boeing

Most stock markets are down lately due to investor worries about a potential eurozone breakup, sluggish U.S. growth and a slowdown in China. Still, the long-term outlook is positive. One way to profit from a rebound is to add exchange traded funds (ETFs) that track major stock market indexes to your portfolio. ETFs trade on stock exchanges, just like stocks. Prices are quoted in newspaper stock tables and online. You must pay brokerage commissions to buy and sell ETFs, but their low management fees still give them a cost advantage over most mutual funds....

WESTJET AIRLINES $15.48 (Toronto symbol WJA; TSINetwork Rating: Extra Risk) (1-877-493-7853; www.westjet.com; Shares outstanding: 130.8 million; Market cap: $2.0 billion; Dividend yield: 1.6%) serves 76 destinations in North America and the Caribbean. Its fleet of 98 modern Boeing Next-Generation 737s are 30% more fuel efficient than older aircraft. WestJet is scheduled to receive 37 more 737s through 2018. In the three months ended March 31, 2012, West- Jet’s revenue rose 15.3%, to $781.5 million from $692.2 million a year earlier. Earnings jumped 41.6%, to $68.3 million from $48.2 million. That’s a new record for the first quarter. It also marks the company’s 28th consecutive quarter of profitability. The higher revenue was the main reasons for the gain. Earnings per share rose 47.1%, to $0.50 from $0.34, on fewer shares outstanding....

WESTJET AIRLINES $15.48 (Toronto symbol WJA; TSINetwork Rating: Extra Risk) (1-877-493-7853; www.westjet.com; Shares outstanding: 130.8 million; Market cap: $2.0 billion; Dividend yield: 1.6%) serves 76 destinations in North America and the Caribbean. Its fleet of 98 modern Boeing Next-Generation 737s are 30% more fuel efficient than older aircraft. WestJet is scheduled to receive 37 more 737s through 2018.

In the three months ended March 31, 2012, West- Jet’s revenue rose 15.3%, to $781.5 million from $692.2 million a year earlier.

Earnings jumped 41.6%, to $68.3 million from $48.2 million. That’s a new record for the first quarter. It also marks the company’s 28th consecutive quarter of profitability. The higher revenue was the main reasons for the gain. Earnings per share rose 47.1%, to $0.50 from $0.34, on fewer shares outstanding.

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PLEASE NOTE: Our next Hotline will go out on Friday, April 13, 2012. MOLSON COORS CANADA INC., Toronto symbols TPX.A $45.24 and TPX.B $41.10, is buying StarBev L.P., which owns nine breweries in central and eastern Europe. StarBev brews over 20 local beers, as well as major international brands, such as Stella Artois, Beck’s and Lowenbrau, under license. Molson Coors aims to close the deal by June 30, 2012....

One way to cut your risk and earn higher profits in the highly cyclical aerospace business is to stick with global leaders. Here are two with bright prospects. UNITED TECHNOLOGIES CORP. $83 (New York symbol UTX; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 908.9 million; Market cap: $75.4 billion; Price-to-sales ratio: 1.3; Dividend yield: 2.3%; TSINetwork Rating: Above Average; www.utc.com) aims to complete its purchase of Goodrich Corp. (New York symbol GR) later this year. Goodrich makes a wide range of aircraft parts, including landing gear, wheels and brakes. It also maintains and repairs planes. United Technologies is paying a total of $18.4 billion, including $1.9 billion of Goodrich’s debt. Goodrich looks like a good fit with United Technologies’ other aerospace operations: Pratt & Whitney aircraft engines; Hamilton Sundstrand aircraft controls; and Sikorsky helicopters. Goodrich will add $8 billion to United Technologies’ yearly revenue....

THE BOEING CO. $75 (New York symbol BA; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 745.7 million; Market cap: $55.9 billion; Price-to-sales ratio: 0.8; Dividend yield: 2.3%; TSINetwork Rating: Above Average; www.boeing.com) has been forced to slow production of its new 787 Dreamliner passenger jet to fix a minor problem on the fuselages of some planes. Even with this delay, Boeing still feels it will deliver 30 to 40 of these aircraft in 2012.

Demand for Boeing’s other planes is also rising. As a result, its 2011 revenue rose 6.9%, to $68.7 billion from $64.3 billion in 2010. Earnings rose 21.1%, to $4.0 billion from $3.3 billion. Due to more shares outstanding, earnings per share rose 19.5%, to $5.33 from $4.46. Without a favourable tax gain, Boeing would have earned $4.81 a share in 2011.

The company expects to deliver 585 to 600 aircraft in 2012, up from 477 in 2011. However, proposed cuts to U.S. military spending could limit Boeing’s 2012 earnings to $4.52 a share. The stock trades at 16.6 times that figure.

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J.P. MORGAN CHASE & CO., $44.57, New York symbol JPM, has passed the Federal Reserve’s latest “stress test”, which measures how well banks and other financial firms would cope with a sharp jump in unemployment, falling stock prices and other unfavourable economic conditions. As a result, Morgan raised its quarterly dividend by 20.0%, to $0.30 a share from $0.25. The new annual rate of $1.20 yields 2.7%. Morgan also announced that it would buy back $15 billion of its shares. That’s equal to roughly 9% of its $170.1-billion market cap. Morgan will repurchase $12 billion of its stock this year and an additional $3 billion in 2013. The dividend hike and buybacks prompted the stock to jump 9% this week. However, low interest rates continue to hurt the revenue the bank receives on loans. Financial reforms passed by Congress also imposed new restrictions on debit card fees....

SPDR DOW JONES INDUSTRIAL AVERAGE ETF $126.91 (New York symbol DIA; buy or sell through brokers; www.spdrs.com) holds the 30 stocks that make up the Dow Jones Industrial Average.

The fund’s top holdings are IBM, ExxonMobil, Chevron Corp., 3M, Johnson & Johnson, McDonald’s Corp., Coca-Cola Co., Caterpillar Inc., United Technologies and Boeing Inc. The fund’s expenses are about 0.18% of its assets.

SPDR Dow Jones ETF is a buy.

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Exchange traded funds (ETFs) may have a place in your portfolio. That’s because, 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 get out of them. Instead, they give you a low-cost, flexible, convenient alternative to mutual funds. ETFs trade on stock exchanges, just like stocks. Prices are quoted in newspaper stock tables and online. You’ll have to pay brokerage commissions to buy and sell ETFs. However, ETFs’ low management fees still give them a cost advantage over most conventional mutual funds. As well, shares are only added or removed when the underlying index changes. As a result of this low turnover, you won’t incur the regular capital gains bills generated by the yearly distributions most conventional mutual funds pay out to unitholders....

Northstar Aerospace Inc., $0.74, symbol NAS on Toronto (Shares outstanding: 30.7 million; Market cap: $22.7 million; www.nsaero.com), makes a wide variety of parts for airplanes and helicopters, including gears, gearboxes, rotor shafts and transmissions. The company is based in Chicago, but it has plants in Ontario, Illinois and Arizona. Northstar gets about 80% of its revenue by selling parts to military-related customers, such as the U.S. Department of Defense and Boeing. The remaining 20% comes from commercial aircraft customers, including General Electric Aviation, Honeywell and Rolls-Royce. In the three months ended September 30, 2011, Northstar’s revenue rose 7.1%, to $45.9 million from $49.4 million a year earlier (all amounts except share price and market cap in U.S. dollars). Defense sales rose 2.8%, but commercial sales fell 31.2%, due to lower demand from Honeywell and Rolls-Royce....