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SUN LIFE FINANCIAL $54.45 (Toronto symbol SLF; SI Rating: Above-average) offers savings, retirement, pension and life and health insurance products and services to individuals and corporations. The company operates mainly in Canada, the U.S. and the UK, and also in Asia, China and India. It has assets under administration of $427 billion. In the three months ended September 30, 2007, Sun Life’s earnings rose 6.7%, to $577 million or $1.02 a share, from $541 million or $0.94 a share a year earlier. Revenue fell 16.9%, to $3.5 billion from $4.2 billion, due to new accounting rules for investments. Sun Life’s shares yield 2.4%. Sun Life is still a buy.

GREAT-WEST LIFECO $34.93 (Toronto symbol GWO; SI Rating: Above-average) is a leading Canadian insurance company, with $404 billion in assets under administration. The company also provides wealth management and other financial services. It also operates in the U.S. and Europe. Power Financial controls about 75% of Great-West. Great-West’s earnings in the three months ended September 30, 2007 excluding one-time items rose 17%, to $558 million or $0.63 a share from $477 million or $0.54. Revenues rose 1.2%, to $6.64 billion from $6.57 billion. The shares yield 3.2%. Great-West closed the $3.9 billion U.S. acquisition of U.S.-based investment management firm and mutual fund company Putnam Investments Trust in August, 2007. The purchase more than doubled Great-West’s assets under administration. Great-West is also making a series of small acquisitions in the U.S. employer-sponsored health insurance market....

MANULIFE FINANCIAL $39.51 (Toronto symbol MFC; SI Rating: Above-average) sells life and other forms of insurance, as well as mutual funds and investment management services. It operates in 19 countries and territories worldwide. Manulife has assets under administration of $399 billion. In the three months ended September 30, 2007, Manulife’s earnings rose 9.9%, to $1.1 billion or $0.70 a share, from $967 million or $0.62 a share a year earlier. Revenue rose 11.3%, to $9.4 billion from $8.4 billion. Manulife has raised its dividend 9.1%, to $0.24 from $0.22. The shares now yield 2.2%. Manulife’s operations are diversified among life and health insurance, segregated mutual funds, and reinsurance. Its geographic diversification in the U.S. and Asia, including China, offers growth prospects....

AIC DIVERSIFIED CANADA FUND $44.27 (CWA Rating: Conservative) mainly holds shares of Canadian companies of average or above-average quality. It also holds stocks of some U.S. firms. The $1.4 billion fund’s 10 largest holdings are Power Financial, Canadian Oil Sands Trust, TD Bank, Shoppers Drug Mart, FedEx, Thomson Corporation, Brookfield Asset Management, Royal Bank of Canada, Manulife Financial and Royal Bank of Scotland. AIC Diversified Canada holds just 19 stocks. The fund holds 53.0% of its assets in Financial services stocks. The rest of the portfolio breaks down as follows: Consumer staples, 16.1%; Energy, 9.9%; Consumer discretionary, 7.4%; Health care, 7.0%; Industrials, 4.0%; and Conglomerates, 1.6%....

AIC AMERICAN ADVANTAGE FUND $6.20 (CWA Rating: Aggressive) (AIC Group of Funds, 1375 Kerns Road, Burlington, Ont., L7R 4X8, 1-800-263-2144; Web site: www.aicfunds.com. Buy or sell through brokers) invests mostly in U.S. stocks, with over 99% of assets in the financial services area. The fund’s holdings in this segment break down as follows: Life & health insurance, 19.5%; Diversified banks, 13.0%; Multi-line insurance, 12.8%; Property & casualty insurance companies, 12.6%; Investment banking & brokerage, 10.7%; Wealth management, 7.0%; Diversified financials, 6.5%; Thrifts & mortgage finance, 6.2%; Insurance brokers, 5.8%; Consumer finance, 5.7%; and Conglomerates, 0.4%. The $85.0 million AIC American Advantage’s top 10 holdings are Toronto-Dominion Bank, Prudential Financial, JP Morgan Chase, American International Group, Manulife Financial, AFLAC, Hartford Financial Services, Northern Trust, Merrill Lynch and Willis Group Holdings. This fund holds just 21 stocks....

TELUS CORP. $48.42 (Toronto symbol T.A; SI Rating: Above average) provides local and long distance telephone service in B.C., Alberta and parts of Quebec, and wireless service across Canada. In the three months ended September 30, 2007, Telus’s earnings per share excluding unusual items rose 10.5%, to $0.95 from $0.86 a year earlier. Revenue rose 4.5%, to $2.31 billion from $2.21 billion. Strong gains at its wireless and high-speed Internet operations offset lower local and long-distance revenues. The company recently raised its dividend rate by 20%. The new annual rate of $1.80 yields 3.1%. Recent auctions of new radio frequencies (or wireless spectrum) to let new cell phone firms such as Videotron and Shaw Cable enter the market will increase competition. Ottawa will also force incumbents like Telus to lease towers and other equipment to these new competitors for five years while they build their own networks....

HONDA MOTOR CO. LTD. ADRs $33 (New York symbol HMC; Conservative Growth Portfolio, Manufacturing & Industry sector; ADRs outstanding: 1.8 billion; Market cap: $59.4 billion; WSSF Rating: Above average) gets just over 50% of its revenue from North America, so it’s more vulnerable to a falling U.S. dollar than Toyota. In Honda’s latest six-month period, overall car sales rose 5.8%. Sales rose 5% in North America, 28% in Europe and 15% in Asia (excluding Japan, where sales fell 15%). Revenue grew 11.5%, to $49.5 billion from $44.4 billion a year earlier. Earnings per ADR rose 38.1%, to $1.74 from $1.26. (Each Honda American Depository Receipt represents one Honda common share.) Despite tougher conditions in the U.S., Honda’s new models should let it increase its current market share of 9.3%. Honda is also preparing to meet tougher U.S. fuel economy standards with new hybrid cars....

TOYOTA MOTOR CORP. ADRs $106 (New York symbol TM; Conservative Growth Portfolio, Manufacturing & Industry sector; ADR’s outstanding: 1.6 billion; Market cap: $169.6 billion; WSSF Rating: Above average) reported that its North American sales in the six months ended September 30, 2007 rose 2.3%, due to strong demand for the new Tundra pickup truck and Prius hybrid compact. Sales grew 18% in Japan, and 8% in Europe. Consequently, Toyota’s six-month revenue rose 9.3%, to $101.0 billion from $92.4 billion a year earlier. Earnings improved 18.8%, to $4.86 per ADR from $4.09 per ADR. (Each Toyota American Depository Share represents two of Toyota’s common shares.) North America accounts for about 40% of Toyota’s sales. Toyota’s sales in North America will probably slow in the second half of 2008. Florida and California account for 25% of its U.S. sales, so falling housing prices in these markets could force Toyota to rely on special incentives to keep inventories down. However, rising sales in developing countries will help offset slowing North American sales. For example, Toyota currently has 5% of China’s car market, but it aims to double its market share by 2010....

LIMITED BRANDS INC. $18 (New York symbol LTD; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 353.1 million; Market cap: $6.4 billion; WSSF Rating: Average) operates two retail chains: Victoria’s Secret (lingerie) and Bath & Body Works (personal care products). In the past few months, the company has sold 75% of the Limited and Express casual clothing chains as part of its strategy to focus on its more profitable operations. The two sales gave Limited Brands a net pre-tax gain of $230 million. In its third fiscal quarter ended November 3, 2007, Limited Brands earned $0.03 a share (total $12 million). Due to the timing of the Limited and Express sales, the latest quarterly earnings included a pre-tax gain of just $0.04 a share ($24.5 million). The company earned $0.06 a share ($24 million) in the year-earlier quarter. Sales fell 9.5%, to $1.9 billion from $2.1 billion....

LIZ CLAIBORNE INC. $21 (New York symbol LIZ; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 99.5 million; Market cap: $2.1 billion; WSSF Rating: Average) designs a wide variety of clothing and accessories for men and women. It sells most of its products though department stores. Liz Claiborne recently sold four of the roughly 40 brands it owns. It also merged two clothing lines with existing brands. The company aims to sell 12 more of its slower growing brands in the next few months. These sales will let Liz Claiborne focus on brands with higher profit potential, particularly brands aimed at younger shoppers such as Juicy Couture and Lucky Brand. An aggressive cost-cutting plan should also save the company $265 million a year by the end of 2010....

JONES APPAREL GROUP INC. $16 (New York symbol JNY; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 85.3 million; Market cap: $1.4 billion; WSSF Rating: Average) designs clothing, accessories and footwear under several brands, including Jones New York, Gloria Vanderbilt and Nine West. In September 2007, Jones sold its Barneys New York upscale clothing chain for $858.7 million. The company used the cash to buy back $496.9 million worth of its shares. Jones still has roughly $300 million remaining under its current authorization plan. If you exclude the gain from the Barneys sale and other unusual items, Jones’s earnings in the third quarter of 2007 fell 22.1%, to $51.7 million from $66.4 million a year earlier. Thanks to the share buyback, per-share earnings fell just 13.6%, to $0.51 from $0.59. Sales slipped to $1.03 billion from $1.08 billion, as warm weather in September hurt demand for winter clothing and boots....

AGILENT TECHNOLOGIES INC. $36 (New York symbol A; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 370.0 million; Market cap: $13.3 billion; WSSF Rating: Average) makes electronic test and measurement equipment. Manufacturers use these products to improve the reliability of a wide variety of electronic products, such as cell phones and communication network components. This business accounts for 60% of Agilent’s revenue. The remaining 40% comes from measurement equipment for medical research labs and drug developers. Agilent’s products also help government agencies test for biological and chemical contaminants in air, water, soil and food. Agilent’s revenue rose from $6.1 billion in 2003 (fiscal years end October 31) to $7.2 billion in 2004, but slipped to $6.9 billion in 2005. In 2006, revenue fell to $5.0 billion after Agilent sold its struggling chipmaking business. On October 31, 2006, Agilent handed out its remaining shares in its chip-testing subsidiary Verigy Ltd. (Nasdaq symbol VRGY) to its own stockholders as a special dividend. Despite the spin-off, Agilent’s revenue in 2007 rose to $5.4 billion....

CANADIAN TIRE CORP. $73 (Toronto symbol CTC.A; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 81.6 million; Market cap: $6.0 billion; SI Rating: Above average) is one of Canada’s leading retailers. Its 468 Canadian Tire stores sell a unique mix of automotive, household and sporting goods. The company also operates smaller retail chains Mark’s Work Wearhouse (casual clothing) and PartSource (auto parts), as well as 265 gas stations. In the mid-1990s, Canadian Tire began a major overhaul of its stores to make them more friendly to shoppers, including wider aisles and better signage and lighting. This helped it compete with big U.S. retailers such as Wal-Mart and Home Depot....

CANADIAN PACIFIC RAILWAY LTD. $66 (Toronto symbol CP; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 153.2 million; Market cap: $10.1 billion; SI Rating: Average) has also run into problems with its plan to buy a U.S. railway. In September 2007, it agreed to pay $1.48 billion U.S. for Dakota, Minnesota & Eastern Railroad Corp. (DM&E), which operates a 4,000-km rail network in eight Midwestern states. DM&E mainly transports agricultural products, coal and ethanol to key ports such as Chicago and Minneapolis. CP also plans to spend $300 million U.S. to upgrade DM&E’s tracks and railcars. This is a big investment for CP, which earned $603.9 million (Canadian) or $3.87 a share in the first nine months of 2007. Like CN, this acquisition also faces local opposition. While this will prolong the regulatory review process, CP will likely win approval for the takeover....

CANADIAN NATIONAL RAILWAY CO. $51 (Toronto symbol CNR; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 494.5 million; Market cap: $25.2 billion; SI Rating: Above average) has agreed to buy a major portion of a 319-km railway near Chicago for $300 million U.S. The company also plans to invest $100 million U.S. to expand capacity on the new line. To put these figures in context, CN earned $485 million (Canadian) or $0.96 a share in the third quarter of 2007. This lightly used line would let CN bypass heavy rail traffic in Chicago. However, the company’s plan to increase volume on these tracks has encountered strong opposition from local municipalities. CN had hoped to complete the purchase in early 2008. But an environmental review could delay the transaction by about 18 months. The stock trades at 15.1 times its projected 2007 earnings of $3.38 a share. Earnings should rise to $3.82 a share in 2008 as CN begins to realize the benefits from its new terminal in Prince Rupert, B.C. That gives it a p/e of just 13.4. The $0.84 dividend yields 1.6%....

ENCANA CORP. $69 (Toronto symbol ECA; Conservative Growth Portfolio, Resource sector; Shares outstanding: 749.5 million; Market cap: $51.7 billion; SI Rating: Average) is one of North America’s leading producers of natural gas (80% of production) and oil (20%). EnCana prefers to focus on unconventional properties such as early-stage gas developments and oil sands. These assets cost more to develop, at least initially, but should last much longer than conventional properties. EnCana is enjoying the benefits of its new partnership with U.S.-based ConocoPhillips to develop its oil sands assets. Daily production at its two main oil sands properties rose 33% in the third quarter of 2007. Oil sands accounted for roughly 20% of EnCana’s earnings of $1.27 a share (total $961 million) in the third quarter of 2007 (all amounts except share price and market cap in U.S. dollars). That’s down from $1.31 a share ($1.08 billion) a year earlier, mainly because the year-earlier quarter included a $255 million pre-tax gain on the sale of an asset. Revenue rose 40.0%, to $5.6 billion from $4.0 billion....

PETRO-CANADA $52 (Toronto symbol PCA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 485.2 million; Market cap: $25.2 billion; SI Rating: Average) is Canada’s secondlargest integrated oil company after Imperial Oil. Main production areas include Western Canada, offshore platforms near Newfoundland, the North Sea, Libya and Trinidad and Tobago. The company also operates over 1,300 retail gas stations. Petro-Canada is investing heavily in long-term projects that should pay off for decades. For example, it owns 60% of the Fort Hills oil sands project, whose reserves should last up to 40 years. Production should begin in late 2011. Petro-Canada estimates its share of Fort Hill’s costs at $8.5 billion. To put that in context, the company earned $1.29 a share (total $630 million) before special items in the three months ended September 30, 2007, up 14.2% from $1.13 a share ($564 million) a year earlier. Revenue rose 5.8%, to $5.5 billion from $5.2 billion....

IMPERIAL OIL LTD. $52 (Toronto symbol IMO; Conservative Growth Portfolio, Resources sector; Shares outstanding: 914.2 million; Market cap: $47.5 billion; SI Rating: Average) is Canada’s largest integrated oil company. Imperial also operates 2,000 retail gas stations under the “Esso” banner. ExxonMobil Corp. owns 69.6% of Imperial’s stock. Imperial continues to invest heavily in new oil and gas projects. For example, it recently received regulatory approval to proceed with its Kearl Lake oil sands project, which contains roughly 4.6 billion barrels. That’s equal to 34% of Imperial proved and non-proved reserves of 13.5 billion barrels. Imperial owns 70% of Kearl Lake, while ExxonMobil owns the remaining 30%. Imperial estimates that Kearl Lake will cost $8 billion to develop. However, oil sands projects are extremely complex, and this figure will probably rise. To put that in context, Imperial earned $0.88 a share (total $816 million) in the third quarter of 2007, up 4.8% from $0.84 a share ($822 million) a year earlier. Revenue fell 3.8%, to $6.4 billion from $6.65 billion, due to lower natural gas production and prices....

JAPAN SMALLER CAP FUND $10.89 (New York symbol JOF; CWA Rating: Aggressive) invests mainly in less-widely-followed Japanese over-the-counter stocks. The fund’s top holdings are Jupiter Telecom, Eagle Industry Co., Nichias Corporation, Tokai Rubber, Futuba Industrial, Aeon Delight, Disco Corp., Kansai Urban Banking, Suraga Corp. and Hisamitsu Pharmaceutical. Japan Smaller Cap Fund sells for a 0.4% premium above the current value of its assets. Our long-standing advice is that you only buy closed-end funds trading at close to or below net asset value. Japan Smaller Cap is a buy.

JAPAN EQUITY FUND $7.83 (New York symbol JEQ; CWA Rating: Aggressive) invests mostly in large capitalization stocks on the Tokyo Stock Exchange. The Japan Equity Fund’s top holdings include: Toyota Motor, Mitsubishi UFJ Financial Group, Mizuho Financial, Sumitomo Corp., Nomura Holdings, Mitsubishi Corp., Canon, East Japan Railway, Komatsu Ltd., and Nippon Steel. Japan Equity Fund is available for 7% less than the current value of its assets. It’s a buy.

BANK OF NOVA SCOTIA $52.15 (Toronto symbol BNS: SI Rating: Above average) ranks second among Canada’s five big banks, with assets of $408.1 billion. It has over 1,000 branches in Canada. In the three months ended July 31, 2007, Bank of Nova Scotia earned $1.02 billion or $1.03 a share, up 9.5% from $928 million or $0.94 a share a year earlier. Net interest income rose 5.6%, to $1.8 billion from $1.7 billion. Other income (which includes wealth management) rose 18.4%, to $1.4 billion from $1.2 billion. The bank’s shares currently yield 3.5%. The bank expects to write down some of its asset-backed securities in its fiscal fourth quarter ended October 31, and take an after-tax charge of around $135 million. However, a $160 million after-tax gain from the Visa restructuring will offset the writedown....

SCOTIA CANADIAN GROWTH FUND $74.27 (CWA Rating: Conservative) (Scotia Securities, 40 King Street West, 6th Floor, Toronto, Ontario M5H 1H1. 1-800-268-9 269; Website: www.scotiabank.com. No load — deal directly with the company.) uses fundamental analysis to identify what the managers see as investments that have the potential for above-average growth. The $619.8 million Scotia Canadian Growth Fund’s 10 largest holdings are Manulife Financial, Suncor Energy, Royal Bank, TD Bank, Research in Motion, Canadian Natural Resources, Sun Life Financial, CN Railway, Bank of Nova Scotia and EnCana. Scotia Canadian Growth currently holds 41.7% of its portfolio in the Resources sector. Its next-largest holding is Financial services at 29.3%. Over the last 10 years, Scotia Canadian Growth posted a 6.8% annual rate of return. That’s less than the S&P/TSX’s return of 9.8%. The fund gained 19.2% over the past year, compared to a gain of 21.4% for the S&P/TSX. Scotia Canadian Growth’s MER is 2.12%....

CIBC CANADIAN EQUITY FUND $26.81 (CWA Rating: Conservative) (CIBC Securities, 5140 Yonge Street, Suite 900, Toronto, Ontario M2N 6X7. 1-800-631-7008; Website: www.cibc.com. No load — deal directly with the company.) uses a “bottom-up” approach (using fundamentals such as earnings, cash flow and low debt) to identify companies that trade at reasonable valuations and yet have growth potential. The $642.2 million fund’s top holdings are Petro- Canada, EnCana, Manulife Financial, Teck Cominco, Bank of Nova Scotia, TD Bank, Canadian National Railway, Suncor Energy and Research in Motion. CIBC Canadian Equity holds 36.6% of its portfolio in Financial services stocks and 23.6% in Resource sector stocks....

BMO EQUITY FUND $33.37 (BMO Mutual Funds, 77 King Street West, Suite 4200, Royal Trust Tower, Toronto, Ont., M5K 1J5, 1-800-665-7700; Web site: www.bmo.com. No load — deal directly with the bank) (CWA Rating: Conservative) generally invests mostly in ‘blue-chip” Canadian companies. These stocks are selected based on the manager’s outlook for the industry they operate in, the earnings record of each company, the strength of management and the potential for growth. BMO Equity Fund’s 10 largest holdings are Manulife Financial, Suncor Energy, Royal Bank of Canada, TD Bank, EnCana Corporation, Canadian Natural Resources, Rogers Communications, Potash Corporation of Saskatchewan, CIBC and Bank of Nova Scotia. The $2.3 billion fund currently holds 41.9% of its portfolio in the Resources sector. Its next-largest holding is Financial services at 28.4%....

RBC CANADIAN EQUITY FUND $29.28 (CWA Rating: Conservative) (RBC Funds, P.O. Box 7500, Station A, Toronto, Ontario. M5W 1P9. 1-800-463-3863; Web site: www.royalbank.com. No load — deal directly with the bank) invests mostly in larger-capitalization stocks, but also looks for opportunities in small and mid-cap stocks. The fund’s 10 largest holdings are TD Bank, Manulife Financial, Bank of Nova Scotia, Royal Bank, EnCana, Canadian Natural Resources, Suncor Energy, Research in Motion, Potash Corp. and Bank of Montreal. The $5.3 billion fund holds 39.3% of its holdings in Resources stocks. It also holds 28.4% in Financial services stocks. Over the last ten years, RBC Canadian Equity posted a 10.3% annual rate of return. That’s about equal to the S&P/TSX’s gain of 9.8%. The fund made 21.4% over the last year, equal to the gain of 21.4% for the S&P/TSX. The fund’s MER is 1.99%....