This week there were 23 Top Picks and 7 ETF in a wide range of industries: Technology, ETF, Financials, Healthcare, Industrials, Consumer and Energy.
It's broken out of an up-channel. Managers are executing well, but it is very overbought now. Wait to $290 to enter.
It is difficult to have a view of a 12 months period but this is a core holding of his. It is relatively expensive and relatively extended. It has an extremely high return on equity, no net debt and they are buying back shares.
He loves the dividend and the strategy. He is the biggest holder of this fund by a long shot. Around $14 he finds he does not love it for capital growth. If we get a pull back then he would go for it.
(A Top Pick Dec 04/18, Up 2%) Safety play. A place to park cash. Never touches a GIC, because they're not liquid.
(A Top Pick Dec 04/18, Up 18%) Companies that consistently pay higher dividends. It's important to look at dividend growth. Very low cost.
(A Top Pick Dec 06/18, Up 14%) Hit new all-time high this week. Protypically recession resilient. Boring, but should perform well in a maturing economy.
It is a US pipeline play. He thinks it will be in a trading range for several years. It is at the bottom of a trading range right now with a great distribution yield, so that is how he is playing it. He still likes it and owns it and bought a little more on…
Seasonal period from April to November. People usually buy REITs for the yield, so it's fine to hold. If you want a faster racehorse, perhaps sell it for something with a higher beta.
(A Top Pick May 09/19, Up 4%) Seasonality ends Oct. 24. It's been faltering lately. The US election campaign is a headwind and will continue to overhang. He may exit this.
(A Top Pick Nov 19/19, Down 4%) Long-term, banks are fine. Not a trade, but a hold. Now could be a buying opportunity.
A spin-off of Brookfield Asset Management. For every 170 shares of BAM-T one owned, they received one share of TSU-T. They underwrite smaller BTB insurance. They can sell-off re-insurance for a recurring fee stream in the US – a process called “fronting”. On paper it looks like they operate at a loss, but it will…
MFC vs. RY MFC shows a nice uptrend, but facing long-term resistance. It's overbought, so enter around $26 during a sell-off. RY's chart is moderately positive with short-term resistance around $110. Not much upside at the current $107. Enter at $102-103.
(A Top Pick Dec 05/18, Up 29%) Remains a cheap stock. They're the best in P&E insurance and executes very well. Consumers aren't making claims on car accidents, fearing higher rates. Allstate is firing on all cylinders and trading cheaply. They've bought back half shares and raise their dividend every year.
Step back and long at the long picture of TCN. He sold it six years ago and hasn't done much since. They've done the right things and are in the right markets, but he's wary of their corporate compensation. What are the incentives of the management team? TCN has disappointed him.
(A Top Pick Dec 05/18, Up 45%) It's a Blackstone-sponsored company that bought a bunch of single-family homes and rent them out. Blackstone IPO'd this and sold it in tranches over time. Now, the stock has legs and doesn't need the parent's support. They rent to tenants and are adding ancillary businesses, like pet services…
(A Top Pick Dec 05/18, Up 33%) When he called it, ARE wasn't cheap. They hold life sciences properties, which is solid and lucrative (fuelled by R&D spending). They can raise rents by 20-30% annually with these companies, which means strong cash flow growth.
He does not own this one, despite the earnings metrics looking solid and there is no net debt. They missed on a recent quarterly earning, but not a bid deal. They are trading at 7 times cash flow and 7 times EBITDA. He would like to see the ROE improve a bit. Price momentum has…
He gives managements kudos for restructuring the business. They are still heavily indebted. He is looking for valuation with consistent cashflow which this is not. It's not the type of company he looks at.
A big health insurer in America, growing 15% annually with dividend growth. It's been held back because of concerns over whether US healthcare coverage will be reformed by politicians. But the health system there is so massive, it'll be hard to change. UNH is so dominant, it'll grow 10-12% annually with technology to help. (Analysts’…
(A Top Pick Dec 03/18, Up 47%) Celgene had made a number of mis-steps, including management applying for multiple FDA approvals. One thing he really liked about the acquisition was the price it was bought. The acquisition by BMY helped them diversify and it seems to be going well.
(A Top Pick Dec 03/18, Up 19%) This company's been on their top picks list since 2016. He spoke to the head of Research when they were brining forward immunotherapy drug Keytruda. The trials are going well over multiple trials. They are also #3 in the animal business too.
(A Top Pick Dec 05/18, Up 31%) They used to make personal care products, but now make healthcare tech products and gaining market share. Managers have executed very well, transforming the company to higher-margin products.
He was concerned that GSK was getting more growth focused. They spun off their consumer products with Novartis, giving up their oncology department. Now they have a joint venture with Pfizer. Having it as a longterm asset is probably positive.
They have done nothing but disappoint for the last couple of quarters. He kept it because the valuation changed and no one expects anything from this company. He is going to give it a couple more quarters.
(A Top Pick Jan 28/19, Down 37%) They are very much encouraged by the latest results. The company has started buying back shares. It is suffering from some tax loss selling. There is huge upside and very little downside. He just bought a lot more.
(A Top Pick Dec 05/18, Up 14%) Trades at a cheap valuation in the cheapest market in the world. Japanese companies pays a higher dividend yield than the S&P 500. Espec delivers strong growth for a Japanese company. Japan has no immigration so growth is zero, but this is slowly changing. Japan has many great…
They had a challenging last couple of years. They got over levered. They sold their surgical business. Now you are starting to see them accelerate the pharmacy business. They have less than 10% of the beds in long term care facilities in Canada. They also have a new product to control seniors taking the right…
He likes it, but it's running into resistance. Don't enter, but take some profits or hold. The stock is stock.
Oil is a difficult space, but SU is building a base around $40. Strategy: buy the strongest stock in a struggling sector, which is SU. SU has the balance sheet to pick up cheap assets.