I've just returned from the World Money Show in Orlando where more than 10,000 investors gathered to learn about global investing. I had a chance to meet with many of the U.S. and foreign financial experts featured at the show, and over the next week I will share some of their top investment ideas. To view all of the stocks featured in this special global report, click here.
With his conservative yet top-performing long-term performance record, Jim Stack cautions that this is not a low-risk market. Yet, the editor of Investech Market Analyst sees value in the renamed Bell Canada (NYSE:BCE).
"Although our key technical indicators in breadth and leadership are surprisingly bullish at present, we also see recessionary warning flags from a slowing economy, struggling housing market, and the inverted yield curve. As such, this is not a low-risk market.
"Therefore, we've maintained a moderate cash buffer this year and focused on defensive sectors -- in line with our commitment to following a safety-first strategy and protecting our bull market gains of the last three years. One stock that we have chosen to upgrade to a buy is BCE, which is changing its name to Bell Canada Inc.
"As background, the Finance Minister of Canada surprised the market with an official announcement that Canada was planning for the first time to tax dividends on income trusts. The move was aimed at closing a loophole that is costing the Canadian government over C$500 million in lost corporate-tax revenue.
"Consequently, BCE, which had proposed to convert its corporate structure to an income trust announced that it was not moving forward with the planned conversion. The company will, however, proceed with plans to simplify its corporate structure and eliminate BCE's holding corporate status.
"This is consistent with the firm's recent divestitures and restructuring over the past two years, which have streamlined the firm's business to become purely a provider of communications services. In addition to the business structure decision, the company announced an 11% dividend increase and a renewed share buyback program.
"These actions, along with a moderate share price retracement and increased confidence in the company's ability to focus on the growth areas (wireless, video, and high-speed internet services), have persuaded us to reinstate our buy recommendation."
Steven Halpern's TheStockAdvisors.com provides a free, daily overview of the latest stock ideas from the nation's leading financial newsletters.
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