Bill Harris' Top Picks: March 11, 2024
Bill Harris, partner and portfolio manager at Avenue Investment Management
FOCUS: Canadian large, mid-caps
MARKET OUTLOOK:
Short-term interest rates might not be cut as fast as the market expects, given the strength of the North American economy. If this is the case, there might be a pullback in market-leading stocks. We are focusing on businesses that are doing well and could benefit from money flows looking for a safer place to invest.
- 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
TOP PICKS:
Bill Harris, partner and portfolio manager at Avenue Investment Management, discusses his top picks: Atrium Mortgage Investment, Osisko Royalties, and Superior Plus.
Atrium Mortgage Investment (AI TSX)
Atrium is a similar short-term mortgage lending business to Timbercreek Financial. We locked in a tax loss last fall last fall by selling Timbercreek and buying AI. AI is doing well lending at higher interest rates. The stock currently yields 8 per cent and trades at a slight discount to book value. The commercial residential property market seems to be able to handle higher interest rates
Osisko Royalties (OR NYSE)
Osisko has a lower valuation than the larger royalty companies. They can show growth in production over the next few years. The company has a new CEO, who we believe is dedicated to keeping the business model tight.
Superior Plus (SPB TSX)
Superior Plus stock still seems to be digesting their Certarus acquisition, and more importantly has been a super warm winter for propane consumption. When we look past those two things, the underlying business continues to grow. Like OR, the company has a new CEO, who we believe is dedicated to keeping the business model tight.
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| Atrium Mortgage Investment (AI TSX) | Y | Y | Y |
| Osisko Royalties (OR NYSE) | Y | Y | Y |
| SHOP TSX | Y | Y | Y |
PAST PICKS: SEPTEMBER 8, 2023
Bill Harris, partner and portfolio manager at Avenue Investment Management, discusses his past picks: Cenovus Energy Bond, Archer-Daniels-Midland, and Timbercreek Financial.
Cenovus Energy Bond: March 2027
Coupon: 3.6 per cent
Maturity: 3/10/2027
Price when recommended: $94.93
Return: 2.2 per cent
Archer-Daniels-Midland (ADM NYSE)
Then: US$78.81
Now: US$54.95
Return: -30 per cent
Total Return: -29 per cent
Timbercreek Financial (TF TSX)
Then: $7.10
Now: $7.63
Return: 7 per cent
Total Return: 14 per cent
Total Return Average: -7 per cent
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| CVE BOND | Y | Y | Y |
| ADM NYSE | N | N | N |
| TF TSX | Y | Y | Y |
