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BUY ON WEAKNESS
Likes it, though it's been hit hard from weather, trade wars and now the coronavirus. A triple whammy. NTR generates a lot of free cash flow, though, at a 12x multiple and also pays a good dividend. They also buyback shares. The agricultural cycle is shorter than others. Buy this on a dip.
agriculture
BUY
He likes Warren Buffet and this company. They have unique advantages--a huge insurance operation with utility-like assets. They're set up to be counter-cyclical when they can achieve above-average returns in tough times. Definitely buy on dips, but hold it for a long time. He expects them to shrink their cash pile and buy more stocks. He's concerned that they are so massive, though, and growth will be slower in the future, but it's a solid long-term compounder.
insurance
BUY ON WEAKNESS
The impact of the coronavirus. They have a diversified operating footprint. They had to close their Shanghai park, which is a temporary hit to their earnings, but earnings will come back later. Disney is a good way to play the virus; he's been buying more shares. Other parts of the operation will offset those virus losses. And CEO Bob Iger's departure was a surprise.
entertainment services
BUY ON WEAKNESS
Likes it, but is waiting for more a pullback, trading below 26x earnings. He'd buy at 24-25x. MSFT spins a ton of cash flow, and buysback shares. It's a great company. Definitely buy when it dips more. (MSFT just announced after hours today an earnings warning due to the coronavirus.)
computer software
processing
DON'T BUY
Already owns it, so sell it during this dip? Don't buy it now during the pullback. Teck's reliance to coal could get hit hard. If you own, sit tight a little and hope things improve. It's a tough one, because it's a rollercoaster of a cyclical stock. There are better ways to compound your money.
Mining
BUY ON WEAKNESS
A great medical equipment company. Over time, they've consolidated and grown. Demographic trends are on his side. But he owns Abbott instead; you can't own everything. Wait for more of a pullback to buy. If the PE falls to the low-$20s, step in.
biotechnology
pharmaceutical
COMMENT
Sell Canadian banks and buy American? Sit tight if you own Canadian banks. They're generating high-quality earnings and pay a nice 4-5% dividend. Doesn't know about transitioning into US banks, which he owns. He sees more value in Canadian banks. On a pullback, look at JPM or US Bank Corp. Canadian banks pay half their earnings in dividends, whereas the American ones return 100% (in dividends and share buybacks).
DON'T BUY
A super major energy company. Their growth and capital allocation don't make this compelling at all. EOG-N is much better and will snap back better after this oil sell-down.
integrated oils
