investment

Wal-Mart Stores Inc., $65.64, symbol WMT on New York (Shares outstanding: 3.2 billion; Market cap: $213.8 billion; www.walmart.com), has had a particularly steep downturn this year, from a January peak near $91, to an August low below $62. The drop began while the rest of the U.S. market was largely moving sideways. The company did have a slight earnings decline in its first and second quarters, somewhat deeper than anticipated. But the plunge in the stock seems out of proportion. The stock price drop may be related to Wal-Mart’s mid-February announcement that it would raise the minimum wage it pays in the U.S. from $9 to $10 an hour. Its $9 minimum rate was already $1.75 or 24.1% above the $7.25 minimum per hour that is federally mandated across the country. The raise only affects the company’s lowest-paid U.S. employees, but it still applies to 40% of its 1.3 million workforce. The company also said it would make scheduling of hours more predictable, tackling a long-time source of worker complaint. Some investors may have sold Wal-Mart because they feared the higher wages would cut too deeply into the company’s profits. However, this move may be wisely timed. The Obama administration has been using its regulatory power to help revive the long-standing downturn in U.S. union membership. Wal-Mart is non-union and wants to keep it that way. Then too, union activists and community organizers have been targeting a $15 an hour minimum wage. The company may also feel that demographic changes are likely to put upward pressure on wages these next few years in any event....

First Solar Inc., $48.01, symbol FSLR on Nasdaq (Shares outstanding: 100.9 million; Market cap: $5.0 billion; www.firstsolar.com), designs and manufactures modules for converting solar energy into electricity. The company makes its modules using a proprietary thin-film semiconductor technology it believes has a lower manufacturing cost per watt than traditional crystalline silicon modules. First Solar first sold shares to the public for $20 each in November 2006. Unlike many solar companies, First Solar is profitable, with forecast earnings of $3 a share this year. The stock trades at 16.0 times that estimate. The company’s balance sheet is also strong, with cash of $1.8 billion, or $17.86 a share, and just $257.8 million of long-term debt....

Microsoft’s Nokia purchase didn’t work out well, but cloud computing helps it remain one of the leading blue chip stocks in the tech world

We think conservative investors could hold up to 10% of their portfolios in foreign stocks. One way to do that is to buy carefully chosen exchange traded funds (ETFs) that have an overseas focus. The best ETFs offer very low management fees and well-diversified, tax-efficient portfolios of highquality stocks. Here’s a look at five international ETFs:...

The Bank of Canada cut its key interest rate to 0.50% from 0.75% in July 2015. The move came after the bank dropped its 2015 growth forecast for the Canadian economy to 1.1% from 2.0%. The cut partly reflects falling prices for oil and other commodities. Even so, the long-term outlook is for higher interest rates. That’s because heavy deficit spending and the expansion of the money supply in the past few years make higher inflation more likely. We continue to advise against investing in bonds right now. That’s because today’s low interest rates make bonds unattractive, and rising rates would push down their future value....

With other properties sold off, IAMGold is focused solely on its gold mines, which we think enhances its prospects for aggressive investors.

Today, we look at a hedged ETF, a BMO dividend fund that Pat McKeough was asked to evaluate by a Member of his Inner Circle....

Not long ago, people still believed that growth in emerging markets would keep the world economy afloat, even if the developed countries stagnated. China fans took it for granted that China’s growth would stay above 7% a year. Events this past week rattled that view. Chinese stocks went through horrendous declines, continuing the plunge they began in the summer. Chinese leader Xi Jinping seems focused on shoring up the Communist party and the Chinese stock market, rather than strengthening the Chinese economy. Brazil officially entered a recession with news that its economy shrank in the second quarter this year, at a faster rate than in the first. Brazil’s per-capita income has been falling since last year, and the Brazilian real has lost a quarter of its value in the year to date....

Penny stock Semafo aims to multiply its gold production with a big West African acquisition—and we assess the opportunities and risks

TORONTO-DOMINION BANK, $52.91, Toronto symbol TD, reported that its earnings rose 5.4% in its fiscal 2015 third quarter, which ended July 31, 2015, to $2.3 billion from $2.2 billion a year earlier. Earnings per share rose at a slower rate of 4.3%, to $1.20 from $1.15, on more shares outstanding. These figures exclude several unusual items, such as investment gains and a recovery of costs related to a lawsuit settlement. On that basis, the latest earnings beat the consensus estimate of $1.18. Earnings at the Canadian banking division (63% of the total) rose 7.9%, thanks to strong loan demand and gains from its wealth-management and insurance businesses. The U.S. banking division’s earnings (27%) jumped 16.5%, largely because the low Canadian dollar enhanced this business’s profits. The wholesale banking division (10%) saw its earnings rise 10.6% on higher trading volumes, stronger demand for corporate loans and higher advisory fees on mergers and acquisitions....