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Market Call

3 top stock picks from money manager Greg Newman Add to ...

Greg Newman is a senior wealth advisor at the Newman Group. His focus is on Canadian dividend stocks and protection strategies.

Top Picks:

Gibson Energy

Gibson’s market, Alberta midstream infrastructure, is a high growth area with producers moving their oil from the well head to the refiners. Gibson enjoys a high rate of organic growth, a nice dividend and trades at discount to its peers.

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Royal Bank

Royal Bank trades at a compelling valuation (10.7 x 2013 estimated price-to-earnings) compared with many other Canadian dividend stocks. Royal Bank has substantial earnings leverage to normalizing capital markets, which should unfold over time as Europe’s credit crisis ultimately abates.



Vermilion Energy

60% of Vermillion’s revenue is derived from Brent oil pricing, which insulates them from the pricing differentials of most Canadian producers. Both production growth and netbacks are impressive. Investors enjoy a sustainable yield from the company, which is 83 % exposed to oil-based pricing.



Past Picks: Sep. 22, 2011



Shoppers Drug Mart

Then: $40.57

Now: $41.97

Total return: +5.34%



Parkland Fuel

Then: $9.22

Now: $13.74

Total return: +56.24%



Intact Financial

Then: $54.50

Now: $61.78

Total return: +14.85%



Total Return Average: +25.48%



MARKET OUTLOOK

Policy easing in China, strong earnings and a vigilant Federal Reserve should help offset some of the negativity from Europe. Spain appears to be making progress, but uncertainty surrounding the next French government will continue to stoke fears. Fiscal compacts may get watered down, but I am of the view that Europe will ultimately find a balanced approach between growth and austerity that is reasonably constructive for the global economy. As such, I would recommend that investors try and use any weakness to build positions into companies with strong balance sheets and the prospect of dividend growth.



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Compiled by Franklin Cameron/BNN Market Call Tonight

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Also see:

3 top stock picks from Toron Capital's David Driscoll

3 top stock picks from hedge fund manager James Hodgins

3 top picks from oil and gas analyst Josef Schachter

3 top stock picks from contrarian Ben Stadelmann

3 top ETF picks from Burgeonvest's John DeGoey

 
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