Gordon Reid is president and CEO of Goodreid Investment Counsel. His focus is U.S. equities.
Clean Harbors Inc.
Clean Harbors provides environmental and hazardous waste management services throughout North America. A recent acquisition of Safety-Kleen will provide cost synergies for the next couple of years and long-term opportunities are abundant. Growth is particularly brisk in the oil and gas services.
As a premier global investment banking franchise, Goldman Sachs is biding its time until the pent-up demand of capital markets business breaks out. Goldman trades close to book value, well below valuation levels when capital markets are active.
The purchase of Ryland is the first foray directly into home builders since Goodreid completely exited this sector in 2008. The Federal Reserve approach of slowly tapering as the economy strengthens is a Goldilocks scenario for home builders with expectations of more balanced lending standards and a continued improvement in consumer confidence. As the supply/demand imbalance corrects home builders will be the winners.
Past Picks: December 19, 2012
Then: $526.31; Now: $553.13; Total return: +7.73 per cent
Then: $51.49; Now: $110.90; Total return: +115.38 per cent
Then: $37.24; Now: $56.63; Total return: +55.73 per cent
Total return average: +59.61 per cent
To date the policies of the Federal Reserve have worked. The equity market has driven higher due to valuations which have rapidly re-calibrated to historically normal levels and low interest rates have boosted earnings by expanding profit margins. Expect this situation to persist for some time.