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Stock Opinions by Stephen Takacsy, B. Eng, MBA

COMMENT
Not keen on resource stocks. They try to have a low beta, low cyclicality strategy. Resources, mining, oil & gas, and any commodity are all volatile businesses, where the CEO can't predict the price of his product. Low ROICs. They make a good trade if you can time it right, but not good long-term investments. Energy in Canada is down over 50% over the last 60 years. He likes energy infrastructure, to get some exposure to the sector, like the mid-streamers. Those ones are much more stable, solid, cash generators, great dividend payers, dividends are rarely cut and usually increased yearly.
Unknown
COMMENT
Aren't oil stocks with huge cashflows screaming buys at these levels? Good point. Trend is away from fossil fuels, so a lot of selling over the decade by pension funds and institutional investors. You should not pay high multiples for these stocks. Price of oil is very volatile. OPEC likes to control the price. These stocks will rise, and fall, with the price of oil.
Unknown
COMMENT
Investing 2022 vs. 2021. In the US, handful of big, very expensive tech stocks drove the market up. Since mid-last year, more than 50% of those stocks were down quite significantly. In Canada, oil & gas and banks were responsible for 18% of the 24% return on the TSX, extremely concentrated. Most stocks had muted returns, even worse in small-mid caps. You have to pick your spots, be company-specific. Lots of sector rotation, computer-driven momentum trading based on algorithms. If your stock goes down, it's a buying opportunity, as sometime it will come back into favour. If it gets overvalued, think about trimming. Be in it for the long run, and stomach the volatility whether it's justified or not.
Unknown
BUY
Largest broadcaster in Quebec. Formidable share of the market at 38%. Extremely profitable. Cheap, 3.5x earnings. He feels it will be privatized at some point, and there's money to be made 2-3x what it's trading at. Be patient. Really good upside, very little downside.
communications / media
BUY
World leader in cloud-based e-learning. YTD, probably best performing tech stock on the TSX. Subscription based model. High margin revenue. 20% increase in annualized recurring revenue. Just signed with NY State University and BC Education. Trades well below peers. Great long-term investment.
0
COMMENT
Market glutted with tech IPOs? No question. Huge indigestion last year on the IPO front. There's always the good (overvalued), the bad (shouldn't have gone public in the first place), and the ugly. Not necessarily easy to pick out the diamonds in the rough.
Unknown
PARTIAL SELL
Doubts about a BHP takeover, as government won't let our potash go to foreign hands. Supply disruptions, high input costs, export restrictions, strong demand. It doesn't get better than that for potash pricing. Time to take profits? CEO departure concerning.
agriculture
BUY
ENB vs. TRP Tough call, he owns both. Quite similar, but different. Loves infrastructure, as it's impossible to build more these days. ENB is more oily, whereas TRP is more into nat gas. Both solid, dividend growers, great cashflow. TRP is more focused on renewables. Both going in that direction. Both stocks were hammered recently for different reasons, buying opportunity.
oil / gas pipelines
BUY
TRP vs. ENB Tough call, he owns both. Quite similar, but different. Loves infrastructure, as it's impossible to build more these days. ENB is more oily, whereas TRP is more into nat gas. Both solid, dividend growers, great cashflow. TRP is more focused on renewables. Both going in that direction. Both stocks were hammered recently for different reasons, buying opportunity.
oil / gas pipelines
COMMENT
Right time of the cycle for industrials? Industrials is a broad category. Momentum investing and sector rotation often cause the industrials to get tossed around together even though they're in very different businesses. It's his biggest segment. Never a bad time, just because they happen to be industrials, to get into good companies.
Unknown
BUY on WEAKNESS
Really likes management and its direction. Automation is the big theme going forward. Healthcare, auto, manufacturing, nuclear industry. Very acquisitive. Pricey, but stable, performing well even on bad days. Good addition on a pullback.
misc industrial products
PAST TOP PICK
(A Top Pick Jan 25/21, Up 5%) He trimmed in the high 50s, recently buying it back in the high 30s. High conviction on this one. Huge barriers to entry. High margins and free cashflow. Stock pulled back on a missed quarter, since demand was so strong that sales had to be pushed to next quarter, setting that one up for strong numbers.
INDUSTRIAL PRODUCTS
PAST TOP PICK
(A Top Pick Jan 25/21, Down 74%) Whole telehealth sector has been decimated. Investors are selling, but they're not pandemic plays. Digital healthcare revolution is just getting started. 2 big contracts announced. Valuations are starting to look attractive. One of the best paths to organic growth and profitability.
Healthcare
PAST TOP PICK
(A Top Pick Jan 25/21, Down 52%) World leader. Benefitting from huge spend on 5G. Travel and infrastructure were delayed during pandemic. Now have a new CEO and backlog. Insider buying. 7x this year's forecast EBITDA. An easy double in the next 12 months, going a lot higher down the road.
0
BUY on WEAKNESS
Really likes it. Also owns CP. Industrial exposure, but not labour intensive. Great business. CNR is under pressure to improve operational metrics. A bit pricey. For CP, lots of synergies with the KSU acquisition. Perhaps a bit more upside with CP over the next 12 months.
Transportation
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