ENJOY YESTERDAY'S ARTICLE FROM FABRICE TAYLOR
Fabrice Taylor offers some of his top picks
BY GARY LAMPHIER, EDMONTON JOURNAL APRIL 20, 2015
EDMONTON - Stock markets have clawed their way to modest gains since Jan. 1, with Toronto’s main equity index up by more than five per cent, and the major U.S. indexes up between two per cent and five per cent.
But the broad market indexes don’t tell the whole story.
Some mid-cap and large-cap issues — such as Dollarama, CGI Group, Element Financial, Avigilon, Exco Technologies, Martinrea, Extendicare and Aecon Group — have posted hefty double-digit returns this year.
The reasons vary. Some are solid growth stocks. Others are benefiting from the weak loonie. Some are rebounding from setbacks in 2014. And with the resource sectors out of favour, many technology, health care and industrial stocks are attracting more interest.
Point is, if you’re willing to do a bit of research and have a bit more tolerance for risk than the average mutual fund investor, there are always winners to be found, no matter what the markets are doing.
Here’s a quick look at three of the high-flying junior stocks Taylor currently owns and likes. If you’re a risk-averse investor looking for blue-chip dividend stocks, read no further. But if there’s room for a junior growth stock or two in your portfolio, read on.
Patient Home Monitoring (TSXV: PHM) — This acquisition-driven Vancouver-based health care company is buying firms in the U.S. that provide monitoring, supplies and services for patients living at home.
It’s currently profitable, has annual revenues of about $60 million and recently completed a $58.5-million “bought deal” financing.
“We got into it at eight cents a little over two years ago, and now it’s at $1.96,” says Taylor, matter-of-factly.
“They’re consolidating a very fragmented market, so they’re growing their revenues quickly and making money because they’re not overpaying.”
Although the stock is up an astonishing 25-fold in just two years, Taylor sees a lot more growth ahead as ObamaCare encourages the growth of more home-based health care services and less costly institutional care.
“Governments are not getting any more flush and their debts are going up. So I think home monitoring will continue to be a growth area and there is still upside as long as they keep executing their growth plan,” says Taylor.
Convalo Health International (TSXV: CXV) — This Los Angeles-based consolidator also operates in the health care field, but it focuses on acquiring small, locally owned addiction recovery services firms.
Convalo made its first acquisition 11 months ago and its shares began trading on the Venture Exchange in February. The company recently announced a $15 million “bought deal” financing and has identified 1,000 potential acquisition targets across the U.S.
Taylor, who participated in Convalo’s recent financing at 40 cents per unit, has already been rewarded. Its shares closed Monday at 75 cents apiece.
“This thing is just on fire right now and unless resource stocks come roaring back — which I don’t see happening for at least a year or two — I think health care and technology are the right places to be.”