David Burrows is president of Barometer Capital Management. His focus is on North American large caps.
Grupo Televisa S.A.
As the leader in Spanish language broadcasting and cable along with a growing telecom presence, Televisa benefits from a youthful and under-levered consumer demographic. Accelerating ad spending and deregulation of the wireless telecom industry is likely to support mid-teens earnings growth over the next three years. At 10 times 2013 earnings, Grupo Televisa trades at a PEG ratio of less than 1. (Last purchased at $56.3057 on Dec. 27.)
iShares MSCI Mexico ETF
Mexico has the youngest population in the developed world along with lowest household debt levels. This Mexico ETF offers investors exposure to a healthy consumer base through a 41-per-cent exposure to the consumer sector and 21 per cent to telecom. (Last purchased at $72.19 on Jan. 3.)
LyondellBasel is one of the worlds largest plastics and chemicals companies. With a major competitive advantage due to low North American natural gas prices and ethylene demand growth outpacing supply, we expect very strong free cash flow and a likelihood of another significant special dividend on top of its regular 2.7-per-cent yield. (Last purchased at $27.6853 on Jan. 3.)
Past picks: Jan. 05, 2012
Alerian MLP ETF
Total return: +4.69 per cent
Kraft Foods Group (now Mondelez International)
Total return: +11.21 per cent
Total return: +1.41 per cent
Total return average: +5.77 per cent
While the upcoming earnings reporting period and debt ceiling negotiations may pose a headwind later in the quarter, in the near term there are several pockets of strength that could provide returns for the targeted investor. Aggressive monetary policy continues to benefit the dividend growth theme, chemical producers will benefit from low natural gas prices, and emerging market strength is increasingly highlighting the resilience in the developing market consumer.