Jason Del Vicario’s Top Picks

BOYD GROUP INCOME FUND (BYD_u.TO 0.18%)

Boyd possesses one of the most beautiful stock charts I’ve ever laid eyes on. Look at a ten year chart and marvel. They operate auto body shops across North America. They are VERY consistent ROE generators. On the surface they appear to be very pricey as their PE ratio is north of 60 but if you look at their cash earnings PE ratio it’s a much more palatable ~18. They are very well run and we anticipate holding them for a long time.  We originally bought them July 2016 at $79 and added to them in April 2017 at $84. They have sold off a bit here and represent good value.

CCL INDUSTRIES (CCLb.TO 1.80%)

This company has been on our radar for a number of years. They are consolidators in the packaging sector. They are very well run and consistently generate cash ROE metrics in the high twenties. They were too expensive for our liking for the longest time but have since traded down and we added to our position.  We initiated our position March 2016 at $46 and recently added in the mid $50s during the recent pullback. They are still well off their all-time high of $70 and we believe this is a good entry point.

CONSTELLATION SOFTWARE (CSUdb.TO)

This is a debenture issued but the number one performing stock on the TSX over the past ten years: Constellation Software (CSU.TO 0.17%). We are huge fans of Mark Leonard and the CSU management team.  They are hands down the best capital allocators in Canada. CSU the stock is one of our largest holdings and we have nearly ten per cent of our more conservative portfolios invested in the CSU.db debenture. We like it for a few reasons: 1) it is under the radar 2) it yields 6.73 per cent and 3) the yield is linked to CPI so there’s an element of inflation protection. We like the equity and we like the debt.