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Stock Opinions by Stockchase Discover

BUY
Allan Tong’s Discover Picks GM stocks trade at a mere 5.28x PE, though their beta is 1.22 and they pays no dividend. Around $32, shares are flirting with 52-week lows, which is an attractive entry point. Bears will point that cars, gas or electric, are a cyclical business, and the economy is slowing down. Fair point. However, the supply chain will ease eventually while demand for EV’s will not diminish. In short, GM stocks have been beaten up so much lately that they’re now looking attractive enough to nibble at. Read 3 defensive stocks weather uncertain markets for our full analysis.
Automotive
BUY
Allan Tong’s Discover Picks Telus pays a fat 4.72% dividend yield at a % payout ratio. It trades at 23x earnings and a mere 0.54 beta. Shares are actually trading at 2022 lows beneath $29, but that’s in line with the overall TSX. Surprisingly, Telus has beat only one of its last four quarters, met two, but missed one. Not exactly a slam dunk. Read 3 defensive stocks weather uncertain markets for our full analysis.
telephone utilities
BUY
Allan Tong’s Discover Picks BCE, owned by Bell which owns the phone lines that the internet runs on (though everyone ignores this conflict of interest) pays a 5.82% dividend, trades at 19.6x earnings and at a super-low 0.34 beta. BCE stocks, too, are wallowing around 52-week lows of $63, but the stock has beaten or met all of its last four quarters. Read 3 defensive stocks weather uncertain markets for our full analysis.
telephone utilities
HOLD
Allan Tong’s Discover Picks Walmart stocks and big retail are out of favour on Wall Street. Supply chain delays, hot inflation, higher wages and now product markdowns are plaguing Walmart and its peers. Further, WM’s last report noted a shift in consumer spending from household stuff to experiences. The company lowered EPS guidance as overall revenues in Q1 fell $5 billion from divesting businesses in the U.K., Japan and Argentina, further weighed by another $0.4 million of unfavourable forex. Meanwhile, international net sales slid 13% to $23.8 billion while net sales declined $5 billion. Adjusted EPS in Q1 reached $1.30, down 23.1% from a year ago. Management forecasted another 1% decline in EPS before flattening. That said, the company beat in Q1, but missed in Q2 which caused shares to slide from $148 to below $120. Read 3 gems from the Collision technology conference for our full analysis.
department stores
BUY
Allan Tong’s Discover Picks The amount Meta paid is a drop in the bucket for company worth nearly $500 billion, but it makes shareholders like me shake my head over why the company keeps stepping into unnecessary controversies. It doesn’t help the share price which has tanked by more than half from its 52-week high of $384.33. And it doesn’t attract ESG investors who value good corporate governance. So, why not sell Meta stocks? Read 3 gems from the Collision technology conference for our full analysis.
0
BUY
Allan Tong’s Discover Picks Airbnb still leads in market share at 74.6%, followed distantly by Vrbo (Expedia) at 20.8% and Vacasa at 4.6%. In early May, ABNB stocks posted a 70% rise in revenue over 2021 to $1.5 billion beating the street’s $1.45 billion. Further, this revenue is 80% higher than in 2019. Lastly, the company’s average daily rates in Q1 2022 were up 37% over Q1 in 2019. To compare, hotel rates in New York jumped 69% between May 2021 and May 2022. I’ve written about ABNB stocks recently, so I’ll just end this by reiterating the stock as a buy. Read 3 gems from the Collision technology conference for our full analysis.
Technology
BUY
Allan Tong’s Discover Picks BEI.UN stocks sport only a 4.1x PE (Killam Apartment REIT trades at 5.9x), yet pay a 2.58% dividend, admittedly not the highest. (Killam pays 4.19%.) Also, daily volumes average only 145,000, so it’s not the most liquid asset out there. However, Boardwalk margins are attractive and comparable to its peers. Its profit margin is nearly 103% and ROI is 8.21%, which is in-line with the sector. Circling back to the oil boom, Boardwalk has been enjoying that tailwind. Current weakness in the TSX correction represents a buying opportunity. Read 3 defensive stocks to find stability with your money for our full analysis.
property mngmnt / investment
BUY
Allan Tong’s Discover Picks DG stocks project same-store stales to rise 3-3.5% in 2022, net sales to increase 10-10.5%, and EPS to advance from 12% to 14%. All this as the chain opens another 1,110 stores this year. At the start of 2017, DG boasted 13,601 locations and started this year with 18,356. Compound annual growth rate (CAGR) between 2016 and 2021 was a healthy 9.2%. Its metrics beat its competitor, Dollar Tree whose CAGR in 2015-2021, for instance, was 4.9%. DG pays a 0.95% dividend and trades at 23.66x PE. Read 3 defensive stocks to find stability with your money for our full analysis.
0
BUY
Allan Tong’s Discover Picks I reiterate a buy on this renown REIT, especially after shares have slid $15 this year to below $44 to 52-week lows, while the dividend has climbed from well below 3% to 3.35%. CAP REIT owns 57,000 units particularly prime real estate in Ontario and to a lesser extent, Quebec. It’s the largest multi-residential REIT on the TSX. CAP REIT’s occupancy rate was 98.6% as stated in the company’s 2021 annual report. The PE is now an attractive 5.75x, though admittedly higher than other residential REITs like Boardwalk, as noted above. Read 3 defensive stocks to find stability with your money for our full analysis.
investment companies / funds
BUY
Allan Tong’s Discover Picks Despite these realities, nuclear is coming back and so is uranium, its essential ingredient. Cameco is the go-to stock here. U.S. President Biden announced in early June that he’s pushing for $4.3 billion plan to buy enriched uranium from domestic producers to wean the country off Vladimir Putin’s supply. On June 7, shares of Cameco soared from roughly $31.40 to $34.40. Shares peeled back over the rest of the week, but remained well above $32.50. Even prior to that, Cameco was making 52-week highs, touching $40 in mid-April, nearly double its late-January price. Cameco has momentum. Read 3 rock stars of the mineral stocks for our full analysis.
integrated mines
BUY
Allan Tong’s Discover Picks FCX is the copper name for many wealth managers turn to who applaud the company’s robust balance sheet, share buybacks, steady 1.42% dividend yield and recent strong recent quarter. In the first three months of this year, FCX shares jumped 19%, the surrendered those gains in April, a victim of that month’s panic selling but also the company’s own strong quarter. FCX beat the street’s top and bottom lines for Q1 2022, but management slightly reduced the outlook for copper sales from 4.3 (2022) and 4.5 (2023) billion pounds as announced in Q4 2021 to 4.25 billion and 4.45 billion respectively. The street reacted harshly and the spring sell-off was overdone. Read 3 rock stars of the mineral stocks for our full analysis.
non-base metal mining
RISKY BUY
Allan Tong’s Discover Picks Lithium shares are another story: they are speculative. Like many precious metals, lithium wakes a lot of time, sweat and money to extract. One of the leaders in this space, Albemarle, boasts a chart that is not a straight upward line like the price of lithium, but a rollercoaster, ranging from $157.82 to $291.48 in the past year. ALB has been a little more stable in the past month, ranging between $230 and $260 (broadly speaking). What’s working in ALB’s favour, though, are recent earnings estimates: $2.65 EPS this quarter, which is 197.75% higher than a year ago, and $12.63 full-year or 2.21.62% from a year ago. Last month, the company raised its full-year 2022 adjusted EBITDA up more than 160% over 2021. Lithium demand and pricing is catching up to the stock price. Read 3 rock stars of the mineral stocks for our full analysis.
Mining
BUY
Allan Tong’s Discover Picks Expedia, like the hotels and airlines it links to, has pricing power. Trading above $130, EXPE is still far below its highs of $217.72, which is precisely the price target going forward. The street is split between 12 holds and 12 buys. The PE of 106x is a concern, more in line for a tech company than a tourist attraction like Six Flags Entertainment, which trades at 16x. Read 3 stocks to profit from revenge travel for our full analysis.
merchandising / lodging
BUY
Allan Tong’s Discover Picks Mastercard stocks’ EPS of $9.61 has jumped 47% in the past year. It trades at 37.23x though the street’s forward PE is only 33.94x. (Visa’s PE is 40.4x). However, the ROE is 142% while Visa’s is barely 40%, and MA pays a safe dividend of nearly 2% at a payout ratio of 19.22%. All in all, the street is confident with MA with 15 buys and one sell, at a target of $431.19. Read 3 stocks to profit from revenge travel for our full analysis.
other services
BUY
Allan Tong’s Discover Picks Airbnb trades above 100x which the street finds too high, given its forward PE of 70.53x, so consider this a note of caution. However, the stock has beaten its last four quarters during periods of blanket lockdowns. Buying Airbnb is wagering on strong summer numbers and all indicators noted above point to one. Read 3 stocks to profit from revenge travel for our full analysis.
Technology
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