Top stock picks for November

Credit: Simon Cunningham

We asked our writers for some of their best share picks for November. Below are some of their selections:

Christopher Georges:  Macquarie Group Ltd (ASX: MQG)

Macquarie remains my preferred large-cap financial share after reporting better-than-expected first half results last week. The company also surprised the market with a sharp lift in its interim dividend to $1.95 per share. Importantly, Macquarie now generates around 70% of its earnings from asset management style businesses that are less volatile and more predictable than traditional investment banking activities.

The company is forecasting flat earnings growth for the remainder of the year, but the medium-term outlook appears promising, especially if the Australian dollar heads lower from here.

Motley Fool contributor Christopher Georges owns shares in Macquarie Group.

Vocus Communications Limited (ASX: VOC)

Shares in the home broadband, data centre and dark fibre business have been hammered since rival TPG Telecom revealed its profit margins would suffer as consumers switch to NBN home internet services. Vocus has also lost three senior staff members, although all this looks more than reflected in a share price of $5.70. The track record of the M2 management team in integrating acquisitions is impressive and Vocus’s fibre, data centre, and New Zealand businesses are growing strongly. The shares look cheap to me and the company is expected to provide a trading update at its November 29 AGM.

Motley Fool contributor Tom Richardson owns shares in Vocus Communications.

Mike King: Reject Shop Ltd (ASX: TRS)

The Reject Shop has seen its share price plunge more than 50% since rising above $15 in August. But there doesn’t seem to be much of a reason for such a large fall. The discount retailer had a strong 2016 financial year, with net profit up 20%. Management said in August that it expected an “improved level of profit” in 2017.

The Reject Shop did report recently that the first quarter had been challenging and it would struggle to match last year’s first half result, but today’s price represents a P/E of just over 10x and a fully franked yield of nearly 6%.

Motley Fool writer/analyst Mike King has no financial interest in The Reject Shop.

Regan Pearson: Trilogy International Limited FPO NZX (ASX: TIL)

Luxury cosmetics producer Trilogy International is a new addition to the ASX, being added last month as an extension of its listing in New Zealand.

The company expects revenue growth of between 20%-32% for the 12 months to 31 March 2017, yet sells for an undemanding 24x trailing earnings. This compares favourably to fellow ASX-listed cosmetics company BWX, which currently sells for 37x trailing earnings and has a similar sales growth rate anticipated for FY17, according to average analysts’ estimates from Reuters.

Motley Fool contributor Regan Pearson has no financial interest in Trilogy International.

Alan Edmunds: Henderson Group plc (ASX:HGG)

Baron Rothschild is credited with saying that: “The time to buy is when there’s blood in the streets”. After the Brexit referendum, Henderson shareholders were feeling the pain as its share price plunged over 30%. Since that time Henderson has announced what in my opinion is a highly complementary merger with Janus Capital, along with a quarterly update that indicated slowing net outflows caused by the Brexit vote. While I will wait until after the U.S. election result before making a final decision, Henderson sits firmly at the top of my buy list.

Motley Fool contributor Alan Edmunds has no financial interest in Henderson Group.

James Mickleboro: Mayne Pharma Group Ltd (ASX: MYX)

In the last month the shares of growing pharmaceutical company Mayne Pharma have dropped by 16%. I believe the decline in its share price has created a great entry point for buy and hold investors. In my opinion Mayne Pharma has a bright future ahead of it thanks largely to the portfolio of drugs it acquired from industry heavyweights Teva Pharmaceutical and Allergan. With the first of these drugs just launched in the US market and more set to follow in the coming months, I believe now is a great time to invest.

Motley Fool contributor James Mickleboro has no financial interest in Mayne Pharma Group Ltd

Sean O’Neill: Sirtex Medical Limited (ASX: SRX)

Although it has a high price to earnings ratio, Sirtex has significant growth potential and the company retains approximately 70% of its earnings to fund growth prospects. Unfortunately the nature of clinical trials means that the widening of clinical application for its SIR-Spheres will be incremental at best. Yet with a presence in just 2% of its core liver cancer market, no debt, and applications for regulatory approval underway in new markets like Japan and China, Sirtex has a good platform for growth. It will be a slow burn, but Sirtex appears to be a standout prospect today.

Motley Fool contributor Sean O’Neill owns shares in Sirtex Medical.

Rachit Dudhwala: National Australia Bank Ltd. (ASX: NAB)

National Australia Bank reported a better-than-expected full-year result in October, with key highlights including 4.2% growth in cash earnings and minimal attrition to the bank’s net interest margin – a lead indicator of future profitability. The solid results were complemented by management maintaining the final dividend at 99 cents per share and lifting NAB’s common equity tier-1 ratio by 8 basis points

Given NAB’s shares currently trade on a price-earnings multiple of 11.5x, NAB’s robust operational performance during weak economic conditions makes it my top pick for investors seeking banking exposure.

Motley Fool contributor Rachit Dudhwala owns shares in National Australia Bank.

Tristan Harrison: Ramsay Health Care Limited (ASX: RHC)

Ramsay has a good outlook for the future with its private hospitals and expansion plans. In my opinion it’s one of the best quality businesses on the ASX and will benefit from the aging population tailwind. Ramsay’s share price has been affected by the price pullback across the health industry and its shares are currently trading 14% lower than their September high of $83.66.

This could be a good opportunity to buy at a lower price, as Ramsay recently reaffirmed that its first quarter FY17 results were in line with expectations.

Motley Fool contributor Tristan Harrison has no financial interest in Ramsay Health Care.

Edward Vesely: ResMed Inc. (CHESS) (ASX: RMD)

ResMed recently reported its financial results for the quarter ending 30 September 2016 showing revenue had increased by 13 percent. Margins were also up on the prior corresponding period, despite a fall in net income of 8.2%.

Looking forward, the company’s recent Brightree acquisition puts ResMed in a good place with double-digit earnings growth expected from its new investment in the years ahead. ResMed’s shares have fallen almost 16% from recent highs in early August, which makes this a good time to start or add to your position.

Motley Fool contributor Edward Vesely owns shares in ResMed Inc.

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Motley Fool contributor Motley Fool Staff has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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