investment

H&R REIT $23.32 (Toronto symbol HR.UN; Units outstanding: 275.3 million; Market cap: $6.5 billion; TSINetwork Rating: Extra Risk; Dividend yield: 5.8%; www.hr-reit.com) owns stakes in 45 office buildings, 114 industrial properties and 340 shopping malls in Canada and the U.S. In December 2014, the REIT sold part ownership of 101 industrial properties in Canada and the U.S. for $731 million. In all, these buildings comprise 19.5 million square feet. The buyers include the Canadian Public Sector Pension Investment Board. H&R will keep a 50% interest in the Canadian properties and a 49.5% stake in the U.S. portfolio. It will also keep managing these assets and will receive fees for doing so. H&R will retain full ownership of 14 other industrial properties....

Alberta’s new NDP government plans to withdraw the province’s support for TransCanada Corp.’s Keystone XL pipeline, which would pump crude oil to the U.S. Gulf Coast. But Keystone XL is just one of many new projects the company is working on. And as these developments come onstream, the cash flow they generate will fuel TransCanada’s plan to hike its dividend by at least 8% annually through 2017. TRANSCANADA CORP. $53 (Toronto symbol TRP; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 709.0 million; Market cap: $37.6 billion; Priceto- sales ratio: 3.8; Dividend yield: 3.9%; TSINetwork Rating: Above Average; www.transcanada.com) operates a 68,000- kilometre pipeline network that pumps natural gas from Alberta to Eastern Canada and the U.S. The company’s pipelines supply 20% of North America’s natural gas needs. In 2014, they provided 48% of TransCanada’s revenue and 53% of its earnings....

TELUS CORP. $42 (www.telus.com) continues to benefit from strong demand for wireless services. As of March 31, 2015, it had 8.3 million wireless subscribers, up 3.1% from a year earlier. In addition, more of these users are upgrading to smartphones under long-term contracts, which generate higher profits for Telus than regular cellphones....

“Theme investing” may have a certain appeal, but it can lead investors toward investment fads and away from sound investment strategies.

Main Street Capital Corp., $30.59, symbol MAIN on New York (Shares outstanding: 49.0 million; Market cap: $1.5 billion; www.mainstcapital.com), is a specialty finance company that lends to, and invests in, small and mid-sized firms, with a focus on those with yearly sales between $10 million and $150 million. Main Street has benefited from a recent major upgrade to its bond rating: in September 2014, Standard & Poor’s assigned it a BBB rating with a stable outlook. A BBB rating is defined as having “adequate capacity to meet financial commitments but more subject to adverse economic conditions.” It’s enough to qualify Main Street’s debt as investment-grade, making financing much cheaper for the company than for many other specialty finance firms with lower, junk bond-level ratings....

A $731 million part ownership deal that unlocks extra value in its industrial properties is just one reason H&R REIT is a buy.

BOMBARDIER INC., Toronto symbols BBD.A $2.65 and BBD.B $2.63, plans to sell shares in its transportation division to the public. This business makes passenger railcars and accounts for 45% of Bombardier’s total revenue. The company expects to complete the sale in the fourth quarter of 2015. The new shares will mainly trade on Germany’s stock exchange because that’s where this business is based. Bombardier will hang on to a majority stake. Meanwhile, the company earned $170 million, or $0.09 a share, in the first quarter of 2015 (all amounts except share price in U.S. dollars). These figures exclude unusual items, such as costs related to its recent decision to suspend development of the Learjet 85 business jet. On that basis, the latest earnings beat the consensus estimate of $0.05 a share. They are also up 12.6% from $151 million, or $0.08 a share, a year earlier. Revenue gained 1.0%, to $4.40 billion from $4.35 billion....

Worrying about things that are out of your control can lead to untimely buy or sell decisions that seriously reduce your long-term profits.

It’s generally a waste of time to obsess about the possibility of a short-term downward movement in the economy, stock market or both. These downward movements can occur for a wide variety of reasons, at any time, without warning. For every “real” short-term downturn, you can spot a dozen fake-outs – situations where the market or economy looked like it was going into a tailspin, but pulled out of the drop and began rising at the last minute. On the other hand, it pays to obsess about matters like portfolio diversification, investment quality, and the extent to which your portfolio suits your personal goals and temperament. Hidden assets are also worth a close look. As long-time readers know, we’ve had a great deal of success over the years in investments that come with hidden assets. These are assets that are worth substantially more than the value they carry on the company’s balance sheet, if they appear there at all. Buying stocks with hidden assets is a little like getting something for nothing, at least for patient investors....

A holding company is a company that owns all or a substantial part of a variety of different businesses. These businesses may be private companies, or publically traded. Holding companies may own all, or a majority or a minority, of companies in which they invest. The one thing most holding companies have in common is that they trade for less than the combined value of their holdings. This “holding company discount” is a well-known phenomenon in finance. It represents a special kind of hidden asset and potential profit for investors in holding companies. When holding companies sell assets or break themselves up into their constituent parts, much if not all of the discount may disappear. In other words, holding companies can usually sell their assets for fair market value, rather than at a discount. In addition, fair market value may turn out to be be more than analysts figured they were worth. Even without a break-up, buying a holding company at a discount to its asset value puts more assets to work for you for each dollar you invest....