great-west lifeco

PowerShares Canadian Dividend Index ETF, $18.44, symbol PDC on Toronto (Shares outstanding: 250,000; Market cap: $4.6 million; www.investco.ca), aims to replicate the performance of the Indxis Select Canadian Dividend Index. PowerShares Canadian Dividend Index ETF was launched on June 16, 2011. The units began trading at $20. However, the fund duplicates the PowerShares Canadian Dividend Index mutual fund, which started up in November 2009. The fund holds 35 stocks, eight real estate investment trusts (REITs) and two income trusts. It has an expense ratio of 0.50%, and yields 3.6%. Its top 10 holdings are Royal Bank, 10.0%; TD Bank, 10.0%, Bank of Nova Scotia, 9.7%; Bank of Montreal, 7.4%; CIBC, 5.6%; TransCanada Corp., 5.4%; Thomson Reuters, 5.2%; Enbridge, 4.6%; Great-West Lifeco, 4.4%; and Power Financial, 3.9%....

TRANSCANADA CORP. $42.91 (Toronto symbol TRP; Shares outstanding: 691.7 million; Market cap: $30.1 billion; TSINetwork Rating: Above Average; Dividend yield: 3.9%; www.transcanada.com) has shut down part of its Keystone pipeline, which pumps crude oil from Alberta to Oklahoma. That’s because a broken valve inside a pumping station in North Dakota caused 500 barrels of oil to leak out. The company has repaired the station, and expects to soon restart the line. This leak could fuel opposition to TransCanada’s plan to extend Keystone to refineries on the U.S. Gulf Coast. However, its quick response limited the size of the leak. Moreover, it will inspect other pumping stations to lower the odds of another leak. TransCanada is a buy....

MANITOBA TELECOM SERVICES INC. $33 (www.mts.ca) continues to benefit from its cost cuts and strong demand for wireless and high-speed Internet servcies. In the first quarter of 2011, earnings per share jumped 59.5%, to $0.67 from $0.42 a year earlier. Revenue fell 0.6%, to $439.3 million from $442.0 million. Buy. TORSTAR CORP. $13 (www.torstar.com) has raised its quarterly dividend by 35.1%, to $0.125 a share from $0.0925. The new annual rate of $0.50 yields 3.8%. Best Buy. GREAT-WEST LIFECO INC. $27 (www.greatwestlifeco.com) earned $0.44 a share in the three months ended March 31, 2011, down 2.2% from $0.45 a year earlier. However, the company had...

GREAT-WEST LIFECO $27.02 (Toronto symbol GWO; Shares outstanding: 949 million; Market cap: $25.6 billion; TSINetwork Rating: Above Average; Dividend yield: 4.6 %; www.greatwestlifeco.com) gets most of its revenue from selling life insurance and wealth-management services to individuals. It also sells catastrophe insurance to other property and casualty insurance companies. The company estimates that claims stemming from the recent earthquake and tsunami in Japan will cut its earnings by $75 million in the three months ended March 31, 2011. The claims mostly relate to property catastrophe coverage sold by London Reinsurance Group, a subsidiary of Great West. However, this one-time charge is small next to the $1.9 billion, or $1.96 a share, that Great-West earned in 2010. Great-West Lifeco is a buy.

Brompton Equity Split Corp., $12.97, symbol BE on Toronto (Shares outstanding: 1.7 million; Market cap: $21.9 million; www.bromptongroup.com) mainly invests in large-cap Canadian stocks. The fund was scheduled to wind up on May 31, 2011. However, it now plans to merge with Dividend Growth Split Corp., $9.21, symbol DGS on Toronto (Shares outstanding: 4.3 million; Market cap: $40.0 million; www.bromptongroup.com), on May 18, 2011. The new Dividend Growth Split Corp., symbol DGS on Toronto, will have a termination date of November 30, 2019....

GREAT-WEST LIFECO INC. $27 (Toronto symbol GWO; Conservative Growth Portfolio, Finance sector; Shares outstanding: 948.5 million; Market cap: $25.6 billion; Price-to-sales ratio: 0.8; Dividend yield: 4.6%; TSINetwork Rating: Above Average; www.greatwestlifeco.com) gets most of its revenue from selling life insurance and wealth-management services to individuals. It also sells catastrophe insurance to other property and casualty insurance companies. The company estimates that claims stemming from the recent earthquake and tsunami in Japan will cut its earnings by $75 million in the three months ended March 31, 2011. To put that in context, Great-West earned $1.9 billion, or $1.96 a share, in 2010. Great-West Lifeco is a buy.

Every Wednesday, we publish our “Investor Toolkit” series on TSI Network. Whether you’re a new or experienced investor, these weekly updates are designed to give you specific investment advice. Each Investor Toolkit update gives you a fundamental piece of investment strategy, and shows you how you can put it into practice right away. Tip of the week: “Smart investing limits the danger of lawsuits.” Lawsuits are an everyday risk in business. For example, U.S. lawnmower engine maker Briggs & Stratton (symbol BGG on New York) recently paid $18.7 million U.S. to settle a lawsuit that accused the company of using misleading labels on its lawnmower engines....

POWER CORP. $27.66 (Toronto symbol POW; Shares outstanding: 409.3 million; Market cap: $11.3 billion; TSINetwork Rating: Above Average; Dividend yield: 4.2%) is a diversified holding company. It holds its financial assets through 66.1%-owned Power Financial. Power Corp.’s financial assets include 68.4% of Great-West Lifeco, one of Canada’s largest life insurers, and 56.6% of IGM Financial, one of the country’s leading mutual-fund companies. Power Financial also owns 50% of holding company Parjointco, which holds a 54.1% stake in Switzerland-listed Pargesa Holdings SA. Pargesa has 95% of its assets in five large European companies: Imerys (minerals), Total SA (oil), Pernod Ricard (wine and spirits), Suez (energy, water and waste services) and Lafarge SA (cement and building materials). Excluding one-time items, Power Corp.’s earnings rose 8.7%, to $274 million, or $0.58 a share, in the three months ended September 30, 2010. A year earlier, it earned $252 million, or $0.53 a share. The increase came from a higher contribution from Power Financial, which gained from its holdings in Great-West Lifeco and IGM Financial....

Power Corp. gives you exposure to a number of high-quality companies that will gain from an ongoing economic recovery. It also trades at a holding company discount, which puts more assets to work for you, and adds a lot of appeal. POWER CORP. $27.66 (Toronto symbol POW; Shares outstanding: 409.3 million; Market cap: $11.3 billion; TSINetwork Rating: Above Average; Dividend yield: 4.2%) is a diversified holding company. It holds its financial assets through 66.1%-owned Power Financial. Power Corp.’s financial assets include 68.4% of Great-West Lifeco, one of Canada’s largest life insurers, and 56.6% of IGM Financial, one of the country’s leading mutual-fund companies. Power Financial also owns 50% of holding company Parjointco, which holds a 54.1% stake in Switzerland-listed Pargesa Holdings SA. Pargesa has 95% of its assets in five large European companies: Imerys (minerals), Total SA (oil), Pernod Ricard (wine and spirits), Suez (energy, water and waste...

TRANSCANADA CORP. $37.42 (Toronto symbol TRP; Shares outstanding: 693 million; Market cap: $25.9 billion; SI Rating: Above Average; Dividend yield: 4.3%; www.transcanada.com) agreed to build a natural-gas-fired electrical-power plant in Oakville, Ontario, in 2008. It also signed a 20-year deal to sell this plant’s electricity to Ontario’s power regulators. However, the Ontario government now feels that the plant is no longer needed, and has cancelled the project. As a result, the government will pay TransCanada an undisclosed termination fee to compensate the company for the funds it has spent on the project to date. TransCanada is still a buy....