Top Stock Picks and Market Outlook – BNN Market Call, Friday March 7

Top Stock Picks and Market Outlook – Michael Sprung Interviewed by Mark Bunting on BNN Market Call

Top Stock Picks

Cenovus to improve Foster Creek's SOR ratio in 2014

Cenovus has taken steps to improve Foster Creek’s SOR ratio.

Michael’s top stock picks for Friday March 7 are:

Cenovus Energy Inc. (TSE:CVE, Mkt cap 22.22B, P/E 33.63, Div/yield 0.27/3.62, EPS 0.87, Shares 756.12M) Owned by clients, last purchase March 6, 2014 $29.08.
Cenovus is an integrated oil and gas company focused on the development of bitumen assets in Alberta with significant joint venture operations at Foster Creek and Christina Lake.  Production should ramp up strongly over the next few years resulting in increasing earnings, cash flow and potential dividend increases.

Fortis Inc. (TSE:FTS, Mkt cap 6.54B, P/E 18.82, Div/yield 0.32/4.17, EPS 1.63, Shares 213.16M) Owned by clients, Last purchase March 4, 2014 $30.55.

Fortis Inc. owns 51% of the Waneta Dam in BC. Expansion will add a second powerhouse located immediately downstream of existing dam.

Fortis Inc. owns 51% of the Waneta Dam in BC.

Fortis is the largest investor owned gas and electric distribution utility in Canada with operations in the US and Belize.  Over the next few years, Fortis is expected to significantly increase its rate base.  Approval for the acquisition of UNS in Arizona is expected later this year.  During this period of transition, the yield will support the stock and given the longer term anticipated earnings growth, the investment should do well.n the longer term anticipated earnings growth, the investment should do well.

 

Enercare is focused on the securitizing and renting of water heaters and sub-meters.

Enercare is focused on the securitizing and renting of water heaters and sub-meters.

Enercare Inc. (TSE:ECI, Mkt cap 607.93M, P/E 347.01, Div/yield 0.06/6.69, EPS 0.03, Shares 58.46M) Owned by clients, Last purchase March 5, 2014 $10.19

Enercare is focused on the securitizing and renting of water heaters and sub-meters (primarily in multi-residential buildings).  Results have been improving as attrition in rentals has been dramatically reduced.  Sub-metering is growing and debt has been reduced.  We anticipate that the stock will continue to reflect the ongoing improvements in Enercare’s operations.

 

Market Outlook

The Canadian market has had a relatively good start to the year buoyed by stronger energy and precious metal prices and advances in the Health Care and Information Technology sectors.  Weakness in the emerging markets and Asia reflect investor concerns as to the sustainability of the recovery despite evidence of continued improvement in the US and greater stability in the Eurozone.  As evidenced earlier this  week, geopolitical events have an immediate impact on investor sentiment.  We anticipate that more disruptions are likely in the coming months and that investors should be prepared to seize opportunities during these periods.

See Michael on BNN Market Call here>>

Free Portfolio Review – Markets were up in 2013. Are you at risk in 2014? Sprung Investment Management Is Pleased To Offer Qualified Investors A Free Portfolio Review—Without Cost or Obligation. Learn more here>>

The opinions expressed here are ours alone. They are provided for information purposes only and are not tailored to the needs of any particular individual or company, are not an endorsement, recommendation, or sponsorship of any entity or security, and do not constitute investment advice. We strongly recommend that you seek advice from a qualified investment advisor before making any investment decision.

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