Canada’s big telephone companies have faced strong competition from cable companies for years. This experience will help them deal with three new entrants in the wireless field. One of these new competitors, Wind Mobile, is already operating. Two more, Mobilicity and Public Mobile, should launch later this year.

Meanwhile, all four major phone companies are using their steady cash flows to …read more »

CANADIAN NATIONAL RAILWAY CO. $54 (Toronto symbol CNR; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 471.0 million; Market cap: $25.4 billion; Price-to-sales ratio: 3.3; Dividend yield: 2.0%; SI Rating: Above Average) is spending $100 million to build a new rail hub in Calgary. To put this figure in context, CN earned $1.5 billion, or $3.24 a share, in …read more »

A subscriber to Stock Pickers Digest, our newsletter for aggressive investing, recently asked us how much importance we give to a company’s name when we’re selecting growth stock picks to recommend in our newsletters and investment services. He felt that a poorly thought-out company name may reflect a poorly thought-out business plan and a low chance of success.

He specifically …read more »

ALCOA INC. $13 (New York symbol AA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 974.4 million; Market cap: $12.7 billion; Price-to-sales ratio: 0.7; Dividend yield: 0.9%; WSSF Rating: Average) will invest $900 million in a joint venture it has formed with Saudi mining firm Ma’aden to build an aluminum plant in Saudi Arabia. To put this figure in context, Alcoa …read more »

INVACARE CORP. $25 (New York symbol IVC; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 32.3 million; Market cap: $807.5 million; Price-to-sales ratio: 0.5; Dividend yield: 0.2%; WSSF Rating: Average) makes wheelchairs, motorized scooters and other mobility and home-care products.

The company may have to pay $12 million to $14 million a year in new taxes. That’s because the U.S. Senate recently …read more »

WESTJET AIRLINES $13.45 (Toronto symbol WJA; SI Rating: Extra Risk) (1-877-493-7853; www.westjet.com; Shares outstanding: 138.8 million; Market cap: $1.9 billion; No dividends paid) has invested heavily in new planes and a state-of-the-art computer reservation system. But unlike most airlines, it has done so without taking on too much debt. That, plus its stellar reputation for customer service, makes it our …read more »

TOROMONT INDUSTRIES LTD. $27.51 (Toronto symbol TIH; SI Rating: Extra Risk) (416-667-5511; www.toromont.com; Shares outstanding: 64.9 million; Market cap: $1.8 billion; Dividend yield: 2.2%) has raised its takeover offer for Enerflex Systems Income Fund (Toronto symbol EFX.UN) to $613 million. Enerflex has agreed to the new terms.

Enerflex unitholders will now receive a combination of cash and Toromont shares equal to …read more »

INTUITIVE SURGICAL $308.99 (Nasdaq symbol ISRG; SI Rating: Average) (515-507-5000; www.intuitivesurgical.com; Shares outstanding: 38.2 million; Market cap: $11.8 billion; No dividends paid) makes the “da Vinci,” a computerized surgical system. Intuitive’s shares trade at a high price, but you can buy as few as 10 through any broker.

Guided by a miniature camera connected to a 3-D monitor, surgeons use the …read more »

MANITOBA TELECOM SERVICES INC. $35 (Toronto symbol MBT; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 64.7 million; Market cap: $2.3 billion; Price-to-sales ratio: 1.2; Dividend yield: 7.4%; SI Rating: Average) has raised $200 million by selling new 10-year bonds that yield 5.625%.

This cash will help the company fund a new high-speed wireless network that it is building in Manitoba in …read more »

Growth stocks are companies whose earnings growth is expected to be above the market average. These firms often pay little or no dividends. Instead, they invest any extra money in furthering their growth.

These stocks are long-term investments. They can be well-known stars or quiet gems, but they share the common trait of growing at a higher than average rate within …read more »

ENCANA CORP $36.15 (Toronto symbol ECA; Shares outstanding: 750.3 million; Market cap: $27.1 billion; SI Rating: Average; Dividend yield: 2.2%) focuses on unconventional natural gas. Its shares have moved up lately, along with higher gas prices spurred on by cold weather.

CENOVUS ENERGY $27 (Toronto symbol CVE; Shares outstanding: 751.3 million; Market cap: $20.3 billion; SI Rating: Extra Risk; Dividend yield: …read more »

THE STANLEY WORKS $52 (New York symbol SWK, Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 80.4 million; Market cap: $4.2 billion; Price-to-sales ratio: 1.1; Dividend yield: 2.5%; WSSF Rating: Average) makes a wide variety of hand and power tools for consumer and industrial users. Top brands include Stanley, FatMax and Powerlock.

Stanley has agreed to buy rival toolmaker Black …read more »

Diebold began making locks, safes and vaults for banks in 1876. NCR started making mechanical cash registers in 1879. In the years since, both companies have evolved into the world’s top suppliers of automated teller machines (ATMs).

Diebold continues to focus on the banking industry, mostly with specialized services. In contrast, NCR has cut its exposure to banks with a variety …read more »

Small caps are companies with a “market cap”(the value of shares they have outstanding) below $2 billion, or some other arbitrary figure. Small-cap stocks are generally more volatile than large-cap stocks. Temporary setbacks, such as a poor quarterly earnings report or the loss of a contract, can quickly cut their share prices.

To cut your risk, you should focus on small …read more »

YUM! BRANDS INC. $35 (Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 467.7 million; Market cap: $16.4 billion; Price-to-sales ratio: 1.6; Dividend yield: 2.4%; WSSF Rating: Average) announced that its 2009 earnings per share should rise by 12%. That’s because strong growth at its fast-food outlets in China and other countries is offsetting slow sales in the U.S. Lower food costs …read more »

H&R BLOCK INC. $21 (New York symbol HRB; Conservative Growth Portfolio, Finance sector; Shares outstanding: 335.5 million; Market cap: $7.0 billion; Price-to-sales ratio: 1.8; Dividend yield: 2.9%; WSSF Rating: Above Average) is best known for its income-tax preparation business, but it also sells accounting services to businesses through wholly owned RSM McGladrey. This subsidiary recently ended a legal dispute with …read more »

MAJOR DRILLING $28.70 (Toronto symbol MDI; SI Rating: Speculative) (www.majordrilling.com; 1-866-264-3986; Shares outstanding: 23.7 million; Market cap: $680.9 million; Dividend yield: 1.4%) is a large contract-drilling company that mainly serves the mining industry.

Major Drilling’s shares have moved up from $23 in mid-December, even though the company reported lower revenue and earnings in the latest quarter.

In the three months …read more »

The credit crisis and recession weighed heavily on these three information providers. They have also been hurt by competition from free information on the Internet.

All three have cut their costs in response. That puts them in a good position to increase their earnings as the economy rebounds and advertising revenues grow again. As well, all are leaders in their niche …read more »

LOBLAW COMPANIES LTD. $33 (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 276.6 million; Market cap: $9.1 billion; Price-to-sales ratio: 0.3; Dividend yield: 2.5%; SI Rating: Above Average) bought Toronto’s old Maple Leaf Gardens hockey arena for $13 million in 2004. The company had hoped to convert it into a supermarket by now, but held off because of …read more »

Bombardier and CAE continue to diversify. This cuts their exposure to the air-travel industry, which has struggled lately. Both stocks are also attractive in relation to their earnings.

BOMBARDIER INC. (Toronto symbols BBD.A $4.53 and BBD.B $4.51; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.7 billion; Market cap: $7.7 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.2%; SI Rating: Extra …read more »

Resource prices have climbed sharply since early 2009, as the global recession began to ease and some countries’ economies returned to growth. Despite their recent gains, prices for oil, gold and other commodities will likely keep rising. That’s partly because resources act as a hedge against inflation.

We feel the best way to profit from rising resource prices is with high-quality …read more »

APPLE INC. $204 (Nasdaq symbol AAPL; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 900.7 million; Market cap: $183.7 billion; Price-to-sales ratio: 5.0; WSSF Rating: Average) has won its court case against Psystar Corp., a Miami-based company that sells computers that run on Apple’s Mac operating system. Apple refuses to let other computer makers use its software, and the …read more »

TOROMONT INDUSTRIES LTD. $26.78 (Toronto symbol TIH; SI Rating: Extra Risk) (416-667-5511; www.toromont.com; Shares outstanding: 64.7 million; Market cap: $1.7 billion) has launched a hostile, $624-million takeover bid for Enerflex Systems Income Fund (Toronto symbol EFX.UN). Enerflex unitholders would receive $13.50 per unit under the proposal.

Enerflex serves oil and natural-gas producers around the world. The company leases and sells natural-gas …read more »

CALIAN TECHNOLOGIES $17.85 (Toronto symbol CTY; SI Rating: Speculative) (613-599-8600; www.calian.com; Shares outstanding: 7.7 million; Market cap: $138.2 million) operates in two areas: The business and technology services (BTS) division, which accounts for 64% of Calian’s revenue, provides engineers, health-care workers and other skilled professionals to clients on a contract basis. The systems-engineering division (SED) contributes the remaining 36% of …read more »

FAIRFAX FINANCIAL HOLDINGS $383.12 (Toronto symbol FFH: SI Rating: Average) (416-367-2612; www.fairfax.ca; Shares outstanding: 19.7 million; Market cap: $7.5 billion) saw its earnings per share jump 22.2%, to $31.04 from $25.40, in the three months ended September 30, 2009.

The company’s insurance operations posted improved results during the quarter. Fairfax also reported higher interest and dividend income. That was partly offset …read more »

LEON’S FURNITURE LTD. $9.86 (Toronto symbol LNF; SI Rating: Average) (416-243-7880; www.leons.ca; Shares outstanding: 70.8 million; Market cap: $697.6 million) has built its chain of over 66 furniture stores on its four main strengths: a huge selection of furniture, appliances and electronics; a lowest-price guarantee; strong after-sales service; and aggressive TV, radio and print advertising.

In the three months ended September …read more »

Maple Leaf Foods has suffered several setbacks in the past three to four years. Because of unfavourable foreign-exchange rates, the company stopped exporting fresh meat products as part of a plan to focus on its more-profitable packaged-food and bakery businesses. Last year, 21 people died of listeriosis (a form of food poisoning) after eating contaminated meat. That led to lost …read more »

LOBLAW COMPANIES LTD. $30 (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 274.2 million; Market cap: $8.2 billion; Price-to-sales ratio: 0.3; SI Rating: Above Average) continues to expand its “Joe Fresh” line of low-cost clothing and fashion accessories. The company generally sells these products at its larger, warehouse-type stores, which have more room for clothing and general merchandise …read more »

TIM HORTONS INC. $31 (Toronto symbol THI; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 180.7 million; Market cap: $5.6 billion; Price-to-sales ratio: 2.5; SI Rating: Average) is one of Canada’s largest fast-food restaurant chains. Its 2,971 outlets mainly serve coffee and donuts. It also has 556 stores in the U.S., mostly near the Canadian border. Franchisees own 99% of the …read more »

Warren Buffett’s Berkshire Hathaway Inc. recently announced that it will buy the 77% of U.S.-based railway Burlington Northern Santa Fe Corp. that it doesn’t already own. The company will pay $44 billion U.S. to complete the takeover.

Burlington Northern owns one of the largest railroad networks in the U.S., with about 51,500 kilometres of track.

Berkshire’s not one of our favourite …read more »

Medical-device sales have suffered lately, partly because of the recession. As well, proposed reforms to the U.S. health-care system could limit or cut the amount that hospitals and clinics can recoup from insurance companies. This could leave them with less to spend on medical devices.

However, these are essential products, so sales should rebound over the next few months, regardless of …read more »

The recession has hurt the earnings of these two high-quality shipping companies. However, both are doing a good job of controlling their costs. This should improve their profitability, particularly as the economy rebounds. The recent drop in fuel costs also brightens their prospects. However, we prefer FedEx to Arkansas Best right now, as its larger international operations lower its reliance …read more »

NCR CORP. $10 (New York symbol NCR; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 159.2 million; Market cap: $1.6 billion; Price-to-sales ratio: 0.4; WSSF Rating: Average) will cut 2,200 jobs, or 10% of its workforce, by the end of this year. Because of the recession, banks are buying fewer of its automated teller machines (ATMs). As well, retailers …read more »

Investors often comment that we sometimes differ with the mainstream view on which stocks make good investments. That’s especially true with drug stocks.

The general view on these stocks seems to be that they are can’t-miss investments because the baby boomers are reaching an age when they will need drugs for a number of medical conditions, and are willing to …read more »

ALARMFORCE INDUSTRIES $5.46 (Toronto symbol AF: SI Rating: Speculative) (1-800-267-2001; www.alarmforce.com; Shares outstanding: 12.2 million; Market cap: $66.7 million) made $0.12 a share in the three months ended July 31, 2009. That’s up 140.0% from $0.05 a share a year earlier. The home security firm’s revenue rose 12.5%, to $8.5 million from $7.6 million.

AlarmForce mainly attracts new customers by aggressively …read more »

TEMPUR-PEDIC $21.15 (New York symbol TPX; SI Rating: Speculative)(800-878-8889; www.tempurpedic.com; Shares outstanding: 74.9 million; Market cap: $1.6 billion) makes and distributes Swedish mattresses and neck pillows made from its own Tempur material. The material conforms to the body to provide support and help alleviate pressure points. Tempur-Pedic sells its products in over 80 countries.

In the quarter ended September 30, 2009, …read more »

ROYAL BANK OF CANADA $56 (Toronto symbol RY; Conservative Growth Portfolio; Finance sector; Shares outstanding: 1.4 billion; Market cap: $78.4 billion; Price-to-sales ratio: 2.1; SI Rating: Above Average) will buy the third party registered investment advisor servicing business of U.S. banking firm J.P. Morgan & Co. (New York symbol JPM). The deal should close in the second quarter of 2010.

This …read more »

A weak economy is prompting more consumers to choose cheaper generic brands over brand names. That’s dampened the profits of these four leading consumer-products firms. However, they are doing a good job of cutting their costs. This gives them the ability to lower their prices without hurting their profit margins.

PROCTER & GAMBLE CO. $57 (New York symbol PG; Conservative Growth …read more »

WESTERN UNION CO. $20 (New York symbol WU; Aggressive Growth Portfolio, Finance sector; Shares outstanding: 701.6 million; Market cap: $14 billion; Price-to-sales ratio: 2.8; WSSF Rating: Above Average) has provided money-transfer services to Cuba since 1999. Cubans living in the U.S. can send money to close relatives in Cuba at over 3,000 of Western Union’s U.S. locations. The company also …read more »

DIAGEO PLC ADRs $63 (New York symbol DEO; Conservative Growth Portfolio, Consumer sector; ADRs outstanding: 624.9 million; Market cap: $39.4 billion; Price-to-sales ratio: 2.6; WSSF Rating: Above Average) is the world’s largest premium alcoholic-beverage company. (Each American Depositary Receipt represents four Diageo common shares.) London-based Diageo has 28% of the global market. Spirits account for 73% of its sales, followed …read more »

FIRSTSERVICE CORP. $18.58 (Toronto symbol FSV; SI Rating: Extra Risk) (416-960-9500; www.firstservice.com; Shares outstanding: 28.1 million; Market cap: $522.3 million) operates in the following areas of the real-estate services market: commercial real estate; residential property management; and property services. FirstService has more than 17,000 employees.

In the three months ended June 30, 2009, FirstService’s revenue fell 6.5%, to $425.3 million from …read more »

WYNDHAM WORLDWIDE $16.01 (New York symbol WYN; SI Rating: Extra Risk) (973-753-6000; www.wyndhamworldwide.com; Shares outstanding: 178.6 million; Market cap: $2.9 billion) is one of the world’s largest hospitality companies, with 7,000 franchised hotels worldwide. Aside from Wyndham and Ramada, it owns a variety of other quality brands, including Days Inn, Super 8, Wingate by Wyndham, Baymont Inn & Suites, Microtel …read more »

CHIPOTLE MEXICAN GRILL $79.27 (New York symbol CMG.B; SI Rating: Speculative) (303-595-4000; www.chipotle.com; Shares outstanding: 33.8 million; Market cap: $2.7 billion) is a Denver-based Mexican-restaurant chain.

Founded in 1993, Chipotle (pronounced chi-POATlay) charges slightly higher prices than fast-food chains, but offers higher-quality food, including naturally raised meat, and better decor and service.

In the three months ended June 30, 2009, Chipotle’s revenue …read more »

DOREL INDUSTRIES $28.99 (Toronto symbol DII.B; SI Rating: Extra Risk) (514-731-0000; www.dorel.com;Shares outstanding: 33.4 million; Market cap: $968.3 million) reports that its revenue fell 7.2 % in the three months ended June 30, 2009, to $551.1 million from $593.7 million a year earlier. (All figures except share price in U.S. dollars.)

The revenue drop was mainly caused by a stronger U.S. …read more »

FAIRFAX FINANCIAL HOLDINGS $396.80 (Toronto symbol FFH: SI Rating: Average) (416-367-2612; www.fairfax.ca; Shares outstanding: 19.7 million; Market cap: $7.8 billion) plans to buy the 27.4% of Odyssey Re Holdings Corp. (New York symbol ORH) that it doesn’t already own for $960 million U.S.

Odyssey Re is a major worldwide underwriter of property and casualty reinsurance. Reinsurers sell insurance to insurance companies. …read more »

REITMANS (CANADA) LTD. $16.09 (Toronto symbol RET.A; SI Rating: Extra Risk) (514-384-1140; www.reitmans.com; Shares outstanding: 70.8 million; Market cap: $1.1 billion) owns 971 women’s clothing stores across Canada.

The chain consists of 368 Reitmans, 164 Smart Set, 162 Penningtons, 123 Addition Elle, 76 Thyme Maternity, 62 RW & Co. and 16 Cassis stores. Reitmans continues to monitor its regional markets, and …read more »

SNC-LAVALIN GROUP INC. $49 (Toronto symbol SNC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 151 million; Market cap: $7.4 billion; Price-to-sales ratio: 1.0; SI Rating: Average) hopes to win a $255 million U.S. contract to install gas turbines in three Iraqi electrical-power plants. To put the value of the deal in context, SNC’s annual revenue is around $7 …read more »

CRESCENT POINT ENERGY CORP. $35.67 (Toronto symbol CPG; Shares outstanding: 159.3 million; Market cap: $5.7 billion; SI Rating: Extra Risk) has made a couple of big acquisitions in Saskatchewan.

The company has bought privately held Wave Energy for about $665.3 million in stock. It has also purchased producing assets from Provident Energy Trust for $258.5 million in cash. Crescent Point plans …read more »

Forecasts are now popping up regularly in the media predicting that the H1N1 virus (also known as “swine flu”) will flare up in North America when the flu season begins in just a few weeks.

There is still a wide difference of opinion on the subject, and it’s far from certain that H1N1 will pose a significant threat. Nonetheless, health authorities …read more »

The recession has prompted most businesses to put off buying new equipment and lower their spending on certain services. That has hurt the earnings of these five companies, which sell specialized products and services to corporate clients. But since these products and services help businesses cut costs, their long-term prospects remain bright. We see all but one as buys.

XEROX CORP. …read more »