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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ISHARES MSCI JAPAN INDEX FUND $11.76 (New York Exchange symbol EWJ; buy or sell through brokers; us.ishares.com) is an ETF that tries to match the return of the Morgan Stanley Capital International (MSCI) Japan index.
The fund has now regained all of the ground it lost in the recent market downturn. Its latest rise came after the Japanese government and the Bank of Japan announced huge increases in their economic stimulus programs.
Under Prime Minister Shinzo Abe’s so-called “Abenomics” strategy, the Bank of Japan has pumped money into the country’s economy. However, consumer spending has remained sluggish, especially after the government raised the sales tax to 8% from 5% on April 1, 2014.
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The fund has now regained all of the ground it lost in the recent market downturn. Its latest rise came after the Japanese government and the Bank of Japan announced huge increases in their economic stimulus programs.
Under Prime Minister Shinzo Abe’s so-called “Abenomics” strategy, the Bank of Japan has pumped money into the country’s economy. However, consumer spending has remained sluggish, especially after the government raised the sales tax to 8% from 5% on April 1, 2014.
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BCE INC. $51.08 (Toronto symbol BCE; Shares outstanding: 778.1 million; Market cap: $41.8 billion; TSINetwork Rating: Above Average; Dividend yield: 4.8%; www.bce.ca) is Canada’s largest provider of telephone, Internet and wireless services. It also offers satellite and Internet TV across the country.
In the three months ended September 30, 2014, BCE’s earnings per share rose 10.7%, to $0.83 from $0.75 a year earlier. Revenue increased 1.9%, to $5.2 billion from $5.1 billion.
Revenue from wireless services (31% of the total) rose 7.0%. The company’s network upgrades continue to attract new wireless subscribers. It’s also gaining from rising use of smartphones, for which it charges higher service fees than regular cellphones.
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In the three months ended September 30, 2014, BCE’s earnings per share rose 10.7%, to $0.83 from $0.75 a year earlier. Revenue increased 1.9%, to $5.2 billion from $5.1 billion.
Revenue from wireless services (31% of the total) rose 7.0%. The company’s network upgrades continue to attract new wireless subscribers. It’s also gaining from rising use of smartphones, for which it charges higher service fees than regular cellphones.
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Pat McKeough responds to many requests from members of his Inner Circle for specific stock tips as well as questions on investment strategy and the economy. Every week, his comments and recommendations on the most intriguing questions of the past week go out to all Inner Circle members. And each week we offer you a report on one of the stocks profiled in these Q&A sessions. We give you Pat’s buy-hold-sell recommendation as well as his analysis of the stock. This is part of the specific buy, hold and sell advice we offer you in our daily posts. Every week you get “A Stock to Sell” on Monday, “Best Canadian Stocks” on Tuesday, and “U.S. Stock Picks” on Thursday.
This week an Inner Circle Member asked us about a Canadian company that’s an international leader in the aircraft parts industry. Héroux-Devtek is the world’s third-largest maker of landing gear for aircraft, with clients such as Boeing, Embraer and Bombardier. Pat considers the company’s rising earnings in light of a recent acquisition and a new contract with Boeing. He also looks at the impact of shrinking military budgets around the globe on Héroux-Devtek’s prospects.
Q: Pat: What is your opinion on Héroux-Devtek Inc.? Best regards.
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This week an Inner Circle Member asked us about a Canadian company that’s an international leader in the aircraft parts industry. Héroux-Devtek is the world’s third-largest maker of landing gear for aircraft, with clients such as Boeing, Embraer and Bombardier. Pat considers the company’s rising earnings in light of a recent acquisition and a new contract with Boeing. He also looks at the impact of shrinking military budgets around the globe on Héroux-Devtek’s prospects.
Q: Pat: What is your opinion on Héroux-Devtek Inc.? Best regards.
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Every Wednesday, we publish our “Investor Toolkit” series on TSI Network. Whether you’re a beginning or experienced investor, these weekly updates are designed to give you specific investment tips and stock market advice. Each Investor Toolkit update gives you a fundamental piece of investment advice, and shows you how you can put it into practice right away. Today’s tip: “While stock options frequently make a lot of money for brokers, but most investors are more likely to lose with options. Here are seven ways they can cost you money.”...
Every Monday we feature “A Stock to Sell” as our daily post. With every stock we recommend as a sell, we give you a full explanation of why we advise against investing in the stock at this time. Westshore Terminals Investment Corp. (symbol WTE on Toronto; www.westshore.com) owns a coal storage and loading terminal at Roberts Bank, B.C., about 30 kilometres south of Vancouver. The terminal started up in 1970....
Every Tuesday we bring you “Best Canadian Stocks.” You get our specific recommendation on the stocks we profile, with a full explanation of how we arrived at our opinion. You’ll read about stocks making moves you should know about, from coverage in one of our three newsletters featuring Canadian stocks—The Successful Investor, Stock Pickers Digest and Canadian Wealth Advisor.
DOREL INDUSTRIES (Toronto symbol DII.B; www.dorel.com) makes a range of items, including ready-to-assemble home and office furniture; juvenile products, such as car seats, strollers, high chairs, toddler beds and cribs; and recreational goods, mainly bicycles.
In the three months ended June 30, 2014, Dorel’s sales rose 9.2%, to $655.8 million from $600.4 million a year earlier (all figures except share price and market cap in U.S. dollars). Sales rose 20.2% at the recreational segment and 3.2% at the juvenile products division. Home furnishing sales fell slightly.
Earnings per share rose 14.6%, to $0.47 from $0.41. Sales of its highly profitable Cannondale and Pacific Cycle premium bikes remain strong. That offset a small loss from Dorel’s 70% stake in Caloi, which it bought for an undisclosed amount last year.
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DOREL INDUSTRIES (Toronto symbol DII.B; www.dorel.com) makes a range of items, including ready-to-assemble home and office furniture; juvenile products, such as car seats, strollers, high chairs, toddler beds and cribs; and recreational goods, mainly bicycles.
In the three months ended June 30, 2014, Dorel’s sales rose 9.2%, to $655.8 million from $600.4 million a year earlier (all figures except share price and market cap in U.S. dollars). Sales rose 20.2% at the recreational segment and 3.2% at the juvenile products division. Home furnishing sales fell slightly.
Earnings per share rose 14.6%, to $0.47 from $0.41. Sales of its highly profitable Cannondale and Pacific Cycle premium bikes remain strong. That offset a small loss from Dorel’s 70% stake in Caloi, which it bought for an undisclosed amount last year.
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Pat McKeough responds to many requests from members of his Inner Circle for specific advice on the Canadian stock market and other investments as well as questions on investment strategy and the economy. Every week, his comments and recommendations on the most intriguing questions of the past week go out to all Inner Circle members. And each week we offer you a report on one of the stocks profiled in these Q&A sessions. We give you Pat’s buy-hold-sell recommendation as well as his analysis of the stock. This is part of the specific buy, hold and sell advice we offer you in our daily posts. Every week you get “A Stock to Sell” on Monday, “Best Canadian Stocks” on Tuesday, and “Our Top U.S. Stocks” on Thursday. Recently we received a question from an Inner Circle member about a Canadian firm that specializes in mortgages. First National Financial is the largest originator of mortgages outside the banks, with almost $80 billion under administration. Pat examines the strategies by which the company sells and securitizes its mortgages in order to free up capital and looks at the effect these strategies have on the company’s short- and long-term profit margins. Q: Dear Pat: What are your thoughts on First National Financial Corp.? Thanks....
Every Thursday we bring you our best U.S. stock picks. You get our specific recommendation on the top stocks we profile, with a full explanation of how we arrived at our opinion. You will read about stocks making moves you should know about, from coverage in our newsletter on U.S. investing, Wall Street Stock Forecaster.
3M COMPANY (New York symbol MMM; www.3m.com) started up in 1902, when it was called the Minnesota Mining & Manufacturing Company.
It now makes over 55,000 different products, including pressure-sensitive masking and packaging tape, air purifiers, medical device components and reflective highway signs. Top brands include Post-it notes, Scotch tape, Scotch-Brite cleaning products, Scotchguard protection and Thinsulate insulation.
3M’s wide variety of products cuts its reliance on a single industry or customer. Sales from outside the U.S. account for two-thirds of its total.
Because the company’s product base is so broad, its results tend to track the overall global economy. As the world rebounded from the 2008/2009 recession, 3M’s sales jumped 33.5%, from $23.1 billion in 2009 to $30.9 billion in 2013.
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3M COMPANY (New York symbol MMM; www.3m.com) started up in 1902, when it was called the Minnesota Mining & Manufacturing Company.
It now makes over 55,000 different products, including pressure-sensitive masking and packaging tape, air purifiers, medical device components and reflective highway signs. Top brands include Post-it notes, Scotch tape, Scotch-Brite cleaning products, Scotchguard protection and Thinsulate insulation.
3M’s wide variety of products cuts its reliance on a single industry or customer. Sales from outside the U.S. account for two-thirds of its total.
Because the company’s product base is so broad, its results tend to track the overall global economy. As the world rebounded from the 2008/2009 recession, 3M’s sales jumped 33.5%, from $23.1 billion in 2009 to $30.9 billion in 2013.
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Every Wednesday, we publish our “Investor Toolkit” series on TSI Network. Whether you’re a beginning or experienced investor, these weekly updates are designed to give you specific investment advice. Each Investor Toolkit update gives you a fundamental piece of strategy, including advice on various ways of investing money, and shows you how you can put it into practice right away. In this case, the tip comes from a Member of my Inner Circle. Members can ask me and my investment team financial questions of any kind. Aside from questions on specific investments, members ask many other questions about how they should be investing their money....
IMPERIAL OIL $52.18 (Toronto symbol IMO; Shares outstanding: 847.6 million; Market cap: $44.9 billion; TSINetwork Rating: Average; Div. yield: 1.0%; www.imperialoil.ca) has begun converting its 95-year-old refinery in Dartmouth, Nova Scotia, into a storage facility for refined petroleum products, such as gasoline, diesel and home heating oil....