Latest Stock Buy or Sell? Make More Informed Decisions!

Market. The Investors Intelligence Survey is at the highest it has been in terms of bullishness in 30 years. The policies of the Trump administration including tax reform, regulatory reform and infrastructure, are all bullish for the market, but the tax and infrastructure ideas are probably going to take longer to play out than most people think. Also, since 1951, whenever January and February were up for the 1^st 2 months of the year, 23 out of 25 times, the market was up for the balance of the year by an average of 11.75%.

Attractively priced. At the current share price and where coal prices are, the stock is undervalued. If you bring the coal price down to $120, which is breakeven for the industry, this is still trading below its historical valuation. Plus, they have copper and zinc. He thinks the stock is oversold. A risk could be if China cuts back on its use of coal, like its premier had suggested.

This looks attractive. It has pulled back after its large acquisition of WGL Holdings. Pays a 6.9% dividend, and management expects the dividend to continue increasing by about 8%-10% for the next 4-5 years. At today’s price, in 2021, the dividend would be 10%. There is no way it will continue trading at the current price with that kind of a dividend, so there is upside from here. He believes the dividend is sustainable.

This is a good time to be investing in this. It has had a long-term track record of success. They’ve stumbled in recent quarters and their production was down. When you have a company with a strong track record that stumbles for the short term, it is very likely that they are going to get back on their feet and resume the growth track record that they had.

The growth prospects for this bank are positive, however the prospects for the stock for the next 6 months is probably due for a “breather”. Valuation is at 13.5X this year’s expected earnings. Between 2003 and 2007 all the banks typically traded at between 12X earnings and 13.5X. Between 2003 and 2007 we had a much more vibrant housing situation in Canada. He would typically Buy when a Bank was trading at 12X, and Sell back at 13.5X.

When you read the company’s press releases, they are highlighting a lot of successes, but they are in very niche areas. He doesn’t see anything yet that is going to be universal enough to replace the BlackBerry.

This company is under fire. The US Federal Trade Commission just sued them for unlawful practices to maintain their monopoly. Apple (AAPL-Q) jumped in 3 days later and knocked $13 billion off. This company has the technology that all the cell phones in the world use, but now, if you want to buy their chips, you have to agree to a licensing agreement where you have to pay a percentage based on the value of the form that you sell.

The best time to buy any oil or gas stock is when there has been a big downturn in the oil/gas price. Pres. Trump has invited the company to submit applications for presidential approval. The Keystone is going to be an $8 billion project, and expected to generate about $1 billion operating cash flow in 2020. That is worth about $8 a share in upside. However, the stock hasn’t moved since the election.

(A Top Pick March 14/16. Up 49.18%.) This is an Internet bank. He no longer owns this and considers it as a Sell. It had a nice move, but mostly because of the rally in financial stocks.

(A Top Pick March 14/16. Down 4.39%.) They just announced results yesterday, and had the 22^nd consecutive quarter of double digit operating earnings growth. A fabulously run company. The stock has been languishing, probably more on sentiment, on a concern that the auto cycle is peaking, interest rates are going to go up, a lot of leased vehicles coming off lease, etc. This is still a Hold.

(A Top Pick March 14/16. Up 26.62%.) He still likes this company. Natural gas prices have weakened considerably, particularly in Western Canada.

Their language changed from pursuing “midterm targets” to “long-term objectives”. They’ve also lowered their EPS outlook from 8%-13% to 7%. The company has matured and this is a natural progression of the Canadian housing market slowing down. Still a very well-run company, it’s just that the market conditions have changed.

This has moved up a lot since last fall. There were 2 things to consider. Last year was their largest year for CapX with $3 billion. That is now going to come down meaning their cash flow is going to increase and they are going to start paying down debt, allowing the valuation level to move on to a higher level to their peers. It is still trading at 5X this year’s earnings and 4X next year’s, much lower than the US peer group. It had a big jump since last fall, so maybe it’s due for a breather.

This has come up a bit, but is still trading at 10X earnings. He doesn’t own any lifecos. Life insurance is a very commoditized business. Where they are trying to grow is to get into wealth management.

Thinks this is getting beaten down because in their latest quarterly results, they guided that revenues would be down 8% this year. The company has 3 divisions, and in each of them the revenues were down year-over-year. Those 3 divisions have 15 subdivisions, and only 2 of them had revenues go up. The current is still running against this company. They have a huge debt load.