Stocks that pass a value manager's fitness test

Beutel's Glenn Fortin favours health-care providers with a leg up over their rivals.

Sonita Horvitch 11 June, 2014 | 6:00PM
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Glenn Fortin, global equity analyst and portfolio manager at Beutel Goodman & Co. Ltd., says that valuations in many sectors of the S&P 500 Index have become stretched, but there are still pockets of value, particularly in areas such as U.S. health care and U.S. technology.

"The strategy in the U.S. portfolios that we manage has been to increase our weightings in these two sectors," says Fortin. "Health-care companies tend to enjoy high barriers to entry and have commanding shares in the markets they serve," he says. "Technology companies addressing the enterprise market, rather than the consumer market, have similar virtues."

In general, Beutel Goodman's non-domestic equity team is finding better value in international equities than in the U.S. equity market, says Fortin. "We are bottom-up value managers; we look out three years and require at least a 50% total return from a stock over that period, when initiating a new position."

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Sonita Horvitch

Sonita Horvitch  

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