Opinions by Robert Lauzon | StockChase
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Robert Lauzon

Deputy Chief Investment Officer

ON STOCKCHASE SINCE Dec 2004

Middlefield Capital Corporation


Opinions by Robert Lauzon


Signal Opinion Expert Chart

2017-10-31

N/A
A Comment -- General Comments From an Expert 

Market. We pretty well have a globalized synchronized growth period now. Brazil and Russia have turned around because of oil prices. Greece, which has always been the problem child until about 2 years ago, will probably put the strongest GDP growth rate in the Eurozone in 2018. China and India are the main drivers of global growth, but with all the other developed nations doing their part. We are seeing that in strong earnings, consumer confidence, unemployment stats and the stock market. He’s been allocating a little of his North American exposure into Europe. The US has been a great place, but thinks they are in the 8th inning. Tax reform is coming, which can give a little more of a melt-up to the stock market. There are still some nice tailwinds on earnings growth coming from the US, but he doesn’t see a multiple expansion happening. In Europe he sees earnings growth, similar to the US, probably 8%, but there will probably be an extra turn in the multiple, and a possible 15% next year in Europe and only 8% or so in the US. The next NAFTA meeting is around November 17, so be prepared to get some noisy headlines. The bigger card in Trump's poker game on world trade, is China. That could be a 2018-2019 story, and he can't deal with China if he is lackadaisical and bends over with NAFTA and the south Korea trade partnership. Don't be surprised if we get a more negative outcome on NAFTA in what the market is anticipating.

Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $0.020
Owned: _N/A

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2017-10-31

N/A
A Comment -- General Comments From an Expert 

If I sell Canadian Banks, where should I put my profits for income and a little growth? This may crystallize some capital gains which you have to look at as a factor. He likes Canadian banks for the long-term. They have a good control on less volatile earnings than we have seen from other banks globally. However, valuation is a little stretched and he prefers European banks that trade around BV. NAFTA could be a headwind in the next while, and that could hurt general Canadian markets and there could be a selloff. In addition, there are new housing rules coming in January. Keyera (KEY-T), Pembina (PPL-Y), Inter-Pipe (IPL-T) have sold off and give you a mixture of good yield and some growth. You can also find some growth and income in some of the REITs.

Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $0.020
Owned: _N/A

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2017-10-31

HOLD
Advanced Micro Devices (AMD-Q)

A play on chips, Apple devices and hopefully they get into more autonomous vehicles. In the last 3 days, it has dropped about 25%-30%. Morgan Stanley reduced their rating on the company, but Morningstar increased their rating. He thinks you are okay continuing to Hold and see what the next couple of quarters brings.

electrical/electronic
Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $10.985
Owned: Yes

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2017-10-31

COMMENT
Arc Resources Ltd (ARX-T)

This is known as a gas stock, but is fairly balanced with 60% gas and 40% oil. They have a great play in British Columbia, one of the higher-quality gas formations. Good management. You've seen a $10 pull back in the share price, similar to other gas stocks. Pays a nice dividend. It will have its time again. You just have to wait for colder weather and the supply/demand balance.

oil/gas
Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $15.730
Owned: Unknown

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2017-10-31

COMMENT
Alterra Power Corp. (AXY-T)

Innergex (INE-T) is buying this company and is giving stock as well as cash. If it's a tax deferred takeover, he would be fine with the takeover. It does some Hydro, renewable and power, a lot of it in Québec and some in Europe. On the cash portion, if you wanted to stay in power, you could buy something like Capital Power (CPX-T), which gives you a good dividend. However, the portion that comes to you in stock should be tax deferred.

Energy
Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $7.840
Owned: Unknown

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2017-10-31

COMMENT
Bank of America (BAC-N)

He likes this bank, and is one of his top US holdings. Expects it is going to move with expectations of interest rates. Loan growth, consumer spending and business optimism is high. He could see this trading at 15X Earnings and as a $32 stock next year.

banks
Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $27.390
Owned: Yes

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2017-10-31

COMMENT
Bombardier Inc (B) (BBD.B-T)

To him, the preferreds would be considered a high yield debt, so for that portion of your portfolio, you are probably OK. He would be hard pressed to envision this company filing for bankruptcy in the next couple of years, when the Government, especially the Québec government, always seems to have their back. Probably a safer way than playing the stock.

transportation equip & components
Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $2.730
Owned: Unknown

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2017-10-31

COMMENT
Birchcliff Energy Ltd. (BIR-T)

What is holding them back right now is the take away capacity, and a lot of maintenance on some of these collecting natural gas lines out west, which has affected production and volumes, and more specifically, a lot of that gas has been shut-in in storage, so you have a glut of gas which caused the AECO price to go to zero 2 weeks ago, but is now back to $1+. Also, one of its major shareholders sold down his holdings. He is waiting for clarity on AECO price, which we might get in the next couple of weeks.

oil/gas
Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $5.250
Owned: No

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2017-10-31

PAST TOP PICK
Bristol Myers Squibb (BMY-N)

(A Top Pick Feb 8/17. Up 20%.) Still his favourite Pharma name. Had a small one-cell lung cancer solution, and the market is starting to get its head around that they are still in the game. We should get results in the 1st half of 2018. Over the next 5-6 years, their pipeline of drugs is so vast and undervalued, that as drugs come through fruition into cash flow and get approval, there are more and more tailwinds. It could be a potential take out candidate.

biotechnology/pharmaceutical
Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $61.660
Owned: Yes

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2017-10-31

PAST TOP PICK
Brookfield Property Partners (BPY.UN-T)

(A Top Pick Feb 8/17. Up 4%.) The thesis is the same, trading at a 20% discount to NAV, so there is a value, but rates have gone up in Canada. If we hadn't had those 2 rate hikes this year, the stock would be higher.

REAL ESTATE
Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $30.060
Owned: Yes

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2017-10-31

COMMENT
CVS Health Corp (CVS-N)

These types of stocks have all been hit for a few reasons. There are too many pharmacies in the US. The dispensing margin is being narrowed, so margins are also being hit. Also, the threat of Amazon is hovering over the pharmacy business. He still sees headwinds.

specialty stores
Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $68.530
Owned: Unknown

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2017-10-31

COMMENT
Deutsche Bank AG (DB-N)

This could be a Buy based on his view of undervalued European banks. You would probably see a couple of good years going forward in the European stock market. However there is still a bit of hair on this. It's cheap, trading at about .4X BV. There are other banks or service companies you could buy that doesn't have as much hair. He would go with names like Credit Suisse that trades at about .8X BV or UniCredit, an Italian bank trading at .75X BV.

banks
Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $16.270
Owned: Unknown

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2017-10-31

PAST TOP PICK
Freehold Royalties (FRU-T)

(A Top Pick Feb 8/17. Up 27%.) A safer way of playing energy. Has been collecting a 4% yield. Volumes are picking up. The lands they are collecting royalties on, and with $50 oil, they’re starting to drill more, so royalty cheques are getting bigger. It was a safer way to play the rebound in energy. Still thinks it is undervalued and is a good holding.

oil/gas
Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $15.780
Owned: Yes

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2017-10-31

PARTIAL BUY
General Electric (GE-N)

A concern he has is the potential of a dividend cut in November. Most analysts are encouraging them to cut the dividend to help right side the ship. There is a lot of value in a company like this if they can turn it around. They started to turn the company around about 6 months ago, and doesn't think you are going to see much until Q4 of 2018. He would recommend buying half around the dividend cut. Being a tax loss candidate at the end of the year, Buy your 2nd half in late December, post tax loss selling, or early next year as you get more clarity. It sets up for a nice trade. Dividend yield of about 4.8%.

electrical/electronic
Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $20.160
Owned: No

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2017-10-31

TOP PICK
HSBC Holdings (HSBA-LSE)

A play for investors that can be bought as an ADR and doesn't have to be bought in Europe. It gets you that synchronized global growth that is happening. Gets you into Europe, North America, South America and, more importantly, Asia. He sees growth in earnings coming from all those areas. Dividend yield of 5.3%. (Analysts' price target is £720.78.)

Robert Lauzon

Deputy Chief Investment Officer, Middlefield Capital Corporation

Price: $0.000
Owned: Yes

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