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.
[text_ad use_category="18"]
Read More
Close
PENGROWTH ENERGY $7.12 (Toronto symbol PGF; Shares outstanding: 526.2 million; Market cap: $3.7 billion; TSINetwork Rating: Average; Dividend yield: 6.7%; www.pengrowth.com) produced 75,102 barrels a day (55% oil and natural gas liquids, 45% natural gas) in the first quarter of 2014, down 16.3% from 89,702 a year earlier.
The drop was mainly because Pengrowth sold several less important oil and gas properties in Western Canada. It’s investing the proceeds in more promising projects, including its Lindbergh oil sands development in Alberta’s Cold Lake region.
Pengrowth’s cash flow, which excludes these losses, fell 6.9%, to $0.27 a share from $0.29. However, that beat the consensus estimate of $0.25.
...
The drop was mainly because Pengrowth sold several less important oil and gas properties in Western Canada. It’s investing the proceeds in more promising projects, including its Lindbergh oil sands development in Alberta’s Cold Lake region.
Pengrowth’s cash flow, which excludes these losses, fell 6.9%, to $0.27 a share from $0.29. However, that beat the consensus estimate of $0.25.
...
BONAVISTA ENERGY $16.63 (Toronto symbol BNP; Shares outstanding: 189.3 million; Market cap: $3.3 billion; TSINetwork Rating: Extra Risk; Dividend yield: 5.1%; www.bonavistaenergy.com) explores for oil and natural gas in Alberta, Saskatchewan and British Columbia. Its production is 65% gas and 35% oil.
In the three months ended March 31, 2014, Bonavista’s cash flow per share gained 40.4%, to $0.80 from $0.57 a year earlier. Production rose just 2.2%, to 73,936 barrels of oil equivalent a day from 72,333. But its realized gas price jumped 55.5%, to an average of $5.07 per thousand cubic feet from $3.26, while oil prices rose 6.2%, to $79.68 a barrel from $75.05.
Bonavista plans to spend $580 million to $600 million on exploration and development in 2014. Its plans include drilling 130 to 135 wells, which will let it raise its average 2014 production as high as 77,000 barrels of oil equivalent a day. For all of 2013, Bonavista spent $460 million to drill 126 wells.
...
In the three months ended March 31, 2014, Bonavista’s cash flow per share gained 40.4%, to $0.80 from $0.57 a year earlier. Production rose just 2.2%, to 73,936 barrels of oil equivalent a day from 72,333. But its realized gas price jumped 55.5%, to an average of $5.07 per thousand cubic feet from $3.26, while oil prices rose 6.2%, to $79.68 a barrel from $75.05.
Bonavista plans to spend $580 million to $600 million on exploration and development in 2014. Its plans include drilling 130 to 135 wells, which will let it raise its average 2014 production as high as 77,000 barrels of oil equivalent a day. For all of 2013, Bonavista spent $460 million to drill 126 wells.
...
PEYTO EXPLORATION & DEVELOPMENT CORP. $39.25 (Toronto symbol PEY; Shares outstanding: 153.7 million; Market cap: $6.1 billion; TSINetwork Rating: Extra Risk; Dividend yield: 3.1%; www.peyto.com) produces and explores for oil and natural gas in Alberta. Its average daily production of 72,209 barrels of oil equivalent is 90% gas and 10% oil.
In the quarter ended March 31, 2014, Peyto’s cash flow rose 53.6%, to $1.06 a share from $0.69 a year earlier. That’s because the company raised its production by 30.4%. Gas prices also gained 27.5%, to an average of $4.45 per thousand cubic feet from $3.49, while oil prices rose 6.1%, to $80.49 a barrel from $75.88.
Peyto plans to spend $625 million on exploration and development in 2014, which will let it drill 110 to 125 wells. To put that in context, the company spent $578 million to drill 99 wells in 2013.
...
In the quarter ended March 31, 2014, Peyto’s cash flow rose 53.6%, to $1.06 a share from $0.69 a year earlier. That’s because the company raised its production by 30.4%. Gas prices also gained 27.5%, to an average of $4.45 per thousand cubic feet from $3.49, while oil prices rose 6.1%, to $80.49 a barrel from $75.88.
Peyto plans to spend $625 million on exploration and development in 2014, which will let it drill 110 to 125 wells. To put that in context, the company spent $578 million to drill 99 wells in 2013.
...
BELL ALIANT INC. $28.91 (Toronto symbol BA; Shares outstanding: 227.8 million; Market cap: $6.5 billion; TSINetwork Rating: Average; Dividend yield: 6.6%; www.aliant.ca) continues to invest heavily in fibre optic networks. It now has 963,048 high-speed Internet users (up 3.9% from a year earlier) and 189,781 digital TV customers (up 38.3%).
However, lower demand for regular phone services cut Bell Aliant’s revenue by 1.2%, to $675.7 million, in the three months ended March 31, 2014, from $683.6 million a year earlier. Before one-time items, earnings declined 9.1%, to $0.40 a share from $0.44.
Due to the cost of Bell Aliant’s network upgrades, its annual dividend of $1.90 a share (6.6% yield) accounts for over 100% of its cash flow, after capital expenditures. However, that payout ratio should drop to 75% to 85% after it finishes these projects by 2016. The stock trades at a high, but still reasonable, 18.1 times its forecast 2014 earnings of $1.60 a share.
...
However, lower demand for regular phone services cut Bell Aliant’s revenue by 1.2%, to $675.7 million, in the three months ended March 31, 2014, from $683.6 million a year earlier. Before one-time items, earnings declined 9.1%, to $0.40 a share from $0.44.
Due to the cost of Bell Aliant’s network upgrades, its annual dividend of $1.90 a share (6.6% yield) accounts for over 100% of its cash flow, after capital expenditures. However, that payout ratio should drop to 75% to 85% after it finishes these projects by 2016. The stock trades at a high, but still reasonable, 18.1 times its forecast 2014 earnings of $1.60 a share.
...
VANGUARD FTSE EMERGING MARKETS ETF $42.42 (New York symbol VWO; buy or sell through brokers) aims to track the Financial Times Stock Exchange (FTSE) Transitions Index, which is made up of common stocks of companies in developing countries. The fund has an MER of just 0.15%.
Vanguard FTSE Emerging Markets ETF’s top holdings include Taiwan Semiconductor (Taiwan: computer chips), China Mobile (China: wireless), Petroleo Brasileiro SA (Brazil: oil and gas), Vale SA (Brazil: mining), Gazprom (Russia: gas utility), China Construction Bank, Tencent Holdings (China: Internet), Industrial & Commercial Bank of China, Naspers Ltd. (South Africa: media) and MTN Group (South Africa: wireless).
The $59.3-billion fund’s breakdown by country is as follows: China (20.6%), Taiwan (13.7%), Brazil (13.7%), India (9.9%), South Africa (9.7%), Mexico (5.7%), Russia (5.4%), Malaysia (5.2%), Indonesia (2.9%), Thailand (2.8%), Turkey (1.9%), Chile (1.7%), Poland (1.7%) and others (5.1%).
...
Vanguard FTSE Emerging Markets ETF’s top holdings include Taiwan Semiconductor (Taiwan: computer chips), China Mobile (China: wireless), Petroleo Brasileiro SA (Brazil: oil and gas), Vale SA (Brazil: mining), Gazprom (Russia: gas utility), China Construction Bank, Tencent Holdings (China: Internet), Industrial & Commercial Bank of China, Naspers Ltd. (South Africa: media) and MTN Group (South Africa: wireless).
The $59.3-billion fund’s breakdown by country is as follows: China (20.6%), Taiwan (13.7%), Brazil (13.7%), India (9.9%), South Africa (9.7%), Mexico (5.7%), Russia (5.4%), Malaysia (5.2%), Indonesia (2.9%), Thailand (2.8%), Turkey (1.9%), Chile (1.7%), Poland (1.7%) and others (5.1%).
...
VANGUARD GROWTH ETF $97.09 (New York symbol VUG; buy or sell through brokers) aims to track the Center for Research in Security Prices (CRSP) U.S. Large Cap Growth Index, a broadly diversified index that mainly consists of stocks of large U.S. companies. The fund’s MER is just 0.09%.
The $38.0-billion Vanguard Growth ETF’s top holdings are Apple, Google, Coca-Cola, Philip Morris International, Oracle, Schlumberger, Comcast, Qualcomm, Gilead Sciences and Walt Disney Co.
The fund’s breakdown by industry is as follows: Technology (24.1%), Consumer Services (19.7%), Financials (12.4%), Industrials (12.1%), Health Care (11.0%), Consumer Goods (10.5%), Oil and Gas (7.9%), Materials (1.7%), Utilities (0.4%) and Telecommunication Services (0.2%).
...
The $38.0-billion Vanguard Growth ETF’s top holdings are Apple, Google, Coca-Cola, Philip Morris International, Oracle, Schlumberger, Comcast, Qualcomm, Gilead Sciences and Walt Disney Co.
The fund’s breakdown by industry is as follows: Technology (24.1%), Consumer Services (19.7%), Financials (12.4%), Industrials (12.1%), Health Care (11.0%), Consumer Goods (10.5%), Oil and Gas (7.9%), Materials (1.7%), Utilities (0.4%) and Telecommunication Services (0.2%).
...
BANK OF NOVA SCOTIA $70.50 (Toronto symbol BNS; Shares outstanding: 1.2 billion; Market cap: $85.4 billion; TSINetwork Rating: Above Average; Dividend yield: 3.6%, www.scotiabank.com) has agreed to buy 20% of the credit card division of Canadian Tire Corp. (Toronto symbol CTC.A and a recommendation of The Successful Investor).
This business is Canada’s eighth-largest credit card issuer, with 1.8 million clients and $4.4 billion in outstanding loans. Its cardholders spend $1.2 billion annually.
The bank will pay $500 million for this stake, and Canadian Tire has an option to sell an additional 29% to Bank of Nova Scotia over the next 10 years.
...
This business is Canada’s eighth-largest credit card issuer, with 1.8 million clients and $4.4 billion in outstanding loans. Its cardholders spend $1.2 billion annually.
The bank will pay $500 million for this stake, and Canadian Tire has an option to sell an additional 29% to Bank of Nova Scotia over the next 10 years.
...
VERESEN $17.50 (Toronto symbol VSN; Shares outstanding: 219.7 million; Market cap: $3.8 billion; TSINetwork Rating: Average; Dividend yield: 5.7%) owns pipelines, power plants and gas-processing facilities across North America.
A major holding is 50% of the Alliance gas line, which runs 3,000 kilometres between Chicago and Fort St. John, B.C. Veresen also owns the Alberta Ethane Gathering System, 42.7% of the Aux Sable NGL plant, and the Hythe/Steeprock natural gas gathering and processing complex in the Cutbank Ridge region of Alberta and B.C.
To diversify its operations, the company is expanding into power generation, including hydroelectric facilities, wind farms and natural gas-fired plants.
...
A major holding is 50% of the Alliance gas line, which runs 3,000 kilometres between Chicago and Fort St. John, B.C. Veresen also owns the Alberta Ethane Gathering System, 42.7% of the Aux Sable NGL plant, and the Hythe/Steeprock natural gas gathering and processing complex in the Cutbank Ridge region of Alberta and B.C.
To diversify its operations, the company is expanding into power generation, including hydroelectric facilities, wind farms and natural gas-fired plants.
...
PEMBINA PIPELINE $44.90 (Toronto symbol PPL; Shares outstanding: 323.0 million; Market cap: $14.5 billion; TSINetwork Rating: Average; Dividend yield: 3.9%; www.pembina.com) owns pipelines that carry half of Alberta’s conventional oil, 30% of Western Canada’s natural gas liquids (NGLs) and almost all of B.C.’s conventional oil.
Pembina bought rival Provident Energy for $3.2 billion in 2012. Provident extracts, transports and stores natural gas liquids (NGLs).
This acquisition is now paying off: in the quarter ended March 31, 2014, Pembina’s cash flow rose 30.6%, to $264.0 million from $202.0 million a year earlier. Cash flow per share gained 22.1%, to $0.83 from $0.68, on more shares outstanding. Pipeline expansions and strong profit margins at Provident were the main reasons for the gains.
...
Pembina bought rival Provident Energy for $3.2 billion in 2012. Provident extracts, transports and stores natural gas liquids (NGLs).
This acquisition is now paying off: in the quarter ended March 31, 2014, Pembina’s cash flow rose 30.6%, to $264.0 million from $202.0 million a year earlier. Cash flow per share gained 22.1%, to $0.83 from $0.68, on more shares outstanding. Pipeline expansions and strong profit margins at Provident were the main reasons for the gains.
...
GLOBAL X COPPER MINERS ETF $10.03 (New York symbol COPX; buy or sell through brokers; www.globalxfunds.com) tracks the Solactive Global Copper Miners Index, which includes 20 to 40 international companies that mine, refine or explore for copper. Germany-based Structured Solutions AG created this index.
Canadian firms make up 41.4% of the fund’s holdings. It also includes companies based in Australia (14.8%), Poland (4.5%), Peru (5.1%) and Mexico (5.0%). Global X Copper Miners ETF’s MER is 0.65%.
Its top holdings are Panaust Ltd. at 6.0%; Vedanta Resources, 5.4%; Oz Minerals, 5.2%; First Quantum Minerals, 5.0%; Imperial Metals, 4.9%; Hudbay Minerals, 4.9%; Kazakhmys, 4.9%; Lundin Mining, 4.9%; Grupo Mexico, 4.7%; Freeport Copper, 4.6%; and Glencore International, 4.6%.
...
Canadian firms make up 41.4% of the fund’s holdings. It also includes companies based in Australia (14.8%), Poland (4.5%), Peru (5.1%) and Mexico (5.0%). Global X Copper Miners ETF’s MER is 0.65%.
Its top holdings are Panaust Ltd. at 6.0%; Vedanta Resources, 5.4%; Oz Minerals, 5.2%; First Quantum Minerals, 5.0%; Imperial Metals, 4.9%; Hudbay Minerals, 4.9%; Kazakhmys, 4.9%; Lundin Mining, 4.9%; Grupo Mexico, 4.7%; Freeport Copper, 4.6%; and Glencore International, 4.6%.
...