Gordon Reid, president and CEO at Goodreid Investment Counsel
FOCUS: U.S. stocks
The focus of the markets has turned toward the possibility of another stimulus plan and, of course, the U.S. election. As the pressure builds, it appears that investors are most interested in stability, clarity and predictability. This year of turmoil has worn down investors and, more than political choices, the market yearns visibility.
Apple (AAPL NASD) Latest purchase Sept 2020 at $111
Apple has surged in 2020, primarily on expanding margins in support of modestly rising earnings. The reasons for this are not entirely clear, but one can point to the entire communications services sector being strong, a focus on recurring services revenues being a bigger part of Apple’s success and finally the buzz around 5G technology.
Lennar (LEN NYSE) Latest purchase Oct 2020 at $83
Homebuilders have been on a tear and for good reason. A confluence of factors has led to strong performance measurements, including historically low mortgage rates, constrained supply of homes and strong demand from people wanting to move from cities because of the pandemic. At 13 times this year’s earnings, Lennar continues to represent excellent value.
La-Z-Boy (LZB NYSE) Latest purchase Oct 2020 at $34
A derivative of strong housing is a boost in sales of furniture. La-Z-Boy has seen a flat stock price for years despite slowly rising earnings. Goodreid expects earnings per share of $2.50 in 2021, up 22 per cent year-over-year and representing 14 times earnings.
PAST PICKS: OCTOBER 17, 2019
Emcor Group (EME NYSE)
- Then: $88.41
- Now: $70.42
- Return: -20%
- Total Return: -20%
Facebook (FB NASD)
- Then: $190.39
- Now: $280.21
- Return: 47%
- Total Return: 47%
Walmart (WMT NYSE) Sold November 2019
- Then: $119.84
- Now: $143.09
- Return: 19%
- Total Return: 21%
Total Return Average: 16%