Search

REITMANS (CANADA) LTD. $4.07 (Toronto symbol RET.A; TSINetwork Rating: Extra Risk) (514-384- 1140; www.reitmans.com; Shares outstanding: 64.6 million; Market cap: $254.5 million; Dividend yield: 4.9%) owns 775 women’s clothing stores across Canada. The chain consists of 332 Reitmans, 136 Penningtons, 107 Addition Elle, 83 RW & Co., 68 Thyme Maternity, 17 HYBA and 32 Smart Set outlets. It also has 21 Thyme Maternity boutiques in Canadian Babies “R” Us stores. On October 8, 2015, the company opened its 17 new HYBA women’s activewear stores across Canada. Activewear is one of the country’s fastest growing clothing categories....

LEON’S FURNITURE LTD. $14.05 (Toronto symbol LNF; TSINetwork Rating: Average) (416-243-7880; www.leons.ca; Shares outstanding: 71.4 million; Market cap: $1.0 billion; Dividend yield: 2.8%) has steadily opened new stores, growing from 27 in 2003 to 80 today. The company more than quadrupled in size overnight with its March 2013 purchase of its main rival, The Brick, for $700 million. The Brick has 221 locations across Canada; the chains continue to operate separately. In the three months ended September 30, 2015, the company’s sales rose 1.2%, to $538.1 million from $531.7 million a year earlier. On a same-store basis, sales gained 1.1%. Earnings rose just slightly, to $27.34 million, or $0.38 a share, from $27.29 million, or $0.38. The company increased its sales with promotional prices, but that cut into its profit margins....

ENERFLEX LTD. $13.10 (Toronto symbol EFX; TSINetwork Rating: Extra Risk) (403-387-6377; www.enerflex.com; Shares outstanding: 79.1 million; Market cap: $1.1 billion; Dividend yield: 2.6%) rents and sells equipment and services for natural gas production, including compression and processing plants, refrigeration gear and power generators. On June 30, 2014, Enerflex closed its $431-million U.S. acquisition of two businesses owned by privately held Axip Energy Services: an international contract compression and processing subsidiary and a division that provides aftermarket services. In the three months ended September 30, 2015, the company’s revenue fell 5.7%, to $425.2 million from $451.1 million a year earlier. Earnings per share were unchanged at $0.40....

TOROMONT INDUSTRIES LTD. $31.62 (Toronto symbol TIH; TSINetwork Rating: Extra Risk) (416-667- 5511; www.toromont.com; Shares outstanding: 77.9 million; Market cap: $2.4 billion; Dividend yield: 2.2%) distributes a broad range of industrial equipment, including machinery made by Caterpillar Inc. It also makes refrigeration systems through its CIMCO division. In the three months ended September 30, 2015, Toromont’s sales rose 8.2%, to $505.6 million from $467.4 million a year earlier. Earnings per share 11.5%, to $0.58 from $0.52. Toromont saw stronger demand from customers in construction and agriculture than a year ago, which offset continued weak mining sales. It also cut costs....

DOMINO’S PIZZA $109.22 (New York symbol DPZ; TSINetwork Rating: Average) (734-930-3008; www.dominos.com; Shares outstanding: 54.6 million; Market cap: $6.0 billion; Dividend yield: 1.1%) has opened its first store in Belarus, in the city of Minsk. The outlet’s master franchisee, DPEU Franchising, plans to open more outlets across the country. This new “pizza theatre” store features an openconcept design that lets customers watch their pizzas being made and baked. Belarus is the company’s sixth new market this year. Domino’s now operates in over 80 countries; its international stores supply over half of its sales and about a third of its earnings. The company still has considerable room to grow internationally....

PASON SYSTEMS $19.46 (Toronto symbol PSI; TSINetwork Rating: Speculative) (403-301-3400; www.pason.com; Shares outstanding: 83.6 million; Market cap: $1.6 billion; Dividend yield: 3.5%) rents equipment for monitoring and managing land-based oil rigs. It also provides communication systems that clients use to remotely collect data from their drilling operations. Pason reduced its capital spending by 46.3% this year, to $65 million from $121 million in 2014. It has also cut its staff by 20%. Meanwhile, the company’s balance sheet remains strong, with cash of $198.1 million, or $2.37 a share, and no debt. The stock yields a high 3.5%, and the dividend appears sustainable....

TEMPUR SEALY $75.57 (New York symbol TPX; TSINetwork Rating: Speculative) (800-878-8889; www.tempursealy.com; Shares outstanding: 62.2 million; Market cap: $4.6 billion; No dividends paid) completed its $1.3- billion purchase of rival Sealy in 2013. This was a major acquisition for Tempur Sealy (formerly Tempur- Pedic), but it let the company diversify into traditional spring-coil beds. In the three months ended September 30, 2015, Tempur Sealy’s earnings rose 27.6%, to $69.9 million, or $1.11 a share, from $54.8 million, or $0.88 a share, a year earlier. Excluding the effect of a higher U.S. dollar, earnings per share jumped 36.4%. Sales gained 6.4%, to $880.0 million from $827.4 million. North American sales (82% of the total) rose 7.5%, while international sales (18%) fell 2.3%....

WYNDHAM WORLDWIDE $74.20 (New York symbol WYN; TSINetwork Rating: Extra Risk) (973- 753-6000; www.wyndhamworldwide.com; Shares outstanding: 116.1 million; Market cap: $8.5 billion; Dividend yield: 2.3%) is one of the world’s largest hospitality companies, with 7,700 franchised hotels worldwide. Wyndham also manages vacation resorts, rental properties, luxury clubs and time-shares. It currently has around 110,000 vacation-rental properties in 100 countries. In the three months ended September 30, 2015, Wyndham’s revenue rose 3.3%, to $1.56 billion from $1.51 billion a year earlier. The company gets most of its revenue from vacation rather than business travel, and vacation bookings rose in the latest quarter. That helped increase its occupancy rate by 1.7%....

CANADIAN REIT (Toronto symbol REF.UN owns 198 properties, including retail, industrial and office buildings, across Canada and in Chicago.

As Cisco Systems adapts to evolving computer networks and expands in cloud computing, we view it as a value stock with strong prospects.

iShares Core S&P 500 Hedged ETF aims to cut currency risk by hedging against movements of the U.S. dollar vs. the Canadian dollar. Our view.

EMERA INC. $42 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares outstanding: 145.3 million; Market cap: $6.1 billion; Price-to-sales ratio: 2.1; Dividend yield: 4.5%; TSINetwork Rating: Average; www.emera.com) recently agreed to acquire Teco Energy (New York symbol TE), which supplies electricity and natural gas to 1.05 million customers in Tampa Bay and the surrounding region....

CANADIAN PACIFIC RAILWAY LTD. $175 (Toronto symbol CP; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 152.9 million; Market cap: $26.8 billion; Price-to-sales ratio: 3.9; Dividend yield: 0.8%; TSINetwork Rating: Above Average; www.cpr.ca) has revised its takeover offer for U.S.-based railway Norfolk Southern Corp. (New York symbol NSC). The combined firm would be North America’s largest railway, with more than 56,000 kilometres of track. Buying Norfolk would also give CP greater access to ports on the U.S. Gulf Coast and Atlantic Ocean. Under the new deal, Norfolk shareholders would receive more stock and less cash: $32.86 U.S. a share in cash plus 0.451 of a CP share. That would give them 47% of the combined company, compared to 41% under the original offer....

RIOCAN REAL ESTATE INVESTMENT TRUST $24 (Toronto symbol REI.UN; Aggressive Growth Portfolio, Manufacturing & Industry sector; Units outstanding: 320.4 million; Market cap: $7.7 billion; Price-to-sales ratio: 6.1; Dividend yield: 5.9%; TSINetwork Rating: Average; www.riocan.com) owns all or part of 305 shopping centres in Canada, including 16 under development. It also owns 49 malls in the U.S. RioCan has settled its dispute with U.S.-based retailer Target (New York symbol TGT). In April 2015, Target closed all 133 of its Canadian stores, including 26 in RioCan’s malls. So far, the trust has found new tenants for seven of these stores. It will have to remodel the other 19, but it expects to have them rented by the end of 2017....

METRO INC. $39 (Toronto symbol MRU; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 241.5 million; Market cap: $9.4 billion; Price-to-sales ratio: 0.8; Dividend yield: 1.2%; TSINetwork Rating: Average; www.metro.ca) operates 600 grocery stores and 250 drugstores in Quebec and Ontario. In its 2015 fiscal year, which ended September 26, 2015, Metro’s earnings rose 13.6%, to $523.6 million from $460.9 million in 2014. It spent $418.0 million on share buybacks in 2015, which is why earnings per share gained 18.7%, to $2.03 from $1.71. Overall sales rose 5.5%, to $12.2 billion from $11.6 billion. Same-store sales increased 4.0%....

CANADIAN TIRE CORP. $122 (Toronto symbol CTC.A; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 75.0 million; Market cap: $9.2 billion; Price-to-sales ratio: 0.7; Dividend yield: 1.9%; TSINetwork Rating: Above Average; www.canadiantire.ca) has 495 Canadian Tire stores, which sell automotive, household and sporting goods. Franchisees run most of these outlets. Other operations include 297 gas stations and 91 PartSource auto parts stores. Canadian Tire also owns Mark’s, which sells casual and work clothing through 379 stores, and the Forzani Group, which offers sporting goods and athletic clothing at 428 outlets, mainly under the Sport Chek and Sports Experts banners. In the quarter ended October 3, 2015, Canadian Tire earned $199.7 million, up 15.9% from $172.2 million a year earlier. Earnings per share rose 20.5%, to $2.62 from $2.17, on fewer shares outstanding....

ENBRIDGE INC. $43 (Toronto symbol ENB; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 863.7 million; Market cap: $37.1 billion; Price-to-sales ratio: 1.1; Dividend yield: 4.9%; TSINetwork Rating: Above Average; www. enbridge.com) will make a final decision on its proposed Northern Gateway pipeline in the second half of 2016....

ENCANA CORP. $9.14 (Toronto symbol ECA; Con- servative Growth Portfolio, Resources sector; Shares outstanding: 845.7 million; Market cap: $7.7 billion; Price-to-sales ratio: 1.4; Dividend yield: 4.2%; TSINetwork Rating: Average; www.encana.com) raised $2.7 billion in 2015 by selling less important properties (all amounts except share price and market cap in U.S. dollars). These sales are part of the company’s plan to focus on four key projects: Montney (B.C.), Duvernay (Alberta) and Eagle Ford and Permian (both in Texas). These fields produce large amounts of oil and natural gas liquids, such as propane and butane, which cuts Encana’s reliance on natural gas. They’re also efficient, which helps the company cope with low oil and gas prices. Because of these asset sales, Encana’s production fell 15.4% in the three months ended September 30, 2015, to 398,300 barrels a day (65% gas and 35% oil and natural gas liquids) from 470,600 a year earlier....

FINNING INTERNATIONAL INC. $18 (Toronto symbol FTT; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 169.3 million; Market cap: $3.0 billion; Price-to-sales ratio: 0.5; Dividend yield: 4.1%; TSINetwork Rating: Above Average; www.finning.com) sells and services Caterpillar-brand heavy equipment. Its main customers are in the oil, mining, forest-products and construction industries. Weaker commodity prices continue to hurt equipment demand. In response, Finning has laid off 13% of its workforce and closed 11 of its locations in Western Canada. The company is now looking at other ways to lower its costs, such as shipping parts directly to customers instead of through dealerships. Meanwhile, Finning’s earnings fell 42.4% in the three months ended September 30, 2015, to $0.19 a share from $0.33 a year earlier. Without one-time items, the company earned $0.34 a share in the latest quarter....

TELUS CORP. $40 (Toronto symbol T; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 600.1 million; Market cap: $24.0 billion; Price-to-sales ratio: 2.0; Dividend yield: 4.4%; TSINetwork Rating: Above Average; www.telus.com) plans to launch several new cloud computing services that will use Microsoft’s cloud software and Internet equipment from Cisco Systems. The company aims to work closely with its clients to develop cloud-based systems that are secure, fast and easily expandable. More businesses are shifting to a cloud platform, as it lets them avoid the high cost of buying new computers and continuously updating software. Over the next five years, companies will probably spend up to eight times more on cloud services than non-cloud technologies....

ATCO LTD. (Toronto symbols ACO.X [class I non-voting] $34 and ACO.Y [class II voting] $34; Income Portfolio, Utilities sector; Shares outstanding: 115.1 million; Market cap: $3.9 billion; Price-to-sales ratio: 0.9; Dividend yield: 2.9%; TSINetwork Rating: Above Average; www.atco.com) operates power plants in Western Canada, the U.K. and Australia. It also builds temporary buildings for construction, mining and energy-exploration firms. Weak commodity prices are hurting demand for electricity and shelters, particularly in Alberta. In response, ATCO is cutting 4% of its global workforce. A new carbon tax in Alberta has also weighed on ATCO’s stock. However, most of the company’s power plants burn natural gas, not coal, which should help reduce the impact of the tax. In addition, ATCO is looking at replacing some of its current facilities with a new hydroelectric plant in northern Alberta....

SHAWCOR LTD. $27 (Toronto symbol SCL; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares out- standing: 64.5 million; Market cap: $1.7 billion; Price-to-sales ratio: 1.0; Dividend yield: 2.2%; TSINetwork Rating: Average; www.shawcor.com) has acquired certain businesses from Flint Field Services....

FORTIS INC. $36 (www.fortisinc.com) has agreed to buy Chevron Corp.’s 93.8% stake in the Aitken Creek underground gas storage facility in northeastern B.C.; BP Canada owns the remaining 6.2%. Fortis will pay $266 million U.S. when it completes the purchase in early 2016....

ROYAL BANK OF CANADA $75 (www.rbc.com) earned $9.9 billion in its 2015 fiscal year, which ended October 31, 2015, up 8.6% from $9.1 billion in fiscal 2014. Earnings per share gained 9.4%, to $6.66 from $6.09, on fewer shares outstanding. Strong gains at its retail banking, securities trading and custodial operations offset weaker results at the wealth management and insurance operations....

Mining stocks Alcoa aims to unleash value for investors by spinning off its fast-growing business in engineered aluminium products.