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TOP PICK
Stockchase Research Editor: Michael O'Reilly The value inherent in the Boots chain within WBA is attracting interest from the huge Reliance Industries of India and is causing us to reiterate WBA as a TOP PICK. The value of the chain operating 2200 stores in the UK is estimated as high as $9 billion. It currently trades at 6x earnings, compared to peers at 14, and is only 1.4x book value. Recently reported earnings beat expectations by 13% and support a solid ROE of 19%. Cash reserves are growing, while shares are being bought back. It pays a great dividend, that has been growing for 46 consecutive years, supported by a payout ratio under 30% of cash flow. We continue to recommend a stop loss at $40.00, looking to achieve $53.50 - 19% potential upside. Yield 4.32% (Analysts’ price target is $50.31)
specialty stores

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TOP PICK
Stockchase Research Editor: Michael O'Reilly We again reiterate this semiconductor and photonic solutions specialist as a TOP PICK. The unfortunate timing of a recent acquisition resulted in a large short position being established. However, now that the deal is expected to be completed by mid-May, this will open the door for the strategic development plans for its augmented and virtual reality, 3D sensing, AI and data center applications. Analysts expect this will enhance earnings next year resulting in a PE of 14x, compared to peers at 21x, which should soon begin to force the buying back of short positions against it. We continue to recommend a tight stop at $58.50, looking to achieve $83 -- upside potential of 33%. Yield 0% (Analysts’ price target is $82.80)
Technology

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TOP PICK
Stockchase Research Editor: Michael O'Reilly Although a little down trodden, we reiterate this Dividend Aristocrat as a TOP PICK. For 65 years MMM has increased its dividend and today the yield is over 4%, backed by a payout ratio under 60% of cash flow. Recently reported earnings beat estimates by 13% and support a stellar 40% ROE. The company has been aggressively buying back shares and retiring debt, while maintaining its cash reserves. We recommend adjusting the trailing stop to $134, looking to achieve $170 -- upside potential of 15%. Yield 4.01% (Analysts’ price target is $169.86)
mngmnt / diversified

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PAST TOP PICK
(A Top Pick Jan 25/22, Down 3.9%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with PIF is seeing improved progress. To ensure we remain disciplined to see a positive return, we recommend trailing up the stop (from $14.00) to $15.50 at this time.
INDUSTRIAL PRODUCTS
COMMENT
Markets and supply chains. Hard to tell right now, visibility is quite low. We'll be able to tell more with earnings season. A lot of companies were anticipating supply chain issues alleviating later this year. Does it get better? Corporate profits will be very important to drive this market higher. Corporate profits are forecast to grow this year and next, and margins are expected to be maintained. Analysts expect companies to pass through higher costs.
Unknown
COMMENT
Sectors with expected good results? Very difficult to say. Price spikes in energy and commodities, so those sectors will benefit from higher revenues. Utilities are more defensive, but they should do well. High growth tech has pulled back, so if they don't meet expectations, they could get hit. US bank reporting is alluding that the environment is uncertain and volatile. JPM increased provisions yesterday, which is a big change. Given the commodity-driven economy, Canadian banks should do relatively better than the US this year.
Unknown
BUY
Attractive dividend yield that should increase. Recent major US acquisition will expand presence in high-growth California. Equity issue to fund that purchase. US growth will fund future growth. Long-term hold for appreciation.
banks