HOLD

A small micro-cap name that he holds that has been disappointing. They have done a good job on recent acquisitions, however, he has yet to see margin expansion. On a price to sales level it trades cheaply, but on an EBIDA basis it is too expensive. They will eventually get taken out he thinks.

DON'T BUY

He sold out a few months ago. The recent selloff has prompted some shareholder resentment and a call for strategic alternatives. The latest quarterly earnings were disappointing. There was discussion of a US acquisition, but he feels it may be a lower margin one. He does not know how they will change the momentum.

HOLD

This stock is starting to recover and has reported a couple of improving quarterly earnings. He owns it, but is a little worried when it did not rally on the recent reports. They have an investor day coming up and hopes they will alleviate investor fears.

BUY ON WEAKNESS

This software company is one of the best four Canadian public offerings along with the likes of Shopify. He bought the IPO at $13. There was a dispute with Samsung that resulted in them exiting an agreement with them. He took money off the table then under that uncertainty. It trades at 70 times earnings. He likes the management team.

TOP PICK

A food infrastructure play. They produce augers and storage equipment. Their last quarter saw sales up 30%. They will be raising prices soon and should be able to protect their margin growth. Their backlog has grown and he thinks this confirms their growth opportunities. They are entering international markets, which could increase the likelihood of a take-over. Yield 4.2%. (Analysts’ price target is $67.38)

TOP PICK

He doesn’t normally like to buy companies when it is like catching a falling knife, but when it fell 25% it was too good to pass by. Unlike other construction companies its multiples did not jump when PM Trudeau announced infrastructure spending, so the stock looks very cheap presently. They have a record high order backlog. Yield 3.3%.

TOP PICK

He likes their growth prospects in the Alberta Cardium area and sees them as having the highest netback per share of any energy company. Their production will jump up sharply in the next two months and they should exit the year at 12,500 boed. They are at 8000 boed today. He likes how management does not issue equity and that growth is through the drill bit. Debt is manageable. Yield 0%. (Analysts’ price target is $7.69)

PAST TOP PICK

(A Top Pick September 28/17 Up 49%) He liked their operations and how they were producing a higher boe/day and became more oily. When Spartan got taken out, it made TVE-T look extremely cheap and the stock rallied aggressively. He thinks some US buyers have entered in now.

PAST TOP PICK

(A Top Pick September 28/17 Up 14%) He had thought it would benefit from the upcoming Christmas season. It is one of Canada’s most successful toy manufacturers. He even likes this compared to Hazbro and Mattel, given their cheap multiples. Yield %

PAST TOP PICK

(A Top Pick September 28/17 Up 8%) A REIT that focuses on distribution centres. He compares it to a play on Amazon. The last few quarters have been very strong and recent buyouts would make it a great potential target. Comes with a good dividend yield as well.

COMMENT

US Fed hikes interest rates by 25 basis points today: that's a positive, because the US economy is
doing very well, with low unemployment and a progressive tax regime. Banks will be
making more money. It's easy to look at Trump as mad. Yes, he's petulant, but your portfolio is making money, like it has this week. He remains very positive about the U.S. Re: Canada/US clash & NAFTA negotiations: This is really a spat that'll get sorted out. Friedland is doing a good job.

BUY

Is there a short-term ETF to park your cash and earn a little yield? HFR-T and ZST.L-T earns up to 2%. He uses both.

PAST TOP PICK

(Past Top Pick, Sept.1, 2017, Up 11%) Covers the TSX, pays no dividends and charges a very low MER.

PAST TOP PICK

(Past Top Pick, Sept.1, 2017, Up 20%) It covers a broad swath of the U.S. market and purely benefits from a booming US economy.

COMMENT

How can I avoiding US taxation when buying a US ETF? There's no escaping the IRS. Instead, buy a Canadian ETF that includes a US sector(s).