Jim Huang, president at T.I.P. Wealth Manager
Focus: North American equities
MARKET OUTLOOK
As the unrelenting sell-off in late 2018 gave way to the rapid recovery of early 2019, optimism is returning to the market and all seems to be right again. After all, global economic growth remains at a healthy pace, and corporate earnings are expected to continue growing. Even the noises of trade war are sounding a bit less deafening now. Lastly, central bankers seem to have taken a step back in their quest to slow the pace of credit expansion, perhaps reacting to the market volatilities despite their protest to the contrary. With major indexes recovered much of their lost territory, key tests lie ahead. The first quarter has typically been below par over the last few years and this year could bring negative surprises in corporate earnings, as management teams dealt with multiple uncertainties in global trade and slowing real economies. Valuation has returned to neutral levels and the threat of over-zealous central banks is ever present. Opportunities do exist in a volatile market, but patience is the key.
TOP PICKS
DIRTT ENVIRONMENTAL SOLUTIONS (DRT.TO)
Last purchased on October 2018 at $5.95.
DIRTT means “Do It Right This Time.” It’s the second coming of Canadian furniture maker SMED. It designs, manufactures and installs modular interiors, in a way that poises to revolutionize the construction industry. Proprietary highly configurable 3D design system, integrated manufacturing and global distribution partnerships are just some of the differentiating factors of DIRTT. Over the last years, it has overcome management turnovers, cyclical business fluctuations and challenges from activist investors. DIRTT is posed to continual its strong growth.
PAREX RESOURCES (PXT.TO)
Last purchased on November 2018 at $15.90.
Parex is an oil exploration and production company focusing in Colombia. Led by a proven management team, Parex boasts a large number of exploration prospects and has a proven track record of making discoveries and convert them into oil productions. With a strong balance sheet and prudent cash flow management, Parex can weather potential storms in the oil market and take advantage of upside in oil prices in a strong global economy.
ENBRIDGE (ENB.TO)
Last purchased October 2018 at $42.34.
Enbridge is one of the largest energy infrastructure companies in North America. It owns oil and gas pipelines, distributes natural gas and electricity as well as a variety of energy-related projects. Enbridge plays a leading role in expanding market access for Canadian oil production. Recently Enbridge received the final regulatory approval for its Line 3 pipeline expansion, which removed a longstanding overhang. It also continues to achieve success in divesting of non-core assets. Enbridge is poised for re-rating while still boasts a 5.55 per cent dividend yield.
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| DRT | Y | Y | N |
| PXT | Y | N | N |
| ENB | N | Y | N |
PAST PICKS: MARCH 26, 2018
LAURENTIAN BANK (LB.TO)
- Then: $47.60
- Now: $44.30
- Return: -7%
- Total return: -1%
CANADIAN NATURAL RESOURCES (CNQ.TO)
- Then: $38.36
- Now: $35.74
- Return: -7%
- Total return: -4%
DIRTT ENVIRONMENTAL SOLUTIONS (DRT.TO)
- Then: $4.58
- Now: $6.91
- Return: 51%
- Total return: 51%
Total return average: 15%
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| LB | Y | N | N |
| CNQ | Y | Y | N |
| DRT | Y | Y | N |
WEBSITE: tipvest.com
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