dividends paid
Hidden value is a key factor we look for in our stock recommendations. A good example of an underappreciated asset is a company’s brand name. Balance sheets often fail to assign any value to brands, even household names that have built up multitudes of loyal customers over the years.
These four companies own some of the best brands in their industries....
These four companies own some of the best brands in their industries....
TEMPUR-PEDIC $39.70 (New York symbol TPX; TSINetwork Rating: Speculative) (800-878-8889; www.tempurpedic.com; Shares outstanding: 59.6 million; Market cap: $2.4 billion; No dividends paid) makes and distributes Swedish mattresses and neck pillows made from its proprietary Tempur material, which conforms to the body to provide support and help alleviate pressure points.
The stock is down 54.6% since it hit an all-time high of $87.43 in April 2012. However, it is still up 91.8% from the low of $20.70 that it dropped to in June 2012.
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The stock is down 54.6% since it hit an all-time high of $87.43 in April 2012. However, it is still up 91.8% from the low of $20.70 that it dropped to in June 2012.
Competitors move into memory foam
INTUITIVE SURGICAL $574 (Nasdaq symbol ISRG; TSINetwork Rating: Average) (515-507-5000; www.intuitivesurgical.com; Shares outstanding: 39.8 million; Market cap: $22.8 billion; No dividends paid) makes the da Vinci, a computerized surgical system.
Guided by a miniature camera connected to a 3-D monitor, surgeons use the da Vinci to operate by remotely manipulating tiny robotic arms. This process is safer and much less invasive than regular surgery and helps cut a patient’s recovery time and post-operative discomfort. It also reduces scarring and infection risk.
In the three months ended December 31, 2012, Intuitive earned $174.9 million, or $4.37 a share. That’s up 15.7% from $151.2 million, or $3.86 a share, a year earlier. Revenue rose 22.6%, to $609.3 million from $496.8 million. Intuitive is debt-free and holds cash of $2.9 billion, or $72.86 a share.
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Guided by a miniature camera connected to a 3-D monitor, surgeons use the da Vinci to operate by remotely manipulating tiny robotic arms. This process is safer and much less invasive than regular surgery and helps cut a patient’s recovery time and post-operative discomfort. It also reduces scarring and infection risk.
In the three months ended December 31, 2012, Intuitive earned $174.9 million, or $4.37 a share. That’s up 15.7% from $151.2 million, or $3.86 a share, a year earlier. Revenue rose 22.6%, to $609.3 million from $496.8 million. Intuitive is debt-free and holds cash of $2.9 billion, or $72.86 a share.
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NEW GOLD $9.93 (Toronto symbol NGD; TSINetwork Rating: Speculative) (888-315- 9715; www.newgold.com; Shares outstanding: 476.0 million; Market cap: $4.7 billion; No dividends paid) produced 411,892 ounces of gold in 2012, up 6.4% from 387,155 ounces in 2011.
New Gold now has four operating mines. The company also owns 30% of the El Morro copper/gold project in Chile and 100% of the Blackwater gold project in B.C.
There is still room to increase production at New Gold’s mines and expand their reserves through exploration drilling. But even if the company doesn’t expand its operations or make acquisitions, its production could still top 1 million ounces within six years. Most of that rise will come from the successful development of the Blackwater project, which could hold up to 8.4 million ounces of gold.
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New Gold now has four operating mines. The company also owns 30% of the El Morro copper/gold project in Chile and 100% of the Blackwater gold project in B.C.
There is still room to increase production at New Gold’s mines and expand their reserves through exploration drilling. But even if the company doesn’t expand its operations or make acquisitions, its production could still top 1 million ounces within six years. Most of that rise will come from the successful development of the Blackwater project, which could hold up to 8.4 million ounces of gold.
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AMAZON.COM $269.47 (Nasdaq symbol AMZN; TSINetwork Rating: Extra Risk) (206-266-1000; www.amazon.com; Shares outstanding: 454.6 million; Market cap: $122.5 billion; No dividends paid) is a major online retailer. It gets about 33% of its sales from books, music and videos. Other products, including electronics, computer games and toys, make up the other 67%. Amazon Marketplace lets other companies sell their products through Amazon’s websites.
In the three months ended December 31, 2012, Amazon’s earnings fell 45.2%, to $97.0 million, or $0.21 a share. A year earlier, it earned $177.0 million, or $0.38 a share. The profit decline came despite a 22.0% jump in sales, to $21.3 billion from $17.4 billion.
In the latest quarter, the company spent $1.3 billion on “technology and content,” up 56.0% from $862 million a year earlier. That was a major reason for the lower earnings. This additional spending included investments in new models of its Kindle reader, including the Kindle Fire tablet computer. It also invested in cloud computing services and expanded its digital content business to compete with rival Apple Inc.
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In the three months ended December 31, 2012, Amazon’s earnings fell 45.2%, to $97.0 million, or $0.21 a share. A year earlier, it earned $177.0 million, or $0.38 a share. The profit decline came despite a 22.0% jump in sales, to $21.3 billion from $17.4 billion.
In the latest quarter, the company spent $1.3 billion on “technology and content,” up 56.0% from $862 million a year earlier. That was a major reason for the lower earnings. This additional spending included investments in new models of its Kindle reader, including the Kindle Fire tablet computer. It also invested in cloud computing services and expanded its digital content business to compete with rival Apple Inc.
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SYMANTEC CORP. $22.62 (Nasdaq symbol SYMC; TSINetwork Rating: Average) (1-408- 517-8000; www.symantec.com; Shares outstanding: 689.2 million; Market cap: $15.6 billion; No dividends paid) has reported better-than-expected quarterly earnings. The company has also launched a restructuring plan that should make it more profitable.
In its fiscal 2013 third quarter, which ended December 28, 2012, Symantec’s earnings per share rose 7.1%, to $0.45 from $0.42. That easily beat the consensus estimate of $0.38 a share.
Symantec’s restructuring plan mainly involves streamlining its product lines and marketing operations. The company will also pay a quarterly dividend starting in the quarter ending June 30, 2013. The annual rate, probably $0.52 a share, would yield 2.3% based on today’s price.
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In its fiscal 2013 third quarter, which ended December 28, 2012, Symantec’s earnings per share rose 7.1%, to $0.45 from $0.42. That easily beat the consensus estimate of $0.38 a share.
Symantec’s restructuring plan mainly involves streamlining its product lines and marketing operations. The company will also pay a quarterly dividend starting in the quarter ending June 30, 2013. The annual rate, probably $0.52 a share, would yield 2.3% based on today’s price.
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BELLATRIX EXPLORATION $5.17 (Toronto symbol BXE; TSINetwork Rating: Speculative) (403-266- 8670; www.bellatrixexploration.com; Shares outstanding: 107.9 million; Market cap: $557.8 million; No dividends paid) produces oil and natural gas in Alberta, B.C. and Saskatchewan. Gas makes up about 66% of its output; the remaining 34% is oil.
In the three months ended September 30, 2012, Bellatrix’s production rose 31.0%, to 15,503 barrels of oil equivalent per day (including natural gas) from 11,837 barrels.
Cash flow per share rose 13.6%, to $0.25 from $0.22. Bellatrix’s selling price for gas fell 37.3%, to $2.45 U.S. per thousand cubic feet from $3.91 U.S. a year ago. However, the big production increase offset that decline. The company’s long-term debt is $154.9 million, or a low 28% of its market cap.
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In the three months ended September 30, 2012, Bellatrix’s production rose 31.0%, to 15,503 barrels of oil equivalent per day (including natural gas) from 11,837 barrels.
Cash flow per share rose 13.6%, to $0.25 from $0.22. Bellatrix’s selling price for gas fell 37.3%, to $2.45 U.S. per thousand cubic feet from $3.91 U.S. a year ago. However, the big production increase offset that decline. The company’s long-term debt is $154.9 million, or a low 28% of its market cap.
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BIRCHCLIFF ENERGY $7.52 (Toronto symbol BIR; TSINetwork Rating: Speculative) (403-261-6401; www.birchcliffenergy.com; Units outstanding: 141.6 million; Market cap: $1.1 billion; No dividends paid) develops, produces and explores for oil and natural gas, mainly in the Peace River Arch area near the Alberta/B.C. border. About 75% of Birchcliff’s production is natural gas. The remaining 25% is oil.
In the three months ended September 30, 2012, Birchcliff’s production rose 21.4%, to 21,426 barrels of oil equivalent per day (including natural gas) from 17,648 barrels a year earlier. Even so, cash flow per share fell 25.9%, to $0.20 from $0.27. The production increase was offset by a 37.0% decline in gas prices.
The company’s exploration efforts continue to be successful, and its production keeps rising as it starts up the resulting new wells. In addition, Birchcliff has completed Phase III of its gas-plant expansion in Pouce Coupe, Alberta.
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In the three months ended September 30, 2012, Birchcliff’s production rose 21.4%, to 21,426 barrels of oil equivalent per day (including natural gas) from 17,648 barrels a year earlier. Even so, cash flow per share fell 25.9%, to $0.20 from $0.27. The production increase was offset by a 37.0% decline in gas prices.
The company’s exploration efforts continue to be successful, and its production keeps rising as it starts up the resulting new wells. In addition, Birchcliff has completed Phase III of its gas-plant expansion in Pouce Coupe, Alberta.
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ACI WORLDWIDE $48.38 (Nasdaq symbol ACIW; TSINetwork Rating: Speculative) (402- 334-5101; www.tsainc.com; Shares outstanding: 39.4 million; Market cap: $1.9 billion; No dividends paid) is buying Online Resources for $126.6 million. The move will help ACI further expand into online banking and bill payments.
Online Resources processes more than 245 million bill payments a year. It will also add 1,000 banks, credit unions, billers, credit card issuers and other credit and payment service providers to ACI’s customer base.
ACI’s outlook is positive. However, the stock is up 35% in the past year and now trades at a high 31.0 times the company’s forecast 2013 earnings of $1.56 a share.
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Online Resources processes more than 245 million bill payments a year. It will also add 1,000 banks, credit unions, billers, credit card issuers and other credit and payment service providers to ACI’s customer base.
ACI’s outlook is positive. However, the stock is up 35% in the past year and now trades at a high 31.0 times the company’s forecast 2013 earnings of $1.56 a share.
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CGI GROUP INC. $24 (Toronto symbol GIB.A;Aggressive Growth Portfolio, Manufacturing &Industry sector; Shares outstanding: 307.7 million;Market cap: $7.4 billion; Price-to-sales ratio: 1.5; No dividends paid; TSI Network Rating: Extra Risk;www.cgi.com) is Canada’s largest provider of computer outsourcing services. CGI helps its clients automate routine functions, like accounting and buying supplies. That makes them more efficient and lets them focus on their main businesses.
CGI was our #1 stock pick for 2010 and 2011.
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CGI was our #1 stock pick for 2010 and 2011.