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.

RIOCAN REAL ESTATE INVESTMENT TRUST $28 (Toronto symbol REI.UN; Aggressive Growth Portfolio, Manufacturing & Industry sector; Units outstanding: 317.9 million; Market cap: $8.9 billion; Price-to-sales ratio: 6.9; Dividend yield: 5.0%; TSINetwork Rating: Average; www.riocan.com) owns all or part of 290 shopping centres in Canada, including 15 under development. These holdings account for 84% of the trust’s rental revenue. The remaining 16% comes from 48 malls in the U.S. Former tenant Target Canada recently abandoned 26 stores in RioCan’s malls, representing 1.9% of the trust’s annual rental revenue. So far, RioCan has found new tenants for eight former Target outlets. It hopes to fill the other 18 in the next few months, but it will probably have to remodel them to handle two or more tenants....
MAPLE LEAF FOODS INC. $24 (Toronto symbol MFI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 143.1 million; Market cap: $3.4 billion; Price-to-sales ratio: 1.1; Dividend yield: 1.3%; TSINetwork Rating: Average; www.mapleleaf.ca) is Canada’s largest food-processing company. It mainly sells its products, including fresh and prepared meats and poultry, under the Maple Leaf and Schneider brands. The company will soon complete a seven-year restructuring that mainly involves closing older plants and shifting their operations to newer facilities. However, it will take several months for the new plants to reach full capacity and increase Maple Leaf’s earnings. Even so, the company expects to increase its gross profit margin to 10% in 2015 from just 0.5% in 2014. The stock has gained 23% since the start of the year and now trades at a somewhat high 31.6 times the $0.76 a share Maple Leaf will likely earn in 2015. The $0.32 dividend yields 1.3%....
TRANSCONTINENTAL INC. $15 (Toronto symbol TCL.A; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 78.1 million; Market cap: $1.2 billion; Price-to-sales ratio: 0.6; Dividend yield: 4.5%; TSINetwork Rating: Average; www.tctranscontinental.com) saw its earnings rise 13.7% in the quarter ended April 30, 2015, to $39.1 million, or $0.50 a share, from $34.4 million, or $0.44, a year ago. The gain largely came from two recent acquisitions: in May 2014, the company bought U.S.-based Capri Packaging, a maker of plastic bags and pouches for cheese and other dairy products, for $146.5 million. And in June 2014, it paid Sun Media $78.8 million for 74 weekly newspapers in Quebec. Revenue rose 2.7%, to $490.5 million from $477.5 million. Contributions from acquisitions offset lower revenue from printing flyers, particularly after Target closed its 133 Canadian stores....
IGM FINANCIAL INC. $40 (Toronto symbol IGM; Conservative Growth Portfolio, Finance sector; Shares outstanding: 248.5 million; Market cap: $9.9 billion; Price-to-sales ratio: 3.4; Dividend yield: 5.6%; TSINetwork Rating: Above Average; www.igmfinancial.com) had $136.0 billion of assets under management as of June 30, 2015. That’s down 3.9% from $141.4 billion a year earlier. The drop resulted from the recent decline in major stock markets; IGM’s fee income rises and falls with the value of the mutual funds and other securities it manages. Even with the current volatility, IGM’s overall mutual fund sales, net of redemptions, rose by $66.5 million in June. Net gains at the company’s Investors Group (up $74.2 million) and Counsel (up $12.3 million) subsidiaries offset $20.0 million of net redemptions at its Mackenzie division....
TECK RESOURCES LTD. $12 (Toronto symbol TCK.B; Conservative Growth Portfolio, Resources sector; Shares outstanding: 576.2 million; Market cap: $6.9 billion; Price-to-sales ratio: 0.8; Dividend yield: 2.5%; TSINetwork Rating: Average; www.teck.com) has postponed its plan to develop its 100%-owned Frontier oil sands project in Alberta due to weak crude prices. The company had planned to start construction in 2019 and complete it in 2021. However, it now feels commercial production will begin in 2026. If Teck decides to build Frontier, it will cost $20.6 billion. Meanwhile, the company continues to work on its 20.0%-owned Fort Hills oil sands project; Suncor Energy (Toronto symbol SU) owns 40.8% of Fort Hills, while France’s Total SA holds the remaining 39.2%. Teck’s share of Fort Hills’ development costs is $2.94 billion. This project should begin operating in late 2017, and its reserves should last 50 years....
EMERA INC. $42 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares outstanding: 144.8 million; Market cap: $6.1 billion; Price-to-sales ratio: 2.1; Dividend yield: 3.8%; TSINetwork Rating: Average; www.emera.com) owns 100% of Nova Scotia Power, that province’s main electricity supplier. This business supplies 45% of Emera’s revenue and a third of its earnings. In the past few years, the company has steadily expanded into other regions, mainly through acquisitions. It now owns or invests in several power plants and natural gas pipelines in the U.S. and the Caribbean. Thanks to these new operations, Emera’s revenue rose 85.0%, from $1.6 billion in 2010 to $3.0 billion in 2014. Erratic earnings history...
BANK OF MONTREAL $75 (Toronto symbol BMO; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 644.3 million; Market cap: $48.3 billion; Price-to-sales ratio: 2.9; Dividend yield: 4.4%; TSINetwork Rating: Above Average; www.bmo.com) is selling its U.S. retirement-services division to OneAmerica Financial Partners for an undisclosed sum. This business manages retirement plans on behalf of employees and businesses, including 401(k) accounts, which are similar to Canadian RRSPs. Bank of Montreal expects to close the deal by September 30, 2015. Following the sale, it will focus on its larger U.S. Harris Bank retail banking and wealth management operations, which mainly serve individual investors....
MANITOBA TELECOM SERVICES INC. $29 (Toronto symbol MBT; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 78.5 million; Market cap: $2.3 billion; Price-to-sales ratio: 1.4; Dividend yield: 4.5%; TSINetwork Rating: Average; www.mtsallstream.com) gets 60% of its revenue from its MTS division, which has 1.3 million telephone, wireless and TV customers in Manitoba. The other 40% comes from Allstream, which sells phone and Internet services to businesses across Canada. The company recently completed a strategic review of its operations. As a result, it now plans to cut 25% of Allstream’s workforce and reduce the subsidiary’s capital spending by 20% to 30% in 2015. These moves should save Manitoba Telecom $50 million annually by the end of 2016. In addition, the company will contribute $120 million to its underfunded employees’ pension plan, eliminating the need for additional payments over the next two years. It has also cut its dividend by 23.5%: the new annual rate of $1.30 a share yields 4.5%....
TELUS $43.67 (Toronto symbol T; Shares outstanding: 60750 million; Market cap: $26.6 billion; TSINetwork Rating: Above Average; Dividend yield: 3.9%; www.telus.com) is closing its remaining 59 Black’s photography stores.

Telus paid $28 million for the 113-store Black’s chain in 2009. It felt these outlets would help it sell more mobile phones and service plans. However, digital camera sales have suffered as more people take pictures with their smartphones.

The company will transfer many Black’s employees to its other retail outlets, so any severance costs will be low.

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