Earning Reports to Watch (Feb 04-08)

One of best managed companies in Canada. Great margins, great business. Grow organically and by acquisition, especially high-end brands. Cheap. Share buybacks. Hit by pandemic, but should see a surge in sales over the next few quarters. Good time to buy a high quality stock.

Has had a huge run and is not sure he would be courageous enough to get onboard at this point. Management has done a remarkable job of building this. He would look for a little lower entry point.

A solid company with a good balance sheet and nice yield. There is a modest opportunity for upside. Since 2012 they have traded between 2.5 and 3.5 times book, with a downward basis trend. The share price is unchanged in ten years and has added no value to investors in that time. He calls these…

He doesn’t know the seasonality on this, but the technicals show that it has been in an upward trend for quite a period of time. During the last little while, it has been in a trading range between around $19 and $22. It is not unusual for a lot of stocks in the consumer staples…

Safer than a non-royalty stock? They pay out everything they earn at a 13.5% dividend yield. It's sold off sharply, because it is perceived that fast food chains will close down during this outbreak.

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. EBITDA beat estimates by more than 100%. Sales also beat. EOS came in at 12 cents. Good overall results. Guidance was increased and the company noted that it had not experienced any supply chain issues. Unlock Premium - Try 5i Free

It has struggled through COVID. People are drinking less milk and being less interested in dairy. They have started to make inroads into plant-based equivalents of dairy and that will be a growth target going forward. People are not eating out as much and SUP-T sells to a lot of restaurants. This is a buying…

Pleasantly surprised with the business fundamentals. Aspects of their business are growing. Very undemanding valuation. Continue to hold. It's on his watch list.

(A Top Pick Nov 22/18, Up 12%)Convertible 8% 2022 bonds He owned the Yellow senior bonds, but then moved into these convertibles. Most of their revenues are in digital, but that has struggled. New management has cut costs a lot until free cash flow now stands around $100 million this year. Their EBITDA margins are…

(A Top Pick Jul 27/17, Down 6%) Volatile. It's come down a lot, but there's a lot of upside ahead. Well-managed. They can make accretive acqusitions. Their problems integrating some businesses are behind them and they now have a strong runway ahead.

Owns Caterpillar dealerships that sell into forestry, agriculture and mining. 55% of revenue comes from Canada, rest from South America and UK. CAT beat on earnings and margins. Reports on Nov 8. Just broke out of a really nice base, which probably means another leg higher. Yield is 2.45%. (Analysts’ price target is $41.67)

It’s under review by the government whether the takeover will take place. You’re dealing with regulatory uncertainty right now. If you bought it before the takeover, unless you’re in tune with what will happen, he wouldn’t own the stock any longer. The price is fair.

(A Top Pick Oct 15/20, Up 180%) Really struggled to get lift-off in the last cycle. A fantastic growth platform. Automating manufacturing process and on-shoring is a tailwind. Has made 3-4 deals since then. Bought a life science business last week, which sells equipment. All the pieces are in place to close the valuation gap…

Fantastic acquisition of IPL at a great price. Really strong portfolio in western Canada combined with global assets that are starting to reawaken from Covid. Poised to run. Good dividend that's steadily increasing. Yield is 3.67%. (Analysts’ price target is $79.06)

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The company looks pretty good today. The valuation is now down slightly although the fundamentals remain sound. A good buying opportunity. Cash balance has increased and it continues to grow its equity position.EPS is projected to grow quite nicely. Unlock Premium - Try 5i Free

Impressed with how the business has grown and the direction it's heading. Attractive multiple, just under NAV. In a position to really grow NAV over the next several years. Focusing on growing investments in healthcare and tech. Lots of capital to deploy. Yield is 0.50%. (Analysts’ price target is $73.61)

Has done a fantastic job. In the top 5 of navigating the pandemic. Landing gear and aerospace business. Commercial business is slowly ramping up now. Should see a string of earnings beat in the next few quarters. The margin expansion will be good. An area of the market he wants to be in. Management can…

Cobalt is attractive but this is not a cheap producer, because they're in Canada and not Russia or Congo.

This has been quite erratic and trading in quite a wide range. He’s been seeing contraction in breadth in forest companies, so is a little cautious on this area. If he had to focus in one space, it would be on lumber which looks attractive. You can use a basket of them through the ETF…

(A Top Pick Jul 02/21, Down 3%) A play over the next year. If you look at housing demand in US and Canada over the next 5 years, there will be increasing demand for lumber. Trading at only 2x this year's earnings. Earnings for 2022 will be solid.

Seasonally, forest product stocks have a history of reaching a peak around the 3rd week in April. This year is no different. Probably an opportunity to take some money off table.

Has been following this story closely. Nitrogen and potash prices are running up. A solid demand environment for Nutrien which should support their valuation. Last quarter was great. Would continue to hold it.

Well-managed. The whole lumber industry had a massive run-up in prices given demand in renovations and new houses as well as supply contraints. The sector has pulled back a lot, but has climbed recently. The outlook is good. They trade at half this PEs now. The balance sheet is clean and IFP has a strong…

The shortage of steel allowed this company to do well. They are well managed and pay a decent dividend. They are exiting their oil tubular business and will be a better company for it. But the price of steel will come down in a year or so.

He rarely talks about Gold. He thinks it is a strong sector bet. It is been out of favor for so long that mines have closed, productions have closed, mergers and acquisitions happened. Central Banks are now massive buyers of Gold. they want to get out of the US dollar. The Fed is not raising…

Uses their GPS system to figure out where trains are, and to more accurately schedule trains and service vehicles for people working on the rails. Reported on Aug 14 and earnings were down 10%. That was against a 32% increase in sales. In the coming quarter, earnings are expected to be down 75% year-over-year. Great…

It is a well run company. He got out of it. They paid out a lot of special dividends and the stock did well, but he got out because most of the catalysts are out of it.

(A Top Pick May 29/20, Up 55%) Oxygen delivery. Recurring revenue model. Very strong outlook.

They make life easier for large diagnostic test companies. It automates the testing process. They did a final financing. They've been working on this technology for 5 years.

Making changes to be able to invest more in foreign stocks. Wait to see how they do.

Share price on the path to recovery. Scores well on valuation, but held back by price momentum. Trades cheaply. Solid yield. Beat most recent quarter. Housing markets have been incredibly resilient. Could see himself as a buyer as they rotate into financials.

Largest P&C insurer in Canada. 21% market share. Efficient operations. Consistent profitability, 5% above that of industry rivals. Consolidator. Now on the map in the UK and Ireland. Longer term, climate change and rising property values advantage them. Yield is 2%. (Analysts’ price target is $196.08)

Owned it a few years ago and cut his losses. Now, cut your losses. This business is struggling as an asset manager, specifically to retain and attract new clients. Also, their key managers, including the CEO, have been leaving. They won't generate much in performance fees, which has been an attraction for investors in the…

Allan Tong’s Discover Picks BPY.UN is anchored by diverse holdings across sectors, including industrial, retail and commercial properties, and across countries. Of course, we all know what happened next to the world, which wiped out the retail and office property markets. BYP.UN shares have slid around 7.5% since that call, but the 7% dividend has…

They've made a big push into the U.S. retirement services business, basically a record-keeping market. It's a very defenisive stock, trades at a cheap 10x earnings and pays a 4.5% dividend. GWO will see earnings growth. Pays a 4% dividend. (Analysts’ price target is $40.00)

Really likes the investment management sector. It should be pretty good business in a time of a decent market and reflation. When a group gets into gear, you want to look at the leaders.

Stockchase Research Editor: Michael O'Reilly We reiterate IGM, a $10 billion Canadian financial services business (with brand names including IG Wealth Management and Mackenzie Investments) as a TOP PICK. It trades at 13x earnings and a PEG ratio under 1.0. It is currently valued at just under 2x book value. It reinstated its dividend with…

Likes that it's lagged the peer group. Energy stocks are a great place to be. Oil and energy prices will remain firm. Improving global demand. Global economies are still recovering. Inventories are very low. Management is being disciplined on capex. Doubled dividend, accelerating share repurchase. Yield is 5.09%. (Analysts’ price target is $39.69)

Generally not a fan of the Chinese inter-listed companies. He has a Short position in this one. There are better places to be.

Stockchase Research Editor: Michael O'Reilly MTL provides trucking and logistics services in Canada and the US. As the economy continues to reopen in North America, the company will benefit from continued demand for its expertise. Recently reported earnings of $0.21 beat analyst expectations of $0.19 for the quarter. It is trading a good value here…

A conglomerate and he isn’t a big fan of this model. A well-known catalyst investor has just purchased about 19%. May sell of some weaker units.

Owns it for the longevity of the assets and miss pricing. Leverage has always been a problem. Trading at 44% free cashflow yield at $70 oil. Fair multiple is 6x, which would bring free cashflow to 15%. Would get a $20 target with this. The stock could continue to work. On the cusp of return…

Top tier producer, great assets, good management, fairly priced when he bought it. Nat gas market is very tight, so the outlook is still great.

Shortage of consumption vs. production, but there are massive inventories on the sidelines, which is holding back gains. Japan turning reactors back on in the next 2-3 years will bump the price. Good long-term story. Wait for it to drift into the $20s before you buy.

They sell energy contracts. They have under gone several management changes over the years. He is not a great fan of this business model.

Likes the renewable space. The growth will be there. Higher interest rates will impact them. Solid, core holding. You'll do fine over the long term.

A lot of success is tied to Gaz Metro in Québec, but they also have some wind farms that have recently come online in the last year or 2, and giving good returns to the company. Recent earnings were solid and they raised the dividend by 3.7%, and plan to raise it 4% next year.…

Allan Tong’s Discover Picks I don’t like the telecoms as a whole, because they enjoy an oligopoly and overcharge Canadian customers, but at least BCE offers stability, predictable growth and pays a safe 5.41% dividend. Read 4 Popular Headline Stocks for our full analysis.