Rebecca Teltscher

Second straight year we've seen returns of over 20% per year, at least in the US. The last time this happened was 1997-98, and we know what happened subsequently when the dot-com bubble burst. She's not saying this market feels like a bubble, but it definitely feels expensive with valuations stretched, and more so in the US than in Canada.

Her firm is always conservative on a regular day. Preservation of capital is the most important thing for her clients, not risky investments. So today, they're being extra cautious. Still, the market rally of the last 2 years has focused predominantly on the tech sector and, in particular, on 7 stocks.

Though her portfolio has done pretty well in the past year, she's not dealing with unreasonable valuations. So there's still an opportunity for the portfolio to continue to grow. The sectors she's in have seen moderate growth, but valuations for the most part are still OK.

Her holdings include pipelines and utilities. Telcos have done poorly, but that's just a small part of the portfolio. She focuses on infrastructure, and critical infrastructure that's difficult to replace. What do consumers need, not want? With utilities, for example, even if we go into recession and consumers are strapped financially, they're not going to cut off their power or cell phone service.

Under $150 it's starting to get interesting. Can't go too wrong at these valuations, though a cheaper opportunity may arise in a recession.

Disconnect in terms of valuation and performance between CNR and CP is enticing. CP is trading a lot more expensively around 21-22x PE. Whereas CNR is trading more cheaply by comparison and by historical standards. Cyclical. Attractive dividend yield of over 2%.

Of all the long-term care facilities, this would be the one she'd look at the closest. Secular trend of aging demographics isn't going away. Targeting 95% occupancy, which is achievable. Liability risk if another Covid-type outbreak. Healthcare worker shortage. Yield is less than 4%.

See her Top Picks for a name that plays to the same demographic.

Hasn't performed as well as others. Hasn't sold or trimmed, but added. Long-term play for next 5 years, don't expect a recovery in the next few months. Management changes and US asset cap could lead to more weakness. Premier asset in US and Canada. Canadian earnings very strong. Trades at steep discount.

Likes exposure to energy and energy prices without the exploration costs. Stock's come down on issuing equity for recent acquisition. Substantial dividend in the space, minimal risk. Good value. Compelling yield of 8.3%.

All the telcos are in a competitive price environment, but this should moderate in 2025. Lower interest rates should benefit. Slower immigration is a slight negative, but Canada's numbers are still more positive than other G7 countries.

Market assumed sale proceeds from MLSE (asset wasn't cashflow positive, but sold for a good price) would be used to pay down debt. Ziply acquisition (accretive to cashflow, higher growth opportunities) really threw investors off. Stock trended down, investor sentiment negative. What they did was positive, but balance sheet is worrisome. Lots of tax-loss selling. Past peak of capex on fibre to the home, which should increase cashflow going forward.

Yield is now 12% or so, with a greater chance of being cut. Doesn't need to cut, but there might be pressure from institutional investors. Even if cut, will still be higher than other telcos. If you own, hold on.

Taking less on credit provisions than other banks. Positive: credit situation better than others. Negative: taking more risk and, if wrong, stock would be penalized. Canada-centric. Exposed to residential mortgages and commercial real estate in Canada; two iffy sectors, but doing better than expected. Good earnings and good asset management. 

Don't sell. Trading more cheaply than RY. RY commands a premium price for a premium asset.

CM is taking less on credit provisions than other banks. Positive: credit situation better than others. Negative: taking more risk and, if wrong, stock would be penalized. CM is Canada-centric. Exposed to residential mortgages and commercial real estate in Canada; two iffy sectors, but doing better than expected. Good earnings and good asset management. 

Don't sell CM. Trades more cheaply than RY. RY commands a premium price for a premium asset.

A favourite. Would've been a Top Pick today, but it got the nod last time. Canadian-only focus. Processing and infrastructure for nat gas and oil. Stock's come off since US election due to negative sentiment on Canada. 

Canada LNG set to start exporting nat gas, which will improve volumes. Lots of positive catalysts for growth. 80% of assets are backed by long-term take-or-pay contracts, which gives consistent cashflow to support the dividend. Strong business model and management team.

Stock was down so much due to defense margins, it was like getting that part of the business for free. Q4 defense earnings showed a lot of improvement, and stock took off. Given the world today, likes exposure to defense.

Anything not considered Trump-friendly has come off. Long-term hold. Diversified on geography and assets. Yield is now 5%, and growing 5-9% a year.

Utilities are her largest sector weight. Defensive, regulated earnings. Secular trend as we transition off fossil fuels. Long-term growth opportunities. Biggest asset is in Florida, a good jurisdiction. Stock came off due to hurricanes. Yield is 5.5%, grows at a small rate.

More work to do, but probably out of the worst of it. Doing the right things. 1-2 years ahead of where TD's at today. Did pretty well last year, up about 23%. Going into the US for some growth with small stake in KEY. 

She's been researching this name for a year, may soon initiate a position. Excellent management team, very long-term focus. Rational M&A and capital allocation strategy. Three recent acquisitions, plus lots of organic growth too. Really trying to grow US side. Capex spend on US manufacturing facility just about done, so cashflow will follow.