Brianne Gardner, Senior Wealth Manager, Velocity Investment Partners, Raymond James
Focus: Canadian and U.S. large caps
Top picks: ATS Corp, Altius Minerals, Salesforce
MARKET OUTLOOK:
Markets remain steady amid a mix of geopolitical tensions and shifting fiscal policies. Last week, oil prices surged seven per cent, briefly exceeding US$74 per barrel, driven by Middle East unrest and potential supply disruptions in the Strait of Hormuz. The concern now extends beyond energy to broader supply chain risks, with rising shipping insurance costs and early signs of pressure on freight and industrial inputs.
U.S. equities have bounced back from April’s dip, with the S&P 500 and Nasdaq up around two per cent and three per cent year-to-date. This recovery is supported by easing inflation, resilient consumer demand, and solid earnings. Analysts still forecast earnings growth of nine per cent this year and 13.7 per cent next year. However, markets paused slightly after the passage of the “Big Beautiful Bill” a major U.S. fiscal package focused on infrastructure and defense, which increases spending in an already high-deficit environment.
In Canada, the TSX is outperforming, buoyed by gold, industrials, and energy. It reached record highs last week, though global trade tensions and rising costs could pressure margins, particularly in manufacturing and resource sectors.
Despite domestic disinflation, the Bank of Canada held rates steady, underscoring the push-pull between local progress and global uncertainty. We continue to maintain a balanced stance invested in long-term growth sectors like AI and industrials, while offsetting with defensives in energy and healthcare. In a landscape shaped by geopolitical flare-ups and fiscal shifts, staying selective, flexible, and liquid remains key.
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TOP PICKS:
ATS Corp (ATS TSX)
ATS is a Canadian company specializing in advanced custom automation systems used by major manufacturers to improve speed, safety, and efficiency. Their technology powers critical infrastructure across sectors such as vaccine production, nuclear energy, and food processing. The company’s core business remains robust, with over $860 million in bookings last quarter and a record $2.1 billion backlog, providing strong revenue visibility. ATS has recently shifted focus back to high-value industries after resolving issues with a major electric vehicle client. Margins are on the mend, reflecting improved execution, and financial flexibility is returning. Leverage is expected to decline to 2.7x by fiscal 2026, positioning the company to resume disciplined acquisitions in strategic verticals like life sciences and nuclear. It ranks 8/10 fundamentally and we see 22 per cent upside from here.
Altius Minerals (ALS TSX)
Altius Minerals is a royalty company that earns revenue from mining operations without operating mines themselves, a model we like for its high margins, scalability, and long-term compounding potential. Altius is strategically positioned in sectors we see as long-term structural winners: copper (for electrification), potash (for global food security), and renewables (for the energy transition). This diversified mix supports steady cash flow while offering upside exposure to major global sustainability trends. Financially, Altius is strong, with over $200 million in marketable securities, low net debt, and access to additional liquidity through its credit facility. The company continues to generate solid operating cash flow and pays a 1.4 per cent dividend. We view Altius as a disciplined, quietly compounding name with smart capital allocation and meaningful long-term upside.
Salesforce (CRM NYSE)
Salesforce is the global leader in CRM software and a pioneer of the SaaS model, allowing businesses to access powerful tools via subscription. Today, it’s evolving into the operating system for the modern enterprise. With platforms like Customer 360, Data Cloud, and Agentforce, Salesforce transforms raw data into real-time, AI-driven insights. AI adoption is accelerating across the platform, with recurring revenue from AI and Data Cloud now surpassing US$1 billion, up 120% year-over-year and AI playing a central role in major client deals. Despite this growth, Salesforce remains attractively valued at approximately 22x forward earnings, near the low end of its historical range. The company is expanding margins and returning capital to shareholders, positioning itself as one of the most compelling names in large-cap tech today. It ranks 9/10 fundamentally and over 30 per cent upside potential.
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| ATS/ TSX | Y | Y | Y |
| ALS TSX | Y | Y | Y |
| CRM NYSE | Y | Y | Y |
PAST PICKS: JULY 17, 2024
VISA (V NYSE)
Then: US$272.70
Now: US$358.47
Return: 31%
Total Return: 32%
UNITEDHEALTH (UNH NYSE)
Then: US$573.28
Now: US$308.76
Return: -46%
Total Return: -45%
LULULEMON (LULU NASD)
Then: US$292.68
Now: US$239.84
Return: -18%
Total Return: -18%
Total Return Average: -3%
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| V NYSE | Y | Y | Y |
| UNH NYSE | Y | Y | Y |
| LULU NASD | N | N | N |
