commodity

FINNING INTERNATIONAL INC. $18 (Toronto symbol FTT; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 169.3 million; Market cap: $3.0 billion; Price-to-sales ratio: 0.5; Dividend yield: 4.1%; TSINetwork Rating: Above Average; www.finning.com) sells and services Caterpillar-brand heavy equipment. Its main customers are in the oil, mining, forest-products and construction industries. Weaker commodity prices continue to hurt equipment demand. In response, Finning has laid off 13% of its workforce and closed 11 of its locations in Western Canada. The company is now looking at other ways to lower its costs, such as shipping parts directly to customers instead of through dealerships. Meanwhile, Finning’s earnings fell 42.4% in the three months ended September 30, 2015, to $0.19 a share from $0.33 a year earlier. Without one-time items, the company earned $0.34 a share in the latest quarter....

ATCO LTD. (Toronto symbols ACO.X [class I non-voting] $34 and ACO.Y [class II voting] $34; Income Portfolio, Utilities sector; Shares outstanding: 115.1 million; Market cap: $3.9 billion; Price-to-sales ratio: 0.9; Dividend yield: 2.9%; TSINetwork Rating: Above Average; www.atco.com) operates power plants in Western Canada, the U.K. and Australia. It also builds temporary buildings for construction, mining and energy-exploration firms. Weak commodity prices are hurting demand for electricity and shelters, particularly in Alberta. In response, ATCO is cutting 4% of its global workforce. A new carbon tax in Alberta has also weighed on ATCO’s stock. However, most of the company’s power plants burn natural gas, not coal, which should help reduce the impact of the tax. In addition, ATCO is looking at replacing some of its current facilities with a new hydroelectric plant in northern Alberta....

After selling its struggling newspaper business, Thomson Reuters thrives as a purveyor of financial, legal and tax information products.

Orbite Technologies Inc., $0.44, symbol ORT on Toronto (Shares outstanding: 380.5 million; Market cap: $165.5 million; www.orbitetech.com), is the new name of Orbite Aluminae. The company has developed a way to extract alumina (which is used in the production of aluminum) and other metals—including rare ones like scandium and gallium—from mud, clay, mine tailings, bauxite and other materials. Unlike other methods, including the industry-standard Bayer process, Orbite’s approach doesn’t produce toxic waste. The company considered its pilot project a success, and it hopes to have its long-delayed three-tonne-per-day, high-purity alumina plant in operation by the end of this year. However, it’s far from certain whether Orbite’s process will be a commercial success, and it’s also unclear whether commodity producers will switch from the proven—and familiar—Bayer process unless environmental legislation forces them to. That adds a lot of risk....

While drilling equipment company McCoy Global has dropped to the penny stock range, we see it as a bargain for aggressive investors

ALIMENTATION COUCHE-TARD, $62.68, symbol ATD.B on Toronto, has agreed to buy Ireland’s Topaz chain for an undisclosed amount. Topaz is the country’s leading operator of gas stations and convenience store stations, with a 35% share of the market. The chain consists of 464 locations across Ireland, including its recently acquired Esso network. Topaz owns 162 of these outlets, while dealers own the remaining 302. The agreement also includes a commercial-fuels operation with more than 30 depots and two terminals. Growth by acquisition can be risky, especially with a deal this big. But Couche-Tard has a long record of successfully integrating acquisitions, including Norway’s Statoil Fuel & Retail gas station chain, which it bought for $2.7 billion in June 2012. It also paid $1.7 billion for the Pantry, which has more than 1,500 convenience stores in 13 southern U.S. states, in March 2015....

We think conservative investors could hold up to 10% of their portfolios in foreign stocks. One way to do that is to buy carefully chosen exchange traded funds (ETFs) that have an overseas focus. The best ETFs offer very low management fees and well-diversified, tax-efficient portfolios of highquality stocks....

With plans to boost production by 75% over three years, Alamos Gold is poised to benefit from a recovery in the gold price

Falling commodity prices have hammered Sherritt International’s stock, but at under $1, this established producer has a lot to offer.

The many industrial uses of copper give copper stocks an advantage over gold and other precious metal stocks.