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Stock Opinions by Peter Gibson

COMMENT
Thinks oil is likely to rebound to the $70 level in the next few months.
oil / gas
BUY
This is a stock that he thinks could rally by 20%. Very good value scores in the proprietary work that he does. Good yield of about 6%. Payout ratio is acceptable. Relatively low risk.
telephone utilities
COMMENT
Very positive on gold. Longer term he expects it to get to the $1300 level. Largest gold reserves in the industry. Prefers Eldorado (ELD-T), which is more of a pure gold play.
precious metals
BUY
Has a very high level of profitability. Operating characteristics, margins/asset turnover are fantastic.
electrical / electronic
DON'T BUY
Canadian banks have held up way better than the global banking system. The median yield in the banking sector is about 7%, which is normally very attractive but never by a company where the yield is high but profitability is falling quickly. The banks profit declines are very strong.
banks
HOLD
Has quite a rapid ROE decline at this stage. Wouldn't be his first choice.
oil / gas
DON'T BUY
ROE level is all right but the rate of profit decline is at a level that implies further weakness. It is negative enough to imply negative earnings surprises are still likely. Attractive yield of around 5%.
oil / gas pipelines
DON'T BUY
In the last few months, profitability has stabilized. Operating characteristics are also improving a little bit but doesn't think it is out of the woods entirely yet. Still too early.
food stores
TOP PICK
Switched out of Agriun (AGU-T), which he still likes but thought this would perform better. World's largest fertilizer company and low cost producer. ROE growth is the 3rd fastest in the TSX in the companies he looks at.
integrated mines
TOP PICK
Typically when you come to the end of these panics stimulus takes place. Oil comes off from very low levels and recovers nicely. This one has ROE levels of 43%.
integrated oils
TOP PICK
Has cash, derivatives, facilitation in equity markets, fixed incomes, energy markets, excellent characteristics and higher ROE levels. Good growth rate. Still has lots of room to run.
other services
BUY
A pure oil sands play. ROE decline is there which bothers him but the yield curve is good in terms of payout ratio and debt cash flow coverage.
oil / gas
DON'T BUY
Yield of about 5%. Return On Equity is falling rapidly. Also wants a reasonable debt to cash flow of below 3X or 2.5X. Theirs is 3.6X.
electrical / electronic
COMMENT
Likes the company and even liked the stock when it was around $7. There is a lot of market apprehension about infrastructure, business jets in particular. Very high level of ROE and very strong profit growth. Valuation looks good. It won't go anywhere until corporate spreads narrow in and some of the risk aversion goes away.
transportation equip & components
DON'T BUY
Almost across the board, there is a collapsing profitability in Canadian banks. He has been nervous about this area for quite some time. Except for CIBC (CM-T) ROE seems to be falling quite rapidly.
banks
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