Linamar Corp (LNR.TO)

He thinks this is a price taker, based on the car cycle. He thinks we are closer to a recession now, so would not see this as a great opportunity at the moment. He would put this as a second-tier company on his list.

This and MG-T are the two big ones and MG-T is holding up while LNR-T is crushed. Both are at risk under Trump. Whatever he says he is going to do he eventually gets to it. Long term there are risks because of the electrification of it.

He sold not that long ago. He is concerned about the sector. These are extremely volatile stocks. It has been punished by its own results and uncertainty due to NAFTA. These companies ride the cycle of new vehicle sales and launches. You want to buy them really cheap when nobody wants them. Stay out of the sector right now.

He thinks this is an impressive homegrown auto parts company that has done a great job competing in the international market, but Magna has done a better job. He thinks that there is no reason to own both Linamar and Magna and he thinks Magna is the better choice.

The Canadian automakers have done well, but Linamar has disappointed in the last few querters. Trade talks and the late auto cycle are clouds over auto-makers. This is the wrong time to enter this industry.

He owns it personally. He has a great admiration for management as it has been a strong manufacturer of quality parts internationally. The sector is facing headwinds due to the high rate of production relative to demand. He would continue to hold it.

Cheap at 7x earnings. Well-managed and aggressive. They recently bought MacDon Industries, which increases their agricultural exposure. He sees 30-50% upside in the coming year if all goes well. LNR recently came off because of poor earnings, but the MacDon purchase meant starting a new business which hits your earnings. (Analysts' price target: $84.38)

A good company. They had weakness in their industrial division. But the stock has done well over many years as it followed the auto cycle. Their core focus is the powertrain. The auto cycle in North America is now at maturity. At some point, earnings will decrease. He prefers auto companies that are researching AI. Linamar's business is more traditional.

Very good auto parts company in Canada. The company is not really a global company. Great balance sheet. Linamar is not really into the electric vehicle. That made some people worry a little bit about the name. They have reasonable good growth.

They are a reasonably priced company. A quality company with quality management. They do fairly transformational acquisitions into some other business lines. They are in the top 5% on valuation. They need to deliver on their most recent acquisition.

An excellent auto parts company that recently announced an acquisition that will take them into the agriculture sector. Their Skyjack platforms business is doing well. He likes it and sees it trading cheaply at 5.3 times EBITA and will continue to hold it.

Has known them since they went public. One of the best-managed companies. They make more gears than anybody in North America and now winning contracts for electric cars. Everything good. (Analysts' target of $83.14)

One of the three major Canadian auto supplier. He likes the space as auto suppliers trade at a compressed multiple despite having positive growth prospects. He prefers Martinrea (MRE-T) though. They have been doing a good job at improving their operations including cutting costs and have very good prospects. NAFTA concerns are more than reflected in the prices.

It was a top pick in the past. He likes it and it is held in his funds. They had a miss-step when they missed on results then did a transformational acquisition. We will have to see what this does for them.

Linamar (LNR-T) vs Magna (MG-T) vs Martinrea (MRE-T) Has a small position in Magna (MG-T) which is the largest of the three. At this point in the auto cycle in North America, would be very hesitant about adding more. Thinks the bump up in number of vehicles in North America is plateauing. Very cyclical. You can see earnings and cash flow really degrade quickly rapidly. It’s one he would be careful and look for opportunities to sell on strong.