STOCKCHASE

17.000

There is no longer any danger of it going to zero but it will be very volatile. Have a lot of commercial real estate, leveraged buyout loans and credit cards on the books. Would prefer JP Morgan (JPM-N), which is a better bank with better management.

2009-08-13

PAST TOP PICK

Carnival Corp.

CCL-N

30.340

(A Top Pick Aug 27/08. Down 14.22%.) Has had a very nice run lately.

2009-08-13

DON'T BUY

CitiGroup

C-N

4.060

Good news is that they have taken the risk of bankruptcy almost away by doing a big conversion of preferred stocks into common stocks so the balance sheet is in much better shape. However a lot of the easy money has already been made.

2009-08-13

BUY

ConocoPhillips

COP-N

44.210

Oil has rallied a lot from its lows so some of the money has already been made in this stock. However, oil stocks have not recovered in the way that oil has so at this point they are cheap. He prefers Exxon Mobil (XOM-N). (See Top Picks.)

2009-08-13

DON'T BUY

14.100

A lot of the story is about the finance subsidiary. This is much more of a financial company than most people think. Huge financial arm that made a lot of investments. Loaned money for companies to buy their aircraft parts, utility equipment, railcars, etc. A lot of the easy money’s been made.

2009-08-13

TOP PICK

60.320

Sector most out of favour right now is healthcare. This is one of the most respected companies in the world with a very strong balance sheet. A leader in all its businesses. Wonderful consumer business. Very cheap with a 14 multiple.

2009-08-13

BUY

Medtronic Inc

MDT-N

36.540

Likes med-tech space. Space has historically traded at 20 PE’s and up. Growth is very good. Demographics are very positive. Currently out of favour because of fears of what the government will do to the industry. Trading at one of the lowest multiples in its 20-year history.

2009-08-13

DON'T BUY

MGM Mirage

MGM-N

8.770

Has run up because people have got much more optimistic about the consumer and consumer discretionary spending. Very leveraged company with a lot of debt. Has run up too far for him.

2009-08-13

PAST TOP PICK

Omnicom Group

OMC-N

35.790

(A Top Pick Aug 27/08. Down 13.9%.) An OK performer. Advertising market has been softer.

2009-08-13

TOP PICK

IMS Health Inc

RX-N

13.230

Relatively small company but the leading dominant provider of data to the pharmaceutical industry. When a drug company wants information about how its drugs are selling, what doctors are prescribing those drugs they go to this company. Great value at about 9X earnings.

2009-08-13

PAST TOP PICK

85.890

(A Top Pick Aug 27/08. Up .14%.) Has outperformed the market.

2009-08-13

WEAK BUY

Wal-Mart Stores Inc.

WMT-N

51.880

A stock that everybody goes to when they’re panicked. Defensive stock as people believe there is more shopping here during a recession. In an upswing in the economy, this company tends to lag. Good value, but not a great value.

2009-08-13

TOP PICK

Exxon Mobil

XOM-N

68.750

Oil has rallied from $30 to $70 but this stock has not and is actually down about 10%. Very strong balance sheet. A most favoured partner for people like Brazil and China who want an international oil company to help in explorations.

2009-08-13

Comment

Google

GOOG-Q

462.280

This one has traded up a lot and is back up to a 20 plus multiple. Made a huge move basically on the idea that media advertising is coming back. Too expensive for him but has some nice momentum now.

2009-08-13

PARTIAL BUY

CIT Group Inc.

CIT-N

1.450

Very risky and can still go bankrupt but could double, triple or quadruple from here. If you wanted to put a small portion of your investment in on the bet that the economy is going to be better than it is a reasonable thing to do.

2009-08-13

DON'T BUY

12.730

Made all those acquisitions and it is still very scary to him. Still a lot of unknowns. About to go through a bad real estate cycle.

2009-06-16

PAST TOP PICK

Carnival Corp.

CCL-N

22.530

(A Top Pick Aug 27/08. Down 35.7%.) With consumer pressures and oil going back up they have under performed. Very cheap stock and he is still recommending it.

2009-06-16

SELL

Fannie Mae

FNMA-Q2

0.670

This is only for the faint of heart. If you own he would recommend you sell as a tax loss.

2009-06-16

SELL

Freddie Mac

FMCC-Q2

0.720

This is only for the faint of heart. If you own he would recommend you sell as a tax loss.

2009-06-16

DON'T BUY

12.780

Had a near-death experience and almost went under in March. Have almost $100 billion of commercial paper outstanding so it is more of a finance company than people think. This one is too hard.

2009-06-16

BUY

Glaxosmithkline PLC

GSK-N

36.060

Likes Johnson & Johnson (JNJ-N) and Merck & Co. (MRK-N) a little better but he likes the whole space. People are negative on pharmaceuticals because of a perception that the Obama administration is hostile to pharmaceuticals/healthcare in general. There is truth in that but the stock has gotten too cheap relative to its earnings. Some things are coming off patent but they have decent stuff in the pipeline. (See Top Picks.)

2009-06-16

DON'T BUY

Home Depot

HD-N

23.200

Good buy for the next 3-5 years? If you go that long he would say yes but he thinks there are still problems in housing. Not that cheap as a stock at about 16X earnings. Also has some problems with the quality of this company.

2009-06-16

TOP PICK

54.620

High quality large-cap and is undervalued. Trading at the lowest multiple in its 20-year history. You're getting it at about 11X earnings.

2009-06-16

BUY

Eli Lilly & Co.

LLY-N

32.980

All the pharmaceutical stocks are cheap. He would recommend Johnson & Johnson (JNJ-N) and Merck & Co. (MRK-N) ahead of this one. (See Top Picks.)

2009-06-16

Comment

MGM Mirage

MGM-N

6.650

He tends to be a big believer in this sector, the gaming space in general. Have a lot of debt, which is scary. If you own you are betting on their ability to refinance. The high yield market is in a lot better shape than in March so directionally he would be bullish.

2009-06-16

PAST TOP PICK

Omnicom Group

OMC-N

31.900

(A Top Pick Aug 27/08. Down 23.9%.) Outperformed the market by a little bit.

2009-06-16

TOP PICK

IMS Health Inc

RX-N

13.310

They provide all the data to companies like Johnson & Johnson (JNJ-N) and Pfizer (PFE-N) on pharmaceuticals sales. If you are J&J and want to know what drug is selling where and how well they tell them. Now trading at 8X earnings. Very cheap.

2009-06-16

PAST TOP PICK

75.720

(A Top Pick Aug 27/08. Down 13.1%.) One of the most respected companies in the world and will really benefit from some of the problems of the big 3 car companies. Has outperformed the market very nicely.

2009-06-16

BUY

Wal-Mart Stores Inc.

WMT-N

48.250

Trading at just about the lowest multiple it ever has at around 12. Likes it here. High quality name.

2009-06-16

TOP PICK

Accenture Ltd.

ACN-N

31.490

The leading IT services company globally. Quality large-cap that has under performed this year. People are worried that they do a lot of business for a lot of large financial institutions but people are going to be outsourcing more and more of their technology and will be hiring more and more IT consultants. Very cheap at about 11X forward earnings.

2009-06-16

Comment

0.020

Integration/Deflation? There is a huge debate on this issue and he thinks it could go either way. If the Fed decides to monetize the current debt, there could be big inflation but if they put a clamp on the money supply we could have deflation. Do not expose yourself by buying long-term bonds. Some gold in your portfolio could act as a hedge.

2009-06-16

Comment

62.460

Had a multiple of 35 PE, dropped to 30 and is now in the low 20's. Starting to get very interesting. Because it is a growth stock he can't own it. Still too big a multiple to him, but getting close.

2009-06-16

DON'T BUY

Apple

AAPL-Q

99.720

Would avoid this one as there is too much technological risk.

2009-02-06

TOP PICK

Aflac Inc

AFL-N

21.800

This is the one financial he continues to believe in. Stock is down about 50% around concerns about portfolios and bonds they own in European banks. He doesn't think there will be defaults on their bonds. Their disability insurance is doing great. 5.2% yield is more secure than most US financials.

2009-02-06

BUY

Becton Dickinson

BDX-N

74.090

If you go to a hospital in the US and look around, everywhere you go you see their products. There is a lot of concern that hospitals are not going to be able to spend the money that they have in the past so the stock has come down a long ways.

2009-02-06

TOP PICK

Dell Computers

DELL-Q

9.460

Everybody hates this. The stock is under $10 and has $3 of cash, trading at 3X EBITDA. Extraordinarily cheap. Demand for computers is still going to be there when we come out of this recession and growth will emerge.

2009-02-06

TOP PICK

Walt Disney

DIS-N

19.450

Going back 5 or 10 years, the stock has been trading with an average PE of about 17 or 18 and is now 9. Very high quality brands. Own EFPN, probably the strongest cable network. Trades at less than 10X earnings. Most concerns were about the DVD sales that were down in the 4th quarter. Long-term this will be fine.

2009-02-06

DON'T BUY

11.100

Stock price is driven by their financial subsidiary. At one point it was a wonderful combination but now it has reversed. Their good businesses are being overshadowed by the bad finance business. In danger of losing their AAA rating. Have close to $100 million of commercial paper and the market is very nervous about their debt.

2009-02-06

Comment

Corning Inc

GLW-N

11.730

Very volatile stock. Faddy, trendy stock but some of their businesses could get hot again.

2009-02-06

BUY

58.510

One of the most respected companies globally. Should be able to produce good growth. Bought Pfizer's (PFE-N) consumer business. Trading at the lowest multiple that they have traded at in at least 20 years.

2009-02-06

HOLD

14.840

At this price it is probably near a low. Made a big acquisition that is scaring everybody. Can't see a lot of downside from here.

2009-02-06

DON'T BUY

Research In Motion

RIM-T

72.100

Would avoid this one as there is too much technological risk.

2009-02-06

Comment

0.020

Platinum: Very concerned about inflation 2 or 3 or 4 years out. With this kind of printing and this kind of debt, there is no way they are going to be able to pay for it with increased taxes. Precious metals would be a reasonable diversification.

2009-02-06

PAST TOP PICK

USG Corp.

USG-N

7.840

(A Top Pick Feb 20/08. Up 4.8%.)

2009-02-06

Comment

Las Vegas Sands Corp.

LVS-N

4.140

Attendance at Las Vegas is down and the companies have a lot of debt. You have to look at the balance sheet to see if they have any issues. This would be his only concern. Longer-term, the fundamentals of the gaming industry are going to be fine.

2009-02-06

PAST TOP PICK

Sotheby's

BID-N

9.160

(A Top Pick Feb 20/08. Down 72.3%.) Would recommend this one.

2009-02-06

PAST TOP PICK

Jones Lang Lasalle Inc.

JLL-N

27.350

(A Top Pick Feb 20/08. Down 63.8%.)

2009-02-06

Comment

55.410

A growth stock and he doesn't own it because he is a value investor. They don't have credit risks. Get fees from transactions. He is bullish on the use of credit cards long-term. Could be a bit of slowing with the recession. Stock price reflects all the good things. High PE at 20. OK if you are a growth investor.

2009-02-06

TOP PICK

Dell Computers

DELL-Q

10.890

The low-cost manufacturer of computers and hardware servers. Extraordinarily cheap. Close to $3 in cash. Trading at an enterprise value of about 2.5 X EBITDA. Great growth in international markets with their server business. Doing much better in portable computers and laptops.

2008-11-14

DON'T BUY

16.020

Generally fearful on this one. For a long time they were able to convince people that they were a growth industrial but was actually a financial services company in hiding. GE Finance is in big trouble. Big commercial paper exposure and not enough bank lines to back it. One of the most complicated balance sheets that there is out there. He has been warning people away from it. Could end up as a single digit stock.

2008-11-14

BUY

IBM

IBM-N

80.330

A couple of headwinds including foreign currency and pensions but their outsourcing, consulting and software businesses are very strong. The hardware business would be the most challenged. Great high quality company. Strong balance sheet.

2008-11-14

BUY

Altria Group Inc

MO-N

16.260

Just completed its financing of US Tobacco and paid over 10% interest on their 30 year bonds. Smoking rates in the US continued to decline. Doesn't own because of his company’s social responsibilities.

2008-11-14

Comment

Microsoft

MSFT-Q

20.060

Doesn't think it will get together with Yahoo (YHOO-Q). Yahoo management behaviour during the whole Microsoft bid was appalling bad.

2008-11-14

Comment

16.280

High dividend yield. Cheap because people think there is not much in the pipeline. Lipitor will be going off patent so earnings will drop. Almost like a short-term bond in that you get cash flow from existing drugs that are pretty dependable but not much growth. Sold his holdings about 2 years ago because of lack of growth. Relatively safe but not a lot of upside.

2008-11-14

TOP PICK

Chicago Mercantile Exchange

63.680

US auto industry is going to be down in production to the lowest in 20-25 years. Took their estimates down. Made about $10 a share last year but will only make about $5 this year. Very strong balance sheet. Very high quality company and will be a winner long-term.

2008-11-14

Comment

Wells Fargo

WFC-N

28.730

Got a great deal when they acquired Wachovia (WB-N). Stock has been stronger than what he would have expected. Strong balance sheet.

2008-11-14

DON'T BUY

Yahoo!

YHOO-Q

10.820

Thought management’s behaviour during the whole Microsoft bid was appalling bad. Not a fan of management and would not recommend this one.

2008-11-14

BUY

CME-N

306.500

Merging with the Chicago Board of Trade. Great company with a great upside potential from all of the derivatives that need to go on to an exchange. A lot of talk of how there is going to have to be central clearing on a lot of these contracts. Great growth business. Huge competitive advantages. There is risk because current earnings are not that big.

2008-11-14

Comment

0.020

US Rails: Move a lot of grain and coal. As the price of grain and coal skyrocket the rails were doing very well. Both of these have reversed and that is the main headwind for them rather than the general economy. Likes them long term. Have some cost issues. Will have a bumpy 2009.

2008-11-14

Comment

54.240

Solid company. Doesn't have the credit risks of a lot of companies have. Not a lot of downside risk but it is going to have pressure as credit card use goes down.

2008-11-14

TOP PICK

Energizer Holdings Inc.

ENR-N

37.830

The Energizer battery company. Also make Schick razor blades as well as a number of leading sunscreen products. Consumer staples that people are going to need. Stock is down almost 65% this year. PE of around 7 X’s.

2008-11-14

TOP PICK

American Express

AXP-N

28.250

Great brand that will be around for 7 or 10 years at least, trading at under 10 times earnings – its lowest in history. Even if we get default rates up to 7 or 8%, they will probably make $2 per share and then up to 3.50 or $4.

2008-10-07

VAGUE

23.770

.8 times book. He is finally stopping saying that it is not a buy, but won’t say it IS a buy.

2008-10-07

BUY

BP PLC

BP-N

44.420

Has been oversold, but don’t tie up too much of your portfolio in oil.

2008-10-07

SPECULATIVE BUY

CitiGroup

C-N

15.150

Doesn’t think they will go to zero. They have a better source of finding that others, but not a stock for the faint of heart.

2008-10-07

TOP PICK

Dell Computers

DELL-Q

13.550

People are going to be buying computers around the world and they have lowest cost computers. Michael Dell himself has been buying stock himself and it will triple or quadruple over the next three or four years. They are taking costs out of the equations.

2008-10-07

SPECULATIVE BUY

Ford Motor

F-N

2.920

Anyone with a lot of debt who has to get refinanced has been hurt pretty bad. At the current stock price, they have a better environment with their unions and if they can make it, there is pretty good upside, but there is no floor that they could not go under. Bailout package does not help them that much.

2008-10-07

DON'T BUY

Fannie Mae

FNMA-Q2

1.200

It could go to 0 and it is currently like a call option. It has theoretical value.

2008-10-07

DON'T BUY

Freddie Mac

FMCC-Q2

1.290

It could go to 0 and it is currently like a call option. It has theoretical value.

2008-10-07

SPECULATIVE BUY

20.300

People worried about hidden problems. It is a great company, but the financial business is very hard to get your arms around. They are about 11 or 12x what he thinks they will make next year.

2008-10-07

VAGUE

62.490

Have medical Device business, Consumer business, great company, a lot of which is not sensitive to politics.

2008-10-07

BUY

17.650

Interesting sock. Almost like a bond. Price assumes there will be no significant new drugs so revenue is based on existing drugs until they come off patent. No phase 2 drugs have hit over the last 2 years.

2008-10-07

TOP PICK

Tiffany & Co. New

TIF-N

28.660

Amazing business. Diamond becomes worth 30% more when you put it in the little blue box.

2008-10-07

Comment

0.020

People are obviously very scared. There are financial institutions in trouble so health companies could not borrow. It’s been very dangerous to call a bottom in financials. Now European banks are getting into trouble. All the government actions are helping the credit market. Lots of areas where he things opportunities are being created. Companies where there is more than a 10% cash flow yield.

2008-10-07

DON'T BUY

51.150

They don’t have the kind of credit exposure that other financials have. Would not own it. Multiple is very high. But not the same downside as other financials.

2008-10-07

DON'T BUY

Apple

AAPL-Q

174.670

Big multiple and too expensive for him.

2008-08-27

BUY

Aflac Inc

AFL-N

56.240

Insurance. Japanese-based. Has been very strong with 15% growth each year. Trades at a multiple below 12. You have to be careful with insurance companies and what they own as asset mix.

2008-08-27

DON'T BUY

General Motors Corporation

29.650

If he was forced to pick one US financial, this would be okay but they bought countrywide and they took on a massive mortgage exposure. A relatively strong investment banking business. He would suggest you not buy any but if you had to, this would be a safe one to buy.

2008-08-27

TOP PICK

Carnival Corp.

CCL-N

36.230

Cruise lines. The cost to buying a new cruise ship is in enormous. Demographics of the cruise business are great. Number of people taking cruises is going up every year. Think they can beat earnings estimates over the long term. Trading at about 12X forward earnings. Yield of 4.4%.

2008-08-27

Comment

Diageo PLC

DEO-N

72.590

Surprised that the alcohol/average stocks have not done better. Input costs have been high with a grain going up. Long-term this is a defensive stock but probably without a lot of massive growth.

2008-08-27

Comment

Walt Disney

DIS-N

31.760

His company doesn't like the movie business. He owns this one because of ESP and theme parks. Movie business is a classic “no barrier to entry” business. Historically it hasn't been a very good business.

2008-08-27

DON'T BUY

Fannie Mae

FNMA-Q2

6.480

In most people's mind, the US government supports the debt of Fannie Mae (FNM-N) and Freddie Mac (FRE-N) so their debt is secure. The question is, what are they going to do with the stocks, and very importantly the preferred stocks. They are down about 50% and there is a lot of concern that they could get wiped out.

2008-08-27

DON'T BUY

Freddie Mac

FMCC-Q2

4.750

2008-08-27

DON'T BUY

GM-N

10.200

Unfortunately, It has reached a point that not only do they not have a sustainable competitive advantage, actually have a sustainable disadvantage in their cost structure. The brand is not as strong today. A lot of debt.

2008-08-27

Comment

Home Depot

HD-N

27.170

This is a company that you can analyze. They are still making money despite all the problems in housing. He prefers Lowes (LOW-N) because they are the better company with better prospects. Trades at a low multiple.

2008-08-27

BUY

IBM

IBM-N

123.380

Was very much out of favour 3 years ago when he bought it. Very pleased with how well it has done. Globally, companies are trying to take costs out of their businesses. Trading at about 13X forward earnings. Has been helped by the weaker US$.

2008-08-27

Comment

JP Morgan Chase & Co

JPM-N

37.140

This is the one US financial that he does own. Good management. Balance sheet is very strong.

2008-08-27

Comment

Coca-Cola Company

KO-N

53.790

Trading at about 17X forward earnings, that is not nearly as cheap as many other companies. You won't be hurt by this long-term. Have been hurt by higher costs. Sugar is a huge cost factor for their products.

2008-08-27

DON'T BUY

Lehman Brothers Holdings

LEH-N

14.780

US Housing Market: There is nothing more out of favour right now than financials, consumers and housing stocks. You should only invest in businesses that you personally understand and it is his view that nobody can really understand the business of an investment bank right now.

2008-08-27

Comment

Lowes Companies Inc.

LOW-N

24.600

He prefers this company to Home Depot (HD-N).

2008-08-27

TOP PICK

Omnicom Group

OMC-N

42.420

World's largest advertising agency. Continues to increase earnings every year. Use to trade at around 25X and 30X forward earnings but is now down around 12X or 13X forward earnings. Their business continues to be global. The shift towards web based advertising is a positive in that they don't have to hire actors, etc. 1.4% yield.

2008-08-27

Comment

PepsiCo

PEP-N

69.200

Great brand. Trading at about 17X forward earnings, that is not nearly as cheap as many other companies. You won't be hurt by this long-term. Have been hurt by higher costs. Sugar is a huge cost factor for their products.

2008-08-27

DON'T BUY

19.080

Owned it about a year ago with a theory that their drugs were worth what the stock price was going at hand you would make money on all the new drugs they developed. The problem is, they haven't developed any new drugs in almost 3 years. Would prefer Merck (MRK-N).

2008-08-27

TOP PICK

88.000

Probably his most favourite stock in the world. Think they will earn about $9 a share this year so you are getting one of the great, most respected companies in the world with the best technology and the best brands for about 10X earnings.

2008-08-27

Comment

Constellation Brands Inc

STZ-N

21.030

Beer consumption has been flat to slightly down which is surprising. Also input costs have been high with grain going up. Long-term this is a defensive stock but probably without a lot of massive growth.

2008-08-27

DON'T BUY

Time Warner Inc

TWX-N

15.880

His company doesn't like the movie business. He owns Disney (DIS-N) because of ESP and theme parks. Movie business is a classic “no barrier to entry” business. Historically it hasn't been a very good business.

2008-08-27

Comment

0.020

Index Trading: First principle is that the market itself is going to be pretty good at reading that data and it will be hard for you to out guess that. If you are going to time the market it would be when there is maximum pessimism. Also, when the market stops going down on really bad news that is an indication that you can step up.

2008-08-27

Comment

0.020

US Interest Rates: At this point the Fed is more likely to increase interest rates then cut further. Probably a consensus view, which is why the US$ has started to become stronger. More important are borrowing rates and these have gone up significantly.

2008-08-27

DON'T BUY