probably dealing with a $4.50 upside right now. The downside is quite good at around $2.80. It doesn’t look like a trade, but something that you would continue to Hold.

They have gone through some lumps. Analysts are expecting earnings growth of 69%. It looks like they finally turned the company around. 14 times PE.

Owned this in the past, and has his eye on it. The larger part of their business is providing anaesthesiology services to gastrointestinal doctors who are doing mostly colonoscopies. The majority of their business is done in the US. Attractive at these levels.

He likes this. It has been fairly strong over the last couple of weeks. Good management team. The cash flow from operations should rise quite a bit this year. Probably trading at around 8X 2016 EBITDA. If you are going to own something in this space, this is a go to name.

(A Top Pick Dec 24/14. Up 126.47%.) Still a Buy. ROE is over 30%. Trading at about 8.9X earnings and 2X Book. Funding all their growth through their own cash flows. Showing all the signs of becoming one of the great stocks.

Colonoscopy clinics. Great company. Good management. This is his best guess of an emerging compounder. Trading at 8.9X earnings with a 33% ROE.

They were tarnished by PHM-T. A lot of investors have gotten out of healthcare, concerned multiples will continue to contract. CRH-T’s business has continued to grow. It is one that if you are patient and you pick it up here, as multiples expand in the sector, it will go up. Healthcare is going to be a long term growth area. Watch for momentum to change if you are a mid-term investor.

It was a hot stock and had a nice trend, then there was some deterioration and now there is support at $3. If it bounces off it then it should be okay, but it could be putting in a top.

This has probably held up the best of the Canadian healthcare stocks. Has a very interesting business, and is significantly different than Concordia (CXR-T) and Valeant (VRX-T). They have a process that helps doctors fix haemorrhoids and have a huge database of doctors who use their product. Have now gone into anaesthesiology. When people go in and have the G.I. process done, they need to be sedated and the company has been doing some consolidation in this sector.

(A Top Pick Dec 24/14. Up 128.24%.) A less risky model than other healthcare stocks. Very blue-chip, solid, well-run company with a 35% ROE. Trading at 8X earnings.

Treatment of haemorrhoids. Stock is declining because earnings estimates have been shaved by 15% in the last 90 days. The advantage is that no surgery is required compared to other methods. Trading at 18X PE for 2016. Analysts are expecting earnings to grow from $0.10-$0.22, but estimates have been shaved 15% in the last 90 days, which is why the stock has been drifting off.