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Curated by Michael O'Reilly since 2020
1550+ opinions with 4.81 rating (one of the best performing expert)

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Stock Opinions by Michael Sprung

COMMENT

China has significant economic problems--real estate, shadow banking and weak demographics--and no longer makes it an attractive place to invest. Inflation will hold up higher than people expect, and this will impact interest-sensitive stocks as well as bonds. There are are also geopolitical concerns in the Ukraine and Middle East, which will benefit only a few industries. Massive defence spending will leave little for everything else. He expects 2024 to be very choppy and we've seen this so far this year. We were living in la-la land with lower interest rates, but now we will see normalization with higher rates for longer.

Unknown
BUY
A value trap?

No, though it's cheap vs. the other banks. In this market, having a good dividend yield of 5.6% is worth a lot. If interest rates fall, the banks will get squeezed in their net interest margin. There are concerns over outstanding loans. But overall, the banks look attractive and CIBC is especially cheap. He likes Royal too.

banks
BUY

He's bullish energy stocks and is overweight them. If you're long-term, you can buy CNQ anytime. It's one of the best-managed oil patch companies..

oil / gas
BUY
BCE Inc.

He doesn't see much downside and the 7% dividend yield makes it attractive. A former top pick of his. Last year, telcos faced pressure, but this year will be better. People won't give up their cell phones and 5G internet to their homes.  Now is a pretty good entry point.

telephone utilities
DON'T BUY
Northland Power Inc

They offer a lot of foreign exposure compared to their peers. The valuation has come off a lot in the past year. But he prefers other peers like Altagas. NPI has some issues to work through.

Utilities
BUY
Hold in a TFSA?

The rails face pressure from the current economy, but the economy will expand in the next 10 years. So, the rails will do well as they move goods. Yes, it's good to hold in a TFSA.

Transportation
BUY
Manulife Financial

It's popped slightly recently. They just did a deal in which they released $1.2 billion of free capital--this finally woke up people that MFC is a little undervalued. It still is at 8x PE with a price-to-book of 1.3x. Under this CEO in recent years, they've been streamlining operations to be more efficient and adding growth. This has been a top pick of his many times.

insurance
BUY
Bank of Nova Scotia

A major holding. The big question is what differences in strategy direction the new leadership will make? Maintain their large exposure to Latin America? They pay a bigger dividend at 6.7% than event CIBC and trades at a bigger discount in price-to-book. Dividend increases are possible.

banks
BUY
Linamar Corp

Has owned this many years. LNR is well-positioned with plants in North America and Europe. The CEO has done an excellent job steering the company.

transportation equip & components
COMMENT

A problematic stock. They were behind on debt payments, but have worked things out with creditors. As one of the last busmakers in North America, they will benefit from future bus orders from cities. It has risen from recent (extreme) lows, due to settling financing problems.  A riskier-than-normal stock. If sales tick up, shares could leap by multiples, but who knows when?

Automotive
BUY

He likes the pipelines for their high dividends and have projects scheduled in coming years. Are safe to own now. PPL is one of the better-managed ones.

pipelines
DON'T BUY

The rails trade in tandem. With CP buying Kansas City, CP now competes head-to-head with CNR which used to have more of a north-south network. He isn't jumping into these stocks, because of a possible recession later this year. If you're a long, long-term holder, holding rails isn't bad, but he wouldn't but them now.

Transportation
DON'T BUY

The rails trade in tandem. With CP buying Kansas City, CP now competes head-to-head with CNR which used to have more of a north-south network. He isn't jumping into these stocks, because of a possible recession later this year. If you're a long, long-term holder, holding rails isn't bad, but he wouldn't but them now.

Transportation
PAST TOP PICK
Royal Bank
(A Top Pick Nov 02/22, Up 12%)

Stick with it. The banks offer stability and pretty good value. RY has regained its premium valuation. Their yield is still above 4%. They remain the top bank in Canada and are prominent internationally. The big question with the banks is what will happen with the loan books. All the banks have made aggressive moves in loan loss provisions, though.

banks
PAST TOP PICK
Suncor Energy Inc
(A Top Pick Nov 02/22, Up 0.4%)

Is hanging on. It remains Canada's dominant oil and gas player. Trades at 8x. Prefers CNQ, but likes this. He's bullish energy for the mid-term. Pays nearly 5% in dividends.

integrated oils
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