Latest Stock Buy or Sell?

Anticipated market reaction to Fed rate decision? Fait accompli that we're going to get a 50 bps hike. Probably a case of investors selling on the rumour, and perhaps there will be a bit of a relief rally on the news of the actual hike, especially if Powell dials back on the hawkishness we've heard to date. There will be a lot of eyeballs on this one, for sure.

A return to the days when Canadian markets outperformed US? The good ol' days are back. From 1999 to 2010, Canada outperformed the US in 10/12 years. Then the reverse from 2011 to the present, where Canada lagged the US in 10/11 years. Things are off to a relatively good start for Canadian stocks YTD, with the TSX Composite outperforming the S&P 500 by around 800 basis points in the first quarter, which is the widest outperformance in a long time. Sustained trend, because of rising interest rates and higher value vs. growth orientation in Canada. As well, commodity boom in resource companies in the energy and materials sector benefits Canadian stocks over US. These 2 sectors have just eclipsed the financial sectors for the first time in quite some time.

Portfolio construction now. Canada has the home ice advantage right now. He's been shifting meaningful portfolio weightings from the US to Canada. From longer duration, secular growth stocks into value, cyclical, resource trades. All the while being mindful of the risk of the economic cycle being truncated by the expected rate hikes.

Steel services, an intermediary. Not a dividend growth stock, and that's part of his firm's mandate. High yield, but the dividend has been stuck at its current level since about 2014. At the top of its trading range. In a slowdown, steel isn't what you want to own. Yield around 4.5%.

Blockbuster results. Fertilizer price cycle should extend. Potash, nitrogen and phosphate are at nosebleed levels, but supply is constrained from Russia and Belarus. Guidance increased by 58% in next year. $18.50 EPS forecast. Farmers are still buying fertilizer. Blue sky scenario: eclipses RY as largest TSX company, as it did briefly in 2008, and more than doubles.

Best in class oil producer. Not moving higher because it's a mid-cap name below the radar. Big money goes to the big caps. Highest operating netback margins. Stealth privatization through buybacks, creating value. Patience required.

(A Top Pick May 04/21, Down 59%) Derating of secular growth stocks due to rising interest rates. Doing all the right things. Delayed US legislative reform. A victim of the environment. Will be a dominant player in years to come.