Gordon Reid, President & CEO, Goodreid Investment Counsel
Focus: U.S. Equities
Top Picks: Eli Lilly, Mercado Libre, Texas Instruments
MARKET OUTLOOK:
As we head towards the end of the year headline indexes are close to record highs but underlying price action tells a completely different story. This incredibly narrow market led by mega cap tech is characterized by 59 per cent of stocks trading more than 20 per cent below all-time highs, 41 per cent of stocks at 30 per cent below highs and 26 per cent more than 40 per cent below highs! So needless to say, serious damage is being inflicted below the surface. No wonder, investors are complaining about their ability to stay up with the market.
The glass half full perspective is that corporate earnings are on fire, meaning that valuations are becoming compelling very rapidly. The final quarter of 2026 is expected to once again provide year over year growth of 25 per cent or greater. Much of that is a margin story as corporate profit margins have surged to a new range of about 15 per cent. Investors are worried about inflation and with the Iran war and tariffs weighing heavily on gas prices and a host of input costs, the consumer is hurting. A resolution to the war would help immensely, but we are left with a Fed that is fighting inflationary trends with higher interest rates, yet another pressure for the average consumer.
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TOP PICKS:
Eli Lilly (LLY NYSE)
The GLP-1 wars are progressively more skewed in favour of LLY and the spoils are immense. The total addressable market (TAM) is estimated to be greater than US$100 billion and there is increasing evidence that the molecular compound, trizepitide, has applications beyond diabetes control and weight loss. Meanwhile, valuations are becoming increasingly more attractive as revenue and earnings growth outstrip the appreciation of LLY’s stock price.
Mercado Libre (MELI NASDAQ)
MELI is often referred to as the Amazon of Latin America. It is expansive, with major operations in Argentina, Chile and Brazil. Just as we witnessed with Amazon, valuations have progressively become less demanding. A pro-business government in Brazil, if elected, could stabilize the region and be additive to MELI’s prospects.
Texas Instruments (TXN NASDAQ)
Unlike other semi conductor companies in the headlines, much of TXN’s business is derived from traditional analog semis, widely used in commercial and industrial applications. This depth of offering provides Texas Instruments with more stability and less cyclicality. As their business deepens they stand to capture significant earnings benefits as their operating leverage is very high.
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| ELI NYSE | Y | N | Y |
| MELI NASD | Y | N | Y |
| TXN NASD | Y | N | Y |
PAST PICKS: OCT. 21, 2025
Elevance Health (ELV NYSE)
Then: US$349.75
Now: US$428.39
Return: 22%
Total Return: 24%
Rocket Companies (RKT NYSE)
Then: US$17.04
Now: US$11.30
Return: -34%
Total Return: -34%
Synovus Financial (SNV NYSE) - Acquired January 2, 2026.
Then: US$46.11
Closed: US$50.05
Return: 9%
Total Return: 9%
Total Return Average: -0.3%
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| ELV NYSE | N | N | N |
| RKT NYSE | N | Y | Y |
| SNV NYSE | N | N | N |
