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Greg Newman.
Greg Newman.

BNN Market Call

3 top stock picks from ScotiaMcLeod’s Greg Newman Add to ...

Greg Newman is director and senior wealth adviser at Newman Group, ScotiaMcLeod. His focus is Canadian dividend stocks and protection strategies.

Top picks:

Peyto Exploration & Development Corp.
Peyto sets the bar for low costs and enjoys enviable production growth. With an improving balance sheet and dividend coverage, it is a great way to benefit from higher natural gas prices – which appear likely.

Baytex Energy Corp.
Baytex is an excellent operator, pays a dividend of more than 6 per cent and should benefit from heavy oil continuing to trade closer to global prices.

Suncor Energy Inc.
Suncor’s stock has been weak for various reasons that are more than likely discounted at present levels. With a healthy balance sheet and $1 to $2 per year in free cash flow, it should have upside and dividend growth from these levels.

Past picks: June 21, 2012

Intact Financial Corp.
Then: $61.51
Now: $63.92
Total return: +6.01 per cent

Brookfield Renewable Energy
Then: $27.03
Now: $30.85
Total return: +19.78 per cent

Gibson Energy Inc.
Then: $21.09
Now: $25.75
Total return: +27.62 per cent

Total return average: +17.80 per cent

Market outlook:

U.S. growth may come into question over the coming months due to the effects of the payroll tax hike in January and the sequester. Combined with European uncertainty, the bull market may be affected. Investors should buy the dips given central bank liquidity, low interest rates, corporate profitability, reasonable equity valuations and a brightening picture emerging out of China and Japan.

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