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Celestica Inc. (CLS)
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goeasy Ltd. (GSY)
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Hammond Power Solutions Inc. Class A Subordinate Voting Shares (HPS.A)
Q: I am still buying and looking around for the best possibilities. Today the motley fool listed the three Canadian stocks they would buy, if they could only buy three. I notice that you seem quite strong on cls these days. And perhaps I see you putting the breaks on for hps. I may be wrong on this perception regarding hps. But, I think you are getting stronger on cls. What would be your 3 stocks Canadian? I am particularly interested in your main reason for liking cls.? It has not corrected. I know you like moment, though. I wonder whether I would’ve put shop in it’s place with the recent drop?
5i Research Answer:
We have liked CLS for some time, but its recent relative strength is extra impressive. It has been hitting all-time highs while the market has been selling off quite sharply. We think it is getting much more notice from US investors as a 'cheap' AI stock, and the momentum is quite solid here. We like HPS, but are perhaps a little more cautious because of the threat of tariffs. SHOP is looking much more interesting with its decline, but CLS remains significantly cheaper. We would probably keep CLS ahead of it in the short term. BN we think makes the top list as well, and we would remain very comfortable with GSY on growth potential and valuation.