RE:RE:GLOBE AND MAIL- Bruce CampbellFrom Globe, Bruce's top picks in health care sector:
Investors should brace for more bumpy days ahead in the markets with the pending U.S. presidential election, a surge in COVID-19 cases and the usual October volatility, says Bruce Campbell, president and portfolio manager at StoneCastle Investment Management.
The possibility of a contested election, as threatened by GOP incumbent Donald Trump should he lose on Nov. 3, could extend that uncertainty. The good news, Mr. Campbell says, is that markets should settle down once we know who wins the White House.
Research shows that stock market returns over the long term aren’t dependent on which party is in office, he adds. And while COVID-19 is a concern, “markets don’t typically sell off for the same reason twice in a row."
Mr. Campbell, who oversees about $100-million in assets under management, is keeping his focus on sectors and stocks he expects to benefit from current economic trends in health care, cannabis and clean energy. Here are his picks in these areas:
The telemedicine trend
Telemedicine is an area Mr. Campbell’s firm had exposure to before the pandemic pushed people to visit their doctors online instead of in-person for non-serious matters such as prescription refills. He believes both doctors and patients will want to keep meeting online postpandemic.
His picks include: Victoria-based CloudMD Software & Services Inc. (DOC-TSX-V), which he bought a year ago; Well Health Technologies Corp. (WELL-TSX) of Vancouver, owned since January, and Mississauga-based CB2 Insights Inc., which trades on the Canadian Securities Exchange (CSE) under the ticker symbol CBII, which he purchased in the last month.
Well Health owns physical and digital medical clinics and provides electronic medical record software services. It has been aggressively acquiring properties in these areas to expand its footprint. Mr. Campbell likes the strategy and the management team, including chief executive officer Hamed Shahbazi, who sold his previous company, Tio Networks Corp., to PayPal Holdings Inc. for $304-million in 2017. Well Health stock is up by about 450 per cent over the past year, as of Oct. 26.
CloudMD provides software-as-a-service (SaaS) to more than 370 medical clinics across Canada. Mr. Campbell also likes its growth plans. CloudMD shares are up more than 700 per cent over the past year.
CB2 Insights, a smaller company, and more focused on the United States than Canada, is shifting from its focus on medical cannabis clinics to more general health care services, which Mr. Campbell believes is promising. The stock is up more than 450 per cent over the past year.
Caveat: Mr. Campbell cautions these companies will face increased competition as telemedicine becomes more common.