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WYNDHAM WORLDWIDE $42.99 (New York symbol WYN; TSINetwork Rating: Extra Risk) (973-753-6000; www.wyndhamworldwide.com; Shares outstanding: 154.0 million; Market cap: $6.6 billion; Dividend yield: 2.1%) is one of the world’s largest hospitality companies, with 7,205 franchised hotels worldwide. Aside from Wyndham and Ramada, it owns a variety of other brands, including Days Inn, Super 8, Wingate, Baymont Inn & Suites, Microtel Inns & Suites, Hawthorn Suites, Howard Johnson, Travelodge and AmeriHost Inn. In addition to hotels, Wyndham manages vacation resorts, rental properties, luxury clubs and time-shares. Wyndham now has 100,000 vacation rental properties worldwide. This wide range of operations gives the company more consistent cash flow than most of its competitors, which mainly focus on hotels.

In the three months ended December 31, 2011, Wyndham’s revenue rose 6.7%, to $1.0 billion from $937.0 million. The company gets most of its revenue from vacation rather than business travel, and vacation bookings rose in the latest quarter. That helped push up Wyndham’s occupancy rate by 3.8%.

Before one-time items, earnings rose 2.2%, to $0.47 a share from $0.46. Wyndham continues to buy back its shares. In the latest quarter, it repurchased 6.7 million shares for $225 million. In all of 2011, it bought back 28.7 million shares for $902 million. The company has also raised its quarterly dividend by 53.3%, to $0.23 from $0.15. It now yields 2.1%.

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FORTRESS PAPER $36.77 (Toronto symbol FTP; TSINetwork Rating: Extra Risk) (1-888-820-3888; www.fortresspaper.com; Shares outstanding: 14.3 million; Market cap: $525.8 million; No dividends paid) just bought Domtar Corp.’s old pulp mill in Lebel-sur-Quevillon, Quebec. The company plans to convert the mill to produce a type of cellulose called dissolving pulp, which is used to make rayon fabrics.

Fortress is buying the plant for a nominal amount of $1, but it will commit to spending $222 million on the conversion, which should be finished in mid-2013. The Quebec government will grant the company a 10-year, $132.4-million loan to help finance the plant.

Fortress’s outlook is positive, and the new dissolving pulp plant should make a big contribution to its earnings.

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ALARMFORCE INDUSTRIES $9.59 (Toronto symbol AF; TSINetwork Rating: Speculative) (1-800-267-2001; www.alarmforce.com; Shares outstanding: 12.2 million; Market cap: $117.0 million; No dividends paid) sells two-way voice alarm systems and monitoring services in Canada and the U.S.

AlarmForce’s system differs from others because it lets operators verify an alarm by establishing immediate two-way voice contact with homeowners. It then dispatches security personnel. If intruders are present, the two-way contact can scare them off.

The company has used radio and TV advertising to gain a high profile. It gives its system away to gain new subscribers. Users then sign a three-year contract to pay $25 a month for monitoring service.

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CALIAN TECHNOLOGIES $18.90 (Toronto symbol CTY; TSINetwork Rating: Speculative) (613-599-8600; www.calian.com; Shares outstanding: 7.6 million; Market cap: $143.6 million; Dividend yield: 5.5%) operates in two areas: the business and technology services division (which supplies 70% of Calian’s revenue) provides engineers, health care workers and other skilled professionals to clients on a contract basis. The systems engineering division (30% of revenue) sells hardware and software for testing, operating and managing satellite and other communication systems.

In the three months ended December 31, 2011, Calian’s revenue rose 6.7%, to $56.8 million from $53.3 million a year earlier. Earnings rose 14.4%, to $3.6 million, or $0.47 a share, from $3.1 million, or $0.41 a share.

Sales rose at the systems engineering division, partly due to an increase in U.S. military orders. The business and technology services division also saw continued strong demand. Calian’s backlog now stands at $665 million, with contracts running to 2018.

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FAIRFAX FINANCIAL HOLDINGS $417.01 (Toronto symbol FFH: TSINetwork Rating: Average) (416-367-2612; www.fairfax.ca; Shares outstanding: 19.9 million; Market cap: $8.3 billion; Dividend yield: 2.4%) now owns 5.12% of Research in Motion, symbol RIM on Toronto. RIM is a recommendation of our Successful Investor newsletter.

RIM has appointed Thorsten Heins as its new chief executive officer and a director of the company. Previously, he was RIM’s chief operating officer. The company’s founders and former co-CEOs, Jim Balsillie and Mike Lazaridis, will remain directors.

As well, the company has appointed Prem Watsa as a director. Mr. Watsa is the chairman and founder of Fairfax Financial Holdings.

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FAIR ISAAC CORP. $38.98 (New York symbol FICO; TSINetwork Rating: Average) (415-472-2211; www.fairisaac.com; Shares outstanding: 36.0 million; Market cap: $1.4 billion; Dividend yield: 0.2%) makes FICO Scores, which dominates the market for software that helps businesses evaluate customer creditworthiness. The company is also profiting by selling software that helps credit card issuers control fraud and analyze their clients’ spending patterns.

In its fiscal 2012 first quarter, which ended December 31, 2011, Fair Isaac’s earnings jumped 87.4%, to $30.0 million from $16.0 million a year earlier. Earnings per share rose 107.5% to $0.83 from $0.40, on fewer shares outstanding. The latest earnings also beat the consensus estimate of $0.62 a share.

Savings from the company’s ongoing cost cuts were a big reason for the increase. Sales rose 9.2%, to $170.3 million from $155.9 million.

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ADOBE SYSTEMS $32.46 (Nasdaq symbol ADBE; TSINetwork Rating: Average) (408-536-6000; www.adobe.com; Shares outstanding: 493.8 million; Market cap: $16.0 billion; No dividends paid) makes software that lets computer users create, edit and share documents in the popular PDF format. As well, graphic designers use its software to create print publications and web pages.

The company also makes Adobe Flash, which lets website developers make their pages more interactive by adding animation and video.

Adobe recently stopped making Flash for smartphones and other mobile devices. Instead, it will focus on developing products that are based on the newer HTML5 Internet standard.

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Even though we recommend mostly aggressive stocks in Stock Pickers Digest, we still manage to pick a large number that get taken over at high profits for our readers.

Mosaid Inc. was our second-most-recent winner, with a $46-ashare offer from Sterling Partners. That gave us a 107.2% gain in the 18 months from our first recommendation in May 2010.

Our latest pick to attract a takeover at a high profit to our subscribers is RuggedCom $33, symbol RCM on Toronto.

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VITERRA INC. $10.09 (Toronto symbol VT; TSINetwork Rating: Average) (1-866-569-4411; www.viterra.ca; Shares outstanding: 371.7 million; Market cap: $3.8 billion; Dividend yield: 1.5%) is a Saskatchewan-based agribusiness that mainly operates in Canada and Australia. The company accumulates, stores, transports, processes and markets grains, oilseeds and specialty crops including lentils and mustard.

Saskatchewan Wheat Pool was a farmers co-operative until it became a public company in 1996. It changed its name to Viterra in 2007 after it bought Agricore United for $1.3 billion. In 2009, Viterra bought Australian grain handler ABB Grain for $1.4 billion.

In its 2011 fiscal year, which ended October 31, 2011, Viterra’s revenue jumped 42.8%, to $11.8 billion from $8.2 billion. Earnings per share rose 82.1%, to $0.71 from $0.39. Higher crop shipments and grain prices were the main reasons for the gains.

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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 successful investing. Each Investor Toolkit update gives you a fundamental tip and shows you how you can put it into practice right away. Tip of the week: “Short sellers can make money in a hurry, but there are more losers than winners.”...

You may find that exchange-traded funds (ETFs) have a place in your portfolio. Unlike many other financial innovations, they don’t load you up with heavy management fees or tie you down with high redemption charges if you decide to withdraw. Instead, they give you a low-cost, flexible, convenient alternative to mutual funds. They have another advantage. Since shares are only added or removed when the underlying index changes, there’s a low turnover. That means you aren’t faced with the capital gains bills generated by the yearly distributions most mutual funds pay out to their unitholders....

One of the questions we get asked most often is how we’ve managed to recommend so many stocks over the years that get taken over. Almost invariably, we come back to one key point. We aim to recommend stocks with hidden assets—assets that attract less investor attention than they deserve....

Question: I would like your opinion on Africa Oil and Cabo Drilling. As always, your pearls of wisdom are very insightful and greatly appreciated.

Our investing strategy is a conservative one. We consistently recommend taking the long, rather than the short, view. But clearly not all stocks can be held indefinitely. A good portfolio is never a completely static one. Bringing in good stocks will obviously invigorate your portfolio. It is equally true that some stocks that fail to perform just aren’t worth holding on to. That leads many investors to ask us just when they should let go of a weak stock and replace it with something new....

Buy a house that suits your needs, and let the potential real estate investment profits take care of themselves. As real estate investments, homes

Tech stocks continue to make headlines. Often, this is due to the competitive race to get new products on the market. Sometimes, it is due to the spectacular rise—or spectacular fall—of a tech stock’s share price. But successful investors look beyond the headlines, to a company’s measurable strengths and weaknesses, to judge its long-term prospects, as we do today with one of the best-known names in the industry. GOOGLE INC. (Nasdaq symbol GOOG; investor.google.com) is the world’s leading Internet search engine. The search service is free, but it provides a platform for Google to sell ads on its websites. Ads account for 96% of its total revenue....

Investing is not an exact science. That’s why experience and judgment are just as essential as fundamental analysis in successful investing. That’s also why a balanced temperament is so important. It can keep you on a steady course and help you avoid losses....

ENCANA CORP. $19.59 (Toronto symbol ECA; Shares outstanding: 737.6 million; Market cap: $14.4 billion; TSINetwork Rating: Average; Dividend yield: 4.1%; www.encana.com) is selling two plants in the Cutbank Ridge area of northeastern B.C. to VERESEN $15.31 (Toronto symbol VSN; Shares outstanding: 169.8 million; Market cap: $2.6 billion; TSINetwork Rating: Extra Risk; Dividend yield: 6.5%). Veresen owns and operates energy pipelines and processing plants across North America.

These plants process natural gas from nearby wells. The sale also includes 370 kilometres of pipelines. Veresen will pay Encana $920 million (Canadian) when the deal closes in early 2012.

Including this deal, Encana sold or agreed to sell $3.5 billion U.S. of non-essential assets in 2011. The sales are part of its plan to focus on its main gas-producing properties in Alberta, B.C., Wyoming, Michigan, Colorado and Louisiana.

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VANGUARD GROWTH ETF $62.76 (New York symbol VUG; buy or sell through brokers) aims to track the MSCI U.S. Prime Market Growth Index, a broadly diversified index that mainly consists of stocks of large U.S. companies. Its MER is just 0.12%.

The $20.8-billion fund’s top holdings are Apple Inc., IBM, Google, Coca-Cola, Microsoft, Philip Morris International, Oracle Corp., Schlumberger, Wal-Mart and Cisco Systems

Vanguard Growth ETF is broken down by economic segment as follows: Information Technology (30.1%), Consumer Discretionary (17.0%), Industrials (12.6%), Consumer Staples (12.1%), Energy (9.4%), Health Care (9.3%), Financials (4.6%), Materials (3.4%), Telecommunication Services (0.8%) and Utilities (0.2%).

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VANGUARD EMERGING MARKETS ETF $39.22 (New York symbol VWO; buy or sell through brokers) aims to track the MSCI Emerging Markets Index, which is made up of common stocks of companies located in emerging markets around the world. The fund has an MER of 0.22%.

The fund’s top holdings are Samsung Electronics (South Korea: electronics), Petroleo Brasileiro SA (Brazil: oil and gas), Vale SA (Brazil: mining), Gazprom (Russia: gas utility), China Mobile (China: wireless), Taiwan Semiconductor (Taiwan: computer chips), America Movil SAB de CV (Latin America: wireless), China Construction Bank (China: banking), Itau Unibanco Holding SA (Brazil: banking), and Industrial & Commercial Bank of China (China: banking), CNOOC Ltd. (China: oil and gas) and MTN Group (South Africa: telecommunications).

The $56.3-billion Vanguard Emerging Markets ETF’s breakdown by country is as follows: China (17.1%), Brazil (15.4%), South Korea (14.9%), Taiwan (10.9%), South Africa (7.5%), India (7.4%), Russia (6.6%), Mexico (4.7%), Malaysia (3.4%), Indonesia (2.9%), Thailand (1.8%), Chile (1.7%), Poland (1.5%), Turkey (1.3%) and Other (0.9%).

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IBM $186 (New York symbol IBM; Shares outstanding: 1.2 billion; Market cap: $223.2 billion; TSINetwork Rating: Above Average; Dividend yield: 1.6%) continues to expand its software business.

In early December 2011, the company agreed to buy DemandTec Inc. (Nasdaq symbol DMAN), which makes software that retailers and consumer products makers use to analyze their customers’ spending habits. This information helps them predict consumer behaviour and quickly adjust their prices.

Adding DemandTec will also enhance IBM’s expertise in cloud computing. That’s where data and software are kept on central servers. Users then access this information over the Internet through a variety of devices

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H&R REAL ESTATE INVESTMENT TRUST $23.16 (Toronto symbol HR.UN; Units outstanding: 157.3 million; Market cap: $3.6 billion; TSINetwork Rating: Extra Risk; Dividend yield: 4.8%; www.hr-reit.com) owns stakes in 39 office buildings, 117 industrial properties and 133 retail properties across Canada. H&R has a 98.9% occupancy rate.

In the three months ended September 30, 2011, the REIT’s revenue rose 11.0%, to $169.6 million from $152.8 million a year earlier. Cash flow per unit rose 5.7%, to $0.37 from $0.35.

H&R is nearly finished building The Bow, a $1.33-billion, two-million-square-foot office building in Calgary. Encana Corp. has already leased the entire building for 25 years.

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CANADIAN REIT $36.18 (Toronto symbol REF.UN; Units outstanding: 67.3 million; Market cap: $2.4 billion; TSINetwork Rating: Extra Risk; Dividend yield: 4.0%; www.creit.ca) owns over 160 properties, including retail, industrial and office buildings, located across Canada and in the Chicago area. These properties contain over 24 million square feet of leasable area. Its occupancy rate is 93.7%.

In the three months ended September 30, 2011, the real estate investment trust’s revenue rose 5.5%, to $83.7 million from $79.4 million a year earlier. Cash flow per unit rose 5.3%, to $0.60 from $0.57.

Canadian REIT bought $264.5 million of properties in 2011, including its June 2011 purchase of two fully leased malls in Mississauga, Ontario, for $174.4 million. Tenants include Future Shop, Famous Players, Chapters, Rona and National Sports.

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RIOCAN REAL ESTATE INVESTMENT TRUST $26.33 (Toronto symbol REI.UN; Units outstanding: 267.0 million; Market cap: $7.0 billion; TSINetwork Rating: Average; Dividend yield: 5.2%; www.riocan.com) has purchased 80% of the Alamo Ranch shopping mall in San Antonio, Texas. Inland Western Retail REIT owns the remaining 20%.

This is RioCan’s first acquisition in San Antonio. The mall is 88% occupied, and has well-known anchor tenants, such as Target, J.C. Penny and Lowes. Other tenants include Best Buy and Dick’s Sporting Goods. These factors cut the risk of expanding into unfamiliar markets.

RioCan is a buy.

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MANITOBA TELECOM SERVICES INC. $29.80 (Toronto symbol MBT; Shares outstanding: 65.7 million; Market cap: $2.0 billion; TSINetwork Rating: Average; Dividend yield: 5.7%; www.mts.ca) has over 1.3 million telephone and wireless customers in Manitoba. This business now accounts for 54% of the company’s revenue.

The remaining 46% comes from its Allstream division, which provides integrated telephone, Internet and other communication services to businesses across Canada.

In the three months ended September 30, 2011, Manitoba Tel’s revenue fell 1.7%, to $443.2 million from $451.0 million a year earlier. The MTS division’s revenue rose 0.7%. Allstream’s revenue fell 4.6%, mostly because it is closing less-profitable businesses. Earnings per share fell 8.2%, to $0.56 from $0.61. The stock yields a high 5.7%.

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