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.

SPDR S&P 500 ETF $191.30 (New York symbol SPY; buy or sell through brokers; www.spdrs.com) holds the stocks in the S&P 500 Index, which consists of 500 major U.S. companies chosen based on their market cap, liquidity and industry group. The fund’s MER is just 0.10%, and it yields 2.5%. The index’s highest-weighted stocks are Apple, 3.2%; Microsoft, 2.6%; Alphabet, 2.6%; Exxon- Mobil, 1.9%; Johnson & Johnson, 1.7%; General Electric, 1.6%; Facebook, 1.5%; Berkshire Hathaway, 1.4%; Wells Fargo & Co., 1.4%; Amazon.com, 1.3%; AT&T, 1.3%; Procter & Gamble, 1.3%; and JPMorgan Chase, 1.3%. The SPDR S&P 500 ETF is a top ETF pick for 2016.
ISHARES CANADIAN SELECT DIVIDEND INDEX ETF $20.37 (Toronto symbol XDV; buy or sell through brokers; ca.ishares.com) holds 30 of the highestyielding Canadian stocks. Its selections are based on dividend growth, yield and payout ratio. The weight of any one stock is limited to 10% of the ETF’s assets. The fund’s MER is 0.55%, and it yields 5.0%. Its top holdings are CIBC, 9.7%; Bank of Montreal, 7.4%; Royal Bank, 6.8%; BCE, 6.5%; Bank of Nova Scotia, 5.6%; Rogers Communications, 5.2%; Laurentian Bank of Canada, 5.0%; Manitoba Telecom, 5.0%; TD Bank, 4.7%; IGM Financial, 4.4%; and TransCanada Corp., 4.4%. The ETF holds 58.6% of its assets in financial stocks. The top Canadian finance stocks have sound prospects, but if you invest in this ETF, be sure to adjust the rest of your portfolio so it won’t be overly concentrated in the financial sector....
ISHARES S&P/TSX 60 INDEX ETF $18.65 (Toronto symbol XIU; buy or sell through brokers; ca.ishares.com) is a good low-fee way to buy the top stocks on the TSX. The units are made up of stocks that represent the S&P/TSX 60 Index, which consists of the 60 largest, most heavily traded stocks on the exchange. The ETF’s MER is just 0.18% of assets, and the units yield 3.2%. The index mostly consists of high-quality companies. However, it must ensure that all sectors are represented, so it holds a few we wouldn’t include. The index’s top holdings are Royal Bank, 8.7%; TD Bank, 8.0%; Bank of Nova Scotia, 5.6%; CN Railway, 4.8%; BCE, 4.0%; Bank of Montreal, 3.9%; Suncor Energy, 3.8%; Valeant Pharmaceuticals, 3.5%; Enbridge Inc., 3.3%; and Manulife Financial Corp., 3.1%....
CANADIAN PACIFIC RAILWAY $159.03 (Toronto symbol CP; Shares outstanding: 153.8 million; Market cap: $25.5 billion; TSINetwork Rating: Above Average; Yield: 0.9%; www.cpr.ca) reported 5.9% lower freight volumes in the latest quarter, mainly because of falling prices for oil, minerals and other commodities. In the three months ended December 31, 2015, CP earned $419 million, down 8.9% from $460 million a year earlier. However, per-share earnings gained 1.5%, to $2.72 from $2.68, on fewer shares outstanding. Revenue fell 4.1%, to $1.69 billion from $1.76 billion. Still, revenue from forest products jumped 20.4%, and fertilizer shipments rose 18.0%....
ALLIED PROPERTIES REAL ESTATE INVESTMENT TRUST $32.83 (Toronto symbol AP.UN; Units outstanding: 78.3 million; Market cap: $2.6 billion; TSINetwork Rating: Extra Risk; Dividend yield: 4.6%; www.alliedreit.com) owns 147 office buildings, mostly in major Canadian cities. These mainly Class I properties contain over 10.5 million square feet of leasable area. Class I refers to 19th- and early-20th-century industrial buildings that have been converted to retail space. They usually feature exposed beams, interior brick and hardwood floors....
RIOCAN REAL ESTATE INVESTMENT TRUST $25.02 (Toronto symbol REI.UN; Units outstanding: 320.4 million; Market cap: $7.9 billion; TSINetwork Rating: Average; Dividend yield: 5.6%; www.riocan.com) is Canada’s largest real estate investment trust. In the three months ended September 30, 2015, RioCan’s cash flow rose 5.0%, to $140.2 million from $133.6 million a year earlier. Per-unit cash flow gained 2.3%, to $0.44 from $0.43, on more units outstanding. The trust has now agreed to sell its 49 U.S. malls for $1.2 billion (Canadian). It expects to complete the sale in April 2016....
TORSTAR $2.21 (Toronto symbol TS.B; Shares outstanding: 79.9 million; Market cap: $182.1 million; TSINetwork Rating: Average; Dividend yield: 11.8%; www.torstar.com) will close its money-losing printing plant in Vaughan, Ontario, just north of Toronto, in July 2016. It will then transfer printing of The Toronto Star newspaper to Transcontinental Inc. Torstar will also sell the Vaughan plant and land. This will help offset its closing costs. It will also give it more cash for Star Touch, the tablet-newspaper app it launched in October. So far, more than 200,000 users have downloaded Star Touch, which uses technology licensed from Montreal’s La Presse newspaper. The app should help Torstar attract younger readers and sell more online ads....
MANULIFE FINANCIAL $18.16 (Toronto symbol MFC; Shares outstanding: 2.0 billion; Market cap: $37.9 billion; TSINetwork Rating: Above Average; Dividend yield: 3.7%; www.manulife.ca) sells life and other related forms of insurance, as well as mutual funds and investment management services. In the three months ended September 30, 2015, Manulife’s earnings per share, excluding one-time items, gained 10.3%, to $0.43 from $0.39 a year earlier. Revenue rose 16.2%, to $7.48 billion from $6.44 billion. The company continues to expand in growing Asian markets. Right now, about 40% of its insurance premiums come from that region....
GREAT-WEST LIFECO $34.22 (Toronto symbol GWO; Shares outstanding: 993.4 million; Market cap: $34.5 billion; TSINetwork Rating: Above Average; Yield: 3.8%; www.greatwestlifeco.com) is one of Canada’s largest insurance firms. It also offers mutual funds and wealth management. Power Financial owns 67.2% of Great-West. In the three months ended September 30, 2015, Great-West’s earnings rose 4.3%, to $0.72 a share from $0.69 a year earlier. The company continues to benefit from two recent acquisitions. In 2013, it paid $1.75 billion for Irish Life, Ireland’s largest pension manager and life insurance provider. In 2015, it paid an undisclosed sum for the Irish operations of Legal & General Group plc, which provides investment and taxplanning services to wealthy individuals....