bbd a

AGRIUM INC., $94.59, Toronto symbol AGU, plans to continue expanding its retail operations after shareholders decided not to elect five nominees from activist investment firm Jana Partners to Agrium’s 12-member board of directors. The retail division has 1,220 stores in North America, South America and Australia that sell seed, fertilizer and other products to farmers. These outlets supply about 70% of Agrium’s revenue. The remaining 30% mainly comes from making fertilizers from natural gas. Jana, which owns 7.5% of Agrium’s shares, wants Agrium to spin off its retail division as a separate company. However, steady revenue streams from these stores help offset the cyclical nature of Agrium’s fertilizer operations....

TRANSCANADA CORP., $47.92, Toronto symbol TRP, continues to move ahead with its plan to convert its main natural gas pipeline, which pumps gas from Alberta to markets in central and eastern Canada, to handle crude oil. That’s because rising production of shale gas in the northeastern U.S. has lowered this pipeline’s volumes and hurt its profitability. The company is now signing up oil producers. If demand is strong, it will begin converting the pipeline. TransCanada did not say how much this would cost, but it should complete the project by late 2017. Converting this pipeline to oil would also improve TransCanada’s long-term prospects, particularly if the U.S. government rejects its proposed Keystone XL pipeline, which would pump crude oil from Alberta’s oil sands to refineries on the U.S. Gulf Coast....

BOMBARDIER INC. (Toronto symbols BBD.A $4.06 and BBD.B $4.06; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.7 billion; Market cap: $6.9 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.5%; TSINetwork Rating: Average; www.bombardier.com) has received a firm order for 32 of its new CSeries passenger jets from Russian aircraft leasing firm Ilyushin Finance Co.

If Ilyushin exercises its option to buy an additional 10 planes, the entire order would be worth $3.4 billion U.S. That’s equal to 20% of Bombardier’s 2012 revenue of $16.8 billion U.S. The company did not say when it would begin deliveries, as it is still developing the CSeries plane. It plans to begin test flights in June 2013.

The subordinate-voting class B shares are the better choice because of their slightly better liquidity and higher dividend yield.
...

TRANSCONTINENTAL INC., $12.40, Toronto symbol TCL.A, is the largest commercial printer in Canada and the third-largest in North America. It also publishes newspapers and magazines. The company plans to pay a special dividend of $1.00 a share on April 26, 2013, to shareholders of record on April 5. That’s in addition to its regular quarterly payout of $0.145 a share, for a 4.7% annualized yield. Meanwhile, Transcontinental earned $28.5 million in its fiscal 2013 first quarter, which ended January 31, 2013. That’s up 5.2% from $27.1 million a year earlier. Earnings per share rose 12.1%, to $0.37 from $0.33, on fewer shares outstanding....

ANDREW PELLER LTD. $11 (Toronto symbol ADW.A; Income Portfolio, Consumer sector; Shares outstanding: 14.3 million; Market cap: $157.3 million; Price-to-sales ratio: 0.6; Dividend yield: 3.3%; TSINetwork Rating: Above Average; www.andrewpeller.com) reported that its sales rose 4.2% in the three months ended December 31, 2012, to $79.8 million from $76.6 million a year earlier....

BOMBARDIER INC. (Toronto symbols BBD.A $3.43 and BBD.B $3.28; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.7 billion; Market cap: $6.4 billion; Price-to-sales ratio: 0.3; Dividend yield: 3.0%; TSINetwork Rating: Average; www.bombardier.com) has received a firm order for 56 of its Global business jets from Switzerland-based VistaJet. This deal is worth $3.1 billion (all amounts except share price and market cap in U.S. dollars). If VistaJet exercises all of its options, the order would rise by 86 planes, for a total value of $7.8 billion. That’s equal to 43% of Bombardier’s 2011 revenue of $18.3 billion. The company will begin delivering these planes in 2014.

The subordinate-voting class B shares are the better choice because of their slightly better liquidity and higher dividend yield.

Bombardier B stock is a buy.

...

PLEASE NOTE: This is our last Hotline for 2012. Our next Hotline will go out on Friday, January 4, 2013. RESEARCH IN MOTION LTD., $10.86, Toronto symbol RIM, reported a lower-than-expected loss in its latest quarter. Its revenue matched the consensus estimate. However, due to its falling share of the smartphone market, RIM has had to cut the fees it charges wireless carriers to use its proprietary messaging network. RIM earns higher profits from this service than selling hardware, so lower fees will hurt its profitability. That’s why the stock fell 22% today....

BOMBARDIER INC. (Toronto symbols BBD.A $3.43 and BBD.B $3.28; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.7 billion; Market cap: $6.4 billion; Price-to-sales ratio: 0.3; Dividend yield: 3.0%; TSINetwork Rating: Average; www.bombardier.com) has received a firm order for 56 of its Global business jets from Switzerland-based VistaJet. This deal is worth $3.1 billion (all amounts except share price and market cap in U.S. dollars). If VistaJet exercises all of its options, the order would rise by 86 planes, for a total value of $7.8 billion. That’s equal to 43% of Bombardier’s 2011 revenue of $18.3 billion. The company will begin delivering these planes in 2014. The subordinate-voting class B shares are the better choice because of their slightly better liquidity and higher dividend yield. Bombardier B stock is a buy.

BOMBARDIER INC., Toronto symbols BBD.A $3.51 and BBD.B $3.43, is having trouble getting enough parts from suppliers to build its new CSeries passenger jet. As a result, the company has delayed the new aircraft’s first test flight from the end of this year to June 2013. It still expects to deliver the first CSeries plane by the end of 2013. As well, slowing demand for its passenger railcars has prompted the company to cut 3% of this division’s workforce, including closing a plant in Germany. Severance and other costs will probably total $150 million (all amounts except share prices in U.S. dollars) in the fourth quarter of 2012. The company did not say how much these moves would save it. Meanwhile, Bombardier earned $209 million, or $0.12 a share, on sales of $4.3 billion in the three months ended September 30, 2012. The latest earnings beat the consensus estimate of $0.11 a share....

TELUS CORP., Toronto symbols T $62.71 and T.A $61.52, has paid an undisclosed sum for KinLogix. This Quebec-based private company makes software that lets medical professionals store patient records on remote server computers. KinLogix already serves over 200 clinics and accounts for 36% of Quebec’s electronic medical records market. Telus’s health care-related operations are much smaller than its main wireless and regular telephone divisions. However, demand for reliable electronic record storage is growing steadily. Telus’s strong reputation should help KinLogix attract more clients....