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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GEORGE WESTON LTD. $109.43 (Toronto symbol WN; Shares outstanding: 128.0 million; Market cap: $14.0 billion; TSINetwork Rating: Above Average; Dividend yield: 1.6%) makes a number of products through Weston Foods. Its businesses include fresh and frozen bakery and cookie operations in Canada and plants that make frozen bakery items, biscuits, cookies, cones and wafers in the U.S.
Weston also owns 46% of Loblaw (see above) and 5.5% of Choice Properties REIT (Toronto symbol CHP.UN). Choice owns 519 properties, mainly supermarket- and drugstore-anchored shopping malls and stand-alone supermarkets and pharmacies. Loblaw holds 83.0% of Choice and accounts for 91.0% of the REIT’s earnings.
In the three months ended October 10, 2015, Weston’s revenue rose 2.9%, to $14.4 billion from $14.0 billion a year earlier.
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Weston also owns 46% of Loblaw (see above) and 5.5% of Choice Properties REIT (Toronto symbol CHP.UN). Choice owns 519 properties, mainly supermarket- and drugstore-anchored shopping malls and stand-alone supermarkets and pharmacies. Loblaw holds 83.0% of Choice and accounts for 91.0% of the REIT’s earnings.
In the three months ended October 10, 2015, Weston’s revenue rose 2.9%, to $14.4 billion from $14.0 billion a year earlier.
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LOBLAW COMPANIES $66.80 (Toronto symbol L; Shares outstanding: 412.4 million; Market cap: $27.6 billion; TSINetwork Rating: Above Average; Dividend yield: 1.5%; www.loblaw.ca) is Canada’s largest food retailer, with about 1,200 supermarkets. Its banners include Loblaws, Provigo, Fortinos, Real Canadian Superstore and No Frills. George Weston Ltd. (see below) owns 46% of the company.
In the three months ended October 10, 2015, Loblaw earned $408 million, or $0.99 a share, up 10.0% from $371 million, or $0.90, a year earlier. Sales rose 2.5%, to $13.9 billion from $13.6 billion. Excluding gasoline, same-store sales rose 3.1% at Loblaw and 4.9% at the 1,300-store Shoppers Drug Mart chain, which the company bought for $12.3 billion in March 2014.
Loblaw continues to integrate its operations with Shoppers Drug. It expects these moves to save it at least $222 million in 2016.
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In the three months ended October 10, 2015, Loblaw earned $408 million, or $0.99 a share, up 10.0% from $371 million, or $0.90, a year earlier. Sales rose 2.5%, to $13.9 billion from $13.6 billion. Excluding gasoline, same-store sales rose 3.1% at Loblaw and 4.9% at the 1,300-store Shoppers Drug Mart chain, which the company bought for $12.3 billion in March 2014.
Loblaw continues to integrate its operations with Shoppers Drug. It expects these moves to save it at least $222 million in 2016.
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TORSTAR $3.13 (Toronto symbol TS.B; Shares outstanding: 79.9 million; Market cap: $254.3 million; TSINetwork Rating: Average; Dividend yield: 8.2%; www.torstar.com) lost $164.8 million, or $2.04 a share, in the three months ended September 30, 2015. A year earlier, it lost $87.0 million, or $1.08 a share.
Excluding costs related to job cuts and other measures in response to falling ad revenue at Torstar’s newspapers, the company lost $10.4 million, or $0.13 a share, in the latest quarter. Torstar expects its restructuring to cut $9.3 million from its annual costs in 2015 and a further $14.3 million in 2016.
Overall revenue declined 7.3%, to $185.4 million from $199.9 million. Lower ad sales cut revenue at both the free weekly newspapers and flyer-distribution operations, as well as at the Toronto Star and other daily papers.
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Excluding costs related to job cuts and other measures in response to falling ad revenue at Torstar’s newspapers, the company lost $10.4 million, or $0.13 a share, in the latest quarter. Torstar expects its restructuring to cut $9.3 million from its annual costs in 2015 and a further $14.3 million in 2016.
Overall revenue declined 7.3%, to $185.4 million from $199.9 million. Lower ad sales cut revenue at both the free weekly newspapers and flyer-distribution operations, as well as at the Toronto Star and other daily papers.
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TRANSCANADA CORP. $42.69 (Toronto symbol TRP; Shares outstanding: 708.9 million; Market cap: $30.7 billion; TSINetwork Rating: Above Average; Dividend yield: 4.9%; www.transcanada.com) recently had its proposed Keystone XL pipeline rejected by the U.S. The line would have pumped oil sands crude to refineries on the U.S. Gulf Coast.
So far, TransCanada has spent $2.4 billion U.S. on this $8.0-billion U.S. project. However, it can use some of the line’s equipment on other projects, which would minimize a writedown.
Meanwhile, TransCanada has $35 billion of large-scale projects underway, as well as $13 billion in small- to medium sized developments set to come into service in the next three years.
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So far, TransCanada has spent $2.4 billion U.S. on this $8.0-billion U.S. project. However, it can use some of the line’s equipment on other projects, which would minimize a writedown.
Meanwhile, TransCanada has $35 billion of large-scale projects underway, as well as $13 billion in small- to medium sized developments set to come into service in the next three years.
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TELUS $42.20 (Toronto symbol T; Shares outstanding: 605.0 million; Market cap: $25.5 billion; TSINetwork Rating: Above Average; Dividend yield: 4.1%; www.telus.com) earned $398 million in the three months ended September 30, 2015, up 2.8% from $387 million a year earlier. Earnings per share rose 3.1%, to $0.66 from $0.64, on fewer shares outstanding. Revenue gained 4.2%, to $3.2 billion from $3.0 billion.
Telus continues to sign up high-speed Internet and TV customers, which is helping offset lower demand for traditional phone services.
The company now aims to improve its earnings by cutting 3% of its workforce. That should lower its annual costs by $100 million to $125 million.
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Telus continues to sign up high-speed Internet and TV customers, which is helping offset lower demand for traditional phone services.
The company now aims to improve its earnings by cutting 3% of its workforce. That should lower its annual costs by $100 million to $125 million.
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ISHARES MSCI BRAZIL INDEX FUND $23.14 (New York symbol EWZ; buy or sell through brokers) is an ETF that’s designed to track the Brazilian stock market.
Its top holdings are AmBev SA (beer and beverages), 10.6%; Cia Itau Unibanco Holding (banking), 10.2%; Petrobras (oil and gas), 6.8%; Banco Brandesco SA, 6.4%; BRF SA (food), 4.3%; Cielo SA (payment processing), 3.9%; Ultrapar SA (gas distribution and petrochemicals), 3.0%; and Itausa Investimentos SA (financial services), 2.8%. The ETF was launched on July 10, 2000. It has a 0.62% expense ratio.
Sluggish exports and low resource prices continue to slow Brazil’s economic growth. State-controlled oil and gas giant Petrobras is also in the midst of a huge corruption scandal. As well, president Dilma Rousseff, re-elected in late 2014, has yet to fulfill her promises of less growth-inhibiting government intervention in the economy.
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Its top holdings are AmBev SA (beer and beverages), 10.6%; Cia Itau Unibanco Holding (banking), 10.2%; Petrobras (oil and gas), 6.8%; Banco Brandesco SA, 6.4%; BRF SA (food), 4.3%; Cielo SA (payment processing), 3.9%; Ultrapar SA (gas distribution and petrochemicals), 3.0%; and Itausa Investimentos SA (financial services), 2.8%. The ETF was launched on July 10, 2000. It has a 0.62% expense ratio.
Sluggish exports and low resource prices continue to slow Brazil’s economic growth. State-controlled oil and gas giant Petrobras is also in the midst of a huge corruption scandal. As well, president Dilma Rousseff, re-elected in late 2014, has yet to fulfill her promises of less growth-inhibiting government intervention in the economy.
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ISHARES MSCI AUSTRALIA ETF $19.43 (New York symbol EWA; buy or sell through brokers) is an ETF that holds the 71 largest Australian stocks. The fund’s top holdings include Commonwealth Bank of Australia, 12.1%; Westpac Banking Corp., 9.3%; National Australia Bank, 6.9%; Australia and New Zealand Banking Group, 6.7%; BHP Billiton, 5.4%; CSL Ltd., 4.2%; Wesfarmers, 3.8%; Woolworths Ltd., 2.7%; Macquarie Group, 2.2%; and Telstra Corp., 2.1%. The ETF’s industry breakdown consists of Financials, 53.0%; Materials, 14.4%; Consumer Staples, 7.8%; Industrials, 6.3%; Health Care, 6.0%; Energy, 3.9%; Telecommunications, 2.5%; Consumer Discretionary, 2.2%; and Utilities, 2.1%.
The iShares MSCI Australia ETF was launched on March 12, 1996. It has a 0.48% expense ratio. Australia benefits from its stable banking and political systems and is rich in natural resources. Low commodity prices have hurt the country’s economy, but its proximity to Asian markets with vast potential, including India and China, gives it strong long-term prospects.
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ISHARES MSCI CHILE INVESTABLE MARKET INDEX FUND $31.91 (New York symbol ECH; buy or sell through brokers) is an ETF that aims to track the MSCI Chile Investable Market Index, which consists of stocks that mainly trade on the Santiago Stock Exchange.
The fund’s largest holdings are Enersis SA (electricity), 10.1%; Empresas Copec SA (conglomerate), 8.1%; Empresa Nacional de Electricidad (electricity), 8.1%; S.A.C.I. Falabella (retail), 6.1%; Banco Santander Chile (banking), 5.9%; Empresas CMPC (pulp and paper), 5.4%; Cencosud SA (retailer), 5.3%; Colbun SA (utility), 4.4%; and Banco de Chile, 4.2%.
The ETF’s industry breakdown consists of Utilities, 31.2%; Financials, 19.7%; Materials, 13.7%; Consumer Staples, 9.6%; Energy, 8.4%; Consumer Discretionary, 7.4%; Industrials, 5.3%; Telecommunications, 2.5%; and Information Technology, 1.7%.
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The fund’s largest holdings are Enersis SA (electricity), 10.1%; Empresas Copec SA (conglomerate), 8.1%; Empresa Nacional de Electricidad (electricity), 8.1%; S.A.C.I. Falabella (retail), 6.1%; Banco Santander Chile (banking), 5.9%; Empresas CMPC (pulp and paper), 5.4%; Cencosud SA (retailer), 5.3%; Colbun SA (utility), 4.4%; and Banco de Chile, 4.2%.
The ETF’s industry breakdown consists of Utilities, 31.2%; Financials, 19.7%; Materials, 13.7%; Consumer Staples, 9.6%; Energy, 8.4%; Consumer Discretionary, 7.4%; Industrials, 5.3%; Telecommunications, 2.5%; and Information Technology, 1.7%.
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ISHARES MSCI GERMANY FUND $26.83 (New York symbol EWG; buy or sell through brokers) tracks the stocks in the MSCI Germany Index. This index aims to replicate 85% of the market capitalization of the German stock market. The remaining 15% is unavailable for investment, partly due to limitations on foreign ownership. The ETF’s top holdings are Bayer (diversified chemicals), 9.6%; Daimler (automobiles), 7.3%; Siemens (engineering conglomerate), 7.1%; Allianz (insurance), 7.1%; SAP (software), 6.8%; BASF (chemicals), 6.6%; Deutsche Telekom, 5.1%; BMW AG, 3.1%; Deutsche Bank AG, 3.1%; Munich Reinsurance, 2.9%; Linde AG (industrial gases), 2.9%; Deutsche Post, 2.5%; and Fresenius (health care), 2.4%.
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ISHARES MSCI SOUTH KOREA INDEX FUND $52.74 (New York symbol EWY; buy or sell through brokers) aims to track the MSCI Korea Index. The ETF’s top holdings are Samsung Electronics, 24.6%; Hyundai Motor, 3.6%; SK Hynix Semiconductor, 2.8; Shinhan Financial, 2.8%; Naver (Internet), 2.8%; Hyundai Mobis (auto parts), 2.7%; LG Chemicals, 2.4%; Kia Motors, 2.2%; KB Financial, 2.2%; AmorePacific Corp. (cosmetics), 2.1%; Korea Electric Power, 2.0%; KT&G Corp. (tobacco), 1.8%; and Posco (steel), 1.8%.
The iShares MSCI South Korea Index Fund was launched on May 9, 2000. Its expense ratio is 0.62%. South Korea has Asia’s fourth-largest economy, after China, Japan and India. It is heavily reliant on exports, but shipments to the U.S. are rebounding, offsetting weakness in Europe and China.
The steady rise of South Korea’s currency, the won, hurt its economy in 2012 and 2013 by making its goods more expensive for foreign buyers. But South Korea has cut interest rates to record lows, bringing the won back down to five-year lows against the U.S. dollar and boosting exports.
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The iShares MSCI South Korea Index Fund was launched on May 9, 2000. Its expense ratio is 0.62%. South Korea has Asia’s fourth-largest economy, after China, Japan and India. It is heavily reliant on exports, but shipments to the U.S. are rebounding, offsetting weakness in Europe and China.
The steady rise of South Korea’s currency, the won, hurt its economy in 2012 and 2013 by making its goods more expensive for foreign buyers. But South Korea has cut interest rates to record lows, bringing the won back down to five-year lows against the U.S. dollar and boosting exports.
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