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Investment Ideas Three top stock picks from Sprung Investment’s Michael Sprung

Michael Sprung is president of Sprung Investment Management Inc.

Michael Sprung is president of Sprung Investment Management. His focus is on Canadian large caps.

Top picks:

Alliance Grain Traders

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AGT is the worldwide leader in pulse processing. The company is on the road to achieving a multi-origin, multi-product, multi-market platform. Rising lentil exports and the expanding food ingredients business should continue to contribute to advances in profitability.

Manulife Financial

Manulife is Canada's leading provider of insurance and wealth management products in Canada with operations in North America, Japan, Hong Kong and China. Over the past few years, management has made extensive strides in limiting the company's exposure to adverse events. The recent economic environment will result in increasing profitability and visibility.

Cenovus Energy

Cenovus is an integrated oil and gas company focused on the development of bitumen assets in Alberta with significant joint venture operations at Foster Creek and Christina Lake. Production should ramp up strongly over the next few years resulting in increasing earnings, cash flow and potential dividend increases.

Past Picks: October 22, 2012

Talisman Energy
Then: $12.56
Now: $12.65
Total return: +3.11 per cent

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CAE Inc.
Then: $10.55
Now: $11.43
Total return: +10.41 per cent

Alliance Grain Traders
Then: $13.87
Now: $15.61
Total return: +17.40 per cent

Total return average: +10.31 per cent

Market outlook:

There is good reason to be more optimistic: business conditions in the U.S. are improving as profits expand and corporate balance sheets are stronger; conditions in Europe appear to be stabilizing as the Euro economy posted positive growth after six quarters of decline; Japan's economy has been expanding and the economy in China shows signs of stabilizing at a growth rate around 7-7.5 per cent. The end of the political logjam in the U.S. has also contributed to a reprieve in investors' concerns. The markets have advanced to the point where all the good news appears to be priced in while the longer-term headwinds have been ignored. This could set the stage for some pull-backs in the market as these underlying issues surface.

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