As 2014 draws to a close, it’s time to take a fresh look at your portfolio. And on that note, below are three stocks to load up on before the new year arrives.
1. The Bank of Nova Scotia
This year has not been a great one for The Bank of Nova Scotia (TSX: BNS)(NYSE: BNS) or its shareholders. So far this year, the bank’s shares have fallen by about 1.5%, by far the worst performance of any big 6 bank. There have been a couple of reasons for this.
First of all, this has not been a great year for emerging markets stocks, and the bank has gotten caught up in the mix. In January alone, the shares declined by 8%. Secondly, the bank has struggled with many of its international operations, especially in the Caribbean. In the most recent quarter, net income fell 14%, coming way short of analyst expectations.
But there are still reasons to like Canada’s most international bank. The markets where it competes – countries like Mexico, Colombia, Peru, and Chile – still offer plenty of growth potential. And it trades at less than 12 times earnings. If things turn around in 2015, even modestly, then the shares could see big gains.
2. Manulife Financial Corp.
Like The Bank of Nova Scotia, Manulife Financial Corp. (TSX: MFC)(NYSE: MFC) is shunned by a lot of investors.
Canada’s largest life insurance provider has a troubled history – during the financial crisis, it suffered more than any other Canadian financial institution. And even in the years afterward, its recovery struggled to get off the ground.
But nowadays, Manulife’s prospects are as bright as ever. The company is doing especially well in Asia, which accounts for about a third of core earnings. Better yet, the Asian insurance and wealth markets are poised for tremendous growth, as more people enter the middle class and reach retirement age.
Manulife shares are not particularly popular for another reason. Its dividend, despite being raised this year, still yields less than 3%. This is less than any of the big banks. But Manulife pays out a very small portion of earnings to shareholders. So there’s plenty of room for the company’s dividend to increase, and when it does, the shares could see big gains. Until then, Manulife trades for about 10 times earnings.
3. BlackBerry
BlackBerry Ltd. (TSX: BB)(Nasdaq: BBRY) is certainly the riskiest option in this list. But you may still want to hold some shares.
There’s a lot to say about the company, but there’s one thing in particular worth focusing on: its new leadership.
Since taking over as CEO late last year, John Chen has increased BlackBerry’s focus, sold off assets, and improved the company’s profitability. He’s been exactly the dose of medicine the company needs, and as a result the company’s turnaround is ahead of schedule.
So at this point, Mr. Chen is clearly a man worth betting on. He’s come through before, and if he does again, the shares could skyrocket.
