Canadian Tire Corporation Ltd. (A) (CTC.A.TO)

This is high quality, and the market that it targets is quite mass and wide, which he likes. However, he is quite bearish on the Canadian consumer. Household debt levels are at all-time highs and consumer debt is at around 165X income. Anything in the consumer discretionary space is going to be challenged in the coming years. There is still more potential downside on the stock.

This is in the more cyclical sector of consumer discretionary. The sector runs from October all the way through to May. The summertime is the off period for something like this. Technically the 200 day is still pointing higher which implies the momentum on a long-term basis is still positive. This is a seasonally soft period and you want to be looking at buying this in October.

This company has been amazing. They have done really, really well. They got the Forzani group. Have spun off the real estate trying to recognize some of the value. Have had a lot of competition over the years but they seem to rise to the top. The only trouble is, they don’t have the dividend yield that the banks have.

Spinning off the real estate showed investors there was hidden value in the stock. They have been very good as a retailer at offsetting the threat of Wal-Mart. They have great locations. They have great loyalty. He has never stepped in, but hopefully some day it backs off.

Screens quite well on a valuation standpoint. They are doing all the right things. He likes that they are doing a meaningful share buyback. The Sports Chek acquisition was a wonderful one. Thinks they have wrung out all the best parts of the company. If the family does not cash out, it is going to be a slow grind from here.

This typically has a nice move from the beginning of January into the spring time, and then after that they have difficulty. This one, as well as the retail sector in general, tend to have problems as we get into the summer. Technically it is not looking great right now because it is starting to show signs of rolling over. Very close to its 20 day moving average. If you are a longer-term investor, this is a very interesting and attractive stock, so stick with it.

They are buying 12 leases off Target. He used to own it and sold, but perhaps should not have. He is excited that they started to buy back stock. They are generating cash they don’t know what to do with. Marks Work Warehouse worked out well for them. He likes what they did with the real estate spin off. It has not gotten as cheap as he would like it to be. If it did he would be all over it. If you own it continue to hold it.

A really strong retailer in the Canadian marketplace. Not too sure if they will really benefit from Target (TGT-N) leaving as they didn’t seem to get hit while it was in Canada. They are well-balanced across a number of their different platforms. Looking at the valuation relative to its level of profitability, he doesn’t see a lot of upside. He would want to be buying in the $90s and selling in the $120s.

He likes it here. It has had a decent run and is at 15-16 times forward earnings, which is a decent market multiple. They showed some better growth over the last couple of years. Target pulling out of Canada is a bit of a win for them. They benefit from the falling oil price.

This is in the sector that is doing well, because weak energy is great for the consumer. You could almost throw a dart at any of the Canadian retailers and see something that hangs higher. This one is performing very, very well. If he had to choose on something in this space, he would probably choose Home Depot (HD-N), but you should do just fine with this one.

This got a lot of press because of Target leaving. Thinks the company is in a good position with a lot of growth potential. Overall a good place to be. The price of oil coming down will have a positive effect on consumer spending, and they would benefit from this.

The consumer staples sector was the best performing sector in Canada last year. He recently ran a bunch of blue-chip consumer stocks against blue-chip energy stocks over the last 20 years. With some of the consumer stocks sitting on multiyear highs, and the energy stocks sitting at multiyear lows, the energy stocks still outperformed. He just doesn’t think consumer discretionary in Canada is all that exciting for the long-term. The dividend yields are not there and there aren’t any sustainable competitive advantages.

Has done extremely well over the last couple of years, and thinks they will continue to do so. This will be a beneficiary with people paying lower prices at the pump. From his perspective, this is sort of out of value territory, but if he didn’t own it, he wouldn’t be selling it. There is some positive momentum in their sales going forward.

Still in an upward trend and is outperforming the Canadian market. All the technicals are lined up. On a seasonality basis it does very well 2 times in the year. From October right through until November, and then from February into May. You want to play these opportunities when they become available. On a short-term basis this is probably going to sit here for a while. As you get into February seasonality clicks in once again. Watch for a chance to buy on weakness between now and the end of February.

A classic retail merchandising stock in Canada. Has 2 periods of seasonal strength. One is from October right through until the end of November, and the other one is from February through to May of each year. This has a history of doing something that most merchandising stocks do. It goes up prior to Black Friday. On Black Friday and thereafter, they tend to come under some profit taking pressures.