Top Investment Picks for 2020

Dale @ Cut the crap Investing: Apple Inc (AAPL)

“Apple continues to innovate (enough) with their iPhones, in an industry that now only sees incremental advancements. They are now seeing greater growth in other product lines. They are one of the strongest brands on the planet. That brand strength is transferrable. Their customers are loyal. They could benefit greatly from 5G.”

Dan @ Stocktrades: Canada Goose Holdings Inc (TSE: GOOS)

“Stock has been hammered in 2019 due to revised guidances on growth and China unrest. Company has a CAGR on earnings of 52.59% over the last four years, and has beat on top and bottom line estimates every single quarter since it’s IPO. Once trade tensions and unrest settle, I believe GOOS has the potential to hit low 90’s again. Strong international growth and a rock solid brand have made them an excellent option for growth investors.”

DGI for DIY: Bristol-Myers Squibb Co (BMY)

“Bristol-Meyers Squibb looks quite attractive following the closing of its acquisition of Celgene. It trades at a PE multiple of just 10 based on 2020 EPS estimates of $6.36. Recently announced a 9.8% dividend increase (its largest since 2001), which is a potentially good sign for future dividend growth. Earnings are expected to grow by 46% in 2020, with double-digit growth thereafter. Potential 50% gains in 2020 if it can reach a 15 PE, which is a reasonable target for a company with its expected earnings growth.”

DivHutBitcoin (BTC)

“Crypto will have its ups and downs but it is here to stay. Governments are fighting and embracing BTC. We’ll see who is right over the long haul. Long BTC again in 2020.”

Dividend Diplomats: Royal Dutch Shell plc (RDS.B)

“Bring on the come-back stock for big oil! Time for them to start marching returns and an increase to their dividend. LET’S GO!!”

Dividend Diversify: Altria Group Inc (MO)

“For a 1 year time frame, I like Altria’s dividend yield of ~6.5%. Couple that with a beaten down stock price and I think Altria could return ~15% in 2020. That might not sound like a lot, but I think we will see a pull back in financial markets next year that will make this a nice return on a relative basis.”

Dividend Dude: iShares S&P TSX North America Preferred Stock Index ETF (TSE: XPF)

“Preferred shared are really beaten down and may recover in 2020”

Dividend Growth Investing & Retirement: Sylogist Ltd (CVE: SYZ)

“This Canadian small-cap software company has no long-term debt, a healthy amount of cash on the balance sheet, 9 consecutive years of dividend increases (Sylogist increased every year since the dividend started in 2011), a reasonably high yield (slightly above 4% at the beginning of 2020), and a 5 year dividend growth rate of 12.1%. Overall Sylogist has been a good little company. It has been fast-growing, has no debt and has good dividend growth metrics. For a stock-picking contest like this, you want a bit of risk, which is why I picked Sylogist even though I don’t currently own it. Sometimes smaller companies will cut the dividend even when it appears safe and it is usually to do with a large expansion where they need the additional funding or change the capital allocation strategy. I’m not saying this will happen with Sylogist, but in general, smaller companies have more flexible capital allocation policies so I’m a bit more cautious with them. While I don’t currently own Sylogist Ltd, it is on my radar, but I’m waiting for the yield to get closer to 5%, and I need to determine if they have a sustainable competitive advantage or not”

Dividend Growth Investor: Walgreens Boots Alliance Inc (WBA)

“44 years of dividend increases, Low P/E, Amazon headwinds fears overblown, healthcare fears overblown, worst performer on Dow Jones Industrials Average this year ( expect reversion to the mean).”

Dividend Investor: First Majestic Silver Corp (TSE: FR)

“A bet on recession/correction”

Dividend Wisp: Canadian Apartment Properties REIT (TSE: CAR.UN)

“They have been doing very well on executing their growth strategy with rental and townhouse properties, including buying internationally.”

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11 thoughts on “Top Investment Picks for 2020

  1. zasid says:

    Hi,

    Nice one thank you for sharing your knowledge.

    I am beginning my journey this year for Dividend investing.

    I am 38,based in Canada. Have 10k cad to invest in my TFSA+some more room there to invest further down the line. where should I begin? My plan is on long term horizon (Dividend investing).To have healthy cash flow during my retirement. Please guide me a bit on where should I begin as I am still learning the ropes. I understand you are not a financial advisor and I will only take this as a suggestion not financial advice.

    How would you invest 10k Cad if you starting today in dividend investing?

    Thank you for your help on this.

    • Hey there,
      Since you are starting out, I recommend going the ETF route. There a plenty of good dividend focused ETFs from iShares, Vanguard or BMO.

      Long time ago I used to own ‘CUD’ from iShares (which held US dividend growth stocks — but since the ETF is listed in Canada, you dont have to worry about dividend taxes). There is also a monthly income ETF from BMO with ticker ‘ZMI’ — that will give you a diversified portfolio across various asset classes and provide you with a ~4% yield. Those are some good starting points for research.

      Alternatively if you are comfortable with the risk of holding individual stocks, take a look at the ‘dividend growers’ list. DGI&R posts monthly updates on Canadian dividend stocks (link here). These are usually blue chip stocks that pay a dividend and grow them year over year.

      Hope that helps
      R2R

    • Thanks for the participation, Eric. BMY with the Celgene acquisition should be a force to reckon with in the pharma space. All the best in 2020 and beyond.

      Also, thank you for linking to this post from your dividend growth digest post.

      R2R

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