Full episode: Market Call for Thursday, August 22, 2019
Gordon Reid, president and CEO of Goodreid Investment Counsel
Focus: U.S. equities
The short to intermediate outlook for equities is flashing a caution signal. World economic growth is waning, interest rates are plunging and valuations are elevated. That said, there are identifiable areas of opportunity. The U.S. consumer is in solid shape, a carryover from the 2008-2009 experience. Innovation is driving productivity and damping inflation. Be measured and prudent. Review your financial investments to ensure appropriate asset mix, constructive internal hedges, and stock ownership driven by catalysts.
Latest purchase in August 2019 at $281.
Anthem is a managed care operator with 40 million members. With the tailwind of an aging population and a desperate need to provide health insurance solutions, Anthem will be in the mix. Goodreid expects earnings of nearly $20 per share in 2019 and an ongoing growth rate in the 15 to 20 per cent range.
BOOKING HOLDINGS (BKNG:UW)
Latest purchase in August 2019 at $1,900.
Booking Holdings (formerly Priceline) has been one of the most successful stocks of the past couple of decades and that success is far from over. As the world’s premier online travel company, expect double-digit growth in revenues, earnings and cash flow, all for less than 20 times earnings.
CISCO SYSTEMS (CSCO:UW)
Latest purchase in August 2019 at $51.
With a market that is looking toppy after an extended period of economic growth, the opportunity to own a technology powerhouse with strong financial metrics and a relatively low valuation threshold is compelling. Chuck Robbins assumed the CEO role from John Chambers in 2015 and has transformed the company into a new age tech force with a leadership role in the 5G rollout.
PAST PICKS: AUG. 21, 2018
CVS HEALTH (CVS:UN)
- Then: $73.69
- Now: $61.40
- Return: -17%
- Total return: -14%
- Then: $1,217.41
- Now: $1,180.66
- Return: -3%
- Total return: -3%
- Then: $161.04
- Now: $218.07
- Return: 35%
- Total return: 39%
Total return average: 7%
Goodreid’s North American balanced Fund
Goodreid’s balanced approach allows investors to participate in the potential growth of equity holdings while mitigating risk through ownership of quality fixed income instruments.
Performance as of: June 30, 2019
- 1 year: 3.0% fund, 3.3% index
- 3 years: 8.7% fund, 5.8% index
- 5 years: 6.3% fund, 4.2% index
INDEX: Equity Balanced Category Average
Returns are based on reinvested dividends, net of fees and annualized.
- U.S. equities: 37%
- Cdn equities: 32%
- Canadian fixed income: 19%
- Cash: 12%