South Bow Corporation (SOBO.TO) - March 12, 2025

The situation in the stock market isn't getting any easier, and for those operating without a big data aggregator, the situation will undoubtedly feel like blindly swinging at a piñata. Every day, the SIA platform completes millions of comparisons that, in essence, poll the investing audience (buyers and sellers) to ascertain where money flows are moving. Under the hood is the powerful point and figure chart, which by its very nature isn't concerned with volume or time but has a laser focus on price. The price that investors are willing to pay is a keystone to this methodology, and when these millions of changing price levels are put to head-to-head battles, the results can be easier for the human brain to begin to digest, especially for the seasoned investment advisor. So, let's review some of the things that have changed in the past quarter. First, we have seen the old leadership within the SIA technology sector, specifically the electronics, semiconductor, and computer hardware sub-sectors, reverse into an unfavored status. Meanwhile, we have seen the SIA utilities sector bubble back into favored status within the SIA sector reports, which, taken together, may represent a flight to safety. While there are other sector rotations, that one, taken independently, effectively highlights the drive toward a defensive footing. More recently, we have witnessed the SIA asset change, where CASH has moved above both Canadian and United States equity and, in doing so, has taken the #1 spot in the asset rank, even as the SIA Equity Action Call is in the green zone, albeit flirting with the yellow zone. Given these changes, our minds switch to finding cash or cash-like opportunities, so we turned to the SIA Combined Dividend report to scan for high-paying equity investments. Understanding that we are flirting with the Equity Action Call yellow zone, it is essential that we look only in the favored zone for opportunities, as we want to ensure that the portfolio holdings have strong relative strength as we move into a potentially choppy time in the market. Let's run through this exercise now. In the table provided, we have a clipping from the SIA Combined Dividend report, which we have sorted by highest yield. Not only are we looking for high yield, but we are looking for the highest yielding stock with the highest relative strength, which we have outlined in green as South Bow Corporation (SOBO.TO). Here we find an equity position that has a very high SIA Rank of 89.58% and is currently sitting in the favored zone of the SIA Combined Dividend report at position #8. While this exercise takes only minutes with the SIA platform, how could a mere mortal begin to recognize that SOBO.TO has both of these important characteristics? Also, just above it is Peyto Exploration (PEY.TO), with a slightly better yield but a much lower SIA Rank score and also positioned 19 positions below SOBO.TO within this dividend report.

In looking at SOBO.TO a little more (see matrix position chart above), we find that the shares entered the favored zone of the SIA Combined Dividend report in mid-January and have rallied from a relative perspective for the last couple of months. Although on an absolute basis, it is up only 1.28% over the last month, it isn't down, and for those who look for total return, which includes the dividend, this number might be much more attractive. The attached SIA point and figure chart shows the trading history of SOBO.TO, and it is impressive indeed with a nice, organized, positively trending chart, a recent breakout up to $39, but a retracement to support levels that are now identified at $34.79, while additional support is along the trend at $34.10. Resistance is now observable at $36.56, with the upper-level resistance at $39.59. Note also the clipping of all the SIA reports that show SOBO.TO as a constituent where it is in the favored zone of each and every report. When compared against other asset classes like Commodities, Equities, Currencies, Bonds, and Cash to form the SIA SMAX score, SOBO.TO is calculated at 7 out of the 10 best possible scores, giving it another positive SIA technical attribute. So, let's review. The SIA platform is suggestive of CASH as the top asset class. In looking for a better-than-T-bill rate of return, we find a defensive utility position with a 7.91% dividend and exhibiting high relative strength in all SIA vectors of technical analysis. What a great system!!!! Please don't forget to throw your colleagues a fish with South Bow, or even better, refer them to one of the SIA account managers, and together, let's teach them to fish.