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COMMENT
Market outlook. Not a strategy that he follows, but this May it may be a strategy to follow. They have been pressing equities a lot. Still very bullish and markets are getting cheaper since earnings have gotten up. That being said, we are seeing some technical resistance, higher tax propositions and all that together makes market more tough. If you have indices that are near highs, he would peel back from them and look at specific equity allocations.
BUY
Just had a great quarter. The company just keeps chugging. This name keeps getting better. Beat earnings by 20% and 26% up YoY. Backlog is at record levels, and anticipated recovery. Excellent balance sheet with capital ready to deploy for acquisitions. Modelling 21% EPS growth. Trades at 24x. Bought after earnings and you can continue to build positions into this name.
machinery
RISKY
A tough names. Has had problems with the underlying commodities. There is a fear of a glut of caustic acid coming to market. The story does not seem to be turning around. There is promise in 2 quarters. The dividend is not secure if business does not turn around. Could take a shot in a taxable account and you'll do okay probably.
chemicals
COMMENT
Commodities. The commodities rally probably has more legs. People are misjudging pent-up demand and the impact of stimulus. The key player in commodities is China. Copper has been trading sloppy since the Chinese policy makers pronounced on the issue. You have to buy and sell at the right time. This will change if China decides to dig its heels in.
BUY ON WEAKNESS
Announced great numbers yesterday. Business is doing very well and will continue to grow. In their space, it is about execution and M&A. They have been doing both well. The problem is valuation. When do you get in. It's trading at 16x 2022 versus Shopify at 25x. Both expensive. A good name to own although it does move around a lot. Buy when it is down like in the last couple weeks.
Technology
PARTIAL SELL
WEAK BUY
Impact of asset sales this year. Thinks they have the balance sheet now at 0.9x debt to cash flow. Has the cashflow to buy the shares back. It has dramatically turned around. Cheap at 3.5x. Seeing EPS growth. If you like oil and energy stocks, you could look at it. The commodity will dance around with politics and environmental impacts. A stock to trade.
oil
gas
BUY
An expensive stock at 18.4x PE. Earnings will grow as wireless gets better. Their core business is more landline. Investing heavily to build. This investment will benefit them with the 5G tailwinds coming. They will make their dividend and will grow it. A prudent buy in a market that has rewarded high flyers. It is a choice for patient money to go in.
telephone utilities
PAST TOP PICK
PAST TOP PICK
PAST TOP PICK
(A Top Pick Jun 12/20, Up 67%) A trickier name. Nasdaq stocks have had a huge run. Trimmed back in January but now reloading more. Google is not outstandingly compelling any more. 14% EPS growth. Trading at 21x 2023, 24x 2022. Kind of on the fence. A good long term story. Wait to buy more.
Technology
