Market Outlook The bull run in 1982 is following the same pattern of the 2009 bull run -- which is very bullish. There has not been the hysteria of the tech bubble on the upside in this run. He thinks the bull run will continue. The recent correction was too soon to be a signal of the end of the bull run.
This is lagging their peers in the US financial space. If interest rates increase, earnings will grow. He thinks their reputation still needs some improving before it brings back investors.
They have an enormous content library. The future will depend on how they deal with the Netflix challenge. He would look to add to any position on a pull back.
They have announced some write-downs on oil sands related assets in Q4, but they have a very clean balance sheet. They do not have any massive capex projects upcoming to eat into their cash flow. He sees any further weakness as a buy opportunity.
He likes the balance sheets of the tech companies in general. However, with there not being many Canadian software companies to find, he sees better value in the US space. (Analysts’ price target is $98.00)
Weed Sector Outlook No one knows where this sector is going forward. He sees this area like agriculture and science combined -- but there is a lot of uncertainty. Prices are very strong and it makes the metrics very expensive. You are only seeing cash burn at this point. Until there is a normalized margin for the space, it is not worth his risk-reward evaluation.
They continue to thrive against Amazon and he likes their business model. Upside in the stock price will depend on the health of consumer spending. A good core holding.
They effectively sold their airplane division. He looks for companies with good balance sheets and strong margins. He does not see this as a good margin business and would rather look for more quantifiable investments.
He does not do small caps. It trades on very expensive metrics and he would look to US companies for new capital. If you already own it, continue to hold it.
$20 floor price? They have interest in the highway 407 toll road, which provides some certainty of earnings. He wonders about the growth opportunities. He can't see a clear plan for their plans to grow. If they have a heavy debt load, he would stay away.
(A Top Pick Jun 29/18, Down 17%) They recapitalized and has shrunk to grow. Regulators never hiked rates in Europe like in North America, which was a surprise to him. Now there are no forecasts for rate hikes in North America, which will create further headwinds. You make more money when they are being fined, than during regular course of business. Rumours of merger abound, but he puts no value in that. He is sticking with it.
(A Top Pick Jun 29/18, Down 12%) If you owned any Chinese stock during the trade war with the US money has flowed away. It is a platform and software based company, which he believes creates unique value. He will continue to hold it.
(A Top Pick Jun 29/18, Down 4%) A play on household formation in the US. With tax reform last year and with HD-N having plans to increase dividends (maybe over 25% growth), he will continue to hold it.
Long term, he wonders about their growth plans. Will they get into cannabis? Beer only grows by 1-2% per year. The dividend is decent. He expects it to be a quiet stock. Yield 2.4%.
He was negative on utilities with a rising interest environment. If you believe interest rates are not going higher, this could be a good buy. He likes the management and the dividend. Yield 6.4% (Analysts’ price target is $37.00)