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Alex RuusTibor Kolley/The Globe and Mail

Alex Ruus is portfolio manager at Arrow Capital Management. His focus is North American equities.

Top Picks:

Anthem (ANTM.N)

Anthem is the leading U.S. health-care insurance provider, strategically positioned to benefit from the need for cost control in the health-care system. The company produces prodigious amounts of free cash flow, which translates into growing dividends and share repurchases to return capital to shareholders. The stock is undervalued at 10 times next year's earnings. Last purchase September 6, 2016 at $124.24.

Element Financial (EFN.TO)

Element is a leading independent finance company operating in asset-based financing, led by an experienced management team. The company has jumped into a void in the leasing market following the 2008 downturn and is emerging as one of the leaders in the space. The company is undervalued at 8 times next years earnings. Last purchased September 6, 2016 at $13.80.

Gilead Sciences (GILD.O)

Gilead is the world leader in providing medication for HIV and hepatitis, producing prodigious free cash flow. The company is undervalued by the market, trading at six times earnings with a growing dividend and continuing share buybacks. Last purchase September 6, 2016 @ $78.15.

Past Picks: September 21, 2015

Alaris Royalty (AD.TO)

Then: $29.00 Now: $21.70 -25.17% Total return: -20.42%

Magna International (MG.TO)

Then: $65.57 Now: $53.05 -19.09% Total return: -17.18%

Microsoft (MSFT.O)

Then: $44.11 Now: $57.61 +30.61% Total return: +34.20%

Total Return Average: -1.13%

Market outlook:

A slowly growing global economy, alongside low interest rates, is providing the backdrop for a slowly rising stock market. While the media is full of stories of problems, the global economy continues to move forward gradually. While the overall market has climbed higher, leading some securities into overvalued territory, there is a multitude of undervalued opportunities for fundamental-driven investors like ourselves willing to dig for opportunities. The coming year will provide a divergence in company performance, which will emphasize the importance of superior stock selection in attaining optimal investment returns.

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