To my clients:
It was an up week for North American stock markets with the Canadian TSX finishing up 1.1%; the U.S. Dow Jones Index finishing up 0.8%; and the U.S. S&P 500 finishing up 0.5%.
After a couple of weeks of meatier and lengthier than usual updates, this week will be brief. I’ll merely note the continuing contributions of long-term (more than 10 years) portfolio position United Healthcare. For many clients, this position is up 500 to 1,000% over the decade+ it has been held, but it has been a recent underperformer this past year leading to queries from a number of clients about its continued inclusion in portfolios. Thankfully, the company itself delivered an answer this morning: a strong beat of earnings expectations and a raise of forward looking guidance. This company is the gorilla in the Managed Healthcare space, and unless the share price were to spike up egregiously fast (similar to Microsoft a couple of months ago where profits were taken and the position was trimmed back to its intended weight), I’d envision the United Healthcare position being a core holding of client portfolio for years to come.
I’ll add that all that I’ve said about United Healthcare, I’d also say about Brookfield Infrastructure Partners. This name too has recently underperformed but, likewise, has been a proven long-term wealth compounder in client portfolios. I’m confident that patience here will be similarly rewarded.
That’s it for this week. All the best,
Nick
Nick Scholte, CIM, FCSI
Senior Portfolio Manager
Scholte Wealth Management
RBC Dominion Securities Inc. │ Tel: 604.257.7569 │ Fax: 604.235.9950
3200-1055 West Georgia │ Vancouver, BC │ V6E 3P3
Toll Free: 1.844.665.9900 │Email: nick.scholte@rbc.com
Visit Our Website: www.nickscholte.ca
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