- Robert Gill, senior vice president and portfolio manager at Goodreid Investment Counsel, discusses his playbook for Canadian over U.S. equities
- Gill says, “You can buy the TSX at a much more attractive rate than you can the S&P 500 right now.”
- Gill gives actionable investment ideas in Canada
- He likes BCE Inc., despite the share price drop; shares were last trading at C$34.15
Robert Gill , senior vice president and portfolio manager at Goodreid Investment Counsel joins The Market Online to discuss investing in Canada vs. the United States.
Watch the above video for the full interview featuring Gill’s comparisons of Canadian and U.S. equities. He also offers some actionable investment ideas in Canada.
TSX vs. S&P 500
Gill gets in depth on TSX and S&P 500 comparisons, price-to-earnings multiples, dividend income and historical statistics.
Using historical data dating to the 1980s, he concludes that, “You can buy the TSX at a much more attractive rate than you can the S&P 500 right now.” And on the dividend yield side, he says, “the top yield would be that of the TSX index,” adding that, “it is at about 3.2 per cent right now, and the lower yield is that of the S&P 500 that’s only 1.4 per cent.”
As for some actionable investment ideas in Canada right now, Gill likes interest sensitive stocks, such as banks, utilities and telcos. The attractiveness of these stocks are because, “in a higher rate environment, investors start to switch out of the higher-yielding equities, and they move their money into fixed income. The reason they do that is because fixed income starts to offer better returns than in a lower rate environment, and there’s also a better perceived rate of return with respect to risk.”
BCE Inc.
Gill likes BCE Inc. (TSX:BCE), because of its longevity and the company’s assets, which include its Bell Media content creation division. He points out that the shares are down because it is an interest-rate sensitive stock, and the issues with the Rogers acquisition of Shaw. That acquisition led to Freedom mobile being acquired by Quebecor. As a result, Freedom cut their rates significantly, impacting prices and dropping margins in Bell and the wireless industry right across the board.
In addition, he adds that the regulatory environment in Canada has not been very constructive to Telus and BCE, asking these company’s to allow their competitors to have access to their fibre network.
Despite these issues, Gill says BCE has a strong balance sheet and plenty of recurring revenue. He adds that, “After food, water and shelter, people need to communicate with each other, and they also want to be entertained.”
On Goodreid.com’s blog, Gill has further information about BCE.
BCE Inc. was last trading at C$35.04.
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