The Successful Investor Hotline – Friday, May 15, 2015

Article Excerpt

CANADIAN TIRE CORP., $133.55, Toronto symbol CTC.A, recently sold 20% of its financial services division to Bank of Nova Scotia (Toronto symbol BNS) for $500 million. That’s the main reason why the company’s earnings fell 3.0% in the quarter ended April 4, 2015, to $68.5 million from $70.6 million a year earlier. Per-share profits were unchanged at $0.88 on fewer shares outstanding, but that beat the consensus estimate of $0.87. Overall sales fell 2.3%, to $2.5 billion from $2.6 billion, mainly because lower gasoline prices hurt revenue at Canadian Tire’s gas stations. But if you exclude fuel-station revenue, the company’s overall sales gained 2.2%. Its 493 Canadian Tire outlets reported 4.7% higher same-store sales, thanks to strong demand for seasonal goods, such as snow shovels and garden tools. Same-store sales rose 8.6% at its 434 sporting goods stores, including Sport Chek and Sports Experts, partly due to strong demand for athletic shoes and clothing, as well as warm-weather goods like camping gear. The…