PAST TOP PICK
(A Top Pick Feb 16/23, Down 4%)

Oil has been choppy. Turmoil with purchase of Hess, though he likes the opportunity longer term. Tussle with XOM. Pristine balance sheet, very little debt, great dividend. Will do well with oil, profitable, just be patient.

PAST TOP PICK
(A Top Pick Feb 16/23, Up 32%)

Lumpy during pandemic, supply chain now sorted out. Strong management. Earnings have grown average 15% over last 10 years. 13x earnings, still a good opportunity. Buying back franchises will enhance profitability.

COMMENT
Buy US stocks on a Canadian exchange?

No. If you purchase on a Canadian exchange, you're really just neutralizing the currency fluctuation of holding a US security.

His position is that holding US securities in USD is a benefit, as he wants exposure to the US dollar. He doesn't want to limit himself to an economy that represents 3% of the world's wealth. He encourages diversification at every level, including currency.

COMMENT
Buy US stocks on a Canadian exchange?

No. If you purchase on a Canadian exchange, you're really just neutralizing the currency fluctuation of holding a US security.

His position is that holding US securities in USD is a benefit, as he wants exposure to the US dollar. He doesn't want to limit himself to an economy that represents 3% of the world's wealth. He encourages diversification at every level, including currency.

DON'T BUY

Reasonably priced. Decent earnings and growth, but not exceptional. Do peer group analysis. Often companies in a sector go up and down together, being driven by the same things. Ask if CAT has a tailwind, and is it the best in the industry? He wouldn't buy CAT, but does own URI.

BUY

Growth rates for earnings are roughly double those of CAT, yet the valuations are very similar. More bang for your buck. In his US small-cap portfolio. Still likes it here.

SELL
Further EPS growth?

Recently sold on price exhaustion. Outgrew growth of earnings. Yes, sees continued growth of earnings, but the stock price more than compensated him for that growth. This is where valuation is so terribly important in your analysis.

BUY

His impression was that the Phase 1 trial did go well. Management emphasized long way to go before it would have a monetary impact. Stock did sell off when earnings released. Still likes it. Recent acquisition will be positive for future earnings and revenue growth. Not expensive. Lots in pipeline.

HOLD

Fantastic value. Trading above market multiple, yet growth is 4-5x GDP and 2-3x that of the average stock. Missteps every once in a while. Don't be too critical, they will work out. Extremely well positioned. In everybody's ecosystem. Likes it very much.

DON'T BUY

Challenged by people's reluctance to adopt EVs, but it's just a matter of time. Charging is not so easy. Car rental companies have cooled on EVs. Does internal combustion well. He owns GM.

BUY

Margins are superior to Ford's. Likes the CEO and plan going forward. Incredibly inexpensive valuation.

TOP PICK

Copper's popping today on news that Chinese smelters are shutting down. Wind at its back on the secular front like EVs, China will emerge from recession. Just because EV adoption is slow, doesn't mean we're not moving in that direction. One study says copper demand will rise 50% by end of decade. Well capitalized and managed. Not expensive. Yield is 1.41%.

(Analysts’ price target is $46.26)
TOP PICK

Legacy name that's trying to adapt. Now much more about services and subscriptions. Getting into AI through Watson, which long ago beat a world-class chess player and won a bunch of money on Jeopardy! Partnered with META and OpenAI. 18x earnings, not expensive. Good yield of 3.37%.

(Analysts’ price target is $183.38)
TOP PICK

Originally sold on its clouded future, Metaverse was enigmatic. Recently repurchased. Balance sheet and expenses  under control. Ad market took off post-Covid. Yield is 0.41%.

Lesson: As an investor, don't be afraid to go back. Swallow your pride and look at a company for what it is today, not what it was. Ask whether it's a good investment for your portfolio today.

(Analysts’ price target is $518.13)
HOLD
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research

EPS $0.008; revenue $47.6M. We would like to hold at least until we rates decline, so we can see how the business/stock performs in a different rate environment.
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