Disclaimer: This is not investment or financial advice. I take no responsibility for anyone’s decision
BNN Bloomberg runs a program called Bloomberg Top Stock Picks. It brings together fund managers to give their top stocks for the month. This month, I am highlighting these stocks from them and providing you with some objective analysis. And no, I am not recommending any of them. I leave that up to you. My job is just to bring to you what the market is thinking about.
Bruce Murray (Murray Wealth Group): Alphabet
Business: Provides searching, entertainment and advertising services.
Investment Thesis: Largest advertising company and twice the size of Meta. Cheap valuations at a Price-to-Earnings ratio of 22 times. Possible dominant position in the AI space in terms of booking hotels, restaurants, etc.
Analyst Target Price: US$165 (+9.0%), STRONG BUY
Objective Analysis: The latest 2023 full-year financial results show a strong performance. Revenue grew by 9.4% to US$307 billion, while profits rose by a whopping 23% to US$74 billion. This gives it a strong 24% in profit margin for 2023. Its earnings have beaten expectations by 6% for 2023, and most investors are now positive about the continued strength of Alphabet in the market.
Teal Linde (Linde Equity Fund): Brookfield Corp
Business: Investment management company in real estate and insurance solutions.
Investment Thesis: Target to grow share price by 15% every year in the long term. Stock is trading at a 45% discount to its net asset value. Opportunity for the stock to trade upwards to its fair value.
Analyst Target Price: US$47.56 (+16.0%), STRONG BUY
Objective Analysis: While it’s true that it is trading at a discount to its net asset value, its price-to-earnings ratio stands at a very expensive 68 times. Its peers only average about 15.2 times. From a financial perspective, it has managed to grow its revenue by 15% every year from 2020 onwards. But, its profits have instead declined in the same period (-50% in 2022 and -42% in 2023), casting doubts on its operations to be cost-efficient.
Kim Bolton (Black Swan Dexteritas): Intuit
Business: Provide personal finance products such as TurboTax, Credit Karma, QuickBooks, and MailChimp.
Investment Thesis: There’s still some room left for Intuit’s share price to climb. Tax season is approaching for the U.S. and Canada.
Analyst Target Price: US$701 (+9.5%), BUY
Objective Analysis: This is an opportunistic pick. It relies on the tax season in the U.S. and Canada when investors will buy in due to an expected increase in revenue and profits. The months of January to April is the strongest quarter, where 1Q 2023 generated US$6 billion in revenue compared to an average of US$3 billion in a normal quarter.
Christine Poole (GlobeInvest Capital Management): Mondelez
Business: Produces and sell chocolates, biscuits and other food products.
Investment Thesis: Leading chocolate (no 1, 10% of market) and biscuit (no 2, 5% of market) manufacturer. High brand loyalty. Investing into baked goods, cakes and pastries segments, and divesting low growth sectors such as gum.
Analyst Target Price: US$83.50 (+19.1%), STRONG BUY
Objective Analysis: Based on its sales, biscuits and baked snacks made up 50% of its revenue in 2022, followed by chocolate (30%). Before it sold its gum business, gum $ candy made up 11% of its revenue. It is very well-diversified across the global markets with North America encompassing 31% of revenue, followed by Europe (36%), Latin America (12%) and the rest of the world (21%).
