How To Invest
In addition, Pat thinks then beginner investors should cultivate two important qualities: a healthy sense of skepticism and patience.
Investors should approach all investments with a healthy sense of skepticism. This can help keep you out of fraudulent stocks that masquerade as high-quality stocks. It will also keep you out of legally operated, but poorly managed, companies that promise more than they can possibly deliver.
If you are a new investor, you should also realize that losing patience can cause you to sell your best choices right before a big rise. All too often, investors buy a promising stock just as it enters a period of price stagnation. Even the best-performing stocks run into these unpredictable phases from time to time. They move mainly sideways in a wide range for months or years before their next big rise begins. (Stock brokers often refer to these stocks as “dead money.”)
If you lack patience, you run a big risk of selling your best choices in the midst of one of these phases, prior to the next big move upward. If you lose patience and sell, you are particularly likely to do so in the low end of the trading range, when stock prices have weakened and confidence in the stock has waned.
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IMPERIAL OIL $40.37 (Toronto symbol IMO; Shares outstanding: 847.6 million; Market cap: $34.2 billion; TSINetwork Rating: Average; Dividend yield: 1.5%; www.imperialoil.ca) is raising its quarterly dividend by 7.1% with the July 2016 payment, to $0.15 from $0.14. The company has paid dividends every year for over a century and has increased its annual dividend payment for 21 consecutive years. Imperial Oil is a buy....
CANADIAN PACIFIC RAILWAY $181.49 (Toronto symbol CP; Shares outstanding: 153.0 million; Market cap: $27.8 billion; TSINetwork Rating: Above Average; Dividend yield: 1.1%; www.cpr.ca) has abandoned its plan to merge with U.S.-based railway Norfolk Southern Corp. (New York symbol NSC). Norfolk rejected CP’s latest offer of about $30 billion U.S. in cash and shares. In addition, U.S. transportation regulators probably would have blocked any deal no matter how CP structured the transaction. The company will now use some of the cash it had set aside for the takeover to raise its quarterly dividend by 42.9%, starting with the July 2016 payment. The new annual rate of $2.00 a share yields 1.1%....
Trading on the after hours market can easily do more harm than good to your portfolio returns.
Imperial Oil is selling its remaining Esso gas stations. This will let the company focus on its oil sands operations. These projects will prosper when oil prices recover, and enhance the company’s growth prospects. IMPERIAL OIL $41.25 (Toronto symbol IMO; Shares outstanding: 847.6 million; Market cap: $34.4 billion; TSINetwork Rating: Average; Dividend yield: 1.4%; www.imperialoil.ca) is a major integrated oil company with oil sands projects in Alberta and conventional oil and gas operations across Western Canada. It also operates three refineries. Imperial is now selling its 497 company-owned Esso gas stations to independent operators for $2.8 billion. Following the sale, franchisees will operate all 1,700 Esso stations across Canada....
TRANSCANADA CORP. $49.18 (Toronto symbol TRP; Shares outstanding: 709.0 million; Market cap: $34.3 billion; TSINetwork Rating: Above Average; Dividend yield: 4.6%; www.transcanada.com) has run into difficulties lately in gaining approvals for new pipelines, including Energy East in Canada and Keystone XL in the U.S. However, the company has moved forward with its proposed acquisiton of Texas-based Columbia Pipeline Group (New York symbol GPCX) for $13 billion U.S. This is a big purchase for TransCanada, which has a market cap of $35.4 billion (Canadian)....
PEMBINA PIPELINE $34.61 (Toronto symbol PPL; Shares outstanding: 373.4 million; Market cap: $12.7 billion; TSINetwork Rating: Average; Dividend yield: 5.0%; www.pembina.com) owns pipelines that carry half of Alberta’s conventional oil and almost all of B.C.’s oil. It also carries 30% of Western Canada’s natural gas liquids (NGLs). Pembina owns extensive facilities to extract, process and store NGLs, as well as natural gas processing plants. In the three months ended December 31, 2015, the company’s cash flow per share jumped 57.0%, to $0.77 from $0.49 a year earlier. New plants starting up boosted volumes at its NGL extraction business....
ALGONQUIN POWER & UTILITIES CORP. $10.72 (Toronto symbol AQN; Shares outstanding: 255.8 million; Market cap: $2.8 billion; TSINetwork Rating: Extra Risk; Dividend yield: 4.8%; www.algonquinpower.com) has tripled in size in the past three years, mostly through acquisitions. The company’s regulated utility businesses now provide water, electricity and gas to over 560,000 customers, up sharply from 120,000 three years ago. Its hydroelectric, thermal energy, solar and wind plants generate 1,050 megawatts, up from 460. Emera (Toronto symbol EMA) owns 20.9% of Algonquin. It is a recommendation of The Successful Investor, our conservative growth advisory....
INNERGEX RENEWABLE ENERGY $13.82 (Toronto symbol INE; Shares outstanding: 104.0 million; Market cap: $1.4 billion; TSINetwork Rating: Extra Risk; Dividend yield 4.6%; www.innergex.com) has acquired eight wind power projects in northern France from a German company for $137 million. The purchase includes seven operating plants with 87 megawatts of generating capacity, plus a 44-megawatt project now under construction. All power generated at the eight plants is already sold under long-term power-purchase contracts averaging 13 years in length. The acquisition is Innergex’s first in Europe. It sees France as a big growth market and plans to buy or build more plants....
SUN LIFE FINANCIAL $41.71 (Toronto symbol SLF; Shares outstanding: 612.3 million; Market cap: $25.4 billion; TSINetwork Rating: Above Average; Dividend yield: 3.7%; www.sunlife.ca) sells life insurance, savings, retirement and pension products to individuals and corporations. The company has $891.3 billion of assets under management and mainly operates in Canada, the U.S. and the U.K. It’s also expanding in Asia. In the three months ended December 31, 2015, Sun Life’s earnings per share rose 7.4%, to $0.87 from $0.81. The company continues to diversify in the U.S. At the same time, it’s focusing on highly profitable niche markets with low capital requirements....
MANULIFE FINANCIAL CORP. $18.04 (Toronto symbol MFC; Shares outstanding: 2.0 billion; Market cap: $35.1 billion; TSINetwork Rating: Above Average; Dividend yield: 4.1%; www.manulife.ca) sells life and other related forms of insurance, as well as mutual funds and investment management services. In the three months ended December 31, 2015, Manulife’s earnings per share dropped sharply, to $0.11 from $0.33. That was largely due to writedowns in the value of its own investments in oil and gas stocks. However, excluding one-time items, per-share earnings rose 16.7%, to $0.42 from $0.36. The company continues to expand in growing Asian markets. Right now, about 40% of its insurance premiums come from that region....