Imperial
Canada’s oil sands still face strong opposition from environmentalists. However, new technology has sharply lowered the oil sands’ greenhouse-gas emissions. As well, turmoil in Egypt and other Middle Eastern countries highlights the oil sands’ strategic importance to the U.S. and Canada. These factors make it less likely that Ottawa will introduce regulations that would slow oil-sands development. These three oil-sands …read more »
NORTHGATE MINERALS CORP. $3.08 (Toronto symbol NGX; SI Rating: Speculative) (604-681-4004; www.northgateminerals.ca; Shares outstanding: 291.1 million; Market cap: $896.5 million; No dividends paid) is focused on building a mine at its Young-Davidson gold property in northern Ontario.
The $339-million open-pit/underground mine is now under construction, and is scheduled to start up in 2012. It is expected to produce 180,000 ounces …read more »
IMPERIAL OIL LTD. $39 (Toronto symbol IMO; Conservative Growth Portfolio, Resources sector; Shares outstanding: 847.6 million; Market cap: $33.1 billion; Price-to-sales ratio: 1.4; Dividend yield: 1.1%; SI Rating: Average) has formed a new joint venture with parent company ExxonMobil Corp. (New York symbol XOM) and BP plc (New York symbol BP). This new company will explore for oil and natural …read more »
NORTHGATE MINERALS CORP. $3.13 (Toronto symbol NGX; SI Rating: Speculative) (604-681-4004; www.northgateminerals.ca; Shares outstanding: 290.9 million; Market cap: $910.5 million; No dividends paid) is focused on building a mine at its Young-Davidson gold property in northern Ontario.
The $339-million mine, which would produce 180,000 ounces of gold per year, is scheduled to start up in 2012. After two years, its production …read more »
The BP oil spill in the Gulf of Mexico will probably lead to greater regulation of offshore drilling. Because of the extra costs, energy-exploration firms may turn their attention to safer onshore oil and natural-gas deposits, like Canada’s oil sands. That would help these three companies, which supply equipment and services to oil-sands producers. However, only two are buys right …read more »
Oil prices fell from their July 2008 peak of $148 U.S. a barrel to just under $40 U.S. in February 2009. Prices then more than doubled, to $90 U.S. in May 2010. They have since fallen to $72 U.S., mostly due to worries about a slower-than-expected economic recovery.
It will take years before oil exceeds its 2008 high. But it could …read more »
We’ve long recommended that all Canadian investors own two or more of the country’s big five bank stocks. That’s mainly because of their importance to Canada’s economy. As well, investors continue to underestimate them. As a result, they consistently trade at below-average price-to-earnings ratios.
(In the latest issue of The Successful Investor, we’ve published a special analysis of all five of …read more »
ROYAL BANK OF CANADA $52 (Toronto symbol RY; Conservative Growth Portfolio, Finance sector; Shares outstanding: 1.4 billion; Market cap: $72.8 billion; Price-to-sales ratio: 2.0; Dividend yield: 3.8%; SI Rating: Above Average) is Canada’s largest bank, with total assets of $655.1 billion.
In the three months ended April 30, 2010, Royal earned $1.3 billion, or $0.88 a share. That’s a big improvement …read more »
MOLSON COORS CANADA INC. $43 is paying $40 million for 51% of a new joint venture with Chinese brewer Hebei Si’hai Beer Company (all amounts except share price in U.S. dollars). This will help Molson Coors make its Coors Light beer more available in China. To put this investment in context, Molson Coors earned $69.7 million in three months ended …read more »
BANK OF NOVA SCOTIA $50 (Toronto symbol BNS: Shares outstanding: 1.0 billion; Market cap: $51.4 billion; SI Rating: Above Average; Dividend yield: 3.9%) has reported better-than-expected earnings in the latest quarter.
In its first quarter, which ended January 31, 2010, the bank earned $988 million. That’s up 17.3% from $842 million a year earlier. Earnings per share rose 13.8%, to $0.91 …read more »
