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
ROYAL BANK OF CANADA $71 (Toronto symbol RY; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 1.4 billion; Market cap: $99.4 billion; Price-to-sales ratio: 2.7; Dividend yield: 3.8%; TSINetwork Rating: Above Average; www.rbc.com) is Canada’s second-largest bank, with $860.8 billion of assets. Royal recently agreed to sell its 13 branches and related operations in Jamaica. The country’s struggling economy has hurt these branches’ profits in the past few years, so selling them frees up cash for Royal to invest in its more promising Caribbean business. The bank will record a one-time loss of $60 million on the deal. Meanwhile, Royal earned $8.4 billion in its 2013 fiscal year, which ended October 31, 2013. That’s up 11.1% from $7.6 billion in 2012. Earnings per share rose 12.4%, to $5.54 from $4.93, on fewer shares outstanding....
SUNCOR ENERGY INC. $36 (Toronto symbol SU; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.5 billion; Market cap: $54.0 billion; Price-to-sales ratio: 1.3; Dividend yield: 2.6%; TSINetwork Rating: Average; www. suncor.com) produced 558,100 barrels of oil equivalent (99% oil and 1% natural gas) a day in the three months ended December 31, 2013. That’s up 0.3% from 556,500 barrels a year earlier. Oil sands production rose 17.9%, to a record 446,500 barrels a day, because Suncor started up a new phase of its Firebag project. That helped offset lower conventional output following the company’s recent sale of a big part of its Western Canadian gas properties. The higher production helped push up Suncor’s revenue by 7.4%, to $10.2 billion from $9.5 billion. However, its average realized price for oil sands bitumen fell 5.2%, and a lack of pipeline capacity is forcing the company to ship more crude by rail. As a result, its earnings fell 1.5%, to $973 million from $988 million....
ENBRIDGE INC. $47 (Toronto symbol ENB; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 831.1 million; Market cap: $39.1 billion; Price-to-sales ratio: 1.2; Dividend yield: 2.7%; TSINetwork Rating: Above Average; www. enbridge.com) plans to expand its storage terminal near northern Alberta’s Christina Lake oil sands project, which will help it take advantage of t h i s p r o p e r t y ’ s r i s i n g production. The company will also build pipes and other infrastructure to connect the expansion with its existing pipelines. This project will cost $200 million. That’s equal to 72% of the $278 million, or $0.34 a share, that Enbridge earned in the third quarter of 2013. It expects to finish construction in the third quarter of 2015. Enbridge is a buy.
TORSTAR CORP. $5.12 (www.torstar.com) continues to cut costs as more people get their news from the Internet. This secular trend is working against newspapers and print advertising. As a result, we’ve cut Torstar’s TSINetwork Rating from “Above Average” to “Average”....
EMERA INC. $33 (www.emera.com) earned $259.4 million in 2013, up 12.5% from $230.5 million in 2012. Due to more shares outstanding, earnings per share rose just 6.0%, to $1.96 from $1.85. Revenue rose 8.3%, to $2.2 billion from $2.1 billion. These increases are mainly due to Emera’s April 2013 purchase of three gas-fired power plants in New England....
CAMPBELL SOUP CO. $43 (New York symbol CPB; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 315.0 million; Market cap: $13.5 billion; Price-to-sales ratio: 1.7; Dividend yield: 2.9%; TSINetwork Rating: Above Average; www.campbellsoupcompany.com) is the world’s largest maker of canned soups. It also makes Prego canned pasta and sauces, Pepperidge Farm cookies and V8 vegetable juices. Wal-Mart accounts for 19% of its sales.




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NORDSTROM INC. $61 (New York symbol JWN; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 193.4 million; Market cap: $11.8 billion; Price-to-sales ratio: 0.9; Dividend yield: 2.0%; TSINetwork Rating: Average; www.nordstrom.com) mainly sells upscale clothing, accessories and footwear.

In Nordstrom’s 2014 fiscal year, which ended February 1, 2014, its sales rose 3.3%, to $12.5 billion from $12.1 billion in 2013. Same-store sales gained 2.5%. Online sales jumped 30%.

Nordstrom continues to open new stores, particularly discount outlets. The related costs were part of the reason why its earnings fell 0.1%, to $734 million from $735 million. Per-share earnings rose 4.2%, to $3.71 from $3.56, on fewer shares outstanding.
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EBAY INC. $57 (Nasdaq symbol EBAY; Aggressive Growth Portfolio, Finance sector; Shares outstanding: 1.3 billion; Market cap: $74.1 billion; Priceto- sales ratio: 4.6; No dividends paid; TSINetwork Rating: Above Average; www.ebay.com) has paid an undisclosed sum for PhiSix Fashion Labs.

This private firm specializes in 3-D computergraphic simulations. eBay plans to use this technology to show customers of its auction and e-commerce websites how they look in different clothing items. This should reduce returns and spur more people to buy clothes online.

eBay is a buy....
NVIDIA CORP. $19 (Nasdaq symbol NVDA; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 568.5 million; Market cap: $10.8 billion; Priceto- sales ratio: 2.8; Dividend yield: 1.8%; TSINetwork Rating: Average; www.nvidia.com) earned $588.4 million in its 2014 fiscal year, which ended January 26, 2014. That’s down 19.2% from $728.4 million in fiscal 2013. Earnings per share fell 15.4%, to $0.99 from $1.17, on fewer shares outstanding.

Revenue declined 3.5%, to $4.1 billion from $4.3 billion. Weak demand for entry-level computers continues to hurt sales of Nvidia’s graphic chips, but sales of high-end desktops and servers remain strong. Sales of its Tegra chips for mobile devices also slowed, particularly in the first half of the year, as customers waited for the company to launch a new version.

Nvidia is a hold.
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