Increasing quality, looking for higher ROEs and ROCs and less debt. Increased the number of stocks, going from 18 names to 30. They shifted into better value names, by taking profits in names that had run up and deploying profits into names with more reasonable valuations that pay dividends. 2022 was a very different year that what we experienced over the past decade. Inflation has roared back, interest rates have risen, fears of global recession are as high as they've been since 2008. When the facts change, they change their minds.
Both high quality, good balance sheets, strong management. Both attractive value right now. MFC is 8x earnings, SLF is 11x. Asian business is a differentiator, which both have. MFC is much more international, with 80% of revenues from outside Canada, and 50% from Asia. Covid has slowed Asia, but when it bounces back, MFC should benefit a bit more. MFC yield slightly higher. Long term, you'll do well in both.
Both high quality, good balance sheets, strong management. Both attractive value right now. MFC is 8x earnings, SLF is 11x. Asian business is a differentiator, which both have. MFC is much more international, with 80% of revenues from outside Canada, and 50% from Asia. Covid has slowed Asia, but when it bounces back, MFC should benefit a bit more. MFC yield slightly higher. Long term, you'll do well in both.
His firm doesn't try to predict 12-month returns or set price targets. Instead, they evaluate a company's ability to produce earnings for the next 3-4 year period. In other words, what is its normalized earnings power? So, if the company looks attractive based on its share price and normalized earnings power, it's a Buy. If it becomes expensive, then they tend to lighten up.
Canadian blue chip. Rails are magnificent businesses. Backbone and arteries of Canadian economy. Has done well during post-Covid rebound. Efficient way to move goods, relatively environmentally friendly. Proposed acquisition gives them a bigger footprint. Multiple stretched at 30x. Revisit after a pullback.