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There was a lot of angst about a foreign entrant that really hit the stock. Another headwind with telecoms is the rate environment that is conversely, so good for banks and lifecos, but not so good for telcos. You have a macro environment that is hostile for telecoms but, underneath, this company is still growing their wireless customer base and it doesn’t look like a foreign entrant is coming in. She finds better uses for her money.
Switch to Manulife (MFC-T)? Macro picture for both companies is very positive, so you are picking between Good and Good. This bank is the cheapest of the Canadian banks. Well-run. Given the 2, she would continue to hold because it is cheap and the fundamentals are great. The asset management side is growing.
Very positive environment for the auto industry globally. In North America you have a very old and aging fleet of domestic cars. Replacement factor is very high. There is a bit of inventory issue with the whole market, which is being worked off, but that is why it has been soft in the last few months. This is a buying opportunity.
This is old school where Amazon (AMZN-Q) is new school. It’s Cloud versus servers. This company is the hardware of the way we used to do business on laptops and now, with Amazon, everyone is doing their business on tablets. Revenues can grow, but if you are not making much money, the stock is not going to go up. Wouldn’t touch this one. If you want revenues and earnings, Google (GOOG-Q) is a great tech stock instead of this one.
Has a lot of runway. Made an acquisition in Europe. They are just rolling out their strategy. In a lot of the European gas stations, you can buy only gas and oil but this company is offering customers merchandise similar to what we have in North America. They’ll make other acquisitions as well. She buys this on a pull backs.
On a macro picture, there is still a valuation mismatch between our shares and US shares. Feels that is just beginning to close and this company will benefit from that. On top of that there is a global economic growth and she thinks 2014 gets better, which will pull oil along. As well, Warren Buffett entered into the stock this summer, which gives it a halo effect.
The only bank that disappointed in earnings. Also, disappointed on their domestic lending platform. Not her favourite bank but the macro backdrop is very positive for the Canadian banking system. This will be okay and you will probably make more than the coupon but she feels you will make more in the other banks and lifecos.
What bank would you suggest to take advantage of US housing? The US housing rebound is continuing. There was some backup in interest rates in May and June, but it is still quite strong and she thinks it has years ahead of it. US banks is a great way to play it. There are banks, you could play, but are expensive. Prefers the money centers, the bad banks during the downturn. There are fresh management teams in there and there has been time for healing their balance sheets. They are not perfect, but they are certainly better and they are really cheap. Bank of America (BAC-N) and Citigroup (C-N) are trading at less than BV. There is the steep yield curve as well as the housing market and these 2 things are a great way to play a recovery in the US economy and in the housing market. She owns these 2 banks.
Fresh management teams since the downturn and there has been time for healing their balance sheets. Not perfect, but certainly better and really cheap. Trading at less than BV. The steep yield curve and the housing market are a great way to play a recovery in the US economy and in the housing market.
Fresh management teams since the downturn and there has been time for healing their balance sheets. Not perfect, but they are certainly better and really cheap. Trading at less than BV. The steep yield curve and the housing market are a great way to play a recovery in the US economy and in the housing market.
The backdrop for this company is positive. Stock has run like crazy. Long-term, she feels it is still a good story, but short-term it has run a lot and there have been a whole bunch of analysts that have downgraded it. It went into the MSCI index, which created a lot of buying, which is now coming off. There is no real catalysts short term. Moving their methanol plants from South America to North America in order to gain security of energy, so this is long-term.
Global Positioning Technology. The new major theme in technological innovations is sensors. In this case, they are sensors on fleets of vehicles. Rail cars, for example, where they can tell the company how fast a railcar is going around certain corners, and how they can improve efficiencies. They can also tell whether a car is going to breach soon. This is incredibly powerful information for fleet operators. This can be trucking fleets, rental cars and they can see in real time how everything is.
Content is king and this company owns a lot of 2nd tier kids animated videos. Content providers can now distribute their content to more than just TV channels. They can do Netflix, YouTube, etc. They have the bargaining power. Thinks it will, eventually, get taken out. Recently, bought the Family Channel and the Disney Channel off of Bell Canada (BCE-T) in order to satisfy the regulators.
Collision repair and consolidator. It is reliable because you have accidents in recessions and growth times. This company is consolidating but they also have insurance companies in their back pockets. Insurance companies actually drive business to them so that when they buy a new mom and pop collision center, they automatically increase the profitability of that shop.
