This week were 20 Stock and 1 ETF Top Picks in a wide range of industries: Technology, Industrials, Healthcare, Consumer, Financials, Energy and ETF.
Stockchase Research Editor: Michael O'Reilly TWOU offers online education technology worldwide. They have benefitted as universities and schools have moved to online classes. Although return to work is progressing with vaccine distribution, there is an underlying change in the way many organizations view online learning going forward, including new client, The London School of Economics.…
Trades at 26x earnings. Strong user base. Under levered. Instagram can still be monetized. Lots of free cash. Sees great growth in revenue produced per user in Europe and underdeveloped areas of the world, which will benefit free cashflow. No dividend. (Analysts’ price target is $335.11)
Accenture Ltd. (ACN-N)
Best of breed. Work from home will continue even after vaccines, and this will create opportunities for ACN. Organic growth plus tuck-in acquisitions. Spread across government and healthcare. Great story, dividend growth. Yield is 1.37%. (Analysts’ price target is $278.52)
Stockchase Research Editor: Michael O'Reilly HLF is a nutritional supplement and weight management product company. Management revised upward its 2021 guidance in light of pandemic related demand growth. At 13x earnings, it trades at a good discount to its peers and earnings growth has been 11% annually over the past 5 years allowing its cash…
Air Canada (AC-T)
As the economy reopenings, the airline will rebound. The Air Transat buy gives them more market share. You can male 50-60%. If Ottawa gives AC assistance, AC should refund passenger fares (he knows people who are unhappy with AC and are waiting). He doesn't see ill will from the non-refunds; people always hate Air Canada.…
Eastman Chemical (EMN-N)
This is a cyclical pick. Strength is Jan 28 to May 5th. It is positive over 80% of the time with an average gain of over 80%. (Analysts’ price target is $112.10)
Aecon Group Inc (ARE-T)
Has a $1B market cap. A play on Canadian infrastructure spending. The yield is decent around 4%. Trades at 5x enterprise value to EBITDA. Trades at a 34% discount to US comparables. 97% growth expected this year, with a PE of less than 16x. Could see a 2-3x upside if it breaks $23. (Analysts’ price…
Magna Int’l. (A) (MG-T)
The question is whether oil is cheap or not. How widespread will the adoption of EVs be? Caveat is that governments will have to spend on infrastructure. All car companies are talking about growing EV opportunities, and their valuations are very cheap. Longer duration trade in car companies themselves, though a bit riskier, than with…
Stockchase Research Editor: Michael O'Reilly HOLX manufactures medical equipment and diagnostic devices including COVID-19 test kits. Sales were recently reported up almost 90% and management guidance calls for revenue to double over the year to over $1.5 billion. Trading at 11x earnings, it is good value here. We would buy this with a stop-loss at…
Zoetis Inc (ZTS-N)
Animal care plus livestock. Livestock is not growing as quickly as last year, but will as protein consumption grows in developing countries. Pet business really strong this year. Drugs come to market sooner, and not many generics. Great demographic and growth story. Yield is 0.67%. (Analysts’ price target is $186.31)
Johnson & Johnson (JNJ-N)
Dividend growth of 57 consecutive years. 3 divisions, plus vaccine rollout. Operates like a tax on the consumer. Continues to tick along. Possible acquisitions, especially on the device side. Yield is 2.56%. (Analysts’ price target is $183.68)
Yesterday, COST reported a mixed quarter despite 15% sales growth. The valuation is ridiculously cheap now, but current market turbulence doesn't matter as investors bail on stocks like this. Costco is good for the long term, though. Keep buying as this falls.
Lordstown Motors Corp. (RIDE-Q)
Stockchase Research Editor: Michael O'Reilly RIDE has the early lead in bringing the world's first all electric commercial pickup truck to market -- targeting September 2021 for the rollout. With only four moving parts and 95% more efficient than traditional engines, it can be a real disruptor in the space. The stock was recently hurt…
Domino’s Pizza, Inc. (DPZ-N)
Stockchase Research Editor: Michael O'Reilly Last October we identified DPZ as a BUY ON WEAKNESS candidate if it traded back down towards $345. It has achieved our target and so we are recommending to buy with a stop-loss at $300, looking to target $424 -- upside potential over 23%. It pays a small dividend, backed…
Nike Inc (NKE-N)
Is getting hammered in the current rotation out of 2020's winners (e-commerce retailers like this) and into reopening plays (travel, hotels).
They continue to drive e-commerce delivery. Their cloud business is growing even faster. Both are highly profitable and growing. Cash flow will rise in the next two years. The target price is $1,000 higher than the current shares. (Analysts’ price target is $4051.63)
Comcast Corp (CMCSA-Q)
There's been dislocation in US telecoms with mergers and 5G coming in, but Comcast continues to win market share from traditional telecoms. This trend should continue and feed cash flow. Their TV content through NBC and Sky should enjoy ad recovery this year while their theme parks and film operations should benefit from the reopening.…
A number of strategic moves have gone largely unnoticed. Selling non-core assets. Interest rates will benefit it. An inexpensive entry point. Not a lot of downside from here. Yield is 5.67%. (Analysts’ price target is $34.80)
Has lagged CNQ and other companies due to them cutting dividends. Likes it for the long reserve life of lower-cost oil sands that is run well. The downstream integration is very good. The financial strength of the company makes it better than mid-sized or smaller producers.
Tourmaline Oil Corp (TOU-T)
The price of oil has moved up a lot since November. It could possibly go as high as $100. Mainly a western Canadian oil company. Well completion cost is 40-50% less than their competitors. Dividend of 2% that is expected to grow. Management is bullish with $850M of free cashflow. Sales are up 19%. 3.6x…
Canadian banks have performed really well recently. A lot has to do with rising interest rates. Canadian banks are unique. They are an oligopoly. If the market slips a bit here, Canadian banks can perform well.
This post summarizes the top picks weekly. The previous week’s stock picks list is available for an additional week using the link below. Refer to Daily Top Picks available in the All Top Picks pages to browse the all-time top picks archive.
Use this list wisely to identify buying opportunities.
Happy trading !!!