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Stock Opinions by Karl Berger

N/A

Markets. Whatever happens, we are going to continue to be in a low growth economic environment into 2013 and we need to accept that. Whether the driver comes out of the US, out of Europe or out of China, there are some positive things that we can look to in each of those different scenarios. Global growth is going to remain slow and we are going to have to deal with that environment. People need to be very cautious in this environment about precisely what kind of companies they own and what the yield represents. However, they also need to be cognizant of the alternatives to the equity market of very low yielding fixed incomes.

Unknown
DON'T BUY

There are headline risks with any of the pharma stocks and this is not an area that he gravitates to despite the fact the dividends are reasonably solid, have been paid for some time, and would likely be paid for some time. Issue for many of the big pharmas is the risk of the shift away to generic drugs and the lack of growth prospects that result from that dynamic.

biotechnology / pharmaceutical
COMMENT

Had a pretty decent run over the last little while. Pretty good defensive company. Likes the mix of revenues that come from emerging markets. Given the run-up it has had, he would recommend watching it and trying to get it a little cheaper or put only 50% in and add to it when the opportunity arises.

food processing
COMMENT

Just announced they are acquiring Plains and McMoran for $9 billion so are getting deep into oil now. Whenever a company like this dilutes their product offering or their focus, it can be very good or sometimes a challenge. Market is treating this as a challenge but he doesn’t know that he would jump to that conclusion. Well managed. Don’t expect they would get into an endeavour like this without having done thorough research.

non-base metal mining
N/A

Caller is thinking of putting 30% (3 of his stocks) of his RRIF into Singapore. Notion of putting 3 stocks as 30% of your portfolio seems excessive. He would much prefer to see a portfolio that was diversified with no more than 3%-5% in each holding. No problem with putting 30% of your portfolio outside of Canada.

Unknown
DON'T BUY

Not a stock that he would be keen on at this time. Dividend has disappeared but he believes it will be coming back. Heavy levels of debt and the Spanish economy is still not in particularly good shape.

telephone utilities
DON'T BUY

British economy is still struggling. You have to look at any European bank at this point as having an awful lot of exposure to an area that has a very uncertain economic future ahead of it. Still too many headwinds.

banks
COMMENT

He exited their positions recently because of concerns over the euro. Pays a solid dividend and the dividend is safe. This will be a boring, defensive holding that should just churn along with possible marginal dividend increases.

food processing
PAST TOP PICK

(A Top Pick Nov 22/11. Up 27.46%.) Still likes. Has managed decent same-store sales growth. Not overvalued yet.

merchandising / lodging
PAST TOP PICK

(A Top Pick Nov 22/11. Up 16.63%.) Videotron 6.875% bonds maturing July 15/21.

Unknown
PAST TOP PICK

(A Top Pick Nov 22/11. Up 3.61%.) Dividend is solid, very sustainable and will likely grow. A little disappointed that company management hasn’t grown at a more active pace. A little conservative. If the price of oil stays reasonably consistent, he expects they could get spectacular dividend growth over the next little while.

integrated oils
WEAK BUY

Loves the theme of food commodity price appreciation, which he thinks will play out over quite a period of years. Prefers Agrium (AGU-T) as a way to play this theme because of the exposure it gives to nitrogen-based fertilizers. Going through some challenges on the pricing front right now because of India and China holding off. Also, expect new players will start producing potash as well.

integrated mines
WEAK BUY

Sold his holdings about a year ago because growth prospects weren’t what he hoped for. IT space has been fairly challenging from a number of different perspectives. Have done a couple of really good things recently including instituting a dividend which they could grow over time. Without a real robust economic environment, all of the IT companies face a bit of a headwind.

electrical / electronic
BUY

Likes this equally well as Royal Dutch Shell (RDS.A-N), which he owns.

integrated oils
DON'T BUY

Early reviews are good in terms of the Windows 8 operating platform and in terms of the Lumia phone. His sense is that it is a little too early to claim victory in the battle. Looking at the smart phone space, it is incredibly competitive. The amount of innovation required, in shorter and shorter cycles, worries him.

Telecommunications
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