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Nutrien Ltd. offers exposure to potash and nitrogen prices, a stable retail base and strong profitability.
Toromont Industries Ltd. should see continued earnings growth thanks to its leading market share and Canada’s plan to increase spending on infrastructure projects.
Top pick Barrick Mining just raised its dividend a whopping 140% as it generates record earnings and continues its strategic asset reorganization.
Warner Music Group Corp. is well-positioned for higher-margin catalog revenues, added streaming adoption, and new AI monetization opportunities.
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DREAM OFFICE REIT $20.59 (Toronto symbol D.UN; TSINetwork Rating: Extra Risk) (416-365-3535; www.dream.ca/office; Units outstanding: 107.9 million; Market cap: $2.3 billion; Dividend yield: 7.3%) is up more than 23% since its recent announcement of a three-year strategic plan to push up its unit price. The trust will sell non-essential properties worth $1.2 billion to realize their full market value. These properties represent about 17% of its holdings. It will use some of the proceeds to pay down debt, and possibly to buy back units. The trust will also cut its annualized distribution by 33.0%, to $1.50 from $2.24. This will lower its payout ratio to 67% of forecast 2016 cash flow. Dream will also suspend its dividend reinvestment program. The DRIP has a high 38% participation rate. That program lets it conserve cash, but issuing more shares at low prices dilutes the interests of current unitholders. The units yield 7.3%....
WAJAX CORP. $16.85 (Toronto symbol WJX; TSINetwork Rating: Extra Risk) (905-212-3300; www.wajax.ca; Shares outstanding:20.0 million; Market cap: $335.9 million; Dividend yield: 5.9%) sells and services cranes, forklifts and other heavy equipment. It also provides related parts (such as ball bearings, motors, hoses and fittings) and power systems (including diesel engines and transmissions). The company’s customers are in the natural resource, construction, manufacturing and transportation industries. In the three months ended December 31, 2015, Wajax’s clients in mining and oil and gas made fewer purchases. As a result, revenue fell 16.0%, to $324.4 million from $386.1 million a year earlier. Earnings, excluding one-time items, declined sharply, to $4.0 million, or $0.20 a share, from $11.0 million, or $0.66....
MCCOY GLOBAL $1.90 (Toronto symbol MCB; TSINetwork Rating: Speculative) (780-453-8451; www.mccoyglobal.com; Shares outstanding: 27.7 million; Market cap: $54.6 million; No dividends paid) sold its heavy-duty truck-trailer unit in 2014 and is now focused on its Energy Products and Services segment. It sells hydraulic gear, including power tongs, for drilling rigs. (Power tongs are large wrench-like tools that tighten and loosen the pipe in the drill hole.) McCoy has international sales and service centres in Singapore, Dubai and Aberdeen, Scotland. In the three months ended December 31, 2015, McCoy’s revenue fell 57.2%, to $11.6 million from $27.2 million a year earlier. Low oil and gas prices prompted clients to cut back on equipment purchases....
Aecon Group Inc. continued to increase its revenue, earnings and dividend with a steady flow of public infrastructure and private road-building contracts.