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.

LOBLAW COMPANIES LTD. $69 (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 412.7 million; Market cap: $28.5 billion; Price-to-sales ratio: 0.6; Dividend yield: 1.4%; TSINetwork Rating: Above Average; www.loblaw.ca) plans to close 52 less profitable stores in the next year, including supermarkets, gas bars and stand-alone Joe Fresh clothing outlets. Following these closures, it will operate 2,400 stores, including the 1,250 Shoppers Drug Mart pharmacies it bought for $12.3 billion in cash and shares in March 2014.

The move will cut $300 million from Loblaw’s yearly sales, but it should add $35 million to $40 million to its annual gross profits. Loblaw also expects to save $200 million this year by merging its warehouses and other operations with Shoppers.

Excluding store-closure costs, Loblaw earned $350 million in the three months ended June 20, 2015, up 17.8% from $297 million a year earlier. Earnings per share gained 14.9%, to $0.85 from $0.74, on more shares outstanding.

Sales rose 2.2%, to $10.5 billion from $10.3 billion. Excluding gasoline, same-store sales rose 4.2% at Loblaw’s supermarkets, while Shoppers’ same-store sales gained 3.8%. Savings from the Shoppers acquisition are helping Loblaw repay the money it borrowed to complete the purchase. The company ended the latest quarter with total debt of $11.1 billion (or 39% of its market cap), down from $11.4 billion at the end of 2014. It also held cash of $1.3 billion.

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EMERA INC. $42 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares outstanding: 145.3 million; Market cap: $6.1 billion; Price-to-sales ratio: 2.2; Dividend yield: 4.5%; TSINetwork Rating: Average; www. emera.com) is buying Teco Energy (New York symbol TE), which supplies electricity and natural gas to 1.05 million customers in Tampa Bay, Florida and surrounding areas. A separate subsidiary distributes gas to 510,000 customers in New Mexico. This a big purchase for Emera, which will pay $6.5 billion U.S. in cash. If you include Teco’s debt, the deal is worth $10.4 billion U.S., or 2.3 times Emera’s current market cap.

After Emera completes the purchase in mid-2016, it will have $20 billion U.S. of assets (56% in Florida, 23% in Canada, 10% in New England, 6% in New Mexico and 5% in the Caribbean).

Regulated utilities will provide 80% of the combined company’s earnings.

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MANITOBA TELECOM $28.74 (Toronto symbol MBT; Shares outstanding: 78.9 million; Market cap: $2.3 billion; TSINetwork Rating: Average; Dividend yield: 4.5%; www.mts.ca) has acquired AWS-1 radio frequencies (or spectrum) in Manitoba from rival wireless carrier WIND Mobile.

The $45-million purchase will boost the speed and capacity of the company’s wireless networks.

Manitoba Telecom is a hold.

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BCE INC. $52.87 (Toronto symbol BCE; Shares outstanding: 848.1 million; Market cap: $44.1 billion; TSINetwork Rating: Above Average; Dividend yield: 5.0%; www.bce.ca) has sold its 15% stake in the Globe and Mail newspaper to Woodbridge Co., the private firm controlled by the Thomson family. Woodbridge now owns 100% of the Globe.

The company didn’t say how much it received, but the sale will let it focus on its main media businesses, including CTV Television, specialty channels, radio stations and their related websites.

In the second quarter of 2015, the media division’s earnings rose 2.4% from a year earlier and accounted for 9.8% of BCE’s total.

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ISHARES CANADIAN UNIVERSE BOND INDEX ETF $31.67 (Toronto symbol XBB; buy or sell through brokers) mirrors the performance of the Canadian Universe Bond Index. The 929 bonds in the portfolio have an average term to maturity of 10.34 years. The fund’s MER is 0.33%.

The bonds in the index are 71.3% government and 28.7% corporate.

The fund yields 2.8%, compared to the Short-Term Bond Fund’s 2.4%. Its yield to maturity is 1.93%, 0.85% above the Short-Term Fund. That reflects the added risk of holding long-term bonds.

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