Jamie Murray’s Top Picks for Oct. 8, 2026

Jamie Murray, President, Murray Wealth Group

Focus: Global Equities

Top Picks: Amazon.com, Aon, Primaris REIT

MARKET OUTLOOK:

Rates are a temporary but real headwind. The Fed’s September hike was driven by oil, not by an overheating economy. Wage growth has slowed to three per cent, the weakest since 2021, payrolls rose just 29,000 in September, and real home prices are falling. Headline Consumer Price Index (CPI) of 3.4 per cent is mostly energy, and oil starts lapping tough comparisons in 2027: the Energy Information Administration (EIA) sees Brent easing from about US$90 to about $74. Without a second oil shock, we expect the 2026 hikes to start reversing in 2027.

Artificial intelligence (AI) is a deflationary force. The cost of running an AI model at a fixed level of capability is falling roughly 50 times a year, and cheaper tokens are driving more usage, not less. Second quarter (Q2) productivity grew at a 1.4 per cent annualized rate against 0.6 per cent expected. When the cost of knowledge work collapses, it shows up first in margins and wages, well before it shows up in CPI.

Industrial activity is healthy, so pullbacks are opportunities. The Institute for Supply Management (ISM) manufacturing purchasing managers’ index (PMI) was 54.5 in September, the ninth straight month of expansion. New orders rose 1.6 points to 55.3, and five of the six largest manufacturing industries grew. Rate-driven weakness in cyclicals is a buying opportunity, not a signal.

About a quarter of S&P 500 companies are down more than 10 per cent year-to-date so there are pockets of opportunities despite a market that is expensive on the surface.

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TOP PICKS:

Amazon.com (AMZN NASD)

• AWS growth: AWS sales grew 37 per cent, its fastest growth in 18 quarters, to a US$169 billion annualized revenue run rate. Amazon disclosed a US$496 billion AWS order backlog. Capacity, not demand, is the constraint: management says even US$220 billion of capex won’t meet 2026 demand, and most 2027 AWS capacity is already reserved.
• AWS margins: AWS operating income rose 64 per cent to US$16.6 billion, lifting the segment margin to 39.4 per cent from 32.9 per cent. That’s about US$66B of annualized operating income from AWS alone (my arithmetic).
• Retail margins: North America grew operating income faster than sales, lifting its margin to 7.9 per cent from 7.5 per cent; International is profitable at a 4.1 per cent margin. Higher-margin advertising, up 26 per cent, and third-party seller services are doing the work. Note that Prime Day shifted into Q2 and flattered the quarter.
• Valuation: The stock trades at about 23x forward earnings, more like a mature retailer even though AWS is growing 37 per cent, and below Microsoft’s multiple. The pushback is that capex has pushed trailing free cash flow negative, to -US$7.6 billion

Aon (AON NYSE)

• Growth model: Aon grows organically at five to six per cent through the cycle: five per cent in each of the last three quarters, while peers averaged about three per cent. Margins expand 50 to 90 basis points (bps) a year, and the cash is recycled into debt paydown, dividends and buybacks.
• Recent acquisition: USI is a US$17B all-cash deal that fills Aon’s gap in the U.S. middle market. It’s full-priced, takes leverage to about 4.8 times and pauses the buyback. Management targets leverage back at 2.8–3.0x within about 24 months, which it delivered on time after the NFP deal. The deal turns accretive in 2028.
• Low multiple: The stock is down about 24 per cent YTD and trades at 14 times 2026E and 11 times FY28E earnings. Brokers overall are at decade-low multiples. The price already assumes the deal fails.
• Why AI won’t disintermediate commercial brokers (Jamie’s view):
• Large risks need syndicating across dozens of carriers in layered programs.
• Brokers aggregate billions of premium, which buys pricing, capacity and terms that no single buyer gets.
• Clients buy a bundle of property & casualty, reinsurance, benefits, analytics and claims advocacy, not a quote.
• The AI shopping apps target small personal auto, not commercial risk.
• For Aon, AI is a servicing-cost tool that supports margin expansion.

Primaris REIT (PMZ-UN TSX)

PT $26.06, about 18 per cent upside plus a 4 per cent yield

• Investor Day: Management set new 2027–29 targets of four to eight per cent annual FFO/unit growth and four to eight per cent distribution growth, up from four to six per cent and two to four per cent. It also targets 96 per cent occupancy. Much of that is already contracted: occupancy excluding the old HBC space is 93 per cent in place and 96 per cent committed. Rent escalators are moving from two to three per cent.
• Recent acquisition: Upper Canada Mall in Newmarket for $411 million in cash, with $888/sf same-store sales productivity, bought from Oxford and CPPIB. It’s only about 70 per cent occupied in place, so there’s lease-up upside, and it closes by October 31.
• Strategy: Own the dominant mall in each market. That means skipping trophies like Yorkdale, which are too expensive, and selling the bottom tier. Former HBC boxes are being re-leased at about 4x the old rent, mostly to Walmart, grocers and national chains.
• Capital allocation: Primaris has bought back units at an average 33 per cent discount to NAV. It targets more than $500M of dispositions plus $275–375M of land sales, a 45–50 per cent payout ratio and leverage of five to six times. Redevelopments must clear a 10 per cent yield. The units trade at about 1.0 times NAV.

PAST PICKS: OCT. 23, 2025

Nu Holdings (NU NYSE)

Then: US$15.90

Now: US$15.53

Return: -2%

Total Return: -2%

Exchange Income Corp (EIF TSX)

Then: $77.34

Now: $118.21

Return: 53%

Total Return: 56%

Vital Infrastructure Property Trust (VITL-UN TSX)

Then: $5.22

Now: $5.16

Return: -1%

Total Return: 6%

Total Return Average: 20%