Wajax Corp (WJX-T)

Recently added a small, 2%, position. Likes the dividend yield. Believes the industrial economy will pick up, though Canada may be slower than the US. Exposed to the Canadian industrial economy right across the country. Yield is 6.7%.

His strategy is to ride the stock up. As it does, the yield drops. So if the yield here were to drop, and he found another stock with a better yield, he'd consider switching out.

Margins under pressure. Inventory is elevated, which makes it difficult for margins to recover in the short term. Elevated leverage. Doesn't see any great catalyst to unlock value. Intense capital requirements. Might stay in deep value territory for a long time.

Invest somewhere else and do better.

Added recently. Might have more upside than, say, TOR in the next year. It will have a bigger recovery when the market does turn.

Relatively new holding for him. Services industrials, mining, energy. Great parts and service business. Facilities throughout NA. Very well managed, strong balance sheet. Trading at a fairly competitive price. Stock fell on disappointing quarter, which opens up a great opportunity to get in. Attractive yield of 6.4%.

A play on where the next bull market's going to be, and that's going to be cyclicals. A cheaper valuation within the group.

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. Cheap at 11x earnings. A cyclical company that has never reached over 20x multiple. They continued their dividends during the pandemic. Sales missed but EPS beat by 20%. Cash flow is good. The small size presents some risks but it is doing many things right. Unlock Premium - Try 5i Free

It'll be flat this year. It's very illiquid, so likely way cheaper than it ought to be. Good balance sheet. Cheap at 8x earnings. The payout ratio is safe. You can buy and win with this.

(A Top Pick Feb 17/17. Up 8%.) Sold this a while ago to reduce his holdings in the infrastructure space. He still likes the sector immensely. Chart shows a reverse head and shoulders. If this can get above $25.70, he would like to buy it again.

They cut their dividend, but he sees this as pretty safe with a 60% payout ratio. He models 45% EPS growth. Their balance sheet has gotten much better. The cycle is just starting to come on with equipment makers, and is trading at about a 6-point discount to Finning. Trades at about 13.8X with Finning at around 19X.