SHAWCOR LTD. $55 - Toronto symbol SCL

p>SHAWCOR LTD. $55 (Toronto symbol SCL; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 60.1 million; Market cap: $3.3 billion; Price-to-sales ratio: 1.8; Dividend yield: 1.1%; TSINetwork Rating: Average; www.shawcor.com) makes sealants and coatings that keep oil and natural gas pipelines from rusting. The company also makes industrial products, such as electrical wire and protective sheaths. Thanks to acquisitions and new pipeline-coating contracts in North America and Europe, ShawCor’s revenue rose 5.4% in the three months ended March 31, 2014, to $479.1 million from $454.7 million a year earlier.

However, the company’s earnings declined 12.3%, to $61.9 million from $70.6 million, due to lower profits from joint ventures and higher interest costs and taxes. Per-share earnings rose 2.0%, to $1.03 from $1.01, on fewer shares outstanding.

ShawCor ended the quarter with an order backlog of $642 million. In addition, it is currently bidding on over $800 million worth of new contracts and should win many of them.

The stock trades at a still-reasonable 18.3 times the company’s likely 2014 earnings of $2.84 a share. The $0.60 dividend yields 1.1%.

ShawCor is a buy.

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