John Stephenson, President and CEO, Stephenson & Company Capital Management

Focus: North American Large Caps and Resource Stocks

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MARKET OUTLOOK:

Stock markets globally have recovered nicely from the uncertainty surrounding the Brexit but the catalyst for strong future returns will need to be earnings growth. With weak global growth around the world a defensive posture with good dividend paying companies is the way to invest going forward.

Top Picks:

Lloyds Banking Group (LLOY LN) – Last Bought on July 6, 2016 at 50.65 GBp

After the Brexit vote the shares of Lloyds got hammered and the stock is incredibly cheap despite being on the best capitalized European banks. The company boasts a dividend yield of 5.34 per cent and the company will likely continue to distribute capital to shareholders via share repurchases and dividend increases. The business model is very low risk and generates large amounts of capital.

Comcast Corporation (CMCSA.O) – Last purchased on February 2, 2016 at $57.75

The company is a good solid defensive holding with a solid yield. The company is the largest cable operators in the U.S. and owns NBCU which gives it significant scale advantages in reducing programming costs. It is growing both its Revenue and EBITDA faster than its competitors.

Pattern Energy Group (PEG.TO) – Last purchase today at $30.95

The company is an independent wind power producer with nearly 3,000 MW installed with 89 per cent contracted for on average 15 years. The company’s parent PEG LP a power developer that can drop down new assets into Pattern Energy Group thereby reducing development risk. The company has a very juicy dividend yield of 6.6 per cent.John Stephenson, President and CEO, Stephenson & Company Capital Management. 

Past Picks:  August 18, 2015

*Short* Baytex Energy (BTE.TO)

• Then: $8.53
• Now: $7.26
• Return: +14.89%
• TR: +13.69%

*Short* Tesoro (TSO.N)

• Then: $105.65
• Now: $75.80
• Return: +28.25%
• TR: +26.62%

Universal Health Services (UHS.N)

• Then: $145.45
• Now: $135.10
• Return: -7.12%
• TR: -6.82%

Total Return Average: +11.16%