Latest Expert Opinions

Signal
Opinion
Expert
COMMENT
COMMENT
April 12, 2017

Warren Buffett has been picking away at this. It is very difficult to build a refinery. There is a limited number of competitors, so they are well situated. The drawback is that you are beholden to crack spreads, basically the value of all the different components of a barrel of oil after it has been refined. In the past couple of years, it has been a very, very good business, but it is a cyclical business. The ways the composition of crude oil is coming to refineries is changing. He would prefer going to where the greatest value is, which is going to be the crude producers.

Phillips 66 (PSX-N)
April 12, 2017

Warren Buffett has been picking away at this. It is very difficult to build a refinery. There is a limited number of competitors, so they are well situated. The drawback is that you are beholden to crack spreads, basically the value of all the different components of a barrel of oil after it has been refined. In the past couple of years, it has been a very, very good business, but it is a cyclical business. The ways the composition of crude oil is coming to refineries is changing. He would prefer going to where the greatest value is, which is going to be the crude producers.

John O'Connell, CFA
Chairman and CEO, Davis Rea
Price
$77.380
Owned
Unknown
DON'T BUY
DON'T BUY
April 12, 2017

He wouldn’t go into this. It is way too early. Facebook (FB-Q) is doing everything it can to destroy this company. What Snap is doing is not patentable, and Facebook is building out a very, very powerful model, and have 1.8 billion users. If they just slow growth of Snap, it will destroy Snap.

Snap Inc. (SNAP-N)
April 12, 2017

He wouldn’t go into this. It is way too early. Facebook (FB-Q) is doing everything it can to destroy this company. What Snap is doing is not patentable, and Facebook is building out a very, very powerful model, and have 1.8 billion users. If they just slow growth of Snap, it will destroy Snap.

John O'Connell, CFA
Chairman and CEO, Davis Rea
Price
$20.220
Owned
No
COMMENT
COMMENT
April 12, 2017

A well-run bank. It always has the highest dividend yield and trades at the lowest valuation. Has always generated an ROE that has been comparable to the other banks. Why it trades at a discount is beyond him. If you have a five-year view, this bank will serve you very well.

A well-run bank. It always has the highest dividend yield and trades at the lowest valuation. Has always generated an ROE that has been comparable to the other banks. Why it trades at a discount is beyond him. If you have a five-year view, this bank will serve you very well.

John O'Connell, CFA
Chairman and CEO, Davis Rea
Price
$55.120
Owned
Unknown
TOP PICK
TOP PICK
April 12, 2017

A global provider of tools and security systems. Every acquisition they’ve integrated has been flawless. It has been a great, great long-term investment. Great earnings growth and great dividend growth. They always under promise and over deliver. A great way to play the growing economy. Dividend yield of 1.8%. (Analysts’ price target is $140.)

A global provider of tools and security systems. Every acquisition they’ve integrated has been flawless. It has been a great, great long-term investment. Great earnings growth and great dividend growth. They always under promise and over deliver. A great way to play the growing economy. Dividend yield of 1.8%. (Analysts’ price target is $140.)

John O'Connell, CFA
Chairman and CEO, Davis Rea
Price
$132.260
Owned
Yes
TOP PICK
TOP PICK
April 12, 2017

This basically supplies information technology to hospitals, healthcare systems and ambulatory companies. It has gone through a couple of years where it has shifted from selling software as a package to software as a service. It always takes time to roll over the way your profits are measured, and Wall Street is not patient about those kinds of things. Their revenues and profits have continued to grow. It used to trade at 35X earnings and is now down to around 20X, and represents an exceptionally good value in the healthcare space. (Analysts’ price target is $60.)

Cerner Corp. (CERN-Q)
April 12, 2017

This basically supplies information technology to hospitals, healthcare systems and ambulatory companies. It has gone through a couple of years where it has shifted from selling software as a package to software as a service. It always takes time to roll over the way your profits are measured, and Wall Street is not patient about those kinds of things. Their revenues and profits have continued to grow. It used to trade at 35X earnings and is now down to around 20X, and represents an exceptionally good value in the healthcare space. (Analysts’ price target is $60.)

John O'Connell, CFA
Chairman and CEO, Davis Rea
Price
$58.770
Owned
Yes
TOP PICK
TOP PICK
April 12, 2017

Made a major acquisition of light oil from Arc Resources for $700 million. Management has done everything right. Trading exceptionally cheap compared to its larger cap peers. It is going to start populating itself in larger portfolios. Everybody acknowledges that they have managed this downturn. When he first bought this, they were doing 3000 barrels a day, and are now going to do 21,000 barrels a day this year. They have loads of inventory and don’t need to make any acquisitions. Decline rates are low. (Analysts’ price target is $4.25.)

Made a major acquisition of light oil from Arc Resources for $700 million. Management has done everything right. Trading exceptionally cheap compared to its larger cap peers. It is going to start populating itself in larger portfolios. Everybody acknowledges that they have managed this downturn. When he first bought this, they were doing 3000 barrels a day, and are now going to do 21,000 barrels a day this year. They have loads of inventory and don’t need to make any acquisitions. Decline rates are low. (Analysts’ price target is $4.25.)

John O'Connell, CFA
Chairman and CEO, Davis Rea
Price
$2.630
Owned
Yes