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.

Posts by the author
AIMIA INC. $19.13 (Toronto symbol AIM; TSINetwork Rating: Extra Risk) (514-205-7315; www.aimia.com; Shares outstanding: 173.4 million; Market cap: $3.2 billion; Dividend yield: 3.8%) is buying 25% of Travel Club, Spain’s largest loyalty program.

Travel Club, which generated 40 million euros of revenue in 2013, has 6 million members and 30 business partners. Aimia plans to use its international experience to expand Travel Club’s member base and attract partners from new areas, including finance, fashion, insurance and the telecom industry.

The company has lots of experience with European loyalty programs. For example, it built Nectar, the U.K.’s leading coalition loyalty program, from a start-up into a multinational business in just 10 years. Today, Nectar has 19 million members, which amounts to more than 50% of U.K. households. Aimia has also built a significant presence in the Italian customer-loyalty market through Nectar Italia.

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DELPHI ENERGY $3.34 (Toronto symbol DEE; TSINetwork Rating: Speculative) (403-265-6171; www.delphienergy.ca; Shares outstanding: 154.4 million; Market cap: $529.7 million; No dividends paid) develops, produces and explores for oil and natural gas. About 72% of its output is gas. The remaining 28% is oil.

In the three months ended December 31, 2013, the company’s production rose 24.3%, to 8,988 barrels of oil equivalent a day (including gas) from 7,229 barrels a year earlier.

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TRILOGY ENERGY CORP. $28.59 (Toronto symbol TET; TSINetwork Rating: Speculative) (403-290-2900; www.trilogyenergy.com; Shares outstanding: 99.5 million; Market cap: $3.6 billion; Dividend yield: 1.5%) owns oil and gas properties in central Alberta’s Kaybob and Grande Prairie areas. About 61% of Trilogy’s production is natural gas. The remaining 39% is oil.

In the three months ended March 31, 2014, Trilogy produced 33,135 barrels of oil equivalent a day (including gas), down 8.2% from 36,119 barrels a year earlier.

Cash flow per share fell 4.5%, to $0.64 from $0.67, as higher oil and gas prices partly offset the production drop.

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WYNDHAM WORLDWIDE $72.29 (New York symbol WYN; TSINetwork Rating: Extra Risk) (973-753-6000; www.wyndhamworldwide.com; Shares outstanding: 127.3 million; Market cap: $9.3 billion; Dividend yield: 1.9%) reported revenue of $1.19 billion in the three months ended March 31, 2014. That was up 5.3% from $1.13 billion a year earlier.

Before one-time items, earnings rose 9.9%, to $0.78 a share from $0.71.

To further boost its revenue, Wyndham has invested heavily in its online booking systems. It is also expanding in fast-growing markets like Asia and Latin America. The company’s outlook is positive, but the stock now trades at a high 19.1 times Wyndham’s latest 12 months of earnings.

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RUBY TUESDAY, INC. $7.72 (New York symbol RT; TSINetwork Rating: Speculative) (865-379-5700; www.rubytuesday.com; Shares outstanding: 61.4 million; Market cap: $502.6 million; No dividends paid) owns 679 casual dining restaurants in the U.S., with franchisees operating 31 in the U.S. and 45 overseas. The company also runs 20 Lime Fresh restaurants and franchises eight (six domestic and two international).

In the three months ended March 4, 2014, Ruby Tuesday’s sales fell 3.8%, to $295.6 million from $307.4 million a year earlier. Same-restaurant sales declined 1.9%. Continued weak consumer spending was the main reason for the decline. As well, the company closed less-profitable restaurants in the quarter, and competition remains intense in the casual-dining business.

Excluding one-time items, Ruby Tuesday lost $4.5 million, or $0.07 a share, compared to a year-earlier profit of $6.3 million, or $0.10. That beat the consensus estimate of an $0.08-a-share loss.

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CHIPOTLE MEXICAN GRILL $504.32 (New York symbol CMG; TSINetwork Rating: Speculative) (303-595-4000; www.chipotle.com; Shares outstanding: 31.1 million; Market cap: $15.7 billion; No dividends paid) is a Denver-based Mexican restaurant chain. It charges slightly higher prices than fast food companies, but it offers better quality food, including naturally raised meat, and superior decor and service.

In the three months ended March 31, 2014, Chipotle’s sales rose 24.4%, to $904.2 million from $726.8 million a year earlier. The company’s restaurants attracted more customers during the quarter, which pushed up same-restaurant sales by 13.4%. Chipotle also opened 44 new outlets and now has a total of more than 1,600. In all of 2014, it aims to open 180 to 195 locations.

Earnings gained 8.5%, to $83.1 million, or $2.67 a share, from $76.6 million, or $2.47.

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>YAMANA GOLD $8.22 (Toronto symbol YRI; TSINetwork Rating: Speculative) (416-815-0220; www.yamana.com; Shares outstanding: 753.3 million; Market cap: $5.9 billion; Dividend yield: 2.0%) has succeeded in its joint $3.9-billion bid with Agnico Eagle Mines for Osisko Mining. Rival bidder Goldcorp has withdrawn its offer. Agnico Eagle and Yamana will now each own half of Osisko’s assets, including the Canadian Malartic gold mine in Quebec.

The acquisition also lets Yamana diversify beyond South America and Mexico, where it has seven mines. It should also boost the company’s per-share cash flow.

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IMPERIAL METALS $14.41 (Toronto symbol III; TSINetwork Rating: Speculative) (604-669-8959; www.imperialmetals.com; Shares outstanding: 74.9 million; Market cap: $1.1 billion; No dividends paid) is a Vancouver-based firm that produces and explores for base and precious metals.

Imperial’s producing assets include two B.C. mines: 100%-owned Mount Polley (copper and gold) and 50% of Huckleberry (copper and molybdenum). Japan’s Mitsubishi Materials holds 31.1% of Huckleberry, and Furukawa Co., Dowa Holdings and Marubeni Corp. own 6.3% each.

Imperial restarted Mount Polley in 2005 and continues to explore around the deposit to increase the mine’s reserves and lengthen its life. The company expects Mount Polley to produce until mid-2023.

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IAMGOLD $3.71 (Toronto symbol IMG; TSINetwork Rating: Speculative) (1-888-464-9999; www.iamgold.com; Shares outstanding: 376.6 million; Market cap: $1.4 billion; No dividends paid) owns 41% of the Sadiola mine and 40% of the Yatela mine, both located in Mali; 90% of its Essakane gold mine in Burkina Faso; 100% of the Doyon mine in Quebec; and 95% of the Rosebel mine in Suriname, South America.

In addition, IAMGold has a 1% royalty interest in the Diavik diamond mine in the Northwest Territories. It also owns the Niobec niobium mine in Quebec. When used as an additive, niobium makes steel stronger, more heat-resistant and easier to weld.

In the three months ended March 31, 2014, IAMGold’s revenue fell 8.5%, to $279.3 million from $305.3 million a year earlier. Cash flow per share dropped to $0.17 from $0.31. The declines were mostly due to 21.2% lower gold prices and an 8.5% production decrease.

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