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BELL ALIANT INC. $28 (www.bellaliant.ca) earned $0.43 a share in the three months ended March 31, 2013, unchanged from a year earlier. Revenue rose 0.3%, to $683.6 million from $681.8 million. Strong demand for high-speed Internet and TV services offset lower local and long-distance revenue....

MOLSON COORS CANADA INC. (Toronto symbols TPX.A $49 and TPX.B $49; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 181.7 million; Market cap: $8.9 billion; Price-to-sales ratio: 2.4; Dividend yield: 2.6%; TSINetwork Rating: Average; www.molsoncoors.com) is one of the world’s leading brewers. Its main brands include Coors Light, Molson Canadian and Carling.

The company’s sales fell 36.5%, from $4.8 billion in 2008 to $3.0 billion in 2009 (all amounts except share prices and market cap in U.S. dollars). That’s because it merged its U.S. brewing operations with those of rival SABMiller to form MillerCoors. Each company has a 50% voting interest in this joint venture, but Miller gets 58% of the profits while Molson Coors gets 42%. Because it owns less than half of MillerCoors, accounting rules forced Molson Coors to stop including the sales from this business in its overall sales.


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METRO INC. $70 (Toronto symbol MRU; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 95.2 million; Market cap: $6.7 billion; Price-to-sales ratio: 0.6; Dividend yield: 1.4%; TSINetwork Rating: Average; www.metro.ca) earned $100.5 million in the 12 weeks ended March 16, 2013. This figure excludes a $266.4-million gain on the sale of about half its stake in Alimentation Couche-Tard Inc. (Toronto symbol ATD.B), which operates convenience stores in North America and Norway. The latest earnings are also up 4.4% from $96.3 million a year earlier. Metro used the sale proceeds to buy back shares. As a result, earnings per share rose 8.5%, to $1.02 from $0.94.

Sales fell 2.6%, to $2.5 billion from $2.6 billion, as the company closed some unprofitable supermarkets in Ontario. As well, the year-earlier quarter, which began on December 18, 2011, included the busy week before Christmas. Same-store sales were flat.

Metro is a buy....

CANADIAN TIRE CORP. $74 (Toronto symbol CTC.A; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 81.2 million; Market cap: $6.0 billion; Price-to-sales ratio: 0.5; Dividend yield: 1.9%; TSINetwork Rating: Above Average; www.canadiantire.ca) operates 490 Canadian Tire stores, which specialize in automotive, household and sporting goods. The company owns these stores, but franchisees (called dealers) operate most of them.

The company recently negotiated a new 11-year contract with its dealers. This should make it easier for Canadian Tire and its dealers to remodel stores and adjust inventories as they compete with U.S.- based retailers like Wal-Mart and Target.

Canadian Tire is a buy....

CANADIAN IMPERIAL BANK OF COMMERCE $81 (Toronto symbol CM; Conservative Growth Portfolio, Finance sector; Shares outstanding: 401.9 million; Market cap: $32.5 billion; Price-to-sales ratio: 1.9; D i v i d e n d y i e l d : 4 . 6 % ; TSINetwork Rating: Above Average; www.cibc.com) is buying Atlantic Trust Private Wealth Management, which sells portfolio management services to wealthy clients in the U.S.

CIBC will pay $210 million U.S. when the deal closes later this year. To put that in context, it earned $895 million (Canadian), or $2.15 a share, in the three months ended January 31, 2013. Atlantic Trust will add $20 billion U.S. to the $223 billion (Canadian) in assets that CIBC’s wealth management division already has under administration.

CIBC is a buy....

TRANSCANADA CORP. $49 (Toronto symbol TRP; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 707.0 million; Market cap: $34.6 billion; Price-to-sales ratio: 4.2; Dividend yield: 3.8%; TSINetwork Rating: Above Average; www.transcanada.com) plans to build a new 200- kilometre crude oil pipeline that will connect Edmonton to the storage hub at Hardisty, Alberta. From there, TransCanada will pump the oil to refineries in the U.S. Midwest through its Keystone pipeline.

The project, which will cost $900 million, also includes a new oil-storage facility. The company already has long-term contracts from producers, which cuts the risk of this investment. The project should begin operating in the second half of 2015.

These investments will help TransCanada handle rising production from Alberta’s oil sands. The new system will also help support its proposed Keystone XL pipeline extension. This project, which requires U.S. government approval, would pump oil to refineries on the U.S. Gulf Coast.
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BLACKBERRY INC. $15 (Toronto symbol BB; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 524.0 million; Market cap: $7.9 billion; Price-to-sales ratio: 0.7; No dividends paid; TSINetwork Rating: Average; www.blackberry.com) announced that the U.S. Department of Defense will let its employees use the company’s new smartphones, which run on the BlackBerry 10 operating system.

The company’s unique software helps businesses and governments encrypt mobile email messages and other sensitive data. That’s why the Defense Department has 470,000 BlackBerry users, compared to just 49,700 users of other devices.

BlackBerry is still a hold....

CAE INC. $11 (Toronto symbol CAE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 259.7 million; Market cap: $2.9 billion; Price-to-sales ratio: 1.4; Dividend yield: 1.8%; TSINetwork Rating: Average; www.cae.com) received orders for 35 flight simulators in the fiscal year ended March 31, 2013. That’s down slightly from 37 in 2012.

However, CAE continues to win contracts for its pilot-training operations: it now has over 100 flight schools in 30 countries. For example, it recently agreed to build a pilot-training facility for the Kuwait Air Force. Other recent contracts include deals to train pilots for airlines in South America, Turkey and Ireland.

The company probably earned $0.69 a share in fiscal 2013, and the stock trades at 15.9 times that figure. CAE’s fiscal 2014 earnings could rise to $0.79 a share, and the stock trades at a more reasonable 13.9 times that forecast. The $0.20 dividend yields 1.8%.

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BOMBARDIER INC. (Toronto symbols BBD.A $4.25 and BBD.B $4.23; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.8 billion; Market cap: $7.6 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.4%; TSINetwork Rating: Average; www.bombardier.com) had commitments in place for 382 CSeries planes, including 148 firm orders, at the end of 2012. If the buyers exercise all their options, these deals would be worth around $23 billion U.S. That’s equal to 1.4 times Bombardier’s 2012 revenue of $16.8 billion U.S.

Porter Airlines recently ordered 12 CSeries planes, with an option to buy 18 more. The deal is conditional on Porter winning approval for its plan to extend the runway at the Billy Bishop Toronto City Airport in downtown Toronto. The airline’s current fleet of 26 Bombardier Q400 turboprop planes flies out of the airport now, but the runway extension would be needed to handle the CSeries jets.

As part of the agreement, Porter also has an option to buy six more Q400s. If the airline exercises all of its options, the entire deal would be worth $2.3 billion U.S. Bombardier will deliver the CSeries planes in 2016.

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IGM FINANCIAL INC. $47 (Toronto symbol IGM; Conservative Growth Portfolio, Finance sector; Shares outstanding: 251.8 million; Market cap: $11.8 billion; Price-to-sales ratio: 4.6; Dividend yield: 4.6%; TSINetwork Rating: Above Average; www.igmfinancial.com) is Canada’s largest independent mutual fund company, with $125.8 billion of assets under management. Power Financial owns 58.4% of IGM.

The company has two main divisions. Investors Group sells its mutual funds, along with other services like portfolio management and mortgages, through 4,500 affiliated advisors. Mackenzie Financial sells its funds through independent brokers.

In 2012, Investors Group cut the management fees on most of its funds to better compete with other fund companies. This move seems to be paying off. In the three months ended March 31, 2013, Investors Group’s sales, net of redemptions, jumped 114.4% to $375.6 million from $175.2 million a year earlier.
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MAPLE LEAF FOODS INC. $13 (Toronto symbol MFI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 140.0 million; Market cap: $1.8 billion; Price-to-sales ratio: 0.4; Dividend yield: 1.2%; TSINetwork Rating: Average; www.mapleleaf.ca) recently increased the prices of its meat products to offset rising costs of animal feed after last year’s drought in the U.S. The recent drop in the value of the yen has also made its pork products more expensive in Japan. As a result, Maple Leaf’s sales fell 4.1% in the first quarter of 2013, to $1.1 billion from $1.2 billion a year earlier. If you exclude the cost of a major restructuring, which includes building new plants and eliminating unprofitable products, Maple Leaf lost $0.06 a share, compared with a year-earlier profit of $0.06 a share.

Due to new accounting rules for pensions, Maple Leaf has cut its gross margin (gross profits as a percentage of sales) target for 2015 to 11.7% from 12.5%. That’s still a big improvement over its 2012 gross margin of 8.6%.

Maple Leaf Foods is still a buy....

POTASH CORP. OF SASKATCHEWAN $44 (Toronto symbol POT; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 865.1 million; Market cap: $38.1 billion; Price-to-sales ratio: 4.7; Dividend yield: 2.6%; TSINetwork Rating: Average; www.potashcorp.com) no longer aims to buy control of Israel Chemicals, which produces potash from minerals it extracts from the Dead Sea. Potash Corp. wanted to increase its stake from 13.9% to at least 51%, but the plan faced intense political opposition. The company plans to hang on to this investment and may try to buy more of Israel Chemicals in the future.

Meanwhile, the company’s sales rose 20.3% in the three months ended March 31, 2013, to $2.1 billion from $1.7 billion a year earlier (all amounts except share price and market cap in U.S. dollars). Earnings rose 13.2%, to $556 million from $491 million. Due to more shares outstanding, per-share earnings rose 12.5%, to $0.63 from $0.56. New contracts with potash buyers in China and India, plus higher shipments to Brazil, helped offset a 16.6% drop in the company’s average realized selling price.

Potash Corp. is a buy....

CENOVUS ENERGY INC. $31 (Toronto symbol CVE; Conservative Growth Portfolio, Resources sector; Shares outstanding: 755.6 million; Market cap: $23.4 billion; Price-to-sales ratio: 1.3; Dividend yield: 3.1%; TSINetwork Rating: Average; www.cenovus.com) operates three heavy oil projects in Alberta and one in Saskatchewan. It gets about half of its output from the oil sands. Conventional oil and natural gas wells supply the other half.

U.S.-based ConocoPhillips (New York symbol COP) owns 50% of Cenovus’s main Foster Creek and Christina Lake oil sands projects in Alberta. These properties produce heavy bitumen, which Cenovus ships to its 50%-owned refineries in Illinois and Texas. ConocoPhillips recently spun off its refining operations as a separate company called Phillips 66 (New York symbol PSX). This new firm owns the other 50% of these refineries.

Cenovus continues to increase its oil sands output. In the first three months of 2013, it produced 271,100 barrels of oil equivalent a day (66% oil and 34% gas), up 3.1% from 262,900 barrels a year earlier.
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IMPERIAL OIL LTD. $40 (Toronto symbol IMO; Conservative Growth Portfolio; Resources sector; Shares outstanding: 847.6 million; Market cap: $33.9 billion; Price-to-sales ratio: 1.1; Dividend yield: 1.2%; TSINetwork Rating: Average; www.imperialoil.ca) has started operating its new Kearl oil sands project in northern Alberta. Imperial owns 71% of Kearl. ExxonMobil Corp. (New York symbol XOM) owns the remaining 29%. Exxon also owns 69.6% of Imperial.

Kearl is the biggest project in Imperial’s history. Its first phase will produce 110,000 barrels a day (Imperial’s share is 78,100 barrels) by the end of 2013. The project’s second phase will add a further 78,100 barrels to Imperial’s daily production by late 2015. Kearl’s reserves should last 40 years.

Meanwhile, Imperial produced 284,000 barrels of oil equivalent a day in the three months ended March 31, 2013. That’s down 1.7% from 289,000 barrels a year earlier. The decline is mainly the result of planned maintenance at the Syncrude oil sands project; Imperial owns 25.0% of Syncrude.
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SUNCOR ENERGY INC. $32 (Toronto symbol SU; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.5 billion; Market cap: $48.0 billion; Price-to-sales ratio: 1.2; Dividend yield: 2.5%; TSINetwork Rating: Average; www. suncor.com) recently agreed to sell its conventional natural gas operations in Alberta, northeastern British Columbia and southern Saskatchewan for $1 billion. The deal does not include Suncor’s undeveloped shale gas and oil properties in B.C. and Alberta.

The cash from this sale prompted Suncor to raise its quarterly dividend by 53.8%, to $0.20 a share from $0.13. The new annual rate of $0.80 yields 2.5%. The company also plans to buy back up to $2 billion of its shares over the next five months.

In addition, Suncor continues to expand its oil sands operations. In the three months ended March 31, 2013, the company produced an average of 596,100 barrels of oil equivalent (including gas) a day. That’s up 6.0% from 562,300 barrels a year earlier.
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CANADIAN PACIFIC RAILWAY LTD. $132 (Toronto symbol CP; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 174.7 million; Market cap: $23.1 billion; Price-to-sales ratio: 4.0; Dividend yield: 1.1%; TSINetwork Rating: Above Average; www.cpr.ca) continues to benefit from a major restructuring plan, which includes new locomotives, better tracks and software that optimizes train loads and speeds.

In the first three months of 2013, CP’s earnings jumped 52.8%, to $217 million, or $1.24 a share. A year earlier, the company earned $142 million, or $0.82 a share.

The higher earnings are mainly due to CP’s improving efficiency. Its operating ratio improved to 75.8% from 80.1% a year ago. The company aims to cut its operating ratio to 65% by the middle of 2016.
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CANADIAN NATIONAL RAILWAY CO. $102 (Toronto symbol CNR; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 424.1 million; Market cap: $43.3 billion; Price-to-sales ratio: 4.3; Dividend yield: 1.7%; TSINetwork Rating: Above Average; www.cn.ca) operates Canada’s largest railway. The company’s 32,350-kilometre network stretches across Canada and through the U.S. Midwest to the Gulf of Mexico.

Ottawa nationalized CN in 1918 because of the vital role the company played in Canada’s early growth. In 1995, CN became a publicly traded company. Unlike CP, Ottawa limits a single investor’s ownership in CN to 15%.

Due to a drop in freight volumes during the recession, CN’s revenue fell 13.1%, from $8.5 billion in 2008 to $7.4 billion in 2009. Revenue recovered to $8.3 billion in 2010 and surged to $9.9 billion in 2012.

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Pat McKeough responds to many requests for advice on specific stocks and other questions on investment and the economy from the members of his Inner Circle. 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. This week, an Inner Circle member asked about the largest wireless provider in the world. China Mobile competes with two other Chinese wireless providers, each of which has the advantage of being compatible with Apple iPhones, while China Mobile is not. Pat looks at whether an upgrade of China Mobile’s network and new chip technology will let it hook up with Apple and other popular smartphones and keep its lead in the Chinese market. ...

In October 2012 Kraft Foods Inc. broke up into two separate companies, Kraft Foods Group (Nasdaq symbol KRFT) and Mondelez. Recently, we looked at Kraft (view the daily post here), whose operations are now focused on North America. Today we look at its spinoff, Mondelez, which gets most of its sales from overseas markets. MONDELEZ INTERNATIONAL INC. (Nasdaq symbol MDLZ; www.mondelezinternational.com) makes cookies and biscuits (Oreo, Chips Ahoy, Ritz), chocolate bars (Cadbury, Toblerone) and gum and candy (Trident, Chiclets, Halls cough drops). It also makes beverages, including coffee (Tassimo) and powdered fruit drinks (Tang), as well as grocery and cheese products for overseas markets. Mondelez gets 46% of its sales from developing countries, 35% from Europe and 19% from North America....

Every Wednesday, we publish our “Investor Toolkit” series on TSI Network. Whether you’re a beginning or experienced investor, these weekly updates are designed to give you specific investment advice. Each Investor Toolkit update gives you a fundamental piece of investing strategy, and shows you how you can put it into practice right away. Today’s tip: “You take a double loss if you lose money in your RRSP, which means that it is an expensive place to find out if you have a talent for stock trading.”...

MOLSON COORS CANADA INC. (Toronto symbols TPX.A and TPX.B; www.molsoncoors.com) is one of the world’s leading brewers. Its main brands include Coors Light, Molson Canadian and Carling. The company’s sales fell when it merged its U.S. brewing operations with those of rival SABMiller to form MillerCoors in 2008. Because it owns less than half of MillerCoors, accounting rules forced Molson Coors to stop including the sales from this business in its overall sales....

Members of my Inner Circle can ask me and my investment team financial questions of any kind. Aside from questions on specific investments like stocks and exchange-traded funds, members ask us many other questions about how they should be investing their money. One intriguing question came from a member who asked whether there is any advantage to investing in a prepaid funeral. I’d like to share this question, and our answer, with you....

Pat McKeough responds to many requests for specific advice on stock tips and other questions on investment and the economy from the members of his Inner Circle. 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. This week, we had a request from an Inner Circle member about Accord Financial, a stock that did well for us a couple of years ago. We recommended selling Accord and taking profits in February 2011. Pat looks at the company’s prospects today. ...

SYMANTEC CORP. $23 (Nasdaq symbol SYMC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 696.6 million; Market cap: $16.0 billion; Price-to-sales ratio: 2.3; Dividend yield: 2.6%; TSINetwork Rating: Average; www.symantec.com) makes software that protects computers from viruses and intruders, including the popular Norton anti-virus program. It also sells products and services, such as e-mail filtering and data backup, to businesses.

In July 2005, the company paid $13.2 billion for Veritas Software, whose software stores and protects information in large databases. The deal cut the company’s reliance on selling software to consumers and helped it compete with larger computer-services firms, like IBM.


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CEDAR FAIR L.P. $43 (New York symbol FUN; Income Portfolio, Consumer sector; Units outstanding: 55.6 million; Market cap: $2.4 billion; Price-to-sales ratio: 2.2; Dividend yield: 5.8%; TSINetwork Rating: Average; www.cedarfair.com) lost $1.95 a share in the first quarter of 2013, compared to a loss of $1.18 a year earlier. That’s mainly due to a one-time charge on the early retirement of debt. Cedar Fair typically loses money in the first quarter, as most of its 11 amusement parks and seven water parks close during the winter. However, revenue jumped 48.2%, to $41.8 million from $28.2 million, thanks to higher attendance and per-guest spending at its Knott’s Berry Farm year-round park in southern California.

The stock has gained 60% in the past year. However, that’s mainly due to its rising distributions, which could slow this year.

Cedar Fair is still a hold....