encana

Canoe EIT Income Fund, $11.99, symbol EIT.UN on Toronto (Units outstanding: 89.9 million; Market cap: $1.1 billion; www.canoefinancial.com), changed its name from EnerVest Diversified Income Trust in November 2013. The stock symbol remained the same. Canoe EIT is a closed-end fund that invests in a portfolio of stocks that are mainly listed on the Toronto exchange, with a focus on dividend income. The fund trades at a 16.6% discount to its net asset value and has an MER of 1.45%. The fund’s top holdings are TD Bank, Bank of Nova Scotia, Royal Bank of Canada, CN Rail, Crescent Point Energy, Telus, Microsoft, Boeing, Encana and Wells Fargo. Canoe EIT has 33.8% of its assets in finance stocks and 25.1% in oil and gas firms....

H&R REIT (Toronto symbol HR.UN; www.hr-reit.com) owns stakes in 42 office buildings, 112 industrial properties and 164 shopping malls across Canada. The trust has a 98.2% occupancy rate....

H&R REIT $21.22 (Toronto symbol HR.UN; Units outstanding: 269.6 million; Market cap: $5.7 billion; TSINetwork Rating: Extra Risk; Dividend yield: 6.4%; www.hr-reit.com) owns stakes in 42 office buildings, 112 industrial properties and 164 shopping malls across Canada....

VERESEN $13.86 (Toronto symbol VSN; Shares outstanding: 200.9 million; Market cap: $2.8 billion; TSINetwork Rating: Average; Yield: 7.2%) owns pipelines, power plants and gas-processing facilities across North America. A major holding is 50% of the Alliance gas line, which runs 3,000 kilometres between Chicago and Fort St. John, B.C. Enbridge owns the other 50%. Veresen also owns the Alberta Ethane Gathering System, and Veresen and Enbridge together hold 85.4% of the Aux Sable NGL plant.

In February 2012, Veresen paid Encana Corp. $920 million for the Hythe/Steeprock natural gas gathering and processing complex. Encana signed a long-term deal to buy most of this facility’s gas.

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ENCANA CORP. $20.28 (Toronto symbol ECA; Shares outstanding: 740.2 million; Market cap: $15.0 billion; TSINetwork Rating: Average; Dividend yield: 1.4%; www.encana- .com) is one of North America’s largest natural gas producers.

However, rising shale gas production has cut prices from $11.50 U.S. per thousand cubic feet in 2008 to just $3.63 today.

That’s prompting Encana to cut its reliance on gas by narrowing its focus from around 30 properties to five: Montney (B.C.), Duvernay (Alberta), DJ Basin (Colorado), San Juan Basin (New Mexico) and Tuscaloosa Marine Shale (Louisiana).
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iShares Canadian Fundamental Index Fund ETF, $13.39, symbol CRQ on Toronto (Units outstanding: 16.8 million; Market cap: $225.0 million; ca.ishares.com), aims to track the FTSE RAFI Canada Index. The ETF’s top 10 holdings are Royal Bank, 7.2%; TD Bank, 6.2%; Bank of Nova Scotia, 5.0%; Manulife Financial, 4.6%; Suncor Energy, 4.4%; Bank of Montreal, 4.0%; Encana, 3.3%; CIBC, 3.0%; Canadian Natural Resources, 2.8%; and Sun Life Financial, 2.6%. Its expenses are 0.72% of its assets. The RAFI (Research Affiliates Fundamental Index) methodology aims to select companies by the highest fundamental measures of their size, rather than by market capitalization (or the value of all their outstanding shares)....

New technology has increased oil production from North American shale rock formations. Even so, oil prices have held up due to the improving global economy and lower output from conventional wells.

However, the outlook for oil remains uncertain. The lifting of economic sanctions against Iran would increase world oil supplies and hurt prices....

Growth by acquisition can be risky, as newly purchased companies may develop unforeseen problems, especially in an unsettled economy. Today we look at how growth by acquisition is working for two pipeline companies we cover regularly in our advisory on conservative investing, Canadian Wealth Advisor. ...

FORTIS INC., $30.12, Toronto symbol FTS, fell 4% this week after it agreed to buy UNS Energy Corp. (New York symbol UNS), which distributes electricity and natural gas to 654,000 clients in Arizona. UNS also operates power plants with a total capacity of 2,420 megawatts. These facilities get their power from coal (59%), natural gas (34%), solar (1%) and other fuels (6%). Fortis will pay $4.3 billion U.S., which includes assuming $1.8 billion U.S. of UNS’s debt. This is a big purchase for Fortis, which has a $6.4-billion (Canadian) market cap (or the value of all its outstanding shares). The company aims to complete the deal by the end of 2014. After the purchase, Fortis will pay an additional $200 million U.S. to help UNS fund its planned purchases of two gas-fired plants. That will lower its reliance on coal....

ENCANA CORP. $20.28 (Toronto symbol ECA; Shares outstanding: 740.2 million; Market cap: $15.0 billion; TSINetwork Rating: Average; Dividend yield: 1.4%; www.encana- .com) is one of North America’s largest natural gas producers.

However, rising shale gas production has cut prices from $11.50 U.S....