Wolfgang Klein

Market. Based on his recent work, he thinks this is the greatest credit boom and possibly greatest bull move of the stock market. Even if the forward interest rate curve inverts, there will be substantial credit available in the shadow banking space. He thinks we are another year and a half away from seeing rate curves invert. Pension funds have large shortfalls and have hurdle rates of 7% returns, which must be earned by fixed income (i.e. bonds). This group is lending to credit-worthy companies. This could eventually lead to the largest credit bust in history, as these groups become more and more leveraged. He prefers the US market, because the limited number of quality Canadian equities makes the good ones very expensive compared to their US counterparts.

Currency balance within your portfolio. He likes the US market. With today’s currency, you will be paying up for US holdings. As a Canadian having all your money in the Canadian dollar is very risky. Adding US dollars helps reduce risk. You will find cheaper valued stocks in the US, due to the premium paid for quality brands in Canada – and the US companies will be bigger and better. He likes 60% US dollar exposure. He thinks $0.80 CAN/US would be a good time to buy US dollars.

The stock is presenting a fair valuation at these levels. It is a very good company with multiple brands. They have expanded into Europe, where in Norway they are involved in electric vehicle charging. From a technical perspective, the monthly chart is at long term support (200 month moving average). He is not a Canadian consumer staples player, but views this as a good buy for investors with a 2-3 year time horizon.

This water treatment company has had a good correction and now looks like a good buy. This is a quality stock and he has been waiting to buy it – he just wants to understand why there has been a pullback. A quality company and a great long term hold. It is an international play and many silos of business. The 200 month moving average is around $50 and should act as good support.

A very smart company. He would prefer to buy it on a pullback. Cloud computing benefits and they are making smart acquisitions. They have loyal clients, he says.

Would selling be a good idea? He views this as a disciplined way to buy into a stock. This is a quality business, but it comes at a high valuation right now. He is already long his full allotment. Over the next 3-4 years, this stock will continue to strengthen.

He thinks there are much better choices than this. It is an encryption software company that has done a good job to extend its product life. He would rather own Apple, Adobe or others.

Technically the stock looks reasonable. However, at 22 times earnings it is not cheap. There had been 70,000 layoffs through the company, he says. It is a mining and infrastructure play. It is not his favorite space to invest.

A regional air carrier that gets its business from Air Canada. The contract renews in the next couple of years. The balance sheet is fine and the dividend appears safe. He fears the recent weakness in Air Canada stock price. Yield 6.4%. (Analysts’ price target is $10.50)

For his growth portfolio he owns HMMJ-T, which Canopy is a part of. He added a little more Canopy to top up. Buyer beware, it has a $9.5 billion market cap, making it a very expensive company to buy. He likes the management. He would like to see the Canadian banks get in favour of the marijuana stocks once it gets acceptance now that it is legalized. He thinks supply will exceed demand in Canada in the next few years ahead. He thinks there could be emerging opportunities in the US given the vast size of the market there.

He has never owned a defense stock, as it goes against his personal principals. Under the Trump Administration, now is the time to own a defense stock. Trading at 20 times forward earnings, it is not cheap. A clean balance sheet, but he would have to know their order back log. With global rising tensions, there is a lot of runway ahead (unfortunately). (Analysts’ price target is $238)

He thinks this is massively overvalued, given it sells “junk” items. It has a 30 times multiple. He would rather buy McDonald’s with a 20 times earnings multiple.

He has trouble with the valuation. Their new content spend will exceed that of Disney, with the expectation of $10 billion to be spent in the next year. Their subscriber fees will continue to do well; however, competition is on the way with Apple, Google and Amazon.

He doesn’t like the C-series hole that was created. They sold much of their growth to survive. The chart is looking better, but he feels the company is fully valued. He is not excited about this story. If he owned it he would be a seller here.

A great Canadian brand, which has risen due to the scarcity of such investments. He wished he had bought it. He is surprised it has not been a victim of pirating and knock offs. He would look to take some money off the table as it trades at 74 times future earnings.