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bnn market call

Michael Sprung is president of Sprung Investment Management Inc.

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

Top Picks:

Alaris Royalty Corp. (AD-TSX)

Alaris Royalty is a unique investment firm that invests in a diversified range of private companies with solid long-term histories and dedicated management teams. The nature of the investment allows Alaris to participate in future growth while the entrepreneurs maintain control, provided certain agreed upon benchmarks are met. Management has had a successful track record in identifying good investment opportunities. We anticipate this trend will continue and the stock will provide investors a means by which they can participate in a growing cash flow.

Cascades Inc. (CAS-TSX)

Cascades is a producer, converter and marketer of tissue and packaging materials in North America and Europe. As the economy expands, the price of packaging material will increase. In recent years, management has taken steps to realign the company and address any balance sheet concerns. The recent pullback in the stock's price affords a good entry point for investors.

George Weston (WN-TSX)

Weston will continue to benefit from their 46-per-cent ownership of Loblaw Cos. Ltd. as it generates more reach through their innovative extensions into cultural markets as well as product delivery through the integration with Shoppers Drug Mart. The WN Food division is currently facing some pressures that should see some benefits before year-end as new plants come online and efficiencies are gained through their relentless focus on optimizing the production platform. The commodity input hedging should also lead to more stable cost control.

Past Picks: April 26, 2013

Barrick Gold (ABX-TSX)

Then: $18.81; Now: $18.58 -1.22%; Total return: +0.58%

Bank of Nova Scotia (BNS-TSX)

Then: $56.90; Now: $66.71 +17.24%; Total return: +22.09%

Encana Corp. (ECA-TSX)

Then: $18.79; Now: $25.25 +34.38%; Total return: +38.48%

Total return average: +20.38%

"Now" figures are intraday from the date of the analyst's appearance on BNN Market Call.

Market outlook:

We anticipate that the U.S. economy will continue to accelerate as the year progresses, barring any major geopolitical disruption. Canadian markets have thus far outperformed many of their international counterparts, propelled in part by greater activity in the energy sector and strong agricultural commodity prices. Fears of slower growth have negatively impacted the emerging markets, while European markets have been shaken by events in the Ukraine. Going forward, we would not be surprised to see a pullback in Canada as fundamentals catch up with valuations. Such a pullback will be an opportunity for prepared investors.

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