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Holly LaFon
Holly LaFon
Articles (7842) 

Leith Wheeler Canadian Equity Fund's 4 Largest Buys

Canadian value investors list latest picks from 2nd quarter portfolio

September 13, 2017 | About:

Leith Wheeler Canadian Equity (Trades, Portfolio) Fund bought one new stock and increased three holdings more by more than 100%, it disclosed in a second-quarter portfolio update this week.

The Canadian equity fund sank 0.7% for the first six months compared to a 0.7% rise in its benchmark S&P/TSX Composite as strength in holdings within its largest sector, financials, was offset by declines in individual stocks such as Saputo, which fell 9.8%, and Open Text, which declined 9.1%.

Managers poised the fund for further upside in financials with its two largest second-quarter moves happening in the sector. It also made two of its most generous increases to holdings within outperforming utilities and lower-priced energy sectors.

Leith Wheeler Canadian Equity (Trades, Portfolio) Fund managers are principally value investors, selecting low-priced stocks the market may have mispriced or neglected. They buy the stocks or sectors with the fundamental criteria to overcome temporary obstacles.

The fund has $2.7 billion in assets and a 38% sector weighting in financials, with Royal Bank of Canada, Bank of Nova Scotia and Toronto Dominion Bank dominating its largest positions. It is almost fully invested, having only 0.5% in cash.

The fund’s headline trades of the second quarter comprised: Trisura Group Ltd. (TSX:TSU), Bank of Montreal (TSX:BMO), Hydro One Ltd. (TSX:H) and Raging River Exploration Inc. (TSX:RRX).

Buy: Trisura Group Ltd. (TSX:TSU)

The Canadian Equity Fund purchased 11,263 shares of Trisura Group Ltd., worth 0.01% of the portfolio. The company’s share price averaged 22 Canadian dollars during the quarter.

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Trisura Group Ltd. has a market cap of $146.729 million; its shares were traded around $25.24.

Add: Bank of Montreal (TSX:BMO)

The fund increased its Bank of Montreal holding by 320% to 577,900, equivalent to 2.06% of the stock portfolio. The stock traded for 95 Canadian dollars on average during the quarter

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Bank of Montreal has a market cap of $59.34 billion; its shares were traded around $91.43 with a P/E ratio of 11.26 and P/S ratio of 2.76. The trailing 12-month dividend yield of Bank of Montreal stock is 3.85%. The forward dividend yield of Bank of Montreal stock is 3.94%. Bank of Montreal had an annual average earnings growth of 6.7% over the past 10 years. GuruFocus rated Bank of Montreal the business predictability rank of 3-star.

Add: Hydro One Ltd. (TSX:H)

The fund increased its position in utilities company Hydro One Ltd. by 244% to 1.01% of the stock portfolio. The stock traded at an average price of 24 Canadian dollars.

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Hydro One Ltd. has a market cap of $13.52 billion; its shares were traded around $22.70 with a P/E ratio of 21.08 and P/S ratio of 2.14. The trailing 12-month dividend yield of Hydro One Ltd. stock is 3.79%. The forward dividend yield of Hydro One Ltd. stock is 3.88%.

Add: Raging River Exploration Inc. (TSX:RRX)

The fund increased its holding of Raging River Exploration Inc. by 169% to 1.55% of the stock portfolio. The stock traded for an average price of 8 Canadian dollars.

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Raging River Exploration Inc. has a market cap of $1.6 billion; its shares were traded around $6.93 with a P/E ratio of 26.73 and P/S ratio of 4.16.

See Leith Wheeler Canadian Equity Fund's portfolio here


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