Market Call – July 20, 2026
David Driscoll, Founder, President, CEO and Chief Investment Officer, Liberty International Investment Management Inc.
Focus: Global equities
Top Picks: Franco-Nevada Corporation, Halma PLC, Jardine Matheson
MARKET OUTLOOK:
There are plenty of lessons to be learned from this current market. In the past six months, we’ve seen parabolic stock movements, higher-than-average leverage, inflation, geopolitical events that can wreak havoc on supply chains, massive sector rotations and the need to be focused on portfolio construction, not speculation. I believe Warren Buffett said something recently to this effect, “People aren’t investing or even speculating. They’re outright gambling”.
High leverage levels (currently $1.4 trillion in margin debt), means investors are borrowing to invest, pushing stock prices higher.
Inflation creep is beginning to take shape as companies are beginning to raise prices to cover input costs and as the war in Iran is hurting supply chains.
Parabolic rises in stocks, especially tech names, require prudent re-balancing of portfolios. We’ve been doing that for the past three months. For example, we made our first purchase of Comfort Systems, a heating, ventilation, and air conditioning (HVAC) industrial, in April 2025 at US$330 a share. On May 14, 2026, it hit a price peak of US$2,073, an increase of 528 per cent in less than a year. Since stocks historically only grow 10 per cent to 15 per cent a year on average, investors enjoyed 30 to 50 years of growth in just 12 months.
To Liberty, this growth occurred too far, too fast and the prudent thing was to re-balance the position back to a neutral weight. By the time of this writing on July 8, the stock had fallen to $1,675, a 20 per cent drop.
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TOP PICKS:
Franco-Nevada Corporation (FNV:TSE)
A resource royalty and investment company that owns a diversified portfolio of precious and base metal royalties, oil and natural gas royalties and other interests.
If the U.S. dollar falls further, commodity stocks should go higher as commodity prices are in U.S. dollars. As a royalty company, the firm is debt-free, has an above-average return on invested capital of 18 per cent, a dividend that has grown an average of 10 per cent a year and a 20-year compound annual return of 15 per cent, at the high end of historical equity returns.
The stock is also off its February stock price high of $388.26, a 27 per cent decline.
Halma PLC (HLMA:LON)
Operates as a life-saving technology and devices manufacturing company. Subsidiaries include safety (fire and water safety equipment), environmental and Analysis (materials analysis and environmental monitoring technologies) and health care (diagnostic systems).
20 per cent of its revenue comes from optical components for data centres. With cloud giants plowing cash into AI infrastructure, Halma’s sales are set to beat expectations.
The company is a serial acquirer, has a return on invested capital (ROIC) of close to 15 per cent and a 20-year compound annual return of 15 per cent and a dividend growth rate of seven per cent (about the average of companies around the world).
The stock is off its June high of £49.02, a 25 per cent decline
Jardine Matheson (JM:SP)
Trades on Singapore exchange and is a conglomerate with its tentacles throughout China and southeast Asia. It owns the Mandarin Oriental hotel chain, the Maxim’s restaurant chain, Mercedes and BMW dealerships, real estate holding, food retail investments, engineering and construction firms, financial services and franchises of both Ikea and Starbucks.
We believe that Asia should be the place to be in the next decade for investments and Jardines is our proxy. Debt-to-equity is at 62 per cent, so there’s lots of room for them to continue to make future. acquisitions
The stock is off its February high of US$82.50, a 23 per cent decline.
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| FNV:TSE | Y | Y | Y |
| HLMA:LON | Y | Y | Y |
| JM:SP | Y | Y | Y |
PAST PICKS: JUNE 2, 2025
Toromont Industries (TIH TSX)
Then: $118.78
Now: $235.76
Return: 98%
Total Return: 100%
Unilever N.V.A. (UNA:AMS) – sold in September 2025
Then: £55.30
Now: £54.64
Return: -8%
Total Return: -4%
Microsoft (MSFT NASDAQ)
Then: US$461.97
Now: US$393.82
Return: -15%
Total Return: -14%
Total Return Average: 82%
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| TIH:TSX | Y | Y | Y |
| UNA:AMS | N | N | N |
| MSFT:NASDAQ | Y | Y | Y |
