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QUAKER CHEMICAL CORP. $75 (New York symbol KWR; Income Portfolio, Manufacturing & Industry sector; Shares outstanding: 13.2 million; Market cap: $990.0 million; Price-to-sales ratio: 1.4; Dividend yield: 1.3%; TSINetwork Rating: Average; www.quakerchem.com) makes lubricants and chemicals that keep mechanical parts from rusting.

Quaker needs oil to make its products, and rising crude prices have slowed its earnings growth. As well, it gets 60% of its sales from overseas, and the higher U.S. dollar has also weighed on its results.

The company has raised its prices and cut its costs in response. It has also acquired smaller, related firms, which has helped increase its sales and earnings.
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BRIGGS & STRATTON CORP. $22 (New York symbol BGG; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 47.0 million; Market cap: $1.0 billion; Price-to-sales ratio: 0.6; Dividend yield: 2.2%; TSINetwork Rating: Above Average; www.briggsandstratton.com) is the world’s largest maker of lawn mower engines. The company also makes a variety of other home and garden equipment, such as portable power generators, pressure washers and snow blowers.

In Briggs’s 2014 second quarter, which ended December 31, 2013, its sales fell 5.1%, to $416.6 million from $439.1 million a year earlier.

Sales of engines to manufacturers (61% of total sales) fell 3.1%, mainly because the year-earlier sales benefited from strong generator demand after Hurricane Sandy. A lack of major storms also caused sales of consumer products (39%) to decline 13.2%.
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MTS SYSTEMS CORP. $68 (Nasdaq symbol MTSC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 15.3 million; Market cap: $1.0 billion; Price-to-sales ratio: 1.9; Dividend yield: 1.8%; TSINetwork Rating: Average; www.mts.com) makes equipment and software that manufacturers use to test the behaviour of materials, machines and structures. This helps its clients reduce errors and costs.

The company recently announced a new restructur-ing plan, including job cuts and technology investments. This initiative should make its testing division, which supplies 80% of its revenue, more productive. MTS gets the remaining 20% of its revenue by making sensors for industrial equipment.

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TENNANT CO. $63 (New York symbol TNC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 18.5 million; Market cap: $1.2 billion; Price-to-sales ratio: 1.6; Dividend yield: 1.1%; TSINetwork Rating: Average; www.tennantco.com) makes industrial floor-cleaning equipment, including scrubbers, sweepers and polishers. It also manufactures cleaning gear for garages, stadiums, parking lots and city streets.

The company continues to benefit from strong demand for products featuring its ec-H20 technology, which uses electricity to make tap water act like a detergent.

In 2013, Tennant’s sales rose 1.8%, to $752.0 million from $739.0 million in 2012. Overseas markets supply a third of the company’s sales. If you disregard the negative impact of currency exchange rates, sales rose 2.8%.
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CISCO SYSTEMS INC. $22 (Nasdaq symbol CSCO; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 5.2 billion; Market cap: $114.4 billion; Priceto- sales ratio: 2.5; Dividend yield 3.4%; TSINetwork Rating: Average; www.cisco.com) plans to invest $1 billion over the next two years on building a new cloud-computing service, which will let businesses lease data processing and storage systems instead of buying their own.

This is a small investment for Cisco, which earned $2.5 billion, or $0.47 a share, in its latest quarter. However, cloud computing could become an important new business for Cisco, and cut its reliance on selling routers and other networking hardware.

Demand for cloud services is growing fast, as they let corporations and government agencies cut their computing costs. Moreover, these big clients are more likely to trust wellestablished suppliers like Cisco instead of other cloud competitors like Amazon.com, which cater mainly to smaller businesses. (Note— Amazon is a recommendation of Stock Pickers Digest, our newsletter that focuses on aggressive investments.)
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MCDONALD’S CORP. $96 (New York symbol MCD; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 989.9 million; Market cap: $95.0 billion; Price-to-sales ratio: 3.4; Dividend yield: 3.4%; TSINetwork Rating: Above Average; www.mcdonalds.com) operates 35,400 fast food restaurants in 119 countries. The company serves a wide variety of food, but it’s best known for its hamburgers and french fries.

McDonald’s continues to renovate its restaurants, launch new menu items— such as premium coffee— and appeal to cost-conscious consumers through its popular Dollar Menu. These improvements raised its revenue by 23.6%, from $22.7 billion in 2009 to $28.1 billion in 2013.

Same-store sales rose just 0.2% in 2013, because the company attracted 1.9% fewer customers, which offset higher spending per visit.
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Pat McKeough responds to many requests from members of his Inner Circle for specific advice on stock picks 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 one of the highlights from these Q&A sessions. While we reserve our buy-hold-sell advice for Inner Circle members, these excerpts provide a great deal of information and analysis on stocks we’ve covered for members of Pat’s Inner Circle....

FAIR ISAAC CORP. (New York symbol FICO; www.fairisaac.com) makes FICO Scores, the computer program that dominates the market for software that businesses use to evaluate customer creditworthiness. The company is also profiting by selling software that helps credit card issuers control fraud and analyze cardholders’ spending patterns....

SUN LIFE FINANCIAL (Toronto symbol SLF; www.sunlife.ca) sells savings, retirement, pension and life insurance products to individuals and corporations....

STATE STREET CORP. $73 (New York symbol STT; Aggressive Growth Portfolio, Finance sector; Shares outstanding: 415.2 million; Market cap: $30.3 billion; Price-to-sales ratio: 3.0; Dividend yield: 1.9%; TSINetwork Rating: Average; www.statestreet.com) sells accounting and administrative services to large investors, like mutual funds and pension plans.

State Street has raised its quarterly dividend by 13.3%, to $0.34 a share from $0.30. The new annual rate of $1.36 yields 1.9%. State Street also plans to repurchase $1.8 billion worth of its shares by June 30, 2016. It spent $1.65 billion on buybacks in 2014.

The company’s fee income rises and falls with the value of the mutual funds and other securities it manages. Thanks to improving stock markets and new contracts, it will likely earn $5.16 a share in 2015, up from $5.09 in 2014. The stock trades at 14.1 times that forecast.

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CAMPBELL SOUP CO. (New York symbol CPB; www.campbellsoupcompany.com) is the world’s largest maker of canned soups. It also makes Prego canned pasta and sauces, Pepperidge Farm cookies and V8 vegetable juices. Wal-Mart accounts for 19% of its sales....

Pat McKeough responds to many requests from members of his Inner Circle for specific advice on buying stocks 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 one of the highlights from these Q&A sessions. While we reserve our buy-hold-sell advice for Inner Circle members, these excerpts provide a great deal of information and analysis on stocks we’ve covered for members of Pat’s Inner Circle....

TRILOGY ENERGY CORP. (Toronto symbol TET; www.trilogyenergy.com) owns oil and gas properties in central Alberta’s Kaybob and Grande Prairie areas. About 58% of Trilogy’s production is natural gas. The remaining 42% is oil....

Every Wednesday, we publish our “Investor Toolkit” series on TSI Network. Whether you’re a new or experienced investor, these weekly updates are designed to give you specific advice on how you to find the best investments for your portfolio. Each Investor Toolkit update gives you a fundamental piece of investment strategy, and shows you how you can put it into practice right away. Tip of the week: “While insider trading can sometimes be a useful indicator for investors, there are also occasions when it can be misleading.”...

These two Japanese automakers reported higher U.S. sales in 2013, thanks to new models and pent-up demand after the 2008-2009 recession. Meanwhile, the low Japanese yen is increasing the value of their overseas sales....

In the latest issue of The Successful Investor, we analyzed each of Canada’s big five banks. All of the banks have now reported earnings, except for Bank of Nova Scotia, which reports its first-quarter earnings tomorrow, March 4....

MCCOY CORP. $5.83 (Toronto symbol MCB; TSINetwork Rating: Speculative) (780-453-8451; www.mccoyglobal.com; Shares outstanding: 27.4 million; Market cap: $161.1 million; Dividend yield: 3.4%) operates through two divisions: Mobile Solutions and Energy Products and Services.

Energy Products and Services sells or rents gear for oil and gas drilling and pipe handling. It also provides repair and maintenance services for drilling equipment.

Mobile Solutions builds heavy-duty trailers for U.S. and Canadian clients in the oil and gas, wind energy, infrastructure and construction industries.
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WAJAX CORP. $37.46 (Toronto symbol WJX; TSINetwork Rating: Extra Risk) (905-212-3300; www.wajax.ca; Shares outstanding:16.7 million; Market cap: $627.2 million; Dividend yield: 6.4%) sells and services cranes, forklifts and other heavy equipment. It also provides related parts (such as 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, 2013, Wajax’s revenue rose 7.3%, to $391.7 million from $364.9 million a year earlier. The gain mostly came from stronger sales of equipment for forestry, construction and power generation.
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SASOL LTD. (ADR) $52.96 (New York symbol SSL; TSINetwork Rating: Extra Risk) (082- 883-9697; www.sasol.com; ADRs outstanding: 649.9 million; Market cap: $36.6 billion; Dividend yield: 2.8%) is the world’s largest producer of fuel from coal at its facility in Secunda, South Africa. It also makes synthetic fuels from natural gas at plants in Qatar and Nigeria.

In addition, Sasol has substantial chemical production interests and produces oil and gas in Africa. It’s also South Africa’s thirdlargest coal producer.

In Sasol’s 2014 fiscal first half, which ended December 31, 2013, its revenue rose 23.1%, to 98.3 billion South African rand (1 rand = $0.10 U.S.) from 79.9 billion rand in the first half of fiscal 2013.
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BROADRIDGE FINANCIAL SOLUTIONS $37.15 (New York symbol BR; TSINetwork Rating: Extra Risk) (201-714-3000; www.broadridge.com; Shares outstanding: 119.4 million; Market cap: $4.4 billion; Dividend yield: 2.3%) has bought Emerald Connect, a private firm that helps financial advisors promote their services. Emerald helps its clients set up websites, publish newsletters, conduct seminars and manage direct mail and online marketing campaigns.

Broadridge plans to merge Emerald with its Forefield subsidiary, which sells online courses and related services to financial professionals.

The company paid $60 million for Emerald, which is equal to 1.9 times the $31.2 million, or $0.25 a share, it earned in the latest quarter.
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CAMECO CORP. $26.90 (Toronto symbol CCO; TSINetwork Rating: Extra Risk) (306-956-6200; www.cameco.com; Shares outstanding: 395.6 million; Market cap: $10.6 billion; Dividend yield 1.5%) has finally started production at its Cigar Lake mine in northern Saskatchewan.

Construction was several years behind schedule after a series of technical problems, including an underground flood in 2006. The $2.6-billion mine is tapping into one of the world’s largest high-grade uranium deposits.

Cigar Lake is 50% owned by Cameco, 37% by France’s Areva, 8% by Idemitsu Canada Resources Ltd. and 5% by Tepco Resources Inc.
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AMAZON.COM $373.23 (Nasdaq symbol AMZN; TSINetwork Rating: Extra Risk) (206-266-1000; www.amazon.com; Shares outstanding: 459.3 million; Market cap: $172.4 billion; No dividends paid) has raised the price of its Amazon Prime service to $99 a year from $79. This is the first price hike since the company launched Prime in 2005.

The fee gets customers two-day shipping on all their purchases. U.S. members also get two additional free services: Amazon Instant Video, which boasts 180,000 titles, and the Kindle Owners’ Lending Library, which lets users borrow a free book each month from the thousands of titles Kindle offers.

It’s uncertain how many—or if any—Prime members will cancel after the price increase. But while the company hasn’t said how many Prime subscribers it has, the number is likely over 20 million. So the hike could increase its annual revenue by up to $400 million. Amazon had revenue of $74.5 billion in 2013.
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DOMINO’S PIZZA $78.27 (New York symbol DPZ; TSINetwork Rating: Average) (734-930- 3030; www.dominos.com; Shares outstanding: 55.7 million; Market cap: $4.4 billion; Dividend yield: 1.3%) reported earnings of $0.78 a share in the three months ended December 29, 2013. That’s up 21.9% from $0.64 a year earlier.

Sales gained 5.0%, to $566.5 million from $539.7 million. Same-store sales rose 7.0% internationally and 3.7% in the U.S. The company continues to pay down its long-term debt, which is now $1.5 billion, or a manageable 34% of its market cap.

The outlook for Domino’s is positive, but the stock has jumped over 57% for us in the last year. It now trades at a high 28.0 times its forecast 2014 earnings of $2.80 a share.
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STANTEC INC. $68.12 (Toronto symbol STN; TSINetwork Rating: Extra Risk) (780-917-7288; www.stantec.com; Shares outstanding: 46.6 million; Market cap: $3.1 billion; Dividend yield: 1.1%) sells a range of consulting, project-delivery, design and technology services. Its clients operate in a variety of industries, including transportation, construction, and oil and gas.

In the quarter ended December 31, 2013, revenue rose 15.7%, to $451.3 million from $390.1 million a year earlier. Acquisitions were one reason for the gain. Stantec is also working on many new projects, such as major pipelines and the huge Westside Subway Transit Corridor in southern California.

Earnings gained 14.8%, to $35.7 million, or $0.77 a share, from $31.1 million, or $0.68.
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DOREL INDUSTRIES $38.76 (Toronto symbol DII.B; TSINetwork Rating: Extra Risk) (514-731-0000; www.dorel.com; Shares outstanding: 31.5 million; Market cap: $1.2 billion; Dividend yield: 3.4%) 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 December 31, 2013, Dorel’s sales rose 1.8%, to $633.5 million from $622.6 million a year earlier (all figures except share price and market cap in U.S. dollars). Higher sales at the recreational and home-furnishing segments offset lower demand for juvenile products.

Excluding one-time items, earnings per share fell 34.8%, to $0.60 from $0.92. The company’s bicycle sales rose in the latest quarter, but its competitors discounted their bikes heavily, forcing Dorel to sharply cut its prices—and its profit margins with them.
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