Latest Stock Buy or Sell? Make More Informed Decisions!

LNR-T vs. MG-T. He owns LNR-T because he found it cheap vs. the organic growth it was showing. It got cheap and attracted value investors. LNR-T have been executing well and done well with organic growth.

An infrastructure play. He came across this Quebec based company that provides services to gas and electricity companies with 80% in the North-East US. They are benefitting from a huge infrastructure program. The opportunities could grow as the US spends even more money on it. They have long established operations in the US with stellar reputations for execution and safety. No Dividend. (Analysts’ Target: $1.60)

One of his top positions, but it pulled back in the ‘Trump-tantrum’. This one also announced several huge deals recently as well as a new financing. They made huge acquisitions in France and Scotland as well as a huge wind farm in Niagara. Dividend 3.25% (Analysts’ Target: $22.44)

They buy streams of canola production from farms. They have 112 farmers. They could triple or quadruple quite easily. They pulled back in the last few quarters. He has about 3% of the company. It is still early days for them. 2.02% dividend. (Analysts’ Target: $2.66)

Market. Fixed income has been a risk on trade since Trump won. When you look at this as a whole, fixed income is one area where investors stand to be shocked in 2017. Given that yields have been so low, investors had been pushed to take more and more risks to get any sort of net positive yield. For many investors, especially retail ones, it has often meant going from provincials and governments to investment grade, and from investment grade to high yields. Many investors confuse the word bond with safety, even in the high-yield space, which is very much correlated to the equity market. He has been short on the duration curve for a while, and his message to clients is that fixed income is going to get you 2%-2.5%, and it doesn’t get any more exciting than that. It is very difficult to add value, trading fixed income in this market unless you are a large institution. The best thing he would suggest is to use a passive strategy for fixed income, and look to make extra returns on the equity. As soon as you start stretching, you get into the lower quality debt, which has a whole slew of issues itself.

Starbucks (SBUX-Q) or McDonald’s (MCD-N)? He likes both. This one is high quality, with over 21,000 stores in 66 countries. You are getting a lot of global exposure. As large as this one is, it is still early in its growth cycle. Emerging markets, especially Asia, are real growth catalyst for Starbucks. You are seeing double digit growth in their sales growth, 20% year-over-year. Feels this one has more upside. Now is not a bad time to step into this.

Starbucks (SBUX-Q) or McDonald’s (MCD-N)? He likes both. Has held this in the past, but sold it about a year ago, primarily because he felt he had capitalized on the 1^st leg of the recovery. The share price has retracted since then, and he is taking a very close look at it and possibly stepping in again. This has a better yield and a better price to earnings ratio.

This has gone through a restructuring, from being more widespread in terms of media and content to reclassifying, and now is basically focused on 2 business lines, kids and family in the home. He likes to see that, because they now have a clear direction moving forward. The share price has bounced back since the lows. Moving forward, they have a lot of work ahead of them in terms of growing revenue for the share price to really take some meaningful steps forward. The dividend is safe currently.

Anything that has the Brookfield brand attached to it, has really done well. Management has executed, so there are no issues there. He likes the space, but has seen more volatility than usual with the stock. He would recommend taking a half position, because it is at the end of the volatility. Good yield and thinks it is safe.

Canadian telecom space is so tightly knit that outside competition coming in has a low probability. You are pretty much okay owning any of the Canadian telecoms, as long as you don’t bet the farm. If looking for yield, this would be low on his list. It is about 3.5%, whereas a BCE (BCE-T) or Telus (T-T) gives into the high 4%s. This company hasn’t raised their dividend since Q1 of 2015. They also carry more debt. He likes what they are doing on the wireless side. Average revenue per user is going up, which will continue.

Sell? All the Canadian banks have run up. This one and Scotia (BNS-T) have really run up, partially because they lagged last year. It’s not a bad idea to lock in some profits here. First of all, look at what percentage financials are represented as part of your overall portfolio. He holds about 15%. These are names you can hold and not have to worry about selling. The trouble with selling this is, where do you go with the money. You get a good yield and some safety. If you are not overweight, there might not be a need to sell.

(A Top Pick Nov 20/15. Up 32.16%.) He bought this last year, because it was a value play. It was the worst performer of the Canadian banks in 2015. Any time you see Canadian banks, where their yields get close to 5% (indicating their price has dropped), it is a no-brainer. Buy it.

(A Top Pick Nov 20/15. Up 39.02%.) This is a meat and potatoes regional bank and has participated in the Trump rally. Great balance sheet. Pays a good dividend.

(A Top Pick Nov 20/15. Up 1.12%.) A conservative way to play the US housing market. They are focused on title insurance for acquisition of residential properties. This started to sell off when there was talk about rates going up. Unlike most insurance companies, rates going up is not a real positive for this company. On a PE basis, it is attractively

He likes this. The biggest challenge for the street is that many look at this company and expect it to look, feel and behave like it did 5-7 years ago. It is simply not the same. The business today is much larger and less nimble than it was 7-8 years ago. It is a much more mature business, a business that has much larger market share in many of the areas that it had where it had very little to zero market share about 10 years ago. Feels they need to beef up their dividend. It has a reasonable dividend of about 2%, but not enough to make investors and analysts look at it as a more mature business.