Gordon Reid is president and CEO of Goodreid Investment Counsel. His focus is on U.S. equities.
Top Picks:
American International Group
AIG has come a long way since the financial crisis of 2008. Not only have they paid back the government in full (resulting in a $20-billion (U.S.) profit for Uncle Sam) but they have begun paying a dividend again. AIG has gone back to their roots as a property and casualty insurer and wealth manager. At just 10 times earnings this issue holds significant promise.
Visa
Revenues and earnings are growing very rapidly as the world moves to electronic processing in place of cash to settle transactions. Debit transactions now account for almost 60 per cent of Visa's transactions. International expansion is driving growth and as a major sponsor of the upcoming FIFA World Cup and the 2016 Olympic Games in Brazil in 2016 watch for Visa to capture market share to propel growth.
Anixter International
AXE is a distributor of communications products, electrical wire and cable and small electronic parts. As the industrial base recovers world-wide Anixter has a great opportunity to benefit. It is well positioned in Europe and has made recent acquisitions to take advantage of the superior growth offered by Latin America and Asia.
Past Picks: September 20, 2012.
Walt Disney Co.
Then: $52.66
Now: $65.25
Total return: +25.80 per cent
Time Warner
Then: $45.79
Now: $66.48
Total return: +45.19 per cent
The Middleby Corp.
Then: $117.01
Now: $212.12
Total return: +81.28 per cent
Total return average: +50.76 per cent
Market outlook:
The equity market is an expert at making as many investors look foolish as it possibly can. There are a multitude of legitimate reasons for a market correction but with so many investors anticipating one it would not surprise us if the market moved higher until a greater level of complacency surfaced.