COMMENT
He is not a fan of the commodity based equity sectors. The US yield curve inversion often indicates a recession. Quite often see the markets rally after a yield inversion. Need to structure a portfolio that can withstand short term and long term scenarios. There are always going to be 10% pullbacks, which is the risk of equity investing. You are never going to be able to time the tops and bottoms.
BUY
They buy companies and improve the business and then sell the business. He likes it but it is a complicated company. You probably need a 5 year time frame for an equity such as this. It is a nice diversifier in a portfolio but probably not a core position. You have to understand Onex as well as the companies within its structure.
DON'T BUY
This is in the "why bother" pile. There are a lot of issues with this name. There is always something going on in the background. There are better opportunities.
BUY
They are a human resources consulting company. They buy smaller companies. They have done a good job and have made profitable acquisitions. There is not a lot of liquidity. He likes the name. This could be one of the nice under the radar names.
BUY
He likes this name. They have done a good job of right sizing the ship. Their current portfolios of companies has improved. Things are moving in the right direction. May take a few quarters to make sure they are on track. They have about a 90% payout ratio. He thinks between yield and current pricing, investors will be rewarded, but is higher risk.
BUY
Have to think longer term with this name. They trade at a premium valuation. This is one of the best performers in Canada. Strong management team. They have a strict focus on shareholder value. They paid a special dividend last quarter.
WATCH
He has not been a fan of this name because of the swing in the valuations. However, this quarter looks very good. Looks like the turnaround maybe gaining some traction. They got a lot of business from the financial services sector this quarter.
BUY
They are a casino operator. They have won a bunch of contracts in Ontario. It is hard to compete with them because of the restrictions and regulations. They are updating some of the older casinos. There is a nice long term recurring revenue stream. He likes this name.
WATCH
This is an interesting name. It is a good Canadian IPO. This is a great success story. They are involved in payment processes and POS terminals, inventory controls focusing on restaurants. Good growth and recurring revenues. There is a lot to like. But would like to see a few quarters first.
PAST TOP PICK
(A Top Pick Mar 01/18, Up 28%) Same store sales growth over the last 2 quarters of 12-13%. Have done a great job of socially responsible positioning. They are increasing their dividends and are adding stores. He doesn't expect this level of same store sales growth to continue.
PAST TOP PICK
(A Top Pick Mar 01/18, Down 22%) This was disappointing. They were trying to grow at the expense of the bottomline. Their growth plans did not come to fruition. The CFO left. He does not see a lot of reason to be involved in this name at this point.
DON'T BUY
Everything went wrong with this name over the last year. They made a large acquisition and are carrying too much debt. There may be a trade in this name, but it is in his "why bother" pile. There were a lot of missteps by the management team.
HOLD
Don't need to rush in to this name. Hard to be excited about the growth potential in the housing market now. So he is not sure where their growth is going to come from. They are partnering with Shopify now which might help. They have a high market share in their market.
WATCH
They have been building a new plant in BC. Looking at about a year before the plant is up and running. This is a long time to ask investors to wait. There is a lot of risk to owning it now. Look at it in 12 months time. There are better opportunities now and look at this name later.
DON'T BUY
They are a bus manufacturer. It ran too far too fast. This has been a tough space. He doesn't see a lot of reason to own this. He prefers NFI Group. BUS is not a bad company, just doesn't see a lot of reason to own it.