The Daily Top Stock Picks.
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Today's stock picks by The Monthly Gems by Allan Tong and Andrey Omelchak are WCP-T, SAP-T, CCA-T, TOI-X, BYD-T, CSU-T.
A month ago, SAP reported its full-year earnings, and EPS of €2.68 beat expectations, but was down from €3.24 in FY 2023. Revenues of €34.2b were 9.5% higher from FY 2023. The main driver was the cloud. In 2024, its cloud backlog leapt 43% year-over-year to €63.3 billion while cloud revenues jumped 25% to €17.1 billion. This included a 33% increase in cloud ERP suite revenues. In terms of AI, SAP has incorporated over 1,300 skills into AI co-pilot which automates 80% of the most-used user activities.
Well, Cogeco has. It boasts an earnings yield of 30.6%, which places it in the top 10% among global peers, while its book value yield of 146.1% put it in the top 20%. True, its 5.91% dividend yield is smaller than its Canadian competitors, but is safe at a 42.5% payout ratio and growing 10% annually--twice as fast as the others--thanks to strong cash flow. Further, CCA trades at a 6.67x PE, compared to Telus' 30.2x, Rogers' 12.4x and BCE's 179x. Cash flow is one reason why CCA has outpaced its peers in the past year, with shares up nearly 15%, while the Big Three have lost ground, with Rogers and BCE both sinking 30%.
Does the same thing as CSU, but focusing on European markets. Nice 5% organic growth rate, which is very good. Deployed a lot of capital this year at really good rates of return. One of the most exciting compounders in Canada. Can hold for an extended period of time, as in 15-20 years. No dividend.
(Analysts’ price target is $163.00)Usually pretty steady business. Recent spike in insurance premiums, so the repair industry's been hit. BYD has been doing a tremendous job in this tough environment, gaining lots of market share. You can only put off repairs for so long, eventually there's a normalization of insurance premiums, and there will be an eventual catchup in submission rates. Yield is 0.3%.
Stands to benefit from tariffs, as there will be fewer write offs, which means more repair work.
One of a kind. One of the best compounders in the world. Big misconception is that the total addressable market is not that big. Fear that can't deploy capital for the same rate of return going forward as it has in the past. He very much disagrees with that.
The addressable market is huge. Of course with a larger acquisition, you can't expect the same 25-30% after-tax rates of return. But on a blended basis, can still compound at very high rates of return. Yield is 0.13%.
Pre-eminent portfolio in the space. Necessity-based real estate in Canada's urban centres, with half in Toronto. Already owns future development space. Near peak occupancy, so there's potential for positive inflection in retail rents. Good growth prospects, at 25% discount to NAV. Yield is 5.14%.
(Analysts’ price target is $20.02)Can't think of a better defensive class than manufactured communities. Homeowner pays land rent to the REIT, yet still has to pay to maintain their home. Typically seen in retirement communities. Never a year of negative net operating income growth. Lots of upside from its discount to NAV. Yield is 2.89%.
(Analysts’ price target is $138.58)At these levels, this whole area is a buy, and this name is a very strong buy. Probably washed out, multi-year lows. Culprits for that are too much debt, imperfect CRTC decisions, increased competition, and less immigration. Yield is 7.8%, and safer than BCE's.
Valuation ~15x is much more reasonable than it's been in years. 2025 won't be great, but beyond that he's modeling decent growth around 13%. Asset sale of towers is a really good catalyst to right the balance sheet. Better use of capital than to have it tied up in that kind of infrastructure.
Place to hide that's somewhat immune from tariffs. High growth in both utilities and midstream. Q4 announced the next wave of growth projects to the end of the decade. Increased propane sales, expansion of the North. Decent yield of 3.2%, grows 5% a year.
Stock's had a move, but still a discounted valuation at under 14x.
Announced 2 asset sales, gives them a lot of dry powder. Last quarter beat by ~5%; showed strength in midstream, utilities, data, and transport. Boosted distribution by 6%. Inflation-linked revenues. Large backlog. Data centre growth is a great piece of growth. Trades at 8.5x 2027 AFFO, modeling ~11% growth. Yield is 5.8%.
(Analysts’ price target is $57.86)A world with zero crashes, zero emissions and zero congestion. Our diverse team of over 165,000 employees brings their collective passion for engineering, technology and design to deliver on this ambitious future. And the bold commitments we’ve made are moving us closer to realizing this vision. Social media mentions are up 814% in the past 24h.
Founded in 1975, Boyd Gaming Corporation is one of the largest and most successful casino entertainment companies in the United States. We operate 28 gaming properties in ten states – Nevada, Illinois, Indiana, Iowa, Kansas, Louisiana, Mississippi, Missouri, Ohio, and Pennsylvania -- and manage a tribal casino in northern California. Our Company is also a strategic partner and 5% equity owner of FanDuel Group, the nation's leading sports-betting operator. One of the most respected names in the gaming industry, Boyd Gaming prides itself on offering guests an outstanding entertainment experience, all delivered with the unrivaled attention to customer service that is known as Boyd Style. Social media mentions are up 400% in the past 24h.
William (Bill) and Joan Clark founded Realty Income after acquiring a Northridge, California, Taco Bell property directly from Taco Bell founder Glen Bell in 1969. Their vision was to create a platform that provided shareholders monthly dividends that increase over time. Bill and Joan took a unique approach, purchasing commercial real estate and leasing each property to well-qualified companies with a strong financial profile in exchange for capital. This provided the operator access to growth capital while generating a steady stream of monthly revenue for Realty Income, supporting increasing monthly dividends. Social media mentions are up 400% in the past 24h.
What are the best stocks to buy today?
According to The Monthly Gems by Allan Tong and Andrey Omelchak, the best stocks to buy today are WCP-T, SAP-T, CCA-T, TOI-X, BYD-T, CSU-T.
WCP has a book value yield of 104.9% and an earnings yield of 12.8%, both good, while it pays a 7.8% dividend yield based on a decent 53.65% payout ratio, and trades at a low 6.88x PE. Compare that to CNQ's 15.33x and Suncor's 11.6x. The street likes the deal, giving WCP an average price target of $13.36, or 42% higher, based on six buys and one hold. Obviously, the street gives the merger a thumbs up, with three analysts assigning an average price target of $13.00, including one upgrade.