investment

GOOGLE INC., Nasdaq symbols GOOG (class C non-voting), $672.93, and GOOGL (class A voting), $699.62, jumped 16% after reporting better-than-expected earnings this week. In the three months ended June 30, 2015, the company’s earnings gained 17.7%, to $4.8 billion from $4.1 billion a year earlier. Per-share profits rose 16.9%, to $6.99 from $5.98, on more shares outstanding. That was well ahead of the consensus estimate of $6.71. Revenue increased 11.1%, to $17.7 billion from $16.0 billion, falling just short of the consensus forecast of $17.8 billion. Excluding the negative impact of currency-exchange rates, revenue gained 18%....

Profits have soared for Electronic Arts, but the need to keep turning out successful video games makes it a high risk stock in our view.

More people are shopping online, forcing retailers to close stores and print fewer advertising flyers. This trend is weighing on mall operators, like RioCan, and printing firms, such as Transcontinental (see box). Both companies are diversifying beyond retail in response. That cuts their risk and supports their current payout rates. RIOCAN REAL ESTATE INVESTMENT TRUST $28 (Toronto symbol REI.UN; Aggressive Growth Portfolio, Manufacturing & Industry sector; Units outstanding: 317.9 million; Market cap: $8.9 billion; Price-to-sales ratio: 6.9; Dividend yield: 5.0%; TSINetwork Rating: Average; www.riocan.com) owns all or part of 290 shopping centres in Canada, including 15 under development. These holdings account for 84% of the trust’s rental revenue. The remaining 16% comes from 48 malls in the U.S. Former tenant Target Canada recently abandoned 26 stores in RioCan’s malls, representing 1.9% of the trust’s annual rental revenue....

Two U.S. stocks that tap into “big data” to serve financial firms are good stocks to buy as they trade near their all-time highs.

Two of Canada’s biggest insurance firms have the assets to forge ahead with expansion and still rank among our best low risk investments.

A number of Inner Circle have asked two key questions about so-called “robo-advisors”—automated, Internet-based advisory/portfolio management services. Question 1. Will robo-advisors offer valuable new investment avenues for individual investors? They may offer beginning investors a more efficient, lower-cost investment approach, compared to what’s now open to them. Unfortunately, robo-advisors are likely to focus on the less reliable of the two main investment approaches....

ESSA Pharma Inc., $10.30, symbol EPI on Toronto (Shares outstanding: 18.2 million; Market cap: $187.5 million; www.essapharma.com), is a developer of cancer drugs, with a focus on advanced prostate cancer. The company first sold shares to the public and began trading on January 27, 2015. ESSA’s drugs aim to stop prostate-cancer cells from absorbing hormones, such as testosterone, that fuel their growth. It’s particularly focused on its EPI-506 compound, which has shown promise in slowing prostate tumour growth in cell cultures and mice in preclinical trials. ESSA now plans to undertake Phase I trials....

SunEdison, $31.13, symbol SUNE on New York (Shares outstanding: 274.5 million; Market cap: $8.4 billion; www.sunedison.com), develops, finances, installs and operates solar-power plants, delivering electricity to residential, commercial, government and utility customers. The company also supplies other solar products, including polysilicon and solar cells. Photovoltaic cells, also called solar cells, are typically made from polysilicon and absorb the energy in sunlight. This energy excites the electrons in the solar cells, which then break loose and become electricity. Solar manufacturers gather cells into solar panels, which they then connect in large arrays....

Many brokers ignore Andrew Peller, but this hidden gem’s steady growth earns it our rating as one of the best Canadian dividend stocks.

J.P. MORGAN CHASE & CO. $69 (New York symbol JPM; Income Portfolio, Finance sector; Shares outstanding: 3.7 billion; Market cap: $255.3 billion; Price-to-sales ratio: 2.8; Dividend yield: 2.6%; TSINetwork Rating: Average; www.jpmorganchase.com) has four main divisions: Consumer and Community Banking, which includes branches and credit cards (45% of 2014 revenue, 44% of earnings); Corporate and Investment Bank, including brokerage and underwriting services (36%, 33%); Asset Management (12%, 10%); and Commercial Banking (7%, 13%). About 75% of Morgan’s revenue comes from the U.S.

The bank’s revenue fell 8.3%, from $102.7 billion in 2010 to $94.2 billion in 2014. That’s mainly because it sold some operations to cut its exposure to riskier businesses, such as owning and trading commodities. Low interest rates have also hurt the revenue it receives from new loans.

Even so, earnings jumped 22.5%, from $17.4 billion in 2010 to $21.3 billion in 2012. Per-share profits gained 31.3%, from $3.96 to $5.20, on fewer shares outstanding. Morgan continues to settle lawsuits related to its role in the 2008 financial crisis. As a result, its 2013 earnings fell to $4.35 a share (or a total of $17.9 billion). Earnings recovered to $5.29 a share (or $21.8 billion) in 2014.

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