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Christine Poole, Managing Director, GlobeInvest Capital Management
FOCUS: North American Large Caps
Market Outlook:
Equity markets continue to grind upwards despite slowing corporate profit growth and decelerating economic data. The resilience in part reflects investor confidence in continued central bank intervention to bolster economic growth. The prolonged low interest rate environment encourages income seeking investors to invest in financially strong dividend paying corporations to satisfy cash flow needs.
TOP PICKS:
Royal Bank (RY TSX) Recent purchase price $60.20-range in April 2013
Royal Bank’s domestic lending franchise, dominant capital markets position and growing wealth management business combined with its record of rising dividends should appeal to both growth and income oriented investors. Concerns of a slowing Canadian housing market are overdone. Valuation is attractive and stock offers a current dividend yield of 4.2 percent.
Chartwell Retirement Residences (CSH.UN TSX) Recent purchase price $11.30-range in April 2013
Chartwell is the owner/operator of seniors housing communities across Canada (74 percent of suites) and the U.S. (26 percent of suites). Aging population, rising longevity and operating leverage to improving occupancy are reasons to own this stock. Chartwell provides an income yield of 4.8 percent.
United Technologies (UTX NYSE) Recent purchase price $91.30-range in April 2013
United Technologies is a well-managed, diversified industrial company, with 60 percent of its sales from international markets. Its business units include climate, controls and security (brands are Carrier, Chubb), Pratt & Whitney in aircraft engines, Otis in elevators, Aerospace Systems (Goodrich) and Sikorsky in helicopters. Its stable recurring revenue stream is supported by 43 percent of sales from the aftermarket UTX is reasonably priced and a consistent dividend grower, yielding 2.3 percent currently.
| Disclosure: | Personal | Family | Portfolio/Fund |
| RY | Y | Y | Y |
| CSH.UN | Y | Y | Y |
| UTX | Y | Y | Y |
PAST PICKS: May 8, 2012
CGI Group (GIB.A TSX)
| Then: $21.56 | Now: $31.24 | +44.90% | TR: +44.90% |
H&R REIT (HR.UN TSX)
| Then: $24.27 | Now: $24.90 | +2.60% | TR: +8.08% |
Unilever (UL NYSE)
| Then: $34.03 | Now: $43.24 | +27.06% | TR: +31.49% |
Total Average Return: +28.16%
| Disclosure: | Personal | Family | Portfolio/Fund |
| GIB.A | Y | Y | Y |
| HR.UN | Y | Y | Y |
| UL | Y | Y | Y |
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