Teal Linde, manager, Linde Equity Fund

FOCUS: North American mid and large-cap stocks


Through the latter half of 2020 and all of 2021, investors were amazed by the resilience of the rising stock market despite being in the midst of a global pandemic. 2021 particularly benefited from a combination of pandemic-induced pent-up demand, trillions of dollars of government stimulus, rock bottom interest rates, and money printing galore by the U.S. Federal Reserve. We all knew the 180-proof spiked punch bowl would eventually be taken away, but nobody could predict exactly when the rally would end. Now we know. 

Today, amazement has been displaced by many feeling concerned about how much lower will the market fall or when will it recover? Predicting market turns is never easy, but the current market situation is being impacted by three major issues – rising interest rates, inflation and recession worries, each of which appear to be overblown. 

 There is a belief that if interest rates go up, stock prices are destined to fall. At really high-interest levels, yes, but not necessarily if the Fed increases its overnight rate to two per cent, three per cent or four per cent. These are still historically low rates. Second, the market is worried, or perhaps even panicking, that if the Fed moves too aggressively to fight inflation, it will cause a recession.

 However, the fear of inflation rates remaining persistently high, as during the 1970s, also appears overdone. 54 per cent of the CPI index consists of three components that have been dramatically pushing up the inflation rate: Shelter (1/3 of the CPI), energy and food. But housing prices have peaked. Energy prices have likely peaked after oil prices soared following Russia’s invasion of Ukraine. And food costs are heavily influenced by energy prices. Thus, the worst of the price increases are likely behind us.

  • Sign up for the Market Call Top Picks newsletter at bnnbloomberg.ca/subscribe
  • Listen to the Market Call podcast on iHeart, or wherever you get your podcasts



Teal Linde's Top Picks

Teal Linde, manager at Linde Equity Fund, discusses his top picks: Premium Brands, Colliers, and Linamar.


Last purchased on April 29, 2022 at $105.19

Premium Brands is one of Canada’s largest food companies and one of North America’s largest sandwich companies. The company is an investment platform which is focused on acquiring and building specialty food businesses in partnership with talented entrepreneurial management teams. 

Once acquired, the objective is to turn these well-run, good companies into great companies by providing additional capital and marketing expertise to support growth. The company owns over 50 different brands including Freybe, Duso’s, Oberto, Grimm’s, Bread Garden Go and many other specialty food companies, which are privy to industry tailwinds including increased ingredients transparency, on-the-go consumption, local sourcing and products that are free from antibiotics and unnatural/artificial additives. 

The company has a long-term track record of delivering double-digit annualized returns. During inflationary times, food businesses enjoy particularly strong pricing power as everyone needs to eat.


Last purchased on April 18, 2022 at $154.30

Colliers is led by one of Canada’s leading entrepreneurs, Jay Hennick, who is the chairman, CEO and largest shareholder of the company. Colliers is the fastest-growing global real estate professional services and asset management company operating in 65 countries. Colliers is expected to grow organically in the mid-single digits annually and at double-digit growth rates when including acquisitions.

As the faster-growing smaller rival among industry giants CBRE Group and Jones Lang LaSalle, Colliers is also considered more entrepreneurial driven with insider ownership of nearly 40 per cent. Colliers has made a meaningful expansion into recurring revenue services such as investment/property/project management, engineering, valuation, and loan servicing. Having made significant steps to grow its brand worldwide, and with significant runway to consolidate the global fragmented commercial real estate services industries, the successful execution of this plan is expected to lead to shareholder value creation, building upon management's long-term track record of success. 


Last purchased on May 5, 2022 at $50.99

Linamar is a company that should benefit simply from a return to normal operating conditions – a reversion to the mean. With 2019 impacted by the GM strike, 2020 impacted by the coronavirus, and 2021 and year-to-date 2022 hurt by supply chain shortages, a normal year in 2023 should enable the company to return to higher levels of profitability and a higher share price. 

From a financial perspective, Linamar earned an average return on equity of 20 per cent from 2013 to 2017. For the trailing twelve months, its return on equity is around 10 per cent. 

With current book value at $70 per share, if the company can return to earning a return on equity of 15 per cent, that would equate to EPS of $10.50 per share. Apply a 10x P/E multiple to $10.50 of EPS would result in a $105 share price, double its current price. If return on equity returns to 20 per cent, EPS will become $14 per share. At a 10x P/E multiple, the share price would be $140. Linamar is an attractive reversion to the mean investment opportunity.  





PAST PICKS: May 17, 2021

Teal Linde's Past Picks

Teal Linde, manager at Linde Equity Fund, discusses his past picks: Aritzia, Equinox Gold, and Ensign Energy Services.


  • Then: $29.95
  • Now: $38.25
  • Return: 28%
  • Total Return: 28%


  • Then: $11.00
  • Now: $7.02
  • Return: -36%
  • Total Return: -36%


  • Then: $1.15
  • Now: $3.99
  • Return: 247%
  • Total Return: 247%

Total Return Average: 80%