BUY
Really, really likes it. Growth profile and valuation are attractive. Has sold off lately. Threat of rising rates hit utilities hard. Lots of value in today's market. Almost made today's Top Picks list.
electrical utilities
DON'T BUY
Valuations in the EV space are stratospheric. He'd steer well clear. Fundamental demand is undeniable. Too much valuation risk, as a result of too much capital chasing too few outlets. For those stocks you have your heart set on, watch and wait for a pullback.
Automotive
DON'T BUY
Go with GOOGL instead. Statistically looks inexpensive, but its business is changing dramatically. Core business under attack, future business is uncertain. Generates a lot of cash, but capital allocation is toward the unproven. Avoid it like the plague.
0
BUY on WEAKNESS
Absolutely should be on your buy list. Rough start to the year. Core business is tremendous with strong, organic growth. Over time, has become more shareholder friendly. Volatile. Future should provide share buybacks and dividend increases. Reasonable valuation, 18-19x cashflow.
publishing / printing
TOP PICK
Largest restaurant operator in China. All things China have been in the penalty box. Low regulatory risk. Constrained by pandemic, Q4 results weaker than expected. Long-term compounder from growth in an unpenetrated market. Inexpensive valuation. Strong balance sheet. Yield is 0.92%. (Analysts’ price target is $61.88)
food processing
TOP PICK
For income-oriented investors. Inexpensive valuation, reasonable growth profile. Management is good at allocating capital. Yield is 4.95%. (Analysts’ price target is $42.30)
insurance
TOP PICK
Organic growth plus acquisitions. Demand for its video product spiked during Covid. This demand has moderated, so revenue growth has been more challenging. Pandemic also squashed acquisitions, but this year looks better for those. Sitting on excess cash, which gives them optionality. Well positioned for a choppy environment. Inexpensive valuation. Free cashflow yield north of 5%. More of a niche product for call centres, rather than competing with the likes of ZM. Yield is 1.54%. (Analysts’ price target is $60.63)
computer software / processing