Consumer stocks such as Canada Goose, and Saputo, as well as many industrial and financial companies are reporting their earnings this week. Notable among them is the Brookfield names, BPY.UN-T and BEP.UN-T.
Here are the companies with earning reports to watch.
Andrew Peller (ADW.A-T) Feb 04
One of his core holdings. They are continuing to grow their margins. It is trading at a huge discount to other alcohol companies. (Analysts’ price target is $17.00)
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.
One has to think counter-seasonally when it comes to owning GOOS. The best time to buy is the latter part of summer, ahead of the winter shopping season. The company has invested in expanding the direct to consumer sales strategy. China is being targeted as a growing market for the company. There is some speculation…
Saputo Inc. (SAP-T) Feb 07
Always looked expensive, but now is a rare opportunity. The food services side was impacted by the pandemic. Competitors are struggling, so acquisitions are coming that should boost the growth. Raised dividend. Yield is 1.98%. (Analysts’ price target is $39.11)
They bought Newfoundland Capital. It is a radio operator now. Debt is high but they keep increasing their dividend. People see them as background music in a retail environment. It is an okay stock and he would like it a lot better with a lot less debt.
Yellow Media Inc (Y-T) Feb 07
(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.
Finning Int (FTT-T) Feb 05
(A Top Pick May 08/19, Down 25%) A tough environment for them. They sold out of their holding last June around $22. They were having troubles rolling out a South American strategy so opted to move on.
Westjet Airlines (WJA-T) Feb 05
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.
ATS Automation (ATA-T) Feb 06
Robot factories and processes. On-shoring and building new plants will create good opportunities for them. They are quite undervalued to their peers and have a great cash flow profile. They have been involved in developing COVID-19 testing kits. Yield 0% (Analysts’ price target is $25.42)
(A Top Pick Oct 04/19, Up 7%) Has great assets like toll roads, airports, railways, seaports. Low interest rates mean that pension plans and lifecos have to buy into these types of assets to lock in long-term yields to meet obligations.
Toromont Industries (TIH-T) Feb 06
A very well run company with a pristine track record. It pays a low yield, and he looks for higher ones. He needs a sustained income. If the company pays a low yield, you expect the company to somehow raise its share price. Tailwinds for TIH are rising infrastructure spends in Quebec and Ontario plus…
(A Top Pick May 10/19, Down 12%) They're effectively a private equity firm. It's doing well considering markets now. They look to generate a 15% return on their portfolio of energy, infrastructure and power. This market is lining up perfectly for someone with cash. There'll be opportunities for debt rescue or capitalizing companies or buying…
Heroux-Devtek Inc. (HRX-T) Feb 08
They execute brilliantly, integrating very well. They produce landing gear for airplanes. They finished absorbing a major acquisition of a Spanish company which got them into Airbus. They also work on the Boeing 777x. The capex and acquisition spend is now done, so they can pay down debt or buy more companies. HRX is one…
First Cobalt (FCC-X) Feb 04
Cobalt is attractive but this is not a cheap producer, because they're in Canada and not Russia or Congo.
Domtar Corp. (UFS-T) Feb 05
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…
Canfor Corp (CFP-T) Feb 06
Allan Tong’s Discover Picks During the depths of the lockdown, the price of lumber in the CME futures has tripled since April 1 to nearly touch US$828 (per thousand board feet) just recently. There are no signs yet to show a slowdown in demand. Meanwhile, Canfor is still only halfway to its all-time highs above…
Canfor Pulp Products (CFX-T) Feb 06
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.
Nutrien Ltd. (NTR-T) Feb 06
Cyclicals haven't bounced that much off the bottom. Driven by global growth, which has lagged tech. Still a good company, generating free cash, good vertical integration, paying down debt. Stick with it.
Interfor Corp (IFP-T) Feb 07
Earnings expectations are for a $0.14 loss this year per share, compared to $1.23 from last year. The company has recovered to strongly on the US housing market recovery. Based on historic valuations relative to book value he sees a range of $11 to $16 for the share price. It has a good balance sheet.…
Russel Metals (RUS-T) Feb 07
A stable cyclical business. They distribute steel throughout North America. A volume business. A great business with stable dividend that is inexpensive right now. (Analysts’ price target is $20.25)
Goldmoney Inc (XAU-T) Feb 04
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…
BSM Technologies (GPS-T) Feb 05
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…
Vecima Networks Inc. (VCM-T) Feb 07
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 US company that's consolidating in the medical market (home lifts, ventilators, oxygen, etc.). He continues to like it. It was a past pick and since they made an acquisition. The stock has increased, though not as much as he expected. He predicts the valuation will be pretty attractive. This could be a takeover target…
SQI Diagnostics Inc. (SQD-X) Feb 04
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.
United Corps. (UNC-T) Feb 04
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.
Intact Financial (IFC-T) Feb 05
A major insurer. Their biggest expense is going down hard--auto claims. With people under lockdown, people aren't driving much, so the quantity of auto claims is lower than ever based on Q2 results. This boasts their underwriting profit and will be a tailwind for a long while. They're also generating investing income, which may be…
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…
Billy Kawasaki’s Insights - Picks from 5i Research. There are concerns over the impact of coronavirus on retail locations. They just completed a large share buyback and the company is committed to the distribution. They have a good track record and the company is looking long term to opportunity in retail when the virus has…
Great West Lifeco (GWO-T) Feb 07
GWO vs MFC vs SLF? In general, he thinks all insurance companies are safe here. They don't have the threat of rising loan losses, like the banks do. They trade cheaper than the banks. Capital ratios are solid. They are finding ways to deal with low interest rates. GWO has a good job. MFC is…
CI Financial Corp (CIX-T) Feb 08
(A Top Pick May 02/19, Down 25%) He got stopped out. It was a value play. It was cheap at $15. He doesn't know how retailer investors will respond to this current uncertainty. The mutual fund business was facing headwinds before the pandemic. He won't buy back his shares.
IGM Financial Inc. (IGM-T) Feb 08
IGM-T vs. MIC-T. He would prefer MIC-T. He likes the underlying fundamentals, but has always worried about a real estate downturn and how it would affect it. He prefers it to IGM-T where he does not see how the fee structure would be sustainable in the long run.
Suncor Energy Inc (SU-T) Feb 05
Overall, the sector will be fundamentally under pressure since the world is moving to cleaner energy. The sector is now tradeable but not investable.
Generally not a fan of the Chinese inter-listed companies. He has a Short position in this one. There are better places to be.
Mullen Group Ltd (MTL-T) Feb 06
Convertible bonds with a 5.75% coupon They own a great base of real estate. The debt issue is a small piece. The bond is well-covered. MTL.DV-T. You get a 6-year option on the stock within the bond, with a $14 convert price. If oil recovers, these bonds will convert into equity. Until then, collect then.…
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.
MEG Energy Corp (MEG-T) Feb 07
(A Top Pick Aug 30/19, Down 21%) He sees a supply shortage in global oil. The call on oil is only going to grow. They have 60+ years of reserves, and they are ready to go down in the Gulf Coast. Free cash generation is positive.
Arc Resources Ltd (ARX-T) Feb 08
He used to own it to get exposure to Canadian natural gas. Assets and management are superb, and pays a fine dividend. However, at the start of March, he changed his outlook given how tough a sector energy was and gas demand was uncertain. He sold all his energy stocks and put his money into…
Cameco Corporation (CCO-T) Feb 08
(A Top Pick Jun 14/19, Up 9%) It has recovered from a valley it hit during March. They didn't add it back when it dropped since there were so many other good opportunities.
Just Energy Group (JE-T) Feb 06
They sell energy contracts. They have under gone several management changes over the years. He is not a great fan of this business model.
The renewable sector offers great long-term secular growth and she's increasing her exposure. BEP is one of the biggest stocks in this space, and BEP operates globally. Offers attractive exposure to this space. Hold and buy on weakness.
Valener Inc. (VNR-T) Feb 08
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.…
BCE Inc. (BCE-T) Feb 07
The dividend is safe. All telcos are good at increasing their dividend yearly. BCE pays 5.9%. She buys this below $55. A solid income stock.
Use this list wisely to identify buying opportunities.
Happy trading !!!