Andrey Omelchak’s Top Picks for June 26, 2026

Market Call – June 26, 2026

Andrey Omelchak, CEO & CIO, LionGuard Capital Management

Focus: North American small and mid caps

Top Picks: Badger Infrastructure, Magellan Aerospace, Civeo

MARKET OUTLOOK:

The 2026 investment environment remains defined by elevated volatility—geopolitical uncertainty, an evolving interest-rate outlook, and rapid shifts in investor sentiment. Yet beneath the surface, markets are increasingly driven by powerful structural themes that attract significant capital flows and create sustained momentum. For investors who remain disciplined on fundamentals while identifying these long-term trends early, the opportunity set is highly attractive.

Nowhere is this more evident than in Canada. We believe the country is in the early innings of a multi-year “Build Canada” investment cycle, with conviction only strengthening. Canada is becoming highly attractive markets for long-term capital—provided investors are positioned in the right industries.

Defence sits at the heart of this transformation. This is no longer simply a spending story; it is about building sovereign industrial capability. Canada and its allies are making unprecedented commitments to defence, infrastructure, energy security, and advanced manufacturing, creating expanding procurement pipelines and long-duration growth opportunities for domestic champions.

Recent global disruptions have underscored the strategic importance of resilient domestic supply chains. Companies entrusted with strengthening Canada’s sovereign capabilities are positioned to generate exceptional returns on capital for years to come, much like Canada’s banking sector did over previous decades.

Underpinning this opportunity is Canada’s extraordinary natural resource base. Monetizing these assets and recycling the proceeds into domestic innovation, infrastructure, and strategic industries has the potential to reshape the country’s economic future for generations to come.

• Market-moving news, fast: Get the BNN Bloomberg App now
• Sign up for the Market Call Top Picks newsletter at bnnbloomberg.ca/subscribe

TOP PICKS:

Badger Infrastructure (BDGI TSX)

Remains one of our highest-conviction ideas because we believe the market continues to underestimate both the magnitude and the duration of the infrastructure investment cycle now underway. The company is seeing exceptional demand that remains well above available supply, with virtually every new hydrovac truck being deployed into the field almost immediately.

Importantly, demand is being driven by multiple long-term themes occurring simultaneously, including utility grid modernization, natural gas transmission expansion, road widening, semiconductor reshoring, artificial intelligence (AI) data centre construction, water and wastewater infrastructure, and broader industrial investment. Collectively, we estimate these trends could translate into well over US$4 trillion of announced infrastructure projects across North America over the next 18 months.

We also believe that growth should be accompanied by meaningful margin expansion. Despite adding trucks at the fast pace, we believe fleet utilization can continue to improve. At the same time, margins should benefit from higher utilization, pricing discipline, operational efficiency initiatives and significant operating leverage.

While the shares have performed well, we believe Badger is still in the early innings of a multi-year earnings expansion cycle, supported by exceptional demand, disciplined capital allocation and the strongest long-term infrastructure backdrops we have seen.

Magellan Aerospace (MAL TSX)

In our opinion, presents a compelling way to invest in what we believe will be a decade-long global aerospace and defence upcycle. The company is deeply embedded in the supply chains of major OEMs, including Boeing, Airbus and leading defence programs. It continues to report solid operating momentum with current sell-side estimates well below our expectations.

Defence spending is rising rapidly across Canada, the U.S. and Europe, creating a fast-growing pipeline of opportunities. We believe Magellan is particularly well positioned to benefit from Canada’s push to strengthen domestic defence manufacturing and sovereign industrial capabilities, given its existing capabilities, long-standing customer relationships and participation in critical aerospace programs.

We expect higher production volumes, improved product mix and much better capacity utilization to drive strong margin expansion over the next several years. Combined with a valuation that remains well below many global aerospace and defence peers, we see a compelling opportunity for both strong earnings growth and multiple expansion.

Civeo (CVEO NYSE)

Trades at what we believe is the lowest valuation of any publicly listed modular housing company despite owning high-quality assets, generating high free cash flow, and possessing high embedded operating leverage.

The largest opportunity lies in deploying existing idle capacity rather than requiring meaningful capital investment. The company has thousands of available rooms across its Canadian network, meaning incremental demand can be absorbed at exceptionally high incremental margins. We believe this operating leverage is not reflected in the current valuation and could drive a significant step-change in earnings and free cash flow as utilization improves. With a huge wave of “Nation Building” projects forthcoming, we are of the view that all the available industry capacity will be absorbed in short order.

One of the key catalysts is LNG Canada Phase 2. A positive final investment decision would likely create a major increase in demand for workforce accommodations, helping fill existing vacant rooms while supporting pricing and occupancy across Western Canada. Combined with broader investment in Canadian energy, mining, and infrastructure projects, Civeo is well positioned to benefit from an improving demand environment.

The company also generates high free cash flow, allowing it to continue very aggressively repurchasing shares while maintaining a strong balance sheet. Governance has become increasingly shareholder-focused following the addition of two activist-supported directors to the Board, further aligning capital allocation with shareholder interests.

PAST PICKS: JAN. 16, 2026

Bird Construction (BDT TSX)

Then: $29.90

Now: $60.90

Return: 104%

Total Return: 105%

Trisura (TSU TSX)

Then: $45.38

Now: $42.63

Return: -6%

Total Return: -6%

Electrovaya (ELVA TSX)

Then: $13.68

Now: $13.75

Return: 0.5%

Total Return: 0.5%

Total Return Average: 33%