George Weston Ltd. (WN.TO)

(A Top Pick Dec 4/12. Up 24.89%.) Sold half his position at over $80 in order to take profit. He is inclined to get rid of the rest of his holdings at around $76.90 and then pick it up again later.

Their revenues are levered to food prices so be careful. We are seeing some disinflation in food prices. Grocery stores have a hard time with margins when food pricing is coming down. He has virtually no exposure to consumer staples.

Grocery business in Canada has become much, much more competitive with Wal-Mart (WMT-N) coming in. This is an area where everybody is manoeuvring for position, and it is going to be hard to keep margins up.

Right now we have a very competitive landscape, particularly in Ontario. Loblaw’s (L-T) is recovering from a few years of a large capital spending program. Thinks there will be some efficiency in this. The pullback in the stock price is a real opportunity. Have a lot of cash.

This is getting very exciting. They have all this capital coming out and have more properties that they can vend into it if, as and when they buy more properties. Shoppers (SC-T) conglomeration is forming a great food and drug network in Canada. Doing extremely well in the US where they are very excited about their baked good lines. A great way of buying lots of bits and pieces of a great empire. Yield of 1.94%.

A stable business that has been growing. Will run into resistance. The numbers are really good. L-T is an alternative, but he already has WN. They also have a war chest of cash that is not recognized by the market.

Has very significant cash levels which is reflecting the fortunes of Loblaw’s. He can’t give a strong buy or recommendation currently.

Knew Loblaw’s management could do some fantastic stuff. Westons is in the right place. Lots of cash on the sidelines.

(A Top Pick Feb 29/12. Up 5%.) Preferred V series 4.75%. This is a perpetual. He is bullish on the market so he wants to be a bit longer-term.

Downtrend from late 2010 was broken mid-2012. There will probably be some headwinds going forward but they have a big war chest of $5 billion. Yield of 2.06%. Ranks high against the TSX 60.

He has a line at $70.50 and if it breaks below that then it means the market doesn’t believe it is going to do what is going to do. It has a lot of cash and ranks really well against the TSX. You also get a play on Loblaws.

Had a sense that Loblaw’s management was getting its act together. Baking division is doing fantastic. Chart indicates the downtrend is over. He sees some upside close to $80.

They surprised everyone recently on the upside. Everyone knows they are having troubles with higher input costs and passing them through. People didn’t know how well they were doing with improvements in productivities and cost reductions. People were worried about completion to Loblaws (L-T) that they have a big position in.

Have done really well at controlling expenses particularly in the bakery divisions that they have. Their Loblaw (L-T) holding is a major part of this company. Loblaw has put a lot in to capital expenditures over the last number of years both in distribution and SAP. Expect this will flow through and be reflected in this stock.

Preferred C. Should these be sold when rates start to rise? Yes. This is a perpetual preferred and has no Call feature in the investor’s favour. They are like a long-term, low coupon bond. Very long-duration securities and they react to the long-term bond market. As rates rise, these will go down in price.