Christine Poole is Managing Director of GlobeInvest Capital Management. Her focus is on North American Large Caps.
Top Picks: ShawCor ShawCor is the global leader in providing advanced pipe coating materials and processes, with an estimated 25- to 30 per cent market share. The company is well-positioned to participate in the infrastructure build required to meet rising energy demand from emerging regions with over 60 per cent of its revenues from outside of North America. Recent contract wins have boosted its backlog to a historic high and bode well for strong earnings growth going forward.
Boeing Boeing is a global commercial aerospace and defense company, benefiting from strong demand for commercial aircraft due to growth in air travel in developing markets and replacement demand from developed markets. Future earnings growth will be driven by production rate increases on existing models (737 and 777) and the ramp up of new model deliveries (787 and 747-8). Boeing is attractively valued and offers a 2.4 per cent yield.
CN Rail CN consistently reports the lowest operating ratio in the industry and its best-in class operations has resulted in market share gains. Railroad traffic is a good barometer of general economic and industrial activity which we expect to slowly improve throughout the year. With its Canadian competitor focused on internal operating improvements, competitive pricing pressures are expected to be benign. Providing a dividend yield of 2 per cent, CN is a dividend grower, and recently increased its dividend by 15 per cent.
Past Picks: March 29, 2011
Then: $31.10 Now: $25.26 Total return: -18.77 per cent
Then: $41.11 Now: $24.73 Total return: -39.04 per cent
Chartwell Seniors Housing REIT
Then: $8.90 Now: $9.26 Total return: +10.48 per cent
Total Return Average: -15.77 per cent
OUTLOOK Equity market gains year-to-date have been fuelled by an improving U.S. economy, accommodative policy moves by the Chinese government and massive liquidity injections by the ECB. Sensitivity to concerns surrounding the European sovereign debt situation, China's targeted slowdown and factors that may derail the U.S. recovery will remain elevated.
Market consolidations represent opportunities to increase equity exposure in attractively valued companies well-positioned to serve the stronger growth emerging regions as well as high quality dividend paying corporations.
Compiled by Franklin Cameron, BNN Market Call Tonight