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.

TERADATA CORP. $29 (New York symbol TDC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 141.6 million; Market cap: $4.1 billion; Price-to-sales ratio: 1.5; No dividends paid; TSINetwork Rating: Average; www.teradata.com) makes computers and software that capture and store large amounts of a business’s data. It then analyzes this information and identifies buying habits and other trends.

In the second quarter of 2015, Teradata’s earnings fell 33.3%, to $76 million from $114 million a year earlier. Per-share profits declined 26.4%, to $0.53 from $0.72, on fewer shares outstanding. Revenue slipped 7.8%, to $623 million from $676 million.

Strong competition from bigger firms like IBM and Oracle, as well as cloud-based analytics services, continue to hurt Teradata’s earnings. That’s why the stock trades at just 12.3 times the $2.35 a share the company will probably earn in 2015.

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NCR CORP. $24 (New York symbol NCR; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 169.8 million; Market cap: $4.1 billion; Price-to-sales ratio: 0.6; No dividends paid; TSINetwork Rating: Average; www.ncr.com) makes automated teller machines, cash registers, self-serve checkouts and kiosks. The company set up Teradata (see right) as a separate firm in October 2007. It’s now conducting a strategic review, which could lead to more divisions being sold or spun off.

Meanwhile, NCR lost $344 million, or $2.03 a share, in the three months ended June 30, 2015. A year earlier, it earned $90 million, or $0.53 a share.

The loss mainly came from a one-time charge stemming from NCR’s transfer of an underfunded U.K. pension plan to an insurance company. Without unusual items, it earned $0.66 a share in the latest quarter, down 2.9% from $0.68.

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KEYSIGHT TECHNOLOGIES INC. $31 (New York symbol KEYS; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 169.0 million; Market cap: $5.2 billion; Price-to-sales ratio: 1.8; No dividends paid; TSINetwork Rating: Average; www.keysight.com) makes equipment for testing electronics. Clients include makers of computer chips (44% of total revenue) and communications gear (33%), as well as aerospace and defence firms (23%).

In its fiscal 2015 third quarter, which ended July 31, 2015, the company’s revenue fell 12.2%, to $665 million from $757 million a year earlier. Excluding unusual items, earnings declined 29.3%, to $94 million, or $0.55 a share, from $133 million, or $0.80. It spends 14% of its revenue on research.

As of July 31, 2015, Keysight held cash of $1.0 billion, or $5.92 a share. Its long-term debt of $1.1 billion is equal to 21% of its market cap. In August 2015, the company used $600 million of its cash to buy U.K.-based Anite, a software maker whose products will make Keysight’s testing equipment for wireless handsets perform better.

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AGILENT TECHNOLOGIES INC. $36 (New York symbol A; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 332.0 million; Market cap: $12.0 billion; Price-to-sales ratio: 1.6; Dividend yield: 1.1%; TSINetwork Rating: Average; www.agilent.com) split into two publicly traded firms on November 1, 2014.

One company kept the Agilent name and stock symbol and focuses on testing equipment for medical research labs. The other firm, called Keysight Technologies (see right), makes testing systems for electronics.

Under the spinoff, Agilent shareholders received one Keysight share for every two shares they held.

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MONSANTO CO. $97 (New York symbol MON, Aggressive Growth Portfolio; Manufacturing & Industry sector; Shares outstanding: 467.8 million; Market cap: $45.4 billion; Price-tosales ratio: 2.7; Dividend yield: 2.2%; TSINetwork Rating: Above Average; www.monsanto.com) has dropped its takeover offer for Switzerland-based rival Syngenta AG, the world’s largest maker of pesticides, herbicides and other agricultural chemicals.

A merger would have let Monsanto and Syngenta jointly develop new genetically modified seeds for corn, soybeans and other crops. Syngenta’s expertise would also improve Monsanto’s pesticide products.

In addition, the new firm could cut costs and improve its efficiency by combining distribution networks. Monsanto recently increased its bid by 5%, to $47 billion in cash and shares.

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3M COMPANY $143 (New York symbol MMM; Conservative Growth and Income Portfolios, Manufacturing & Industry sector; Shares outstanding: 624.8 million; Market cap: $89.3 billion; Price-to-sales ratio: 2.8; Dividend yield: 2.9%; TSINetwork Rating: Above Average; www.3m.com) started up in 1902, when it was called the Minnesota Mining & Manufacturing Company.

3M started off making sandpaper and abrasives for industrial clients. It later developed other consumer and manufacturing-related goods, such as pressure-sensitive masking and packaging tape, recording tape and reflective highway markings.

Today, 3M makes more than 55,000 items, including air purifiers, medical device components and bandages. Top-selling brands include Post-it notes, Scotch tape, Scotch-Brite cleaning products, Scotchguard protection and Thinsulate insulation.

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Air Boss of America has enjoyed a big bounce in its shares with its rubber products. We look at whether this growth stock can keep rising.
Junior mining stocks Sherritt and Amerigo are adapting to lower commodity prices in different ways, but we see both as aggressive buys.
ENERFLEX LTD. $11.23 (Toronto symbol EFX; TSINetwork Rating: Extra Risk) (403-387-6377; www.enerflex.com; Shares outstanding: 79.0 million; Market cap: $924.9 million; Dividend yield: 3.0%) rents and sells equipment and services for natural gas production, including compression and processing plants, refrigeration gear and power generators.

On June 30, 2014, the company closed its $431- million U.S. acquisition of two businesses owned by privately held Axip Energy Services: an international contract compression and processing subsidiary and a division that provides aftermarket services.

In the three months ended June 30, 2015, Enerflex’s revenue fell 8.3%, to $389.7 million from $424.9 million a year earlier. But earnings per share more than doubled, to $0.34 from $0.15. International contributions from the Axip businesses pushed up earnings and almost offset weaker revenue in the U.S. and Canada. However, falling oil and gas prices are now hurting the company’s orders.

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