Gordon Reid is president and CEO, Goodreid Investment Counsel. His focus is on U.S. equities.
Time Warner's growth engine is their digital platforms, which will capture the growing mobile market for film (Warner Bros.), television (HBO, CNN) and publishing (People,Time). With a valuation of less than 12x earnings, a dividend yield of 2.5% and exciting growth opportunities, this issue is undervalued.
Wellpoint is a managed care operator with over 34 million members. The regulatory turmoil of U.S, healthcare reform has provided an excellent opportunity to invest in an organization that is likely to benefit regardless of outcome. Goodreid expects earnings to approach $8 per share in 2012.
Titan manufactures wheels and tires for off-road vehicles used in farming, construction and recreation. Growth in sales and earnings has been robust and management expects the pace to continue for the next several years. With significant free cash flow, Goodreid expects acquisitions to be a part of the long-term growth strategy.
Past Picks: April 27, 2011
Total return: +13.35%
Total return: -2.73%
Total return: -26.60%
Total Return Average: -5.32%
The extremely strong first-quarter performance in the U.S. markets was built largely on psychological relief as European fears ebbed and strong corporate earnings growth over the past few years gained more attention. With U.S. Federal Reserve policies encouraging investors to own risk assets, expect markets to appreciate at a greater-than-normal rate over the next couple of years.
Compiled by Franklin Cameron/BNN Market Call Tonight