24 Stock Top Picks and 3 ETF (Jan 11-17)

Opinion about ZLU-T: Canada doesn't have a version of this low-vol with a currency hedge. Now is not a good time to invest in the US. ZLU has outperformed the US market long-term with less volatility.  You get less bad when markets are bad and a little more good when it's good--like it for that.

Opinion about ZLB-T: Portfolio of low-beta stocks. Consumer staples, some financials, utilities. MER is 39 bps, not exactly cheap but not overly expensive. For the investor looking for dividends plus a low ride in the equity market. Consumer staples and utilities in Canada aren't cheap right now, as people flock to safety. At some point, investors…

Opinion about IWM-N: Lagged last 2 years, now starting to see some improvement. Positives include Trump being domestic-focused, and tariffs helping the small caps. Earnings growth hasn't been strong in small caps, but could do quite well in a risk-on environment.

Opinion about TD-T: Coming out of a really vulnerable time with money laundering. Settled case, implemented new protocols. US assets capped; but TD shifted some assets around, giving them space to grow without running afoul of the cap. New CEO is very committed to turning over a new leaf.

Opinion about BNS-T: Likes it. Their exposure in Latin America offers exposure to copper and other minerals. Management is shifting focus from Latin America to outside that area. He sees success here, and the stock is priced well now. The yield is generous and safe. This could be a core holding.

Opinion about MFC-T: Why doesn't it get more traction? The insurance business, in general, is not expanding dramatically. You get the nice dividend, which means they're not investing in the business. And they don't invest in the business because there's really nowhere to put their money for a high ROIC. Highly regulated, higher interest rates…

Opinion about FIH.U-T: Don't buy. Doesn't like insurance. 

Opinion about SIM-X: Once owned this. But this will be stuck in a highly competitive space.

Opinion about HSM-T: He has been investing in this for almost three years now. They received Health Canada approval for a new brain stimulation medical device last fall. They are awaiting FDA approval in the US. It magnifies the result of physio-therapy for the brain and the technology is safe. It is a billion dollar…

Opinion about BDX-N: They just reported a disappointing quarter, plunging shares 18%. Many are giving up on it, but it's a buying opportunity. For decades, this was a reliable growth stock, but in the past 5 years have been sideways. They reported beats and raises last year. They sold their life sciences division to unlock…

Opinion about DHR-N: Diversified diagnostics and bio-processing franchise. Good capital allocators. On the upswing in terms of cyclicality. Under-deployed balance sheet can be utilized accretively. Until recently, valuation was coming down. Defensive healthcare, a more resilient vertical than industrials. More complex treatments of the future benefit a name like this (and TMO). Yield is 0.64%.…

Opinion about GCL-T: They own a series of food distribution businesses. It appears they are not making any money from them. It appears to be a scale problem.

Opinion about TJX-N: Will survive this tariff war, TJX will thrive with excess inventory from suppliers.

Opinion about BTO-T: Longtime shareholder and friend of founder/CEO. Behind schedule and over budget on mine in northern Canada. Very remote location, logistically challenged. If that can get resolved, expects stock to be much higher. Stock's extremely cheap from a sum-of-the-parts point of view, but there is completion risk (which, ironically, you can't quantify until…

Opinion about EMN-N: (A Top Pick Jan 24/23, Down 10%) Cyclical business that hasn't performed well.Seasonality affecting share price (May-October).Expecting better performance of shares.Sign that economy is soft.

Opinion about NTR-T: World's largest crop-nutrient business. Upstream production is vertically integrated with downstream retail. Gamechanger for him is that commodity price has bottomed for potash, nitrogen, and phosphate. Cash crop commodity prices are also slowly improving. Management changes. Operational changes to improve profitability. Trading at 1.1x book. Good luck tariffing potash, as the US produces…

Opinion about MTA-X: To manage risk, he sets up his portfolios starting with the biggest, which is FNV. More diversified than OR. He also owns OSK proper.

Opinion about CHR-T: Owns shares in company. Has done well the past year. Expecting further upside going forward. Dividend is expected sometime soon. Subcontracting business from Air Canada very good for reliable revenues. Price multiple not as high as it should be. 

Opinion about TLPFY-OTC: (A Top Pick Jun 20/23, Down 12%) As a call centre it is an outsourcer of IT services. It has been coming back from October onwards. Regarding AI concerns it has the balance sheet and income to train machine algorithms.

Opinion about NVEE-Q: Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. The quarter was a big miss; EPS $1.21 down from $1.61 the prior year and estimates of $1.54. Revenue $189.8M was higher than the prior year $188.6M but missed estimates of $203.4M. For 2023, guidance was $5.28 to $5.64 per share (est $5.44), Revenue…

Opinion about LXE-X: They're in northeast BC where Tourmaline is consolidating land and assets, near LXE. So, LXE will become topical. LXE has reached an inflection point after acquiring a lot of land and pushed the Montney play to the northeast. Now, they need a lot of capital to move to full development. They're talking…

Opinion about TRP-T: Defensive. Pays a 4.8% dividend. Natural gas demand will endure. No tariff worries. Data centres need power, and he doubts tariffs will impact Canadian energy supply. (Analysts’ price target is $71.18)

Opinion about VET-T: (A Top Pick Mar 15/24, Down 37%) Lately they've had success in exploration in Germany, but near-term capex to exploit that is questionable. Are hard hit, now trading at half their book value. Are paying a near-6% dividend. He's held on. He may use VET as a source of funds, but otherwise…

Opinion about RCI.B-T: No issue with defaulting on bonds from any of the big 3 telcos. For the equity side: not a lot of growth, price competition, CRTC always making new rules. 

Opinion about NPI-T: Not sure if tariffs would be applied to this type of cross-border energy. Hit along with all the other clean energy. Likes it here. Nibbling on weakness. Compelling yield. Doesn't see a lot of upside, capped in mid-$20s for next 3-5 years.

Opinion about EMA-T: (A Top Pick Feb 05/24, Up 34%) A boring, stable utility. Pretty much discarded last year with people chasing the AI trend. Big move since January with the flight to safety. Outlook was upgraded from Negative to Stable. Good job reducing leverage. Florida just approved storm reparation costs from 2 hurricanes in…

Opinion about FTS-T: At 52-week high, safe haven from Trump's antics? Everybody's been crowding into what's been working. Bond proxy, not too challenged by Trump tariffs. Great long-term compounder. Raises dividend every year, by ~5%. Good long-term growth. Q4 beat. Steady player, without all the ups and downs.One knock is that it's only growing 5%,…