Julien Nono-Womdim, vice president and equity analysis at Goodreid Investment Counsel, shares his outlook on U.S. Equities.
Julien Nono-Womdim, Vice President, Equity Analysis, Goodreid Investment Counsel
Focus: U.S. equities
Top picks: Piper Sandler, Freeport McMoran, Harrow Inc.
MARKET OUTLOOK:
An object in motion stays in motion. We continue to be bullish on U.S. equities and believe that the cyclical bull market that started in October 2022 is still underway.
The factors that we believe are important are first, the continuation of the artificial intelligence (AI) investment cycle, and second, U.S. Federal Reserve policy amid a weakening labour market.
On AI, we recently wrapped up second quarter earnings and the data points from all the relevant companies is that demand is outpacing supply and the technology will be transformational to the economy.
On Fed policy, given the softening of the U.S. labour market and inflation data that suggests inflation is under control, we should expect the Fed to cut rates which should stimulate growth into 2026.
TOP PICKS:
Julien Nono-Womdim’s Top Picks: Piper Sandler, Freeport McMoran & Harrow Inc. Julien Nono-Womdim, vice president and equity analysis at Goodreid Investment Counsel, shares his top stock picks to watch in the market.
Piper Sandler (PIPR NYSE)
Piper will benefit from a merger and acquisition recovery that is now underway. As a mid market dealer, Piper has witnessed a deferral of some deals as the economic and political environment sorts out. However, pent up demand and a favourable financing environment will push companies over the top.
Freeport McMoran (FCX NYSE)
There are two factors relevant to our thesis. First our view on the underlying commodity: copper. Second, the company’s assets. On copper prices, AI data centre buildouts along with broader electrification trends are likely to exacerbate shortages.
On freeport specifically, they are a low-cost producer with gold byproducts which should allow the company to beat expectations given the strong gold environment.
Harrow Inc. (HROW NASDAQ)
Harrow Inc. is an ophthalmic-focused pharmaceutical company that is a leader in the North American eyecare market. Harrow has stable cash flows from its compounding business; accelerating growth from key products; and a management team with skin in the game. We believe revenues could four times over the next five years from US$250 million today.
The drivers of growth will come from the following drugs:
IHEEZO: A low-viscosity gel indicated for ocular surface anesthesiaVEVYE: Used to treat the signs and symptoms associated with dry eye diseaseTRIESENCE: A steroid injection for the treatment of certain ophthalmic diseases and for visualization during vitrectomyDISCLOSUREPERSONALFAMILYPORTFOLIO/FUND PIPR NYSE YYY FCX NYSEYYY HROW NASDAQYYY