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Stock Opinions by Stockchase Discover

PARTIAL BUY
Allan Tong’s Discover Picks This so-called “old tech” name has gained 52% in the past year. Surprising? Apple has climbed 36%. While FAANG has been stealing the spotlight, HPE has been making money. The company last reported on November 23 (Q3-2021): revenues climbed 9% YOY, adjusted earnings leapt 52% while both numbers beat expectations. Guidance was rosy, forecasting an 8-14% YOY increase in adjusted EPS for fiscal 2022, grounded in solid hardware sales for notebooks and PC's which amount to 71% of all revenues. A weak spot had to do with anything related to HP's printing division where revenues faded in Q4, up only 1%, sliding from 24% in Q3 and 28% in Q2. Also, chip shorrtages hitting the entire sector are a headwind. Read 3 Technology Stocks with Potential for our full analysis.
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BUY
Allan Tong’s Discover Picks I see the recent dip as a buying opportunity. Nothing broken here. Oracle trades at 25.5x earnings, which lower than Apple's or Microsoft's and half of Adobe's 52x. True, its ROI of 11.69% lags Adobe's 24.68% and Intuit's 20.62%. However, Oracle is a relatively safe tech stock, because it benefits from recurring revenues and remains profitable. True, they got into the cloud computing game late, but this division is now showing legs. You can buy Oracle and sleep well. It pays a 1.46% dividend, safe at a 32.78% payout ratio. Read 3 Technology Stocks with Potential for our full analysis.
computer software / processing
BUY
Allan Tong’s Discover Picks In mid-November 19, SHOP-T peaked at $2,139, and now trades below $1,400. That's a 31% slide. What happened? Omicron hit. Then, the feds announced they would raise interest rates. All tech sold off. To be fair, though, Shopify's PE was sailing high. Peaking at 651.57x on September 30, 2020, it then plunged to 85.72x six months later, then 50.53x exactly a year later. It now trades at a fairly reasonable 41x. To compare, Apple stands at 30.8x and Amazon 62x. Also, returns are among the highest in the software business with a 24% ROI. Read 3 Technology Stocks with Potential for our full analysis.
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PARTIAL BUY
Allan Tong’s Discover Picks H&R boasts sound fundamentals: a 7.3x PE which beats RioCan's 15.9x and Choice Properties' 35x; gross margins are in line with peers; its profit margins edges out those two peers; and the 5.19% dividend yield is safe at a 39.53% payout ratio. Though it's still early, H&R shares have inched up since the spin-off and this REIT is certainly worth watching, unless you want to enter with a partial position. Read 3 Best Canadian industrial REITs in 2022 for our full analysis.
property mngmnt / investment
BUY on WEAKNESS
Allan Tong’s Discover Picks There's a lot to like with Summit: a 3.3x PE, margins which blow away its peers, such as its 520% profit margin, and the same with its ROE of 31.32%. There are only two flags, however: Summit pays only a 2.62% dividend, the lowest in its class, and shares are currently trading at highs not seen in a decade. Still the street foresees 16% upside to $25.01. I prefer stepping in with a pullback during this current volatile market. Read 3 Best Canadian industrial REITs in 2022 for our full analysis.
investment companies / funds
BUY on WEAKNESS
Allan Tong’s Discover Picks Granite's PE clocks in at a very respectable 5.8x and margins which handily beat Allied and Dream REITs. The same goes with its ROI of 16.72% vs. Dream's 12.35%. The dividend yield clocks in on the low side in this sector at 3.08% but is solid at a lowly 16.47% payout ratio. Oh, yeah, Magna is one of Granite's biggest clients. Read 3 Best Canadian industrial REITs in 2022 for our full analysis.
property mngmnt / investment
BUY
Allan Tong’s Discover Picks JPM trades at 10.26x earnings and pays a 2.53% dividend. In contrast, Bank of America trades at 13.86x and pays 1.89%, and TD (on the NYSE) stands at 12.7x PE and a 3.62% divvy. (TD has the strongest American presence among the Canadian banks.) JPM delivered four blow-out quarters in the past year. Earnings, profits margins, ROE and cash flow handily beat its peers BAC, Citi and Wells Fargo. If you're buying an American bank, this remains the top candidate. Wall Street agrees, signalling 11 buys, two holds and one sell at a $180.31 price target or nearly 14% higher. Read Best Financial Stocks in 2022 for our full analysis.
Financial Services
BUY
Allan Tong’s Discover Picks SLF earnings of $6.08 easily beat Great-West ($3.52), Manulife ($3.40) and Power ($4.28) and its profit margins beats two of those three (Manulife's is better). SLF narrowly beat three of its last four quarters, and its PE is concerning. It trades at 11.6x while Manulife stands at 7.1x and Power at 9.8x. Read Best Financial Stocks in 2022 for our full analysis.
insurance
BUY
Allan Tong’s Discover Picks In 2021, XFN climbed 31%, which actually outperformed Royal by 3%, but lagged TD by 3%. BAM.A, though, soared 45%. That said, XFN's performance gets a passing grade. Meanwhile, average daily volumes run at 227,000, which is enough to avoid volatility. XFN is currenly trading near its $51.26 52-week high. As rates rise, so will XFN. Read Best Financial Stocks in 2022 for our full analysis.
indexes
BUY
Allan Tong’s Discover Picks BMO's Equal-Weight Banks ETF, outperformed ZFN last year by 2%. As the name suggests, ZEB holds the big six banks more or less equally. It charges an MER similar to ZFN's at 0.6%, but pays a higher dividend of 3.33%. Volumes are more robust at an average of 612,000. And like XFN, ZEB is currently trading at 52-week highs. Read Best Financial Stocks in 2022 for our full analysis.
E.T.F.'s
BUY
Allan Tong’s Discover Picks Though BKNG pays no dividend and trades at 244x earnings, the stock boasts an operating margin of 13.6% and a profit margin of 4.06% while its ROE stands at 7.15%. That beats its rival Expedia at -9.39%, -10.65% and -59.16%. Further, stock performance has been encouraging with BKNG beating earnings in the last three of four quarters. Of course, any stock in the travel sector will get hammered on any Omicron news. On Black Friday, shares tanked by 7.2%. Again, consider those buying opportunities. Read Travel Stocks for 2022 + 1 Low Risk ETF for our full analysis.
department stores
BUY
Allan Tong’s Discover Picks Ride-sharing remains unprofitable. Lyft's PE is -11.3x and its profit margin stands at -43.05% despite gross margins of almost 33%. Also, Lyft—like so many tech stocks—doesn't pay a dividend. However, Lyft has navigated the bumpy road of recovery well. It has beaten its last four quarters by wide margins, and Wall Street expects 68% upside in the stock to $71.38. Consider this a spec buy, but a risk worth taking if you are patient in 2022. Read Travel Stocks for 2022 + 1 Low Risk ETF for our full analysis.
0
BUY
Allan Tong’s Discover Picks Another 23.7% of VDY is based in oil stocks, a volatile group but should enjoy continued high oil prices this winter. Steady, boring telecoms and utilities make up another 14% of this ETF. Nothing sexy here, but every portfolio needs a grey, quiet holding to anchor the volatility of the others. Also, VDY charges a low MER of 0.21% and pays a 12-month 3.67% dividend yield paid monthly. Read Travel Stocks for 2022 + 1 Low Risk ETF for our full analysis.
E.T.F.'s
DON'T BUY
Allan Tong’s Discover Picks Rivian symbolizes this current round of EV speculation. Since it went public less than two weeks ago, RIVN stock has already soared to $179.47 and plunged to $111.78 as of this writing. Everybody wanted a piece of the next Tesla. To be fair, maybe Rivian will live up to that status one day. After all, Amazon and Ford own nearly a third of RIVN and have ordered around 100,000 e-vans from Rivian. And it's not just e-vans, but e-SUV's and pick-up trucks that Rivian will be pumping out. Don't write off Rivian, but don't dive into this free-for-all and lose your shirt. Read 4 Popular Headline Stocks for our full analysis.
Automotive
BUY
Allan Tong’s Discover Picks If you do want to invest in a headline stock in EV’s then consider Apple. The maker of iPhones—it’s long been reported—plans to build self-driving EV’s. We all know of Apple’s long track record of building innovative products, such as the iPod and the tablet, so they’ve earned the confidence of the market to succeed in EV’s. Some readers will swear by Tesla, and I can’t argue against its magnificent stock performance in past years, but Apple offers far less volatility. Read 4 Popular Headline Stocks for our full analysis.
electrical / electronic
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