Sandy McIntyreMcGraw-Hill Ryerson Ltd.MHR.TOPAST TOP PICKAug 25, 2010

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research

MH recently reported strong results and increased guidance. Analysts forward earnings growth estimates are fairly muted, but it trades at a reasonable valuation of 11X forward earnings. Margins are rising, cash from operations is strong, but we we would prefer to see stronger growth rates (forward earnings growth estiamted in the high single-digit to low double-digit range). After its big earnings pop, we think some of the good news is priced in. If earnings growth can accelerate beyond analyst estimates, we think its multiple could expand beyond 11X, and this could help lift its price, but we do not find the name overly interesting, particularly from a growth perspective.
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(A Top Pick Dec 14/09. Up 19.37%.) Still likes.

A closet financial play. They own S & P, which is the indices, but is also the rating agency that has very strong market share. 2.3% yield.