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Look for companies with strong balance sheets who simply need to put in their time until the world returns to normal
In an uncertain world, there is nothing like a clean balance sheet to give investors comfort. Look for companies that are debt-free, with lots of cash, such as Sylogist (SYZ), Knight Therapeutics (GUD), Photon (PHO) or Franco-Nevada (FNV) in this category. In addition, many of the companies we have mentioned in the categories above also have cash-rich balance sheets, particularly most of the tech companies.
Focusing on these themes, of course, is not going to guarantee investment success. But we think, at least, it will give you a leg up on your investments versus just buying a ‘basket’ of random stocks, or buying a market index ETF.
Peter Hodson, CFA, is Founder and Head of Research at 5i Research Inc., an independent investment research network helping do-it-yourself investors reach their investment goals.