Michael Simpson, CFA
Senior Vice-President at Sentry Investments
Member since: Oct '05 · 1245 Opinions
Rating Card
Premium content| All | 
Rating
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Big Win
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Win
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Neutral
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Loss
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Big Loss
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|---|---|---|---|---|---|---|---|
| 3.69 | 55 27.78% | 56 28.28% | 29 14.65% | 41 20.71% | 17 8.59% | ||
| 1 Month | 3.73 | 0 0.00% | 18 45.00% | 16 40.00% | 6 15.00% | 0 0.00% | |
| 6 Months | 3.77 | 6 15.00% | 18 45.00% | 5 12.50% | 10 25.00% | 1 2.50% | |
| 12 Months | 3.55 | 13 32.50% | 8 20.00% | 7 17.50% | 9 22.50% | 3 7.50% | |
| 2 Years | 3.54 | 14 35.00% | 7 17.50% | 1 2.50% | 12 30.00% | 6 15.00% | |
| 5 Years | 3.86 | 22 57.89% | 5 13.16% | 0 0.00% | 4 10.53% | 7 18.42% |
Stock Opinions by Michael Simpson, CFA
It's always hard to predict when you'll have a pullback. Historically the weakest month is September, with October being the second weakest. But we went through September with relatively good results. If there were a small pullback, he wouldn't be surprised but he'd take advantage of it.
At times there's a two-tier market, where some of the higher-valuation stocks get lots of love and attention, while other stocks are neglected. Many investors in Canada don't realize that over the last 12 months more than 30 companies have been subject to actual, or pending, takeovers. Our market is cheaper than the US, and it's a call for Canadians to invest in their home market.
Yes. One research report shows that if you take out the performance of gold and silver, and that's about 12%, the TSX is up ~12.7-12.8%. If you're underweight gold and silver as a portfolio manager, your performance hasn't been the greatest. This doesn't always happen in the Canadian market.
He and his team are fundamental investors. The TSX is trading at a cheaper valuation, with a higher dividend yield, and other metrics are good. Over the next couple of years you want to be in hard assets, and Canada has a lot of those.
He's a North American manager, but for new $$ coming in about 75% will go to Canada and 25% to the US. That's how he sees the world.
He's investing in companies that have good hard assets, grow cashflow, and pay dividends. PPL is one example. Its pipelines will benefit from LNG and LNG expansion. Others includes JWEL and KEY. Two of his three top picks are Canadian. Great companies in Canada; you don't always have to head to the US for good value.
Shows the demand for rare earths. The US wants to make sure they have their own supply, either in the US or in friendly countries (and Canada is one). Rare earths go into so many sectors and industries of the modern economy, including the defense industry and electronics. It's crucial that Canada and the US have access to rare earths.
Healthcare in US has had one of its worst performances over 10 years. Most sector $$ has gone to obesity drug makers. Two key drugs, more in the pipeline. Quality company. Very cheap, so he'd look at it. Based in New Jersey, so very little tariff impact. Dividend yield over 4%.
Time to take a look. On valuation, much cheaper than overall market. Money is starting to flow in from other, overvalued sectors.
He owns JNJ. Two years ago, spun off consumer division. So now it's just drugs and medical devices. Trading ~14-15x PE. Spending billions to build new facilities in US, so that gets them on the right side of the Trump administration.
Remains to be seen. We're still in early days (or innings, because they love their baseball in Toronto ;) There will be winners, but we won't know who until 3-5 years down the road. It's also about how companies adopt AI. We'll have to monitor the spending and see how effective it is.
Likes it. New CEO has done a really good job restructuring. Provides environmental services. Provides chemicals to O&G, water treatment, and food industries. Reduced debt. A good part of the business is economically sensitive. Some investors are concerned about the income trust structure, but management says it's too hard to remove.
Used to own, going to do a deep dive on it.
Focus is on small and medium businesses, so investors are concerned about even small upticks in unemployment. Good, steady company. Attracts a premium valuation. Don't have to worry about AI so much right now; AI can assist (rather than replace) its work, and provide more data. The debate now is about whether the economy grows or shrinks.
Has done well over the years. New CEO of a few months has good credentials, but pressure on stock is about the economy. He'll monitor next set of results to see how it's faring in the more sluggish Canadian economy. Performance depends on its credit underwriting -- as the economy gets stressed, loan losses may go up.
Sold most of its renewable assets, except for hydro. Water utilities in the US. Rate cases coming up always make analysts nervous in case rate increases are denied. New CEO trying to turn things around. Debt levels are a bit high.
Old management expanded things too rapidly. Dividend was cut. Talk of redomiciling to the US, but might be too small to be on the US market. He'll monitor it.
Full agenda, lots of trade items. The first meeting was challenging, but Carney showed grace under pressure. The US needs our aluminum, getting about 62% from us. Steel is a bit different, as it's more of a global commodity.
He'd like to see progress on tariffs coming down, and an idea of what's going to happen with USMCA next May. Canada needs to reinforce to the US that we're a friend, steady ally, and good trading partner. Trade, including that with small and medium businesses, is for the mutual benefit of many parties.
In a world that's getting more dangerous, it's good to have allies. Canada's doing a good job stepping up our military in the defense of our North.
For the US administration to save face, perhaps we can give the US a bone (such as importing more goat milk from the US instead of from elsewhere). The US could take more of our aluminum to benefit its aerospace and defense industry.
