Pat McKeough

A professional investment analyst for more than 30 years, Pat has developed a stock-selection technique that has proven reliable in both bull and bear markets. His proprietary ValuVesting System™ focuses on stocks that provide exceptional quality at relatively low prices. Many savvy investors and industry leaders consider it the most powerful stock-picking method ever created.

As early as 1980, Pat was recognized as #1 in the world of published investment advice by the Washington, DC–based Newsletter Publishers Association, and he was the first multi-year winner of The Globe and Mail’s stock picking contest.

Both CBS MarketWatch and The Hulbert Financial Digest recognized Pat as one of North America’s top stock analysts. The Wall Street Journal called him “one of only four investment newsletter advisors who have managed to serve their readers well over the long haul.”

A best-selling Canadian author, he wrote Riding the Bull, his 1993 book that predicted the stock-market boom of the last half of that decade. Through his many television appearances, he is well-known to investors for his insightful analysis and his candid, unpretentious style.

Bottom line: Pat’s conservative, reduced-risk strategy is a proven approach to safe investing.

Resist the urge to go overboard in Canadian oil stocks—but especially in junior oils, futures or options.
Successful investing in international ETFs has a lot to do with understanding the economies of the countries you invest in.
Formulating a good financial plan forces us to take a good look at the present—and the future.
SUNCOR ENERGY INC. $34 (Toronto symbol SU; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.6 billion; Market cap: $54.4 billion; Price-to-sales ratio: 1.8; Dividend yield: 3.4%; TSINetwork Rating: Average; www.suncor.com) is Canada’s largest integrated oil company. Oil production supplies about 40% of Suncor’s overall revenue. The remaining 60% comes from its four oil refineries (three in Canada and one in Colorado) and 1,500 Petro-Canada gas stations. Suncor gets 66% of its crude from its oil sands projects in northern Alberta. It gets a further 16% from the Syncrude oil sands project north of Fort McMurray. In March 2016, the company completed its all-stock acquisition of Canadian Oil Sands Ltd., which owns 36.74% of Syncrude. If you include Canadian Oil Sands’ debt of $2.6 billion, the total price was $7.1 billion. The company has now agreed to buy an additional 5.0% interest in Syncrude from Murphy Oil Corp. (New York symbol MUR). Suncor will pay $937 million when it completes the purchase in the next few weeks. That will raise its stake in Syncrude to 53.74%....
EMERA INC. $47 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares outstanding: 148.2 million; Market cap: $6.8 billion; Price-to-sales ratio: 2.5; Dividend yield: 4.0%; TSINetwork Rating: Average; www.emera .com) owns 100% of Nova Scotia Power, that province’s main electricity supplier. It also owns power utilities in the U.S. and the Caribbean. In September 2015, the company agreed to buy Teco Energy (New York symbol TE). This firm supplies electricity and natural gas to 1.05 million customers in Tampa Bay, Florida. A separate subsidiary distributes gas to 510,000 customers in New Mexico. Emera will pay $10.4 billion U.S., including Teco’s debt. It expects to complete the purchase in mid-2016....
IMPERIAL OIL LTD. $41 (Toronto symbol IMO; Conservative Growth and Income Portfolios, Shares outstanding: 847.6 million; Market cap: $34.8 billion; Price-to-sales ratio: 1.4; Dividend yield: 1.5%; TSINetwork Rating: Average; www.imperialoil.ca) is Canada’s second-largest integrated oil producer after Suncor. The company’s Alberta oil sands operations, including its 25% stake in the Syncrude project, supply 90% of its crude. Imperial also has conventional oil and gas operations in Western Canada, and invests in offshore projects in Atlantic Canada. In addition, it owns three refineries and makes petrochemicals. In March 2016, Imperial agreed to sell its 497 company-owned Esso gas stations to independent operators for $2.8 billion....
CENOVUS ENERGY INC. $19 (Toronto symbol CVE; Conservative Growth Portfolio, Resources sector; Shares outstanding: 833.3 million; Market cap: $15.8 billion; Price-to-sales ratio: 1,2; Dividend yield: 1.1%; TSINetwork Rating: Average; www.cenovus.com) gets 30% of its revenue from its Western Canadian oil sands properties and conventional oil and gas wells. Its biggest properties are its 50%-owned Christina Lake and Foster Creek oil sands projects; ConocoPhilips (New York symbol COP) owns the remaining 50%. Refining supplies 70% of Cenovus’s revenue. The company ships its oil to its 50%-owned refineries in Illinois and Texas. Phillips 66 (New York symbol PSX) owns the other 50%....
ENCANA CORP. $8.97 (Toronto symbol ECA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 849.9 million; Market cap: $7.6 billion; Price-to-sales ratio: 1.5; Dividend yield: 0.9%; TSINetwork Rating: Average; www.encana.com) owns four key properties: Montney (B.C.), Duvernay (Alberta), and Eagle Ford and Permian (both in Texas). In addition to natural gas, these fields produce large amounts of oil and natural gas liquids, such as propane and butane. That cuts the company’s reliance on gas. In the three months ended March 31, 2016, Encana produced an average of 383,400 barrels a day (66% gas, 34% oil and liquids). Due to recent asset sales, that’s down 10.9% from 430,100 barrels a year earlier. The company’s four main properties now supply 70% of its overall production. Low oil prices have forced Encana to write down the value of its properties by $607 million (all amounts except share price and market cap in U.S. dollars)....
PENGROWTH ENERGY CORP. $2.08 (Toronto symbol PGF; Aggressive Growth and Income Portfolios, Resources sector; Shares outstanding: 547.4 million; Market cap: $1.1 billion; Price-to-sales ratio: 1.4; Dividend suspended in January 2016; TSINetwork Rating: Speculative; www.pengrowth.com) has more than tripled from its low of $0.66 in January 2016. That’s partly because prominent Toronto investor Seymour Schulich recently acquired 16.6% of the company’s shares. The purchase makes him Pengrowth’s largest shareholder. Meanwhile, the company continues to sell less-important properties to focus on its main Lindbergh oil sands project. That’s why its production in the first quarter of 2016 fell 10.5%, to 62,056 barrels a day (61% oil and liquids, 39% natural gas) from 67,934 barrels a year earlier. In addition, weaker oil and gas prices cut its cash flow per share by 4.8%, to $0.20 from $0.21. Pengrowth used the cash from its recent assets sales to pay down its long-term debt. It now stands at $1.7 billion (or 1.5 times its market cap). That’s down 9.3% since the end of 2015....