Monday, January 26, 2015

An all-time high today for overlooked CAE Inc.

During the latter stages of a bull market – investors should get more active with their investments either directly or indirectly by way of an advisor. The idea is to move away from an indexing buy-and-hold approach and move toward an active approach.

One strategy would be to seek out and embrace the current dominant theme  A dominant theme is usually associated with a long term secular trend in a particular asset class that tends to ignore the smaller boom and bust business cycle. A secular trend is usually associated with innovation and the emergence of the "next big thing", be it the age of steam, the railroads, the automobile, transatlantic air travel, the microprocessor and the Internet. Some current Dominant themes are: Health Care, Aerospace, Lumber, Food and Technology

In Canada the Aerospace Complex has few offerings - CAE Inc which is a liquid TSX listed aerospace related Issuer – other names in the sector are AirBoss of America Corp (BOS) which like Heroux-Devtek Inc. (HRX) and Magellan Aerospace Corp (MAL) are thin traders, The liquid Bombardier Inc. (BBD.B) just has too many issues leaving us with CAE which has today posted an all-time high price.

For U.S. dollar accounts look at the Powershares ETF Aerospace & Defense Portfolio (PPA:US) - The top five components are Lockheed Martin Corporation LMT, United Technologies Corporation UTX, Honeywell International Inc. Co HON, Boeing Company (The) BA and General Dynamics Corporation Co GD.

A very long term chart of CAE Inc. (CAE:TSX) $16.00+ has just printed an all-time high breaking above the three peaks of 2001, 2007 and 2014. A bullish opinion free of conflict – because I have no direct of indirect exposure.

1 comment:

Anonymous said...

Thanks for the info.
I know you have recommended this stock a couple of times in the past and I have been patiently looking for this breakout.

Hope it remains above $15.50-$16.00.