Irwin Michael
(www.abcfunds.com) Irwin Michael is founder and portfolio manager of ABC Funds in Toronto. "My family and I are the largest single-unit holders in the fund," he says. "It's my wealth, my job, my livelihood."

• Canadian Natural Resources Limited
  A senior oil and natural gas exploration, development and production company based in Calgary with operations in Western Canada, the North Sea and offshore West Africa, it has good management, but trades at low multiples. Until they find a better way to heat my house, it's attractive. And it pays a dividend of 40 cents.

• Groupe Laperrière & Verreault Inc.
  It is a major manufacturer in Quebec of machinery for the pulp and paper industry. Laurent Verreault, one of its co-founders, is a competent manager, with good vision. I regard it as a multinational company with tremendous growth potential.

• Regional Cablesystems Inc.
  A cable TV operation with 250,000 subscribers in Canada, including half the cable subscribers in Newfoundland, it has been re-organized into a holding company and is planning to expand into the Caribbean. Over the last two years, it traded at $20 to $21; it's now around $9.

• Shermag Incorporated
  A fully integrated Quebec furniture manufacturing company with timber rights, sawmills, manufacturing and distribution facilities, Shermag does 80 per cent of its business outside Canada, so it takes advantage of the low Canadian dollar. It traded in the mid to high teens for the last two years and now trades around $6.50. It has excellent management and trades at just 50 per cent of sales.

• Teck Cominco Limited
  (formerly Teck Corporation) After the takeover of Cominco, it is one of the cheapest of the diversified mining companies, involved in coal, zinc, copper and gold. It has good management. With an estimated net asset value of more than 15, it's trading at 101/4 and was trading at 173/4 in May. It's a good candidate for consolidation.

Kim Shannon
(www.canada.ml.com/mlim.html) Kim Shannon is chief investment officer and senior vice-president of Merrill Lynch Investment Managers Canada Inc. "Any value manager believes the market has a tendency to excess," she says. "I think the market trades at 1.25 to 1.30 times its intrinsic value. We try to buy at 30 per cent less than a stock's intrinsic value. We'll sell some when it reaches 1, then more at 1.10, 1.15, 1.20. We try to get out before it reaches 1.25 or 1.30."

• Canadian Tire Corporation Ltd.
  Shares have risen to $25 since last year, and I still expect the stock to rise to $33. The stock has always had unrealized gains.

• Empire Company Limited
  Holding this food retailer is defensive and a cheaper way to play Sobeys. Expected return from here is 30 per cent, with a target of $46. The company currently holds $17 per share in cash after selling Hannaford Bros. Co. and is looking for a strategic acquisition - perhaps A&P.

• Legacy Hotels Real Estate
  Investment Trust and/or Fairmont Hotels & Resorts These two inter-related stocks are a "contrary play." Fairmont buys, renovates and upgrades hotels. When they begin to generate steady cash flow, Fairmont arranges to flip the properties to Legacy, which can buy properties at a lower cost of capital. Fairmont then takes back a long-term management contract. Both companies have been affected by the recent attack on New York's World Trade Center and by a softer economic environment and are inexpensive today. Legacy currently yields 13.5 per cent, with a target price of $11 in better times, and there is some concern it will cut its dividend.

• inco Limited
  The company provides a quarter of the world's supply of nickel and is the low-cost producer, with some of the best properties in the world. It has cut costs in recent years and expects to remove another $50 million of recurring costs in the near future, making it more profitable at lower commodity prices than in the past. The stock could rise to $32, generating a 40 per cent return to patient investors.

• Quebecor world Inc.
  The world's largest printer is well managed and is accomplished at making significant strategic acquisitions and effectively integrating them so that they start almost immediately to contribute to earnings. The recently acquired World Color Press will be fully integrated by year-end and related debt should be paid off, so the company will be ready for its next acquisition. The stock should rise to $51, producing a 30 per cent return.

Bob Tattersall
(www.saxonfunds.com)
Bob Tattersall is president of Howson Tattersall Investment Counsel Limited and portfolio manager of the Saxon Small Cap fund. "We're very numerate," he says. "If the numbers aren't there, we don't invest." The median holding of the Saxon Small Cap fund has a price-to-book-value ratio of 1.09, for example, compared with 2.31 for the median company in the TSE 300; a price-to-cash-flow ratio of 5.38 versus 9.50 on the TSE 300, and price-to-revenues of 0.34 versus 1.42 on the TSE 300.

• Foremost Industries Inc.
  With its stock trading around $3.85, the company manufactures drilling rigs, especially the new hi-tech coiled-tubing models. The company historically has been known for its Northern Terrain vehicles and a feast-or-famine order pattern from Russia. The new revenue stream is much more stable and more dependent on North American oil activity. The stock trades at 85 per cent of book value and about four times cash flow.

• Offshore Systems International Ltd.
  With a market capitalization of $12 million, the company manufactures and sells marine navigation equipment. One of its products has been described as the most significant advance in marine navigation since the advent of radar 50 years ago. It's not cheap in terms of book value or revenues, but it has lots of order potential.

• SMK Speedy International Inc.
  Operators of 333 Speedy Auto Service and Car-X outlets throughout North America, SMK Speedy trades at a fraction of its book value and the company has lots of cash.

• SR Telecom Inc.
  Specializing in fixed wireless access solutions, SR Telecom designs and manufactures systems used by telecommunications providers worldwide. Trading at half its book value, it is a beaten-up tech stock with good prospects for recovery.

• Transat A.T. Inc.
  Currently trading around $5.95 a share, Transat, which owns Air Transat, is somewhat speculative, as the airline is beset with company-specific problems (including a recent dead-stick landing in the Azores), industry-specific problems caused by the recent terrorist attacks in the United States and Air Canada's price-cut strategy. However, the company is an integrated tour operator rather than an airline and operates tour agencies and hotel rooms as potential profit centres. The company has a market cap of less than $200 million and revenues of almost $2 billion. Its book value is more than $7 a share.

Mark Thomson
(www.beutel-can.com)
Mark Thomson is senior vice-president of Beutel, Goodman & Company Ltd. in Toronto. Beutel, Goodman was formed in 1967 and is one of the oldest independent investment counselling firms in Canada. "Most of our business involves institutional investors such as pension funds," he says. "We look for companies with defensible franchises that are earning their cost of capital, with free cash flow, trading at a discount."

• Enbridge Inc.
  This is an energy transportation and distribution company. The industry presents high barriers to entry. It has high return on equity and significant free cash flow. Even at current prices, it's still good value. We bought in 2000, now it's around $40 a share.

• Investors Group inc.
  Canada's largest mutual fund company is a great franchise, with strong management and significant free cash flow.

• Potash Corporation of Saskatchewan Inc.
  As Saudi Arabia is to oil, Potash Corporation is to potash: the biggest and lowest-cost producer in the world. It has free cash flow. The cyclical nature of the industry means that now is an excellent opportunity to buy.

• TD Bank Financial Group
  The foremost banking franchise in Canada, TD's discount brokerage offers a strong platform for future growth. Strong management has added value. Concerns with capital market exposure have depressed the stock.

• TrizecHahn Corporation
  With 4.5 million square metres of U.S. office space and great assets, it sells at a discount to net asset value. New management is committed to shrinking the valuation gap. Because of concerns about previous management, it became the third-cheapest of 30 real-estate companies in North America. Now, with new management, the company is committed to changing that situation.