23 Stock Top Picks and 3 ETF (Jan 25-31)

Auto stocks are a great place to be right now. Tesla, GM, Ford, etc. MG had their investor day and they are well positioned to profit from EV and other auto innovations. The stock is still trading reasonably. 10.4x 2022, with 43% modelled EPS growth. The best is probably still to come.

CP rail still moves a fair bit of thermal coal, which is decreasing. CNR gets more of its revenue from metallurgical coal, which is increasing. Both provide only a small portion of revenues. They also move chemicals, lumber, autos. If you're betting on worldwide economic recovery for many years, as he is, you have to…

Based on analyst Larry Williams' true seasonal index Younger investors love the airlines, but Williams has a very negative outlook for them. Meanwhile, Williams forecasts--based on the last 11 years' patterns--a market rally starting right before Christmas and into early-January, except certain sectors including airlines.

Has new managers. A well-diversified industrial. He wants to know what their China exposure is. They report Tuesday and he expects good things.

An industrial sector stock that does well in this type of environment. Has been a volatile stock with negative ROE. Cashflow is poor too. Interest coverage is not good. Yield is there but payout ratio is high.

They announced a good last quarter with a record backlog of orders. This is badly undervalued. At some point, there'll be value creation. This business has turned around towards higher-margin product. Some end markets are coming back as nuclear plants need Velan's valves. One day, the company will be privatized, but you need to be…

Customized, prefabricated environmental office interior solutions. High net cash position. Significant upside because of their flexible business model. Surge in office reconfiguration taking place across North America. Top management. No dividend. (Analysts’ price target is $3.46)

An excellent operator with low costs. Problem is, this rallies only when the FAANGs dive and vice versa.

If oil stays up, Baytex can go with it. Their balance sheet is quite bloated compared to peers. They do not have production growth. The commodity side is growing cash flow but there are better plays.

(A Top Pick Apr 03/20, Up 197%) Remains a top holding. A pure play on heavy oil producer. Incredibly mispriced. It would be trading at 4.2x cashflow at $60 oil. High quality name. By next year, expects them to buy back their stock in a meaningful way. Expects to trade at $13.50 per share. Has…

Attractively valued, trading at around 12% free cashflow yield at $60 oil. Would go up to 17% at $70 oil. Big underperformance relative to CNQ. Good upside, even up to 50%. More than that at $70 oil. Sold to buy small cap oil companies. Preference for other names.

Just beat earnings and have increased production. Cheap valuation compared to peers. But it's getting more expensive heading into 2021. There's no growth here, but that goes with the entire oil patch. The real issue is will they survive. Their balance sheet is getting better, but still high for a blue-chip name. You'll be saved…

Essential to our way of life. One of the companies that moves oil. Pipelines are very hard to build. A scarce resource that has coveted assets. Has a much better balance sheet, moving to ESG, and line 3 is getting support. Trading at 14.9x PE 2023 with an 8% EPS growth rate. (Analysts’ price target…

Trading at a very low valuation. Biggest weighting for him. Likes it for the exploration front, partnership with government and valuation. Trading at 2.4x cashflow at $65. 28% free cashflow yield. Theoretically could keep production flat and pay 28% free cash. Sitting on $460M cash. What to do with the cash? Looking into new acreages.…

Has a great CEO, but can you fight this reopening trade? He likes TTWO for its new machines.

Displaced Oracle in the cloud as the database of choice. It's about selling cloud services, like a utility. Margins are much higher on cloud than selling software. Over time, margins and free cashflow will go up. Not concerned about the valuation, because of growing business and margins.

(A Top Pick Apr 28/20, Up 16%) They own 80 LTCs in BC and Ontario. SIA got hit by negative headlines during Covid (seniors died) and higher vacancy rates. This is transitory. Long-term, the number of seniors will double in 15 years in Canada and vacancies should decline. SIA has a solid balance sheet and…

A real health conglomerate. Vertically integrated. Inexpensive valuation, at less than 10x. Recent earnings moved the needle down. Market may have been disappointed on 2021 guidance. 12.5% free cashflow yield. An excellent opportunity. The vaccine rollout will be a major contributor to its financial success.

(A Top Pick Aug 09/19, Up 10%) A cannabis company in Nevada. Like Indus, they cleaned up their situation and are turning around. They bought a large dispensary in Nevada near Reno. An overhang was owing the vendor a lot of money, but that vendor has become the new CEO has fixed that debt. CXXI…

US focused. Lifts, supports, oxygen services. They've been acquirers. Brought debt down, increased profit margin, grown geographically. Still very attractively valued compared to its peers. Could be a takeover target.

Very fine company. One of the best property and casualty companies in the world. Relatively resilient, defensive business model. Long-term, he recommends it. But for short and medium performance, we're exiting a recession, so it makes sense to put more capital into cyclicals.

One of his favourite investments. Assets are all in the US. Benefits from US exposure to e-commerce. Still cheap relative to NAV. Trades at a 5% discount. A great theme that you don't have to overthink. Likes management.

It's real estate in 28 countries. It's something different for Canadians and worth having a look.

(A Top Pick Jan 29/19, Up 1.5%) Global Risk Parity balances the risk of growth and inflation. It balances the risks to keep you level. The peak draw down was 12% -- very manageable in the context of recent volatility.

Stockchase Research Editor: Michael O'Reilly TLT is an ETF that represents US 20 long term treasury bonds of a term of 20+ years. Yields on these treasuries have been rising steadily since the pandemic based market collapse last March from under 1.00% to 2.25% now. This is a precautionary holding, to protect in the event…

(A Top Pick Jan 30/19, Up 85%) They have the market's attention. Later this year there is the decision whether they start up an older mine that has been mothballed for a while.