Search

TORSTAR CORP. $9.40 (Toronto symbol TS.B; Shares outstanding: 79.9 million; Market cap: $751.1 million; TSINetwork Rating: Above Average; Dividend yield: 5.6 %; www.torstar.com) continues to expand its online operations.

This week, it agreed to buy a 14% stake in shop.ca, a new website that sells a wide variety of products from Canadian retailers. These sellers ship their products directly to customers who buy through the site, so shop.ca does not need to invest in costly distribution centres.

Torstar plans to increase its interest to 30% over the next 30 months. In all, Torstar will pay $6 million in cash and provide $12.4 million of promotional support, mainly free ads in its newspaper and on its websites.

...

GREAT-WEST LIFECO $22.51 (Toronto symbol GWO; Shares outstanding: 949.8 million; Market cap: $21.4 billion; TSINetwork Rating: Above Average; Dividend yield: 5.5%) is Canada’s largest insurance company, with $523.0 billion in assets under administration. It also operates in the U.S. and Europe.

In the three months ended March 31, 2012, Great-West’s earnings rose 8.7%, to $451 million, or $0.48 a share. A year earlier, it earned $415 million, or $0.44 a share. Revenue rose 3.9%, to $6.5 billion from $6.3 billion.

The company’s balance sheet is strong. As well, Great-West trades at just 10.7 times the $2.11 a share that it is likely to earn in 2012. The shares yield a high 5.5%.

...

ISHARES MSCI CHILE INVESTABLE MARKET INDEX FUND $62.32 (New York Exchange symbol ECH; buy or sell through brokers) is an ETF that aims to track the MSCI Chile Investable Market Index. This index consists of stocks that are mainly traded on the Santiago Stock Exchange.

The fund’s top holdings are LAN Airlines SA (Chilean national airline), 9.4%; Empresas Copec SA (conglomerate), 8.5%; Quimica y Minera de Chile (mining), 8.2%; Empresa Nacional de Electricidad (electric power), 6.8%; Cencosud SA (retailer), 6.5%; Banco Santander Chile (banking), 6.1%; Enersis AS (electric power), 5.9%; Empresas CMPC (pulp and paper), 4.8%; S.A.C.I. Falabella (retail), 4.7%; and CAP SA (iron mining and steel), 4.1%.

The fund’s industry breakdown is as follows: Utilities, 23.7%; Industrials, 21.6%; Financials, 16.9%; Materials, 15.6%; Consumer Staples, 11.1%; Consumer Discretionary, 11.1%; Telecommunications, 3.3%; and Information Technology, 1.5%.

...

ISHARES MSCI GERMANY FUND $20.18 (New York Exchange symbol EWG; buy or sell through brokers) is an ETF that aims to track the stocks in the MSCI Germany Index.

This index aims to replicate 85% of the total market capitalization of the German stock market. The remaining 15% is unavailable for investment, partly due to limitations on foreign ownership.

The ETF’s top holdings are Siemens AG (engineering conglomerate), 9.0%; BASF (chemicals), 8.3%; Bayer (diversified chemicals), 7.5%; SAP (software), 7.1%; Allianz (insurance), 5.7%; E.ON (energy), 4.7%; Deutsche Bank AG, 4.4%; Deutsche Telekom, 4.0%; and Linde AG (industrial gases), 3.5%.

...

ISHARES MSCI SOUTH KOREA INDEX FUND $55.36 (New York Exchange symbol EWY; buy or sell through brokers), is an exchange traded fund that aims to track the MSCI Korea Index.

The ETF’s top holdings are Samsung Electronics, 20.9%; Hyundai Motor Co., 6.5%; Posco (steel), 4.2%; Kia Motors, 3.5%; Hyundai Mobis (auto parts), 3.4%; Shinhan Financial, 2.9%; KB Financial, 2.4%; LG Chemical, 2.3%; Hynix Semiconductor, 2.3%; and Hyundai Heavy Industries, 1.9%.

The fund’s industry breakdown is as follows: Information Technology, 30.7%; Consumer Discretionary, 18.9%; Industrials, 13.9%; Financials, 13.6%; Materials, 11.5%; Consumer Staples, 5.6%; Energy, 2.7%; Utilities, 1.4%; Health Care, 0.8%; and Telecommunication Services, 0.7%.

...

ISHARES MSCI EMERGING MARKETS INDEX FUND $39.91 (New York symbol EEM; buy or sell through brokers), is an exchange traded fund that aims to track the MSCI Emerging Markets Index. Its geographic breakdown includes China, 17.4%; South Korea, 15.2%; Brazil, 13.2%; Taiwan, 11.0%; South Africa, 8.0%; India, 6.2%; Russia, 5.8%; Mexico, 4.7%; Malaysia, 3.7%; and Indonesia, 2.7%.

The fund’s top holdings are Samsung Electronics (South Korea: electronics), 3.5%; China Mobile, 1.9%; Taiwan Semiconductor (Taiwan: computer chips), 1.8%; America Movil (Brazil: wireless), 1.6%; Gazprom (Russia: gas utility), 1.5%; China Construction Bank (China: banking), 1.4%; Petrobras Petroleo (Brazil: energy), 1.2%; Vale SA (Brazil: mining), 1.1%; and Industrial & Commercial Bank of China, 1.2%.

The fund’s industry breakdown is as follows: Financials, 24.1%; Information Technology, 13.7%; Energy, 12.7%; Materials, 12.1%; Consumer Staples, 8.5%; Consumer Discretionary, 8.1%; Telecommunication Services, 8.1%; Industrials, 6.9%; Utilities, 3.8%; and Health Care, 1.1%.

...

ISHARES MSCI JAPAN INDEX FUND $9.50 (American Exchange symbol EWJ; buy or sell through brokers; us.ishares.com) is an exchange traded fund that tries to match the return of the Morgan Stanley Capital International (MSCI) Japan index.

The fund’s top holdings include Toyota Motor, 5.2%; Mitsubishi UFJ Financial, 2.8%; Honda Motor, 2.7%; Canon, 2.2%; Sumitomo Mitsui Financial, 2.1%; Mizuho Financial Group, 1.8%; Takeda Pharmaceutical, 1.7%; Softbank Corp., 1.5%; Fanuc Corp., 1.5%; and Mitsubishi Corporation, 1.5%.

The fund’s industry breakdown is as follows: Industrials, 20.4%; Consumer Discretionary, 19.9%; Financials, 17.4%; Information Technology, 11.9%; Materials, 6.7%; Health Care, 6.7%; Consumer Staples, 6.6%; Telecommunication Services, 4.4%; Utilities, 3.6%; and Energy, 1.6%.

...

RIOCAN REAL ESTATE INVESTMENT TRUST $27.87 (Toronto symbol REI.UN; Units outstanding: 285.0 million; Market cap: $8.0 billion; TSINetwork Rating: Average; Dividend yield: 5.0%; www.riocan.com) planned to spend $600 million on acquisitions in 2012. That’s equal to 8% of its $7.9-billion market cap. The trust spent $1 billion on acquisitions in 2011.

However, RioCan will likely spend less than it planned this year, due to the rising cost of properties in Canada’s big cities. Instead, the trust plans to upgrade its existing malls. Right now, it is focusing on projects in Toronto and Calgary.

The trust continues to pay monthly distributions of $0.115 a unit, for a 5.0% annualized yield. In light of its improving outlook, RioCan aims to raise its payout in 2013.

...

CANADIAN REIT $42.04 (Toronto symbol REF.UN; Units outstanding: 67.8 million; Market cap: $2.9 billion; TSINetwork Rating: Extra Risk; Dividend yield: 3.6%; www.creit.ca) owns over 190 properties, including retail, industrial and office buildings, located across Canada and in the Chicago area. These properties contain over 19 million square feet of leasable area. Its occupancy rate is 95.0%.

In the three months ended March 31, 2012, the real estate investment trust’s revenue rose 9.7%, to $89.2 million from $81.3 million a year earlier. Cash flow per unit rose 7.7%, to $0.56 from $0.52.

The trust bought $298.6 million of properties in 2011, including its June purchase of two fully leased malls in Mississauga, Ontario, for $174.4 million. In March 2012, it bought 50% of the 310,000- square-foot Altius Centre in Calgary for $92.3 million. In April, it paid $156.0 million for 50% of Calgary Place, a 575,000-square-foot office and retail complex.

...

; Units outstanding: 55.9 million; MaALLIED PROPERTIES REAL ESTATE INVESTMENT TRUST $29.35 (Toronto symbol AP.UN rket cap: $1.6 billion; TSINetwork Rating: Extra Risk; Dividend yield: 4.5%; www.alliedpropertiesreit.com) owns 100 office buildings, mostly in major Canadian cities. These mainly Class I properties contain over 7.8 million square feet of leasable area.

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

In 2011, the trust bought 22 properties for $456 million. In the first quarter of 2012, it bought 10 more buildings for $185.2 million.

...

TELUS $61.56 (Toronto symbol T.A; Shares outstanding: 324.9 million; Market cap: $20.0 billion; TSINetwork Rating: Above Average; Dividend yield: 4.0%; www.telus.com) gets 52% of its earnings from its growing wireless business, which now has 7.4 million subscribers across Canada.

The remaining 48% of Telus’s earnings come from its wireline division, which has 3.5 million traditional phone customers in B.C., Alberta and eastern Quebec. This business also has 1.3 million Internet users and 553,000 TV customers.

In the three months ended March 31, 2012, Telus’s earnings per share rose 6.0%, to $1.06 from $1.00 a year earlier. Rising demand for wireless and high-speed Internet services helped push up revenue by 4.0%, to $2.6 billion from $2.5 billion.

...

The New York Stock Exchange defines a blue chip as stock in a company with a national reputation for quality, reliability and the ability to operate profitably in good times and bad. The problem is that “reputation” plays a key role in the definition. Many companies acquire a blue-chip reputation by displaying the qualities that the definition suggests. Others get it through a strong public relations effort or by being in the right industry or business situation at the right time and place. Regardless of how it got there, this blue-chip label sticks with companies long after they quit living up to it....

A little over three months ago, Pat McKeough responded to the many concerns expressed over a possible real estate crash, especially in Canada’s largest markets. The video drew one of our largest viewing audiences. Today there’s still a great deal of media attention focused on the possibility of a real estate crash. Those fears are undoubtedly heightened by ongoing headlines about the European debt crisis and a slowdown in the global economy. Volatility in the stock market adds a further note of pessimism for many Canadians. That makes it all the more important to keep things in perspective, which makes this an ideal time to replay Pat’s original video. In real estate investments especially, he reminds his viewers, there is a lot of territory between boom and bust. A rising real estate market will always cool down, but that doesn’t mean catastrophe is around the corner....

Dividends don’t always get the respect they deserve, especially from beginning investors. A dividend stock’s yearly 2% or 3% or 5% yield barely seems worth mentioning alongside yearly capital gains of 10%, 20% or 30% or more. Yet dividends are far more reliable than capital gains. A stock that pays a dividend of $1 this year will probably do the same next year. It may even rise to $1.05....

TRANSCONTINENTAL INC. $9.60 (www.tctranscontinental.com) now owns 100% of Metro Montreal, a free commuter newspaper, after buying out its joint venture partner for an undisclosed amount....

strong>SNC-LAVALIN GROUP INC. $38 (www.snclavalin.com) has paid an undisclosed sum for Toronto-based engineering firm DBA Engineering. This firm specializes in paving and environmental cleanup, and should help SNC win more infrastructure contracts....

RESEARCH IN MOTION LTD. $7.57 (www.rim.com) has delayed the launch of smartphones that use its new BlackBerry 10 software to the first quarter of 2013. That’s because the company is having difficulty adapting this software to its email and messaging servers....

$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$ ENCANA CORP. $20 (Toronto symbol ECA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 736.3 million; Market cap: $14.7 billion; Price-to-sales ratio: 1.6; Dividend yield: 4.1%; TSINetwork Rating: Average; www.encana.com) is one of North America’s largest natural gas producers. Its reserves should last over 11 years.

The company took its present form on December 1, 2009, after the old EnCana Corp. split itself into two new companies: the new Encana, which focuses on natural gas, and Cenovus Energy (Toronto symbol CVE), which specializes in oil sands projects, oil refineries and conventional natural gas.

...

CANADIAN PACIFIC RAILWAY LTD. $74 (Toronto symbol CP; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 170.9 million; Market cap: $12.6 billion; Price-to-sales ratio: 2.3; Dividend yield: 1.9%; TSINetwork Rating: Above Average; www.cpr.ca) has signed a long-term deal with U.S. Silica Holdings Inc. (New York symbol SLCA), a leading maker of specialized sand.

Oil and gas exploration companies pump this sand, along with water and other chemicals, into shale rock formations. This fractures the rock and releases the oil and gas.

Under the terms of this multi-year deal, Silica will use CP trains to ship sand from its new Sparta, Wisconsin facility to its customers. CP did not say how much this deal is worth, but it should help the company profit from rising production of shale oil in the Bakken area, which covers parts of Montana, North Dakota and Saskatchewan.

...

SUNCOR ENERGY INC. $29 (Toronto symbol SU; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.6 billion; Market cap: $46.4 billion; Price-to-sales ratio: 1.1; Dividend yield: 1.8%; TSINetwork Rating: Average; www.suncor.com) produced an average of 343,000 barrels of oil per day at its oil sands projects in June 2012. That’s down 0.9% from 346,000 barrels in May 2012.

The company expects its oil sands production for all of 2012 to range from 325,000 to 355,000 barrels a day. If you include conventional oil and natural gas, Suncor should produce 530,000 to 580,000 barrels a day in 2012. The midpoint of that range is 1.6% higher than its average 2011 production of 546,000 barrels a day.

Suncor is a buy.

...

DUNDEE CORP. $22 (Toronto symbol DC.A; Aggressive Growth Portfolio, Finance sector; Shares outstanding: 55.0 million; Market cap: $1.2 billion; Price-to-sales ratio: 1.7; No dividends paid; TSINetwork Rating: Average; www.dundeecorp.com) is a holding company with subsidiaries in wealth management, real estate, resources and agriculture.

In the three months ended March 31, 2012, Dundee earned $32.5 million, up 129.2% from $14.2 million a year earlier. Per share earnings jumped 211.8%, to $0.53 from $0.17, on fewer shares outstanding.

The increase resulted from much higher returns on the company’s various investments during the latest quarter: $21.6 million compared to just $2.3 million a year ago. Dundee’s revenue rose 11.4%, to $131.3 million from $117.8 million.

...

POTASH CORP. OF SASKATCHEWAN $45 (Toronto symbol POT; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 858.9 million; Market cap: $38.7 billion; Price-to-sales ratio: 4.5; Dividend yield: 1.3%; TSINetwork Rating: Average; www.potashcorp.com) has gained roughly 17% since the middle of June 2012. That’s because hot, dry weather in the U.S. could reduce this year’s corn harvest.

In response, farmers are applying more fertilizer to boost their crop yields. As well, corn needs more potash than other crops.

The spike in demand has pushed up potash prices. Moreover, the long-term outlook for potash and other fertilizers remains bright, mainly due to rising demand for better food in fast-growing countries such as China, India and Brazil.

...

THOMSON REUTERS CORP. $29 (Toronto symbol TRI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 829.2 million; Market cap: $24.0 billion; Price-to-sales ratio: 1.7; Dividend yield: 4.5%; TSINetwork Rating: Above Average; www.thomsonreuters.com) is buying FX Alliance Inc. (New York symbol FX), which sells foreign exchange data to banks, portfolio managers and corporations. When the deal closes in the next weeks, it will strengthen Thomson’s electronic-data products.

The $625-million U.S. price is equal to 37% of the $1.7 billion U.S., or $1.98 U.S. a share, that Thomson earned in 2011.

Thomson Reuters is a buy.

...

CANADA BREAD CO. LTD. $46 (Toronto symbol CBY; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 25.4 million; Market cap: $1.2 billion; Price-to-sales ratio: 0.7; Dividend yield: 4.3%; TSINetwork Rating: Above Average; www.canadabread.ca) is Canada’s second-largest producer of baked goods, after Weston Bakery. It supplies around a third of Maple Leaf’s (see left) sales.

A big part of Maple Leaf’s restructuring is Canada Bread’s new $100-million facility in Hamilton, Ontario. This plant, which opened in September 2011, is Canada’s largest fresh bakery.

The new plant let Canada Bread close two outdated Toronto facilities in the latest quarter. The company plans to close a third Toronto-area bakery in early 2013.

...

MAPLE LEAF FOODS INC. $11 (Toronto symbol MFI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 139.5 million; Market cap: $1.5 billion; Price-to-sales ratio: 0.3; Dividend yield: 1.5%; TSINetwork Rating: Average; www.mapleleaf.ca) is Canada’s largest foodprocessing company. It mainly makes its products, which include fresh and prepared meats and poultry, under the Maple Leaf and Schneider brands. Through 90.0%-owned Canada Bread (see right), the company also makes fresh and frozen bread, pastries and pasta.

Maple Leaf continues to restructure its operations, including simplifying its product lines and increasing its focus on its most profitable foods. The company is also installing a new computer system that will give its managers more timely information and help them make better decisions.

These measures should raise Maple Leaf’s gross margin (gross profits as a percentage of sales) from 7.7% in the past 12 months, to 12.5% in 2015.

...