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Gordon Reid is president and CEO of Goodreid Investment Counsel. His focus is on U.S. equities.

Top picks:

Ensco PLC
The youngest fleet in the industry will help this deep-water driller expand profit margins over the coming years. In the meantime, day rates are expanding and utilization rates are high, allowing Ensco to grow revenues and earnings briskly. (Latest purchase: November 2012 at $58.)

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Cooper Tire & Rubber Co.
Falling rubber costs have been a big boost for this tire company. Equally important, however, is the growing number of used cars in circulation as the replacement market is a big part of Cooper's business. (Latest purchase: December 2012 at $24.)

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 60 per cent of Visa's transactions. (Latest purchase: November 2012 at $140.)

Past picks: Jan. 11, 2012

Halliburton Co.
Then: $35.38
Now: $36.77
Total return: +5.09 per cent

United Technologies Corp.
Then: $76.70
Now: $84.80
Total return: +13.49 per cent

WEX (formerly Wright Express)
Then: $55.61
Now: $77.21
Total return: +38.84 per cent

Total return average: +19.14 per cent

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Market outlook:

As a consequence of political and economic turmoil over the past several years, equities are under-owned and under-valued. At this point of the cycle equities normally trade at higher valuations than they do today but negative psychology continues to trump strong corporate performance.

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