encana

ENCANA $7.75 (Toronto symbol ECA; Shares outstanding: 849.8 million; Market cap: $6.4 billion; TSINetwork Rating: Average; Dividend yield: 1.1%; www.encana.com) continues to focus on its four key projects: Montney (B.C.), Duvernay (Alberta) and Eagle Ford and Permian (both in Texas). These fields produce large amounts of oil and natural gas liquids such as propane and butane. The company is now using its excess cash to pay down debt. That’s because Encana’s bonds are trading well below their face value due to weak oil and natural gas prices. Encana will now repurchase up to $400.0 million of those bonds by April 12, 2016 (all amounts except share price and market cap in U.S. dollars). That’s up from its earlier goal of $250.0 million....

RIOCAN REAL ESTATE INVESTMENT TRUST $26.68 (Toronto symbol REI.UN; Units outstanding: 321.9 million; Market cap: $8.7 billion; TSINetwork Rating: Average; Dividend yield: 5.2%; www.riocan.com) owns all or part of 305 shopping centres in Canada, including 16 properties under development. The trust pays monthly distributions of $0.1175 a unit, for a 5.2% annual yield. These payouts accounted for 90.4% of RioCan’s cash flow in 2015. However, 31.5% of the trust’s investors take part in its distribution reinvestment plan, so they get units rather than cash. On this basis, RioCan’s cash payouts were a more reasonable 62.0% of its cash flow. (If you want the units instead of cash, you still have to pay income taxes on your distributions for the year when you receive them.) This week, RioCan announced that with the April 2016 distribution, it eliminated the 3.1% discount it offered to unitholders who reinvested their distributions....

TRANSCANADA CORP., $49.59, Toronto symbol TRP, recently agreed to buy Texas-based Columbia Pipeline Group (New York symbol GPCX) for $13 billion U.S. That’s equal to 48% of its market cap of $35.1 billion (Canadian). Columbia operates natural gas pipelines in the U.S. Northeast, Midwest, Mid-Atlantic and Gulf Coast regions, as well as underground gas storage terminals. To help pay for this acquisition, TransCanada has sold 96.6 million subscription receipts at $45.75 a share for total proceeds of $4.4 billion. Each receipt will convert to one common share when TransCanada completes the Columbia acquisition, probably by the end of 2016. If it fails to complete the acquisition, the funds will be returned to the subscribers. In the meantime, the holders of these receipts will receive the same dividends as holders of the company’s common shares....

Energy sector stocks can round out any well balanced portfolio—and there is a crucial role they can play

ENCANA $6.14 (Toronto symbol ECA; Shares outstanding: 849.8 million; Market cap: $4.9 billion; TSINetwork Rating: Average; Dividend yield: 1.4%; www.encana.com) plans to spend $1.5 billion to $1.7 billion upgrading its properties in 2016, down 25% from 2015 (all amounts except share price and market cap in U.S. dollars). Even with the drop, it expects production at its four main oil projects—Montney (B.C.), Duvernay (Alberta) and Eagle Ford and Permian (both in Texas)—will rise 12% this year. The company has also cut its annual dividend rate by 78.6%, to $0.06 a share from $0.28. In addition, Encana has eliminated the 2% price discount it offered to shareholders who chose to reinvest their dividends in new shares. In all, these moves will save $185 million a year....

ENCANA $6.14 (Toronto symbol ECA; Shares outstanding: 849.8 million; Market cap: $4.9 billion; TSINetwork Rating: Average; Dividend yield: 1.4%; www.encana.com) plans to spend $1.5 billion to $1.7 billion upgrading its properties in 2016, down 25% from 2015 (all amounts except share price and market cap in U.S. dollars). Even with the drop, it expects production at its four main oil projects—Montney (B.C.), Duvernay (Alberta) and Eagle Ford and Permian (both in Texas)—will rise 12% this year. The company has also cut its annual dividend rate by 78.6%, to $0.06 a share from $0.28. In addition, Encana has eliminated the 2% price discount it offered to shareholders who chose to reinvest their dividends in new shares. In all, these moves will save $185 million a year....

BANK OF MONTREAL, $74.15, Toronto symbol BMO, reported better-than-expected results this week, thanks mainly to strong gains from its U.S. operations. In its fiscal 2016 first quarter, which ended January 31, 2016, the bank’s revenue rose 0.4%, to $5.08 billion from $5.06 billion a year earlier. That beat the consensus forecast of $4.88 billion. Overall earnings increased 13.2%, to $1.2 billion from $1.0 billion. Earnings per share gained 14.4%, to $1.75 from $1.53, on fewer shares outstanding. These figures exclude unusual items such as the cost to integrate recent acquisitions. On that basis, they exceed the consensus estimate of $1.72 a share....

ENCANA CORP. $4.86 (Toronto symbol ECA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 849.8 million; Market cap: $4.1 billion; Price-to-sales ratio: 0.8; Dividend yield: 1.7%; TSINetwork Rating: Average; www.encana.com) plans to spend $1.5 billion to $1.7 billion upgrading its properties in 2016, down 25% from 2015 (all amounts except share price and market cap in U.S. dollars). Even with the drop, it expects production at its four main oil projects—Montney (B.C.), Duvernay (Alberta) and Eagle Ford and Permian (both in Texas)—will rise 12% this year. It has also cut its annual dividend rate by 78.6%, to $0.06 a share from $0.28. In addition, Encana has eliminated the 2% price discount it offered to shareholders who chose to reinvest their dividends in new shares. In all, these moves will save $185 million a year. Encana is still a buy for long-term gains.

ENCANA CORP. $4.86 (Toronto symbol ECA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 849.8 million; Market cap: $4.1 billion; Price-to-sales ratio: 0.8; Dividend yield: 1.7%; TSINetwork Rating: Average; www.encana.com) plans to spend $1.5 billion to $1.7 billion upgrading its properties in 2016, down 25% from 2015 (all amounts except share price and market cap in U.S. dollars). Even with the drop, it expects production at its four main oil projects—Montney (B.C.), Duvernay (Alberta) and Eagle Ford and Permian (both in Texas)—will rise 12% this year. It has also cut its annual dividend rate by 78.6%, to $0.06 a share from $0.28. In addition, Encana has eliminated the 2% price discount it offered to shareholders who chose to reinvest their dividends in new shares. In all, these moves will save $185 million a year. Encana is still a buy for long-term gains....

Stock market cycles occur repeatedly—and there are any number of theories as to which sectors will outperform at any given short term stage of the cycle....