Latest Stock Buy or Sell? Make More Informed Decisions!

In spite of a lot of geopolitical headwinds for the last 4 months or so, optimism has been pervasive. We got a fresh burst of it in August with both the S&P 500 and the TSX surging to record highs. Both those indices are up over 7% since he was last on the show 2 months ago. 

This is all concurrent with the release of Q2 earnings, and they're phenomenal. In Canada, earnings are up 15% compared to the same period last year. More than 30% in the US.

The enthusiasm is well validated by fundamentals.

There is that. They also say that the first casualty of war is the truth, and that's certainly been the case from both sides in this conflict. Yes, it appears that investors are shrugging off the war, perhaps hopeful that it will end.

As it relates directly to the economy and corporate earnings, markets do seem to be shrugging off high oil prices (down from peaks, but elevated from a year ago). Higher oil means higher inflation, which has implications for monetary policy. Markets are settling into an expectation that rates will, at best, stay steady through the remainder of the year.

There's a tug-of-war being set up between interest rates and inflation. The score is on the tape; earnings are winning.

Interestingly, the Magnificent 7 are no longer so magnificent. The group is up ~2% from 2 months ago, which trails the S&P 500 (which itself trails the equally weighted S&P 500). Seeing a broadening out of investor interest.

After 4 years of this capital spending arms race, we're starting to see trickle-down benefits flowing broadly into the mainstream economy. The most rabid enthusiasm is still in semiconductors, hyperscalers and memory, but we're starting to see some of the benefits of AI usage trickle down to garden-variety businesses.

Roared back to life. That move was underpinned by a number of things it did to right the ship, but not a sustainable way to grow earnings. An also-ran. Domestic footprint is an advantage, part of Washington's reshoring game. 

Sales this year likely to be same as 2022, while other players are growing mightily. No edge or innovation. Trades at 57x PE, while others trade at less than half that.

Taking steps to transform the business. His firm doesn't usually buy turnarounds; they'd rather invest where something has to go wrong to lose $$, rather than something has to go right to make it. Likes healthcare broadly, but pass on this one. Yield is 2.4%.

Cornerstone of their dividend growers portfolio. Balance of growth and income that's compelling, defensible, and sustainable through the cycles. Biggest, best, trades at slight premium to the group. Accelerated earnings growth, loan loss provisions released back into earnings. Capital markets and wealth management are second to none and booming. Reduced OSFI provisions paves the way to make more loans, buy back shares, or increase dividends.

Banking group up ~75% in past 12 months, unlikely to repeat in the coming 12 months. But that doesn't augur an immediate pullback. Valuations are breaking paradigms. 

Serial acquirer. Hasn't invested in the past, due either to valuation or to higher interest rates impacting acquisition funding. Modest organic growth. If you already own it, probably OK. Better opportunities elsewhere in consumer staples.

ChatGPT unleashed a need for reliable power to electricity-hungry data centres. Recent results were mixed, but noteworthy was Westinghouse filing confidential IPO application. That should be huge, and CCO will benefit as 50% owner. Uranium supply/demand should get much tighter; demand will grow, and governments are investing in nuclear.

PE is high, but it's more of a net asset value story (very discounted compared to what it's really worth).

His firm doesn't buy companies that cut their dividends. Until it can put together a cadence of growing its dividend (based on sustainable cashflow growth and balance sheet strength), which won't be anytime soon, they're not going near it. Cheap for a reason.

Spending lots of $$ to build foundries in the US. Demand backdrop remains strong, margins are great.

Still holds, but trimmed on the runup in March. Making a lot more $$ than last year, so earnings are growing. Still bullish on gold, and really bullish on this name. 

Freight volumes are starting to come back. US less-than-truckload operations are better with higher margins. Earnings power has come roaring back with demand increasing and a US driver shortage.

Really likes it, in their momentum mandate. Sticky recurring revenues, though lower organic growth. New CEO is very capable. M&A has reaccelerated. Back in the saddle. Pullbacks are buyable, and this is as deep a one as it's ever seen.

Nice acquisition about a year ago, accretive to earnings. Beneficiary of more oil being produced in Western Canada. We're increasingly likely to get another oil pipeline and an LNG terminal. Undemanding valuation. Nice dividend. Buys back shares.

Opportunities should extend to at least the end of the decade. New funding going toward Canadarm. Big Arctic contract announced this week benefiting MDA and TSAT. Expanding production capacity, making acquisitions. Likely to benefit from Canada's big step up in military spending. Potential pipeline of $40B on low-orbit satellites.