COMMENT

This is a large insurance company with assets around the world. Prem Watsa was very bearish on US markets a number of years ago and made a huge bet on deflation. He is now becoming more bullish. He hasn’t done a good job of growing BV over the last 5 years. This is trading at a multiple to BV.

BUY

Trading at a very cheap valuation, under 8X PE. They have global operations. They are improving their European operations, so they are improving margins. Good balance sheet to EBITDA at about 1X. If one of the large tech companies ever want to manufacture their own smart car, they might look to a player like this.

COMMENT

There was a rumour that Muddy Waters was going to come out with a scathing Short recommendation on this, dropping the stock by 39%. That was incorrect. The company owns fleets of railcars, commercial jets and industrial equipment.

COMMENT

More or less a utility in infrastructure. A 3rd of revenue comes from wind power, so they are involved in the distribution of electricity, generation, and have some power producers both in the US and Canada. He likes the name. If you are a retiree, it is a decent company to own.

COMMENT

A royalty company, and has investments in approximately 15 private companies, where it has a royalty or gets a preferred interest. Results can sometimes be lumpy. He is comfortable holding this.

BUY

Originally started out as a pension benefits consultant, and has moved into EAP (Employee Assistance Program). They are growing their US business. Very stable business, and about 90% of the revenue is recurring. Expects this will continue to grow in the US.

COMMENT

A gas producer, with operations around the world, including Australia, France, Netherlands and Germany. Quite a well-run company. Their assets are starting to perform well. They are partners in an offshore natural gas project in Ireland. He likes this. Good balance sheet and well-run. 6.2% dividend yield.

BUY ON WEAKNESS

This has a lot of the mature assets in Western Canada that was spun down to this income fund from Enbridge (ENB-T). There is much slower growth in this one. It may be going down because of some concerns that the parent may have to raise equity and may drop down assets to the income fund. They are both very good companies. There is a little concern about US interest rates going up in June. He would be buying this if it went down.

COMMENT

The largest coal handling facility in North America. This was recently in the news when the former BC Premier announced that she might not allow coal shipments from the US. A very quality, large infrastructure asset. If this keeps getting beaten up by the market, there might be an opportunity. Dividend yield of 2.9%.

COMMENT

This has multiyear contracted assets, so he feels the dividend is safe. Good company. Dividend yield of 5.7%.

PAST TOP PICK

(A Top Pick May 4/16. Up 16%.) This is movie theatres in the US, as well as theatres in Latin America.

PAST TOP PICK

(A Top Pick May 4/16. Down 3%.) They are doing everything that a good, long term business owner would do. Reinvesting in some of their plants and winning new contracts. Have had to build new facilities in Vancouver and Toronto. Extremely well-run. He is still buying on weakness.

PAST TOP PICK

(A Top Pick May 4/16. Up 35%.) Printing is a declining business, but this is the largest in Canada. They do outsourcing, flyers and some large newspapers. It reached his target, so he sold his holdings. He expects them to make more acquisitions in the packaging space. Dividend yield of 3.4%.

COMMENT

Provides services such as water heaters, air conditioning, repair and maintenance, furnace installation, protection plan, etc. They acquired a US business in the same area. A good company. Thinks the debt is a little high. The stock has come down, so it is becoming more interesting. A good solid dividend. A very stable business.

BUY

This has operations both in Canada and the US. Energy infrastructure. They have power, and a utility segment. Made a big US acquisition a few months ago of a utility, which they financed partly with debt and partly with instalment receipts. Feels the dividend is sustainable. The instalment receipts are yielding over 7%. There is a concern in the market that they are going to have to raise more equity, but he doesn’t feel that is well-founded.