David Baskin is president of Baskin Financial. He oversees oversees the management of more than $400-million in assets.
Manulife Financial Corp.
This insurance company trades at a significant price/earnings discount to the major Canadian banks. Mr. Baskin believes Manulife's strong cash position will be able to finance its continued expansion outside of Canada, giving it a much better growth profile and he adds "their dividend at 2.2 per cent is less than the banks, but will probably rise faster."
Morguard Corp. is a classic example of an illiquid stock trading at a large discount to net asset value. Mr. Baskin believes the real estate portfolio plus the value of the units in Morguard REIT have a value of at least $75 a share and says "buying a $75 asset for $45 is always a good idea."
Cinram International Income Fund(CRW.UN-TSX) $26.70
For Mr. Baskin "Cinram is like a cat with nine lives." He believes over the years, Cinram has successfully transitioned from audio /video cassettes to CDs to DVDs. Mr. Baskin believes that as a result of a new deal with Motorola this company is on the brink of becoming a major logistics player and says "the message here is that good management will find a way to make money even as industry conditions change."
PAST PICKS July 27, 2006
Canadian Pacific Railway
Then: $54.17 Now: $75.54, +39%
Groupe Laperriere & Verreault (GLV.A-TSX)
Then: $23.60 Now: $40.78, +73%
Power Corp. (POW-TSX)
Then: $30.86 Now: $39.98, +30%
Mr. Baskin's market outlook is "guarded." He explains that the major gains in North American markets have stretched valuations in some sectors, and made bargains harder to find.
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