PAST TOP PICK

(A Top Pick Oct 13/16. Up 21%.) His thesis is that the basic business is okay, and Paul Desmarais’s sons would reinvigorate the company after his death. He was wrong. No catalyst has emerged. However, prospects for insurance companies have improved somewhat, as interest rates have come up.

PAST TOP PICK

(A Top Pick Oct 13/16. Up 38%.) He is not sure there is going to be any pullback, because the runway for growth is so enormous. The penetration of credit cards is very low in China and Southeast Asia.

PAST TOP PICK

(A Top Pick Oct 13/16. Down 11%.) This is medical parts, knees, hips, spinal fusion products, etc. Had felt the stock would benefit from aging baby boomers. However, they had some inventory problems, and didn’t experience the kind of growth he expected. It’s still a great place to be.p

DON'T BUY

Founded by 2 people who were geniuses in the business of managing money for high net worth families. The stock has struggled. The company makes its money by charging a fee on assets under management, but also by charging a participation fee on profits. Increasingly, high net worth families are resisting paying participation, simply because they don’t have to. Because of this, the company has difficulty in expanding its asset base and producing the kind of profits investors want to see.

COMMENT

Largely a commercial and industrial manager of real estate assets, and for years and years a wonderful simple strategy. They would build a commercial building, mortgage it, lease it for 20 years and lock in a spread. It was predictable and it was great. They then branched out, and in 2008 had a near-death experience when they built the Bow office tower in Calgary. They almost ran out of money because they hadn’t locked up their financing. This is a low growth company. Distribution is growing, very slowly. It’s the kind of company that will suffer if interest rates grow. The 6% distribution is not a dividend and is taxed as other income, but is absolutely safe. This is only a yield play.

COMMENT

Their products have a lot of buzz, and accordingly the stock price has some fluff in it. The stock is quite expensive. He would be cautious at this price.

COMMENT

This is never going to blow the doors off, but at the same time it is never going to blow up. The dividend has a tendency to rise over time. If you can make 6%-8% with a combination of dividend and capital gain over time, that’s not so bad. The kind of stock that should be a foundation for most portfolios. Dividend yield of 4.76%.

COMMENT

The company has resisted the recent takeover offer. They make chipsets for mobile devices, and the government of China refused to enforce their patent rights on devices in China, which put a huge hole in their income statement. It’s an unresolved issue. He doesn’t know what is going to happen.

COMMENT

He has nothing in particular against this stock, but look at his Top Picks. Dividend yield of 1.8%. (See Top Picks.)

N/A

How do ethical questions involved with owning marijuana stocks compared with those involved with owning tobacco stocks? Has an aging client base in part, with no fewer than 5 who have Parkinsons. 3 of them are taking medical marijuana which is alleviating their symptoms. He has nothing against the ethical use of marijuana for medical purposes. Also probably doesn’t have much against non-medical uses for recreational purposes.

COMMENT

Doesn’t follow this closely although he knows it has been a tremendous success. Toronto says it is going to be converting to electric buses, and this company has unveiled the next generation of electric transit buses. Cities are altering their transit infrastructure, and will be going towards greener stock. If this company is into that, then it might be a good horse to ride.

BUY

Canadian Banks. Their year-end is October 31, and we haven’t seen results yet. He predicts the Canadian banks have all made a bunch of money for their year end, and a number of them are going to raise their dividend. There should be pretty good trading revenues in the 4th quarter. You have to own Canadian banks.

COMMENT

People were worried about their survival. They have survived, but thinks it is not a great industry right now. They are having trouble gaining assets. Fees are still under pressure, which means margins are under pressure. He wouldn’t rush out to buy the stock.

TOP PICK

In Canada, more than half your total return comes from dividends. The government has been kind enough to give us a tax break on dividends. In this high tax era, we should take advantage. The company is growing their wireless business and we are all using more data all the time. We are going to be using a lot more data when we all have autonomous cars. Dividend yield of 4.7%. (Analysts’ price target is $62.)

TOP PICK

These companies are old, but are not stupid. This company has $6 billion of positive cash flow this year. Compare that to Tesla which has $4 billion of negative cash flow. General Motors has the capacity, the intelligence and the engineering. The stock is trading at a ridiculous PE multiple of 7X. They are finally making money in all their markets, including Europe for the first time in 20 years. Dividend yield of 3.5%. (Analysts’ price target is $48.)