Shauna Sexsmith

Just reported a fairly decent quarter. Been building its business on the US retail side that offers them opportunity, as well as some risk. Likes this but her favourite is Bank of Nova Scotia (BNS-T). (See Top Picks.)

You have every right to be concerned about this because of the natural gas prices. At the end of the last recession, 2001-2002, natural gas bottomed around $2 and we are currently at $2.74. Despite global growth/Chinese demand, natural gas is purely a domestic commodity. We need economic recovery and increase in industrial production to drive natural gas demand.

Has everything from oil sands to Canadian Western conventional to N. Sea to offshore West Africa. Great production and cash flow growth. Cheap.

Gold. Impressive production growth over the last number of years from 1.6 million ounces to about 2.4 million ounces. Have good projects that will be coming on stream after 2013 but until that time it has limited scope for production growth. Great stock longer-term but not for short-term production growth. (See Top Picks.)

Likes this with or without the C.F. Industry acquisition. Undervalued relative to Potash (POT-T) by 20%-30% on NAV and about half the PE multiple. Thinks they will eventually acquire C. F. Industry.

Largest bank in Canada but has some US assets that cause some concern. Had a great quarter because of vote 50% of their revenues came from trading. Has the best ROE in the business. Strong franchise but the shares are priced to reflect that. (See Top Picks.)

Have been growing earnings over 20% a year and is expected to continue this over the next 2 to 3 years. Trading at a 15X forward multiple. When the PE is lower than the growth rate, that is a Buy signal for growth managers.

Had a pretty good quarter considering the environment we are in. Margins on the transportation side have been steadily improving. Balance sheet is in pretty good shape and have enough liquidity to manage this economic downturn. Economic environment has to improve for order numbers to pick up.

Largest global dealer in Caterpillar equipment. While diversified base including oil sands, South American dealerships in the UK. Good, solid, economic recovery kind of story.

Excellent production growth. Largest landholder in the Bakken area with phenomenal production growth. Just acquired a private company (Wave Energy) that increases its land position. 90% of its production is light oil. Add on pullbacks.

Best growth prospects going forward. Has done extremely well in Turkey. More products in the pipeline than most other gold producers. Recently acquired Sino-Gold giving them lots of exploration potential in China.

Of all the banks, it has the best exposure outside of Canada. Latin America is an underdeveloped market in terms of financial services. ROE of about 19%. Strong Tier 1 capital ratios.

With a 5-year time horizon, you are fine with any of the banks. This one has moer issues with the US with its bigger exposure. Caught in the same issues as all global financials. Credit crunch is impacting balance sheets. Probably more write-downs to come. Earnings growth is going to be pretty tough.

US$: It is having a rally in a bear market. Been in a downtrend for 2.5 years against the euro, Cdn$ and other currencies. Still have twin deficits and the credit crisis. Doubts the US Federal Reserve is going to raise interest rates given the fragility of the financial system. Also has inflationary pressure.

Junior that has emerged into an intermediate and wants to be a senior. Been making acquisitions and putting it together but still has to prove itself execution wise. OK if you own in a basket of gold stocks. Prefers Goldcorp (G-T), Agnico Eagle (AEM-T) or Barrick (ABX-T).