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IGM FINANCIAL INC. $52 (Toronto symbol IGM; Conservative Growth Portfolio, Finance sector; Shares outstanding: 252.4 million; Market cap: $13.1 billion; Price-to-sales ratio: 4.9; Dividend yield: 4.1%; TSINetwork Rating: Above Average; www. igmfinancial.com) is Canada’s largest independent mutual fund company. Power Financial owns 58.6% of IGM.

As of December 31, 2013, IGM had $131.8 billion of assets under management, up 9.2% from $120.7 billion at the end of 2012. The company’s fee income rises and falls with the value of the securities it manages, so its revenue and earnings gain when the price of these assets rises.

In 2013, IGM’s earnings rose 2.3%, to $763.5 million from $746.4 million in 2012. Per-share earnings gained 3.4%, to $3.02 from $2.92, on fewer shares outstanding. Revenue for the year increased 3.7%, to $2.7 billion from $2.6 billion. Sales of mutual funds rose 22.1%, while fund redemptions fell 33.7%.
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GREAT-WEST LIFECO INC. $30 (Toronto symbol GWO; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 999.2 million; Market cap: $30.0 billion; Price-to-sales ratio: 1.2; Dividend Yield: 4.1%; TSINetwork Rating: Above Average; www.greatwestlifeco.com) is one of Canada’s largest insurance companies, with $758.3 billion of assets under administration. It also offers mutual funds, retirement planning and wealth management. Power Financial (Toronto symbol PFC) owns 67.0% of Great-West.

The company continues to benefit from its recent $1.75-billion purchase of Irish Life Group, Ireland’s largest pension manager and life insurance provider.

If you exclude integration costs, Great-West earned $2.05 billion in 2013, including $85 million of profits from Irish Life. The latest earnings are also up 5.4% from $1.95 billion in 2012. Due to more shares outstanding, earnings per share rose 2.9%, to $2.11 from $2.05.
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THOMSON REUTERS CORP. $38 (Toronto symbol TRI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 815.8 million; Market cap: $31.0 billion; Price-to-sales ratio: 2.4; Dividend yield: 3.8%; TSINetwork Rating: Above Average; www.thomsonreuters.com) gets 55% of its revenue by selling news and information to professionals in the banking industry. The remaining 45% comes from providing specialized information products to clients in the legal, accounting and scientific research fields.

Thomson earned $137 million, or $0.16 a share, in 2013 (all amounts except share price and market cap in U.S. dollars). That’s down sharply from $2.0 billion, or $2.39 a share, in 2012.

Financial institutions continue to cut their spending on information products in the wake of the 2008 credit crisis. In response, Thomson is cutting jobs and eliminating less-profitable products.
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LOBLAW COMPANIES LTD. $46 (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 412.5 million; Market cap: $19.0 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.1%; TSINetwork Rating: Above Average; www.loblaw.ca) has completed its acquisition of Shoppers Drug Mart, which operates 1,253 drugstores across Canada.

Loblaw paid $12.4 billion, consisting of $6.6 billion in cash and $5.8 billion in shares. Shoppers shareholders now own 29% of the combined company.

In all, the firm will have $43 billion of annual revenue and $3 billion of gross earnings. Combining marketing and distribution should save $100 million in the first year and $300 million annually by the end of the third year.
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BLACKBERRY LTD. $8.66 (Toronto symbol BB; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 526.6 million; Market cap: $4.6 billion; Price-to-sales ratio: 0.5; No dividends paid; TSINetwork Rating: Speculative; www.blackberry.com) lost $711 million, or $1.35 a share, in the fiscal year ended March 1, 2014 (all amounts except share price and market cap in U.S. dollars). A year earlier, it lost $317 million, or $0.60 a share.

Revenue fell 38.5%, to $6.8 billion from $11.1 billion, mainly due to slow demand for its new smartphones. Last year, the company removed several buttons from some of its devices as part of the switch to its new BlackBerry 10 operating system. That alienated many of its users. However, as part of its new turnaround strategy, it plans to launch phones with its traditional physical keyboard.

The company’s balance sheet remains sound: its long-term debt is just $1.6 billion, and it holds cash and investments of $2.7 billion, or $5.05 a share. However, BlackBerry will probably lose money for the next year or two.
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EMERA INC. $35 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares outstanding: 142.1 million; Market cap: $5.0 billion; Price-to-sales ratio: 2.0; Dividend yield: 4.1%; TSINetwork Rating: Average; www.emera.com) is Nova Scotia’s main power supplier. It also holds interests in electrical utilities in the U.S. and the Caribbean.

The company recently sold 8.7 million common shares at $28.85 each. That increased the total number outstanding by 6.5%.

Emera will use the $239.9-million net proceeds to help fund its $1.6-billion Maritime Link project, which will transmit electricity from the island of Newfoundland to Nova Scotia through an undersea cable. The power will come from a new hydroelectric project on Labrador’s Churchill River.
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ATCO LTD. (Toronto symbols ACO.X [class I non-voting] $54 and ACO.Y [class II voting] $54; Income Portfolio, Utilities sector; Shares outstanding: 115.1 million; Market cap: $6.2 billion; Price-to-sales ratio: 1.4; Dividend yield: 1.6%; TSINetwork Rating: Above Average; www.atco.com) holds 53.1% of Canadian Utilities (see left). It also owns 75.5% of ATCO Structures & Logistics, which builds temporary buildings for construction and energy-exploration firms; Canadian Utilities owns the remaining 24.5%.

In 2013, ATCO’s revenue rose 8.6% to $4.4 billion from $4.0 billion in 2012. That’s mainly because Canadian Utilities’ new power lines boosted its contribution. The structures division’s revenue rose just 0.4%, partly because ATCO sold its 50% stake in a South American joint venture for $124 million. It also completed three large projects in Australia in 2012 and early 2013.

Earnings rose 13.0%, to $418 million, or $3.62 a share, from $370 million, or $3.20. Without unusual items, earnings rose 5.4%.
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CANADIAN UTILITIES LTD. (Toronto symbols CU [class A non-voting] $41 and CU.X [class B voting] $41; Income Portfolio, Utilities sector; Shares outstanding: 261.0 million; Market cap: $10.7 billion; Price-to-sales ratio: 3.2; Dividend yield: 2.6%; TSINetwork Rating: Above Average; www. canadianutilities.com) distributes electricity and natural gas in Alberta and Australia. It also operates 18 power plants in Canada, Australia and the U.K. ATCO Ltd. (see right) owns 53.1% of the company.

Canadian Utilities continues to invest in projects that will make Alberta’s electricity grid more reliable. For example, it recently spent $650 million to build 355 kilometres of new transmission lines and substations in the province’s southeast.

Thanks to these new assets, Canadian Utilities earned $587 million in 2013, up 6.1% from $553 million in 2012. Earnings per share rose 3.5%, to $2.09 from $2.02, on more shares outstanding. Without unusual items, mainly deferred payments from or refunds paid to customers, earnings would have risen 11.1%. Revenue gained 11.3%, to $3.4 billion from $3.0 billion.
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strong>CAE INC. $15 (Toronto symbol CAE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 263.2 million; Market cap: $3.9 billion; Price-to-sales ratio: 1.8; Dividend yield: 1.6%; TSINetwork Rating: Average; www.cae.com) recently sold five flight simulators to Southwest Airlines, Lufthansa and other customers.

In all, these orders are worth $75 million. That’s equal to 3% of CAE’s annual revenue of $2.2 billion.

Including these deals, CAE has sold 48 simulators in its 2014 fiscal year, which ended March 31, 2014. That’s up 37.1% from the 35 it sold in 2013. It also beats the company’s previous all-time high of 38 simulator sales in fiscal 1998.
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(Toronto symbol REI.UN; Aggressive Growth Portfolio, Manufacturing & Industry sector; Units outstanding: 303.2 million; Market cap: $8.2 billion; Price-to-sales ratio: 5.8; Dividend yield: 5.2%; TSINetwork Rating: Average; www.riocan.com) started up in 1993 and is now Canada’s largest REIT. In Canada, it owns all or part of 293 shopping centres, including 16 under development. These holdings account for 85% of its rental revenue. The remaining 15% comes from 47 malls in the U.S. In the wake of the recession, RioCan took advantage of lower property values and interest rates to expand its portfolio. As a result, its revenue jumped 52.0%, from $758 million in 2009 to $1.15 billion in 2013....

TRANSCANADA CORP. $55 (Toronto symbol TRP; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 708.9 million; Market cap: $39.0 billion; Price-to-sales ratio: 4.7; Dividend yield: 3.8%; TSINetwork Rating: Above Average; www.transcanada.com) has decided not to build an oil-export terminal at Cacouna, Quebec, due to concerns that it could endanger beluga whales in the St. Lawrence River.

This terminal was one of two (the other is near Saint John, New Brunswick) that are part of TransCanada’s proposed Energy East pipeline project, which would pump crude oil from Alberta to refineries in Eastern Canada.

TransCanada is now looking for an alternative site. That will delay Energy East for at least two years, to 2020, and add to its $12-billion cost. However, cancelling the Cacouna terminal makes it more likely that regulators will approve the project.

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Canada’s inflation rate is just 1.1%, well below the Bank of Canada’s 2% target. That lets the bank keep interest rates low, which holds down our dollar, making our exports cheaper in world markets. That’s good for Canada’s economic growth, but bad for income investors. We continue to advise against investing in bonds right now. Today’s low interest rates make them unattractive for income. Rising rates would push down their asset value....

IGM FINANCIAL INC. $45 (Toronto symbol IGM; Conservative Growth Portfolio, Finance sector; Shares outstanding: 251.4 million; Market cap: $11.3 billion; Price-to-sales ratio: 4.8; Dividend yield: 5.0%; TSINetwork Rating: Above Average; www.igmfinancial.com) had $148.4 billion worth of assets under management as of March 31, 2015, up 8.1% from $137.3 billion a year earlier....

IMPERIAL OIL $51.60 (Toronto symbol IMO; Shares outstanding: 847.6 million; Market cap: $44.0 billion; TSINetwork Rating: Average; Div. yield: 1.0%; www.imperialoil.ca) is selling some of its conventional oil and natural gas properties in Alberta and B.C. to Whitecap Resources. These assets produce 15,000 barrels a day, which is equal to 5.1% of the 295,000 barrels a day that Imperial produced in 2013.

The company will receive $855 million when the sale closes in May 2014. That will help it pay for its plan to spend $5.5 billion on its main properties this year, including expanding its Cold Lake and Kearl oil sands developments. These investments should increase Imperial’s daily output by 150,000 barrels in 2015.

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PENN WEST $9.35 (Toronto symbol PWT; Shares outstanding: 490.7 million; Market cap: $4.5 billion; TSINetwork Rating: Average; Dividend yield: 6.0%; www.pennwest.com) is one of Canada’s largest oil and gas producers.

Penn West continues to shore up its finances and take steps to boost its value since appointing Rick George as chairman and Allan Markin as vicechairman. These moves include cutting staff, selling assets and lowering its dividend.

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CRESCENT POINT ENERGY CORP. $40.44 (Toronto symbol CPG; Shares outstanding: 395.7 million; Market cap: $16.1 billion; TSINetwork Rating: Extra Risk; Dividend yield: 6.8%; www.crescentpointenergy.com) produces oil and natural gas in Western Canada. Its output is weighted 91% toward oil and 9% to gas.

The company continues to focus on its Bakken light oil development in southeastern Saskatchewan.

In the three months ended December 31, 2013, Crescent Point’s cash flow rose 23.9%, to $533.3 million from $430.4 million a year earlier.
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CANADIAN REIT $44.60 (Toronto symbol REF.UN; Units outstanding: 69.0 million; Market cap: $3.1 billion; TSINetwork Rating: Extra Risk; Dividend yield: 3.9%; www.creit.ca) owns 198 properties, including retail, industrial and office buildings, across Canada and in Chicago. These holdings contain over 24.0 million square feet of leasable area. The trust’s occupancy rate is 95.5%.

In the three months ended December 31, 2013, Canadian REIT’s revenue rose 8.6%, to $106.7 million from $98.2 million a year earlier. Cash flow per unit gained 7.5%, to $0.72 from $0.67.

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PENGROWTH ENERGY CORP. $3.74 (Toronto symbol PGF; Aggressive Growth and Income Portfolios, Resources sector; Shares outstanding: 538.0 million; Market cap: $2.0 billion; Price-to-sales ratio: 1.7; Dividend yield: 6.4%; TSINetwork Rating: Average; www.pengrowth.com) recently started up its Lindbergh oil sands project in eastern Alberta, which should produce 16,000 barrels a day by the end of 2015.

The company has shut down less profitable wells in response to weak oil and gas prices. That’s why its average production fell 7.7% in the first quarter of 2015, to 69,334 barrels a day (52% oil and liquids, 48% gas) from 75,102 a year earlier. Without unusual items, Pengrowth earned $64.8 million, compared to a loss of $2.8 million. Cash flow per share fell 22.2%, to $0.21 from $0.27.

For the remainder of 2015, the company has hedged 78% of its oil production at $93.87 (Canadian) a barrel, well above today’s price of $60.16 U.S. It has also hedged 57% of its gas output at $3.72 (Canadian) per thousand cubic feet, compared to the current price of $2.94 U.S. The company’s hedges were worth $354.3 million as of March 31, 2015.

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ALLIED PROPERTIES REAL ESTATE INVESTMENT TRUST $34.29 (Toronto symbol AP.UN; Units outstanding: 68.7 million; Market cap: $2.4 billion; TSINetwork Rating: Extra Risk; Dividend yield: 4.1%; www.alliedpropertiesreit.com) owns 133 office buildings, mostly in major Canadian cities. These mainly Class I properties contain over 9.5 million square feet of leasable area.

Class I refers to 19th- and early-20th-century light industrial buildings that have been converted to retail space. They usually feature exposed beams, interior brick and hardwood floors.

The trust bought $400 million worth of properties in 2012. In 2013, it added $182.4 million more.
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IBM $193.55 (New York symbol IBM; Shares outstanding: 1.0 billion; Market cap: $200.5 billion; TSINetwork Rating: Above Average; Dividend yield: 2.0%; www.ibm.com) continues to expand its cloud computing businesses.

Cloud computing involves storing data and software on one or more centralized computer networks. Users access these programs or files over the Internet or through some other computer network.

IBM recently paid an undisclosed sum for Cloudant, a private firm that creates large databases on remote servers. IBM feels Cloudant’s technology will also enhance its analytics services, which help businesses analyze large amounts of data and improve their efficiency. That’s a big growth area.
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TRANSCANADA CORP. $51.57 (Toronto symbol TRP; Shares outstanding: 707.5 million; Market cap: $36.0 billion; TSINetwork Rating: Above Average; Dividend yield: 3.7%; www.transcanada.com) operates 68,500 kilometres of natural gas pipelines in Canada and the U.S. It also has interests in over 11,800 megawatts of power generation, including the Bruce Power nuclear plant.

In the three months ended December 31, 2013, TransCanada’s revenue rose 11.6%, to $2.3 billion from $2.1 billion a year earlier. Earnings per share rose 28.9%, to $0.58 from $0.45.

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ENBRIDGE INC. $51.24 (Toronto symbol ENB; Shares outstanding: 831.5 million; Market cap: $42.5 billion; TSINetwork Rating: Above Average; Dividend yield: 2.8%; www.enbridge.com) operates the world’s longest crude oil and liquids pipeline system. It also distributes natural gas to consumers in Ontario, Quebec, New Brunswick and New York State. As well, Enbridge has interests in 1,800 megawatts of renewable and alternative energy.

In the three months ended December 31, 2013, the company’s revenue rose 18.4%, to $8.3 billion from $7.0 billion a year earlier. Before one-time items, earnings per share rose 4.8%, to $0.44 from $0.42.

In 2013, Enbridge brought 17 projects, worth a total of $5 billion, into service. It plans to start up a further $29 billion worth over the next four years. That includes a $7-billion replacement of part of its Mainline system, which pumps crude oil from Edmonton, Alberta, to Superior, Wisconsin.
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BCE INC. $48.01 (Toronto symbol BCE; Shares outstanding: 777.0 million;Market cap: $37.2 billion; TSINetwork Rating: Above Average; Dividend yield: 5.2%; www.bce.ca) reports that in the three months ended December 31, 2013, its earnings per share rose 16.7%, to $0.70 from $0.60 a year earlier. Revenue increased 4.3%, to $5.4 billion from $5.2 billion.

BCE added 93,700 new wireless subscribers, net of cancellations, in the latest quarter (it now has 7.8 million users across Canada). That’s 10.8% fewer than it added a year earlier, but 73% of its subscribers under long-term contracts now use smartphones, up from 62%. That’s good news, because smartphones generate higher fees for BCE than regular cellphones. Average revenue per user rose 2.1%.

BCE has just raised its quarterly dividend by 6.0%, to $0.6175 a share from $0.5825. The shares now yield 5.2%. As well, the stock trades at 15.1 times this year’s forecast earnings.
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MARKET VECTORS VIETNAM ETF $21.72 (New York symbol VNM; buy or sell through brokers) holds shares of Vietnamese companies or foreign firms that get a significant amount of their revenue from Vietnam.

The ETF’s top holdings are Masan Group (food, resources and banking conglomerate), 7.9%; Vincom Corp. (real estate), 7.6%; Bank for Foreign Trade of Vietnam, 6.9%; Baoviet Holdings (finance and insurance), 5.8%; PetroVietnam Fertilizer & Chemical, 5.7%; PetroVietnam Technical Services (oilfield services), 5.7%; and Oil & Natural Gas Corp. (an Indian oil and gas firm), 4.8%.

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ISHARES FTSE/XINHUA CHINA 25 INDEX FUND $35.84 (New York symbol FXI; buy or sell through brokers) is an exchange traded fund that aims to track the FTSE/Xinhua China 25 Index, which is made up of the 25 largest, most liquid Chinese stocks. All of the stocks in the index trade on the Hong Kong exchange. Some also trade as American Depositary Receipts (ADRs) on New York.

The fund’s top holdings are China Construction Bank, 9.0%; Tencent Holdings, 8.8%; China Mobile, 7.6%; Industrial & Commercial Bank, 6.9%; Bank of China, 6.2%; PetroChina, 4.2%; China Shenhua Energy, 4.1%; Agricultural Bank of China, 4.0%; China Life, 4.0% and China Petroleum, 4.0%.

The fund’s holdings give it the following industry breakdown: Financials, 56.2%; Telecommunications, 13.8%; Oil and Gas, 12.2%; Technology, 8.8%, Basic Materials, 4.1%; Consumer Goods, 2.4%; and Industrials, 2.4%. Its expense ratio is 0.74%.
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