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HOLD
Domestically, he doesn't generally use ETFs, saving those for foreign exposure instead. Overall, banks are good to be in right now, given world uncertainties. Rules being relaxed means share buybacks and dividend increases. Earnings potential over the next year will stall out, until the economy gets more settled. Prime area to hold for safety.
E.T.F.'s
PAST TOP PICK
(A Top Pick Dec 04/20, Up 32%) Will continue to win back investors. With Latin American exposure, plus potential increases in commodities, it's well positioned to benefit from that. Trading at a discount to the group. Yield of 4.7% is amongst the highest. Towards the top of the list of banks he'd pick today.
banks
PAST TOP PICK
(A Top Pick Dec 04/20, Up 41%) Still at pretty reasonable multiples, very good yield, lots of free cashflow. Expects dividend increases down the line. ROE is very good. Forecast for earnings growth over the next couple of years is fairly substantial. He'd recommend it today. Yield is about 5.5%.
integrated oils
PAST TOP PICK
(A Top Pick Dec 04/20, Up 22%) Underappreciated amongst its peers. Concerns over Line 5, etc. Need for the product is high, hard to believe they'd be shut off. Small dividend increase recently. Premium yield, and he doesn't see any problem maintaining it, but dividend growth might slow down. Yield is over 7%, making it a core holding in an income portfolio.
oil
gas pipelines
COMMENT
Buy an oil/gas stock with no dividend? He'd buy, but dividend payers will always have a bit of an edge. When it comes to resource companies, he looks at total return. Lots of clients want income, and dividend stocks are the main vehicle for this. Resource stocks are so cyclical, he'd like them to pay big dividends in good times, and smaller dividends when times are not so good. When times are bad, it's a more efficient use of an investor's capital to put it elsewhere than a resource company.
