imperial oil

IMPERIAL OIL LTD. $56 (www.imperialoil.ca) has begun converting its 95-year-old refinery in Dartmouth, Nova Scotia, into a storage facility for a variety of refined petroleum products, such as gasoline, diesel and home heating oil. It will take several years to compete this conversion, but the refinery was losing money, so this project should boost Imperial’s long-term earnings. Best Buy. LOBLAW COMPANIES LTD. $55 (www.loblaw.ca) is testing a smaller version of its discount No Frills supermarkets. These stores, which operate under the Box banner, are cheaper to build than full-sized outlets and can fit in smaller strip malls, which lowers their rental costs. The new Box stores could also help Loblaw compete with Wal-Mart, which may start opening smaller locations in Canada following successful trials in the U.S. Buy. CANADIAN NATIONAL RAILWAY CO. $80 (www.cn.ca) is now 13% owned by Microsoft co-founder Bill Gates. Ottawa limits any single shareholder from owning more that 15% of CN, so Mr. Gates has little room to increase his stake. Still, his involvement has helped draw investor attention to CN’s strong long-term growth prospects. Buy.

IMPERIAL OIL $54.20 (Toronto symbol IMO; Shares outstanding: 847.6 million; Market cap: $45.9 billion; TSINetwork Rating: Average; Div. yield: 1.0%; www.imperialoil.ca) recently opened the first phase of its massive Kearl oil sands project in Alberta, and the second phase should start up next year. This project will help the company double its production, to 600,000 barrels a day, by 2020.

Oil sands projects are harder to operate than conventional properties, and they need high oil prices to earn a profit. However, Imperial’s refineries help shield it from a drop in oil prices because they pay less for the crude they need.

The stock trades at a moderate 12.2 times Imperial’s likely 2014 earnings of $4.45 a share.

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IMPERIAL OIL $54.20 (Toronto symbol IMO; Shares outstanding: 847.6 million; Market cap: $45.9 billion; TSINetwork Rating: Average; Div. yield: 1.0%; www.imperialoil.ca) recently opened the first phase of its massive Kearl oil sands project in Alberta, and the second phase should start up next year. This project will help the company double its production, to 600,000 barrels a day, by 2020. Oil sands projects are harder to operate than conventional properties, and they need high oil prices to earn a profit. However, Imperial’s refineries help shield it from a drop in oil prices because they pay less for the crude they need. The stock trades at a moderate 12.2 times Imperial’s likely 2014 earnings of $4.45 a share....

IMPERIAL OIL LTD. $57 (Toronto symbol IMO; Conservative Growth and Income Portfolios, Shares outstanding: 847.6 million; Market cap: $48.3 billion; Price-to-sales ratio: 1.5; Dividend yield: 0.9%; TSINetwork Rating: Average; www.imperialoil.ca) is Canada’s third-largest publicly traded oil company, after Suncor Energy and Canadian Natural Resources. Imperial is a 69.6%- owned subsidiary of U.S.-based ExxonMobil Corp. (New York symbol XOM).

About 80% of Imperial’s oil production comes from its oil sands operations in Alberta, including its 25% stake in the Syncrude project.

It also has conventional oil and natural gas operations in Western Canada and owns interests in offshore projects in Atlantic Canada. Based on its current daily output, Imperial’s 3.6 billion barrels of proven reserves should last 35 years.

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Imperial Oil recently opened the first phase of its massive Kearl oil sands project in Alberta, and the second phase should start up next year. This project will help the company double its production, to 600,000 barrels a day, by 2020. Oil sands projects are harder to operate than conventional properties, and they need high oil prices to earn a profit. However, Imperial’s refineries help shield it from a drop in oil prices, because they would pay less for the crude they need. IMPERIAL OIL LTD. $57 (Toronto symbol IMO; Conservative Growth and Income Portfolios, Shares outstanding: 847.6 million; Market cap: $48.3 billion; Price-to-sales ratio: 1.5; Dividend yield: 0.9%; TSINetwork Rating: Average; www.imperialoil.ca) is Canada’s third-largest publicly traded oil company, after Suncor Energy and Canadian Natural Resources. Imperial is a 69.6%- owned subsidiary of U.S.-based ExxonMobil Corp. (New York symbol XOM)....

Every Wednesday, we publish our “Investor Toolkit” series on TSI Network. Whether you’re a beginning or experienced investor, these weekly updates are designed to give you advice on specific investment topics. Each Investor Toolkit update gives you a fundamental piece of investing strategy, and shows you how you can put it into practice right away. Today’s tip: “Selling half of hot stocks that surge helps you guard your profits. But apply this rule only to more aggressive stocks, and not to the well-established stocks that may surprise you by going a lot higher in the long run.” As you probably know, our Successful Investor business model has two parts. We publish investment advice through The Successful Investor Inc., and we manage investor portfolios through Successful Investor Wealth Management Inc. (These two companies are affiliated by common ownership; I own both but set them up as separate companies for regulatory purposes.)...

Husky Energy Inc., $35.89, symbol HSE on Toronto (Shares outstanding: 983.5 million; Market cap: $35.3 billion; www.huskyenergy.com), is an integrated oil and gas company. Hong Kong-based billionaire Li Ka-Shing owns 68% of Husky’s shares. Husky’s growth prospects are sound and are supported by its Sunrise oil sands project in Alberta and its $6.5-billion Liwan offshore project in the South China Sea, where natural gas has started to flow. Husky operates the deepwater infrastructure at Liwan, while its partner, Chinese state-owned firm CNOOC Ltd., operates the shallow-water facilities and onshore gas terminal. CNOOC owns 51% of Liwan’s production, and Husky holds the rest. The stock trades at 6.3 times this year’s forecast cash flow of $5.73 a share. It yields 3.3%....

IMPERIAL OIL $51.60 (Toronto symbol IMO; Shares outstanding: 847.6 million; Market cap: $44.0 billion; TSINetwork Rating: Average; Div. yield: 1.0%; www.imperialoil.ca) is selling some of its conventional oil and natural gas properties in Alberta and B.C. to Whitecap Resources. These assets produce 15,000 barrels a day, which is equal to 5.1% of the 295,000 barrels a day that Imperial produced in 2013.

The company will receive $855 million when the sale closes in May 2014. That will help it pay for its plan to spend $5.5 billion on its main properties this year, including expanding its Cold Lake and Kearl oil sands developments. These investments should increase Imperial’s daily output by 150,000 barrels in 2015.

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NORDION INC., $12.46, Toronto symbol NDN, sells isotopes for cancer detection and research. It also makes products that sterilize food and surgical tools. The company has accepted a friendly takeover offer from Sterigenics, a private, Illinois-based firm that sterilizes surgical tools, pharmaceutical ingredients and other materials....

IMPERIAL OIL $51.60 (Toronto symbol IMO; Shares outstanding: 847.6 million; Market cap: $44.0 billion; TSINetwork Rating: Average; Div. yield: 1.0%; www.imperialoil.ca) is selling some of its conventional oil and natural gas properties in Alberta and B.C. to Whitecap Resources....