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.

AGT FOOD & INGREDIENTS $32.29 (Toronto symbol AGT; TSINetwork Rating: Extra Risk) (604-231- 1100; www.alliancegrain.com; Shares outstanding: 23.1 million; Market cap: $719.3 million; Dividend yield: 1.9%) buys and processes a range of pulses—which include peas, beans, lentils and chickpeas—as well as other specialty crops.

Saskatchewan-based AGT owns 13 processing plants in Canada, nine in Turkey, four in Australia, two in the U.S., one in China and one in South Africa. In the three months ended March 31, 2015, the company’s revenue gained 23.7%, to $385.2 million from $311.3 million a year earlier. Before one-time items, earnings jumped 162.5%, to $0.42 a share from $0.16. The increases came from recent acquisitions and higher processing activity.

A big part of AGT’s success has come from its shift to more profitable products, such as ingredients and packaged foods, as opposed to simply cleaning, splitting and bagging bulk crops. Food makers use these ingredients in products such as baked goods, soups and beverages, as well as pet food and animal feed. The stock trades at 15.7 times the $2.06 a share AGT is expected to earn in 2015. It yields 1.9%.

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CALIAN TECHNOLOGIES $18.79 (Toronto symbol CTY; TSINetwork Rating: Speculative) (613-599-8600; www.calian.com; Shares outstanding: 7.4 million; Market cap: $137.1 million; Dividend yield: 6.0%) has won a $10- million contract with the City of Toronto to provide a software system for managing city employees’ hours. Calian will deliver this project over an 18-month period.

To put the deal in context, the company reported revenue of $61.0 million in the three months ended March 31, 2015, up 19.3% from $51.2 million a year earlier. Earnings fell 6.6%, to $2.21 million, or $0.30 a share, from $2.36 million, or $0.32. That was mostly because Calian added workers to fulfill new contracts.

This latest deal will add to the company’s revenue and demonstrates its ongoing ability to win recurring orders from all levels of government.

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SIERRA WIRELESS $31.67 (Toronto symbol SW; TSINetwork Rating: Extra Risk)(604-231-1100; www.sierrawireless.com; Shares outstanding: 32.1 million; Market cap: $1.1 billion; No dividends paid) makes modules that connect products—including smart electricity meters and vehicles—to the Internet. This is known as machine to machine, or more generally as the Internet of Things.

In the three months ended March 31, 2015, the company’s revenue rose 24.1%, to a record $150.4 million from $121.2 million a year earlier (all figures except share price and market cap in U.S. dollars). Sierra continues to add new customers.

Excluding one-time items, the company earned $7.2 million, or $0.22 a share, compared to just $483,000, or $0.02, a year earlier. Sierra sold more high-margin cloud-based services to large customers during the latest quarter. It also cut its costs.

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ADOBE SYSTEMS INC. $80.73 (Nasdaq symbol ADBE; TSINetwork Rating: Average) (408-536-6000; www.adobe.com; Shares outstanding: 497.6 million; Market cap: $40.4 billion; No dividends paid) makes software that lets computer users create, edit and share documents in the popular PDF format. Graphic designers also use its programs to create print publications and web pages.

In its fiscal 2015 second quarter, which ended May 29, 2015, Adobe earned $0.48 a share, up 29.7% from $0.37 a year earlier. Revenue gained 8.8%, to a record $1.2 billion from $1.1 billion.

The company continues to shift away from selling software as a one-time purchase and toward a subscription model. It now gets 72% of its revenue from recurring sources, compared to 55% a year ago.

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NISSAN MOTOR (ADR) $19.78 (Nasdaq symbol NSANY; TSINetwork Rating: Above Average) (310-771-3111; www.nissan-global.com; ADRs outstanding 2.3 billion; Market cap: $44.5 billion; Dividend yield: 3.0%) continues to sell record numbers of its Rogue crossovers in the U.S.

In response, the company will export the model from Japan to North America beginning next spring. This will supplement current Rogue production from plants in Tennessee and South Korea.

Crossovers look like sport utility vehicles but have a car rather than a truck chassis. They’re among the top-selling vehicles in the U.S. right now. What’s more, the weak yen will let Nissan realize higher profits from Rogues it makes in Japan and sells in the U.S., compared to vehicles it makes and sells in the U.S.

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STUART OLSON INC. $6.11 (Toronto symbol SOX; TSINetwork Rating: Speculative) (780-454-3667; www.stuartolson.com; Shares outstanding: 26.2 million; Market cap: $161.9 million; Dividend yield: 7.9%) provides building construction, commercial and industrial electrical contracting, earth moving and industrial insulation services to government and private sector clients. It mainly operates in Western Canada.

An increase in construction work in Western Canada pushed up the company’s revenue by 5.4% in the three months ended March 31, 2015, to $282.9 million from $268.5 million a year earlier. Stuart Olson earned $1.0 million, or $0.04 a share, compared to $1.3 million, or $0.05.

The company ended the quarter with a backlog of $2.1 billion, up 5.4% from $2.0 billion a year earlier. Stuart Olson has now worked through most of the lowprofit- margin contracts it took on through acquisitions or agreed to when its markets were more competitive in 2009 and 2010.

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RUSSEL METALS $21.58 (Toronto symbol RUS; TSINetwork Rating: Speculative) (905-819-7777; www.russelmetals.com; Shares outstanding: 61.7 million; Market cap: $1.3 billion; Dividend yield: 7.0%) is one of North America’s largest metal distributors, serving 39,000 clients at 53 locations in Canada and 12 in the U.S.

In the three months ended March 31, 2015, Russel’s revenue fell 2.2%, to $903.9 million from $924.0 million a year earlier. The company’s metal-services business saw its sales rise slightly, but the energyproducts division, which supplies pipes for oil and gas drillers, reported a 14% sales decline.

Earnings fell 36.2%, to $18.5 million, or $0.30 a share, from $29.0 million, or $0.47. Russel’s earnings fell faster than revenue because steel prices declined in the latest quarter. That cuts the company’s profit margins and causes it to suffer losses on its inventory.

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IAMGOLD $1.65 (Toronto symbol IMG; TSINetwork Rating: Speculative) (1-888-464-9999; www.iamgold.com; Shares outstanding: 391.3 million; Market cap: $688.8 million; No dividends paid) believes Burkina Faso’s upcoming parliamentary vote on an updated mining code will have no effect on its Essakane mine’s profits.

Burkina Faso, a landlocked nation in West Africa, is that continent’s fourth-largest gold producer; the precious metal accounts for about 20% of its gross domestic product.

The new code is expected to abolish a 10% tax break on miners’ profits. However, Burkina Faso will honour clauses in existing deals. As well, the new code should also end uncertainty surrounding the current 12-yearold mining regulations.

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AMERIGO RESOURCES $0.27 (Toronto symbol ARG; TSINetwork Rating: Speculative) (604-681-2802; www.amerigoresources.com; Shares outstanding: 173.6 million; Market cap: $48.6 million; No dividends paid) processes copper and molybdenum from waste rock at Chile’s El Teniente, the world’s largest underground copper mine. The rock comes from the mine’s current production and tailings from the nearby Colihues deposit. This contract runs at least through 2037.

Amerigo gets 94% of its revenue by processing copper. The remaining 6% comes from molybdenum.

In the three months ended March 31, 2015, Amerigo’s copper production fell 12.7%, to 8.9 million pounds from 10.2 million a year earlier. Molybdenum output declined 21.7%, to 97,883 pounds from 125,016.

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