Jeff Parent, chief investment officer at Castlemoore Inc.
Focus: Technical analysis

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MARKET OUTLOOK

Earnings are causing a lot of volatility but, on balance, the markets are robust. The major North American indexes are breaking into new territory or heading into that direction. Big drivers, like the U.S. Internet and tech names, are continuing to see strong inflows, but caution is key. We might see some pullback to support levels as the summer progresses. New funds should be placed in predictable names. Opportunities may lie in the lagging groups, like larger banks and materials. There are several value plays in the Canadian energies that may be worth looking at. Some of the names have been beaten down and now are breaking out above long-term resistance.

TOP PICKS

HELIX ENERGY SOLUTIONS GROUP (HLX.N)

Helix Energy just released their earning report a few days ago and the stock popped up nicely. After being in recovery mode for a while, the price looks like it could break into multi-year highs based on the current momentum. Fundamentals are supportive of a continuation. Stops should be in place at $8.70 and $7.60.

ALARIS ROYALTY (AD.TO)

Alaris bounced out of a major bottom on the earnings this week and looks good for a rally to $20. Monthly dividends yielding about 9 per cent help the bottom line. The dividend quality is sufficient. Use $16.80 as an initial reduce point.

PARKLAND FUEL (PKI.TO)

Parkland is on a nice upward trend and not a lot of day-to-day volatility. It could hit 40 before year end. The stock pays a decent dividend. It’s got earnings coming out on Aug. 2, so expect some volatility. It may drop back to the $34 range. Sell below $33.

PAST PICKS: MAY 31, 2018

KEYERA (KEY.TO)

We would continue to hold Keyera. It formed a nice reversal from the bottom in April, and is steadily increasing. It pays a nice dividend and has strong support at $36. It could reach $40 by year’s end. Sell below $35.

• Then: $36.35
• Now: $37.46
• Return: 3%
• Total return: 4%

WELLS FARGO (WFC.N)

Wells Fargo broke nicely above resistance line at $56 and beginning to form a longer-term uptrend along with other global bank names, like Citigroup, JPMorgan and Bank of America.

• Then: $53.99
• Now: $58.63
• Return: 9%
• Total return: 9%

GRAY TELEVISION (GTN.N)

On our last update, we recommended to exit Gray Television as it had broken down below the support line. But the stock turned around on news on June 25. It has a better-looking chart, but it’s probably too risky at the moment for most investors.

• Then: $11.00
• Now: $14.95
• Return: 36%
• Total return: 36%

Total return average: 16%

WEBSITE: www.castlemoore.com