investment
An investment is an asset or property acquired to generate income or gain appreciation. Appreciation is the increase in the value of an asset over time. It requires the outlay of a resource today, like time, effort, and money, for a greater payoff in the future or for generating a profit.
An investment involves using capital in the present to increase an asset’s value over time.
Investments may include bonds, stocks, real estate, or alternative investments.
Investments can be diversified to reduce risk, though this may reduce the amount of earning potential.
In business contexts, investments are financial; however, consider how some people spend time to make higher incomes in the future (i.e. invest in a college education).
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All three of the companies we analyze below provide vital services to banks, credit card issuers and other financial services firms. They’re also benefiting as the improving economy spurs loan demand, prompting their clients to buy more of their products. What’s more, they all dominate their niche businesses, which makes it harder for new competitors to steal their customers. Thanks to these factors, all three are trading near their all-time highs. But only two are buys right now....
Old enough to have helped Thomas Edison with the light bulb, Corning glassworks keeps expanding operations with many high-tech applications.
Every Thursday we bring you one of our best U.S. stock picks. You get our specific recommendation on the stocks we profile, with a full explanation of how we arrived at our opinion. You will read about stocks making moves you should know about, most often from coverage in our newsletter on U.S. investing, Wall Street Stock Forecaster.
The U.S. Environmental Protection Agency plans to bring in new rules forcing power plants to cut their greenhouse gas emissions by 30% by 2030.
Alliant is upgrading its facilities in response. Regulators will probably let it pass along most of the extra costs to customers in the form of higher rates. We feel Alliant is in a good position to handle the new regulations.
ALLIANT ENERGY CORP. (New York symbol LNT; www.alliantenergy.com) sells electricity and natural gas to 1.4 million customers in Wisconsin, Iowa and Minnesota.
The company has earmarked $5.2 billion for plant upgrades and replacing older transmission lines and pipelines between 2014 and 2018. These funds include $750 million for a gas-fired plant that should replace some of its older coal facilities (coal accounts for about half of Alliant’s electricity production).
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The U.S. Environmental Protection Agency plans to bring in new rules forcing power plants to cut their greenhouse gas emissions by 30% by 2030.
Alliant is upgrading its facilities in response. Regulators will probably let it pass along most of the extra costs to customers in the form of higher rates. We feel Alliant is in a good position to handle the new regulations.
ALLIANT ENERGY CORP. (New York symbol LNT; www.alliantenergy.com) sells electricity and natural gas to 1.4 million customers in Wisconsin, Iowa and Minnesota.
The company has earmarked $5.2 billion for plant upgrades and replacing older transmission lines and pipelines between 2014 and 2018. These funds include $750 million for a gas-fired plant that should replace some of its older coal facilities (coal accounts for about half of Alliant’s electricity production).
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Let me remind you of a couple of our most valuable Successful Investor rules: First, a healthy sense of skepticism is your most valuable analytical tool. Second, the greatest risk you face as an investor to fall victim to a conflict of interest....
Concordia Healthcare, $64.13, symbol CXR on Toronto (Shares outstanding: 28.9 million; Market cap: $1.9 billion; www.concordiarx.com), is an Oakville, Ontario-based drug company that acquires and sells established drugs, mainly in the U.S. The company aims to acquire the rights to relatively small, mature products as opposed to the newer treatments larger pharmaceutical firms target. Concordia recently bought the North American rights to the epilepsy drug Zonegran from Eisai Inc. for $91.4 million (all figures except share price and market cap in U.S. dollars)....
Canadian Apartment Properties REIT, $28.42, symbol CAR.UN on Toronto (Units outstanding: 112.3 million; Market cap: $3.2 billion; www.capreit.net), is a real estate investment trust that owns multi-unit residential properties, including apartment buildings and townhouses. In all, the trust owns 41,958 units, including 35,674 residential suites and 30 manufactured-home communities, or trailer parks, with a total 6,284 sites. Its occupancy rate is 97.9%. Fifty-eight per cent of CAP REIT’s units are in Ontario, followed by Quebec (21%), B.C. (9%), Alberta (6%), Nova Scotia (4%), Saskatchewan (1%) and Prince Edward Island (1%)....
Every Monday we feature “A Stock to Sell” as our daily post. With every stock or investment we recommend as a sell, we give you a full explanation of why we advise against investing in it at this time.
Linn Energy (symbol LINE on Nasdaq; www.linnenergy.com) acquires and develops oil and gas properties in the Mid-Continent region in the southern U.S., the Permian Basin (Texas and New Mexico) and the Hugoton Basin (Texas and Kansas), as well as in California, Michigan and Illinois.
In December 2013, Linn bought Berry Petroleum for $4.3 billion in stock. The move added long-lasting, mature properties and boosted Linn’s growth prospects. Berry’s reserves were roughly 75% oil.
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Linn Energy (symbol LINE on Nasdaq; www.linnenergy.com) acquires and develops oil and gas properties in the Mid-Continent region in the southern U.S., the Permian Basin (Texas and New Mexico) and the Hugoton Basin (Texas and Kansas), as well as in California, Michigan and Illinois.
In December 2013, Linn bought Berry Petroleum for $4.3 billion in stock. The move added long-lasting, mature properties and boosted Linn’s growth prospects. Berry’s reserves were roughly 75% oil.
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CANADIAN TIRE CORP. $118 (Toronto symbol CTC.A; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 78.1 million; Market cap: $9.2 billion; Price-to-sales ratio: 0.7; Dividend yield: 1.8%; TSINetwork Rating: Above Average; www.canadiantire.ca) began operating in 1922 and is now one of Canada’s leading retailers.
The company owns 493 Canadian Tire stores, which sell automotive, household and sporting goods. Franchisees run most of these outlets. Other operations include 300 gas stations and 91 PartSource auto parts stores.
Canadian Tire has acquired more-specialized retailers to help it compete with big U.S.-based chains like Wal-Mart and Home Depot. In 2002, it bought Mark’s Work Wearhouse, which sells casual and work clothing through 383 stores. It later shortened the name to Mark’s as it added more women’s clothing and other merchandise.
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The company owns 493 Canadian Tire stores, which sell automotive, household and sporting goods. Franchisees run most of these outlets. Other operations include 300 gas stations and 91 PartSource auto parts stores.
Canadian Tire has acquired more-specialized retailers to help it compete with big U.S.-based chains like Wal-Mart and Home Depot. In 2002, it bought Mark’s Work Wearhouse, which sells casual and work clothing through 383 stores. It later shortened the name to Mark’s as it added more women’s clothing and other merchandise.
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LOBLAW COMPANIES LTD. $48 (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 412.7 million; Market cap: $19.8 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.0%; TSINetwork Rating: Above Average; www.loblaw.ca) is Canada’s largest food retailer, with roughly 1,200 stores. Its banners include Loblaws, Provigo, Fortinos, Real Canadian Superstore and No Frills.
The company recently acquired the 1,250-store Shoppers Drug Mart chain. Loblaw paid $12.3 billion, consisting of $6.6 billion in cash and $5.7 billion in Loblaw common shares. Shoppers shareholders now own 29% of the combined company.
Loblaw’s parent company, George Weston Ltd. (Toronto symbol WN), agreed to help it pay for this acquisition by purchasing $500 million worth of new shares. Due to the extra shares outstanding, Weston now owns 46% of Loblaw, down from 63% prior to the purchase.
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The company recently acquired the 1,250-store Shoppers Drug Mart chain. Loblaw paid $12.3 billion, consisting of $6.6 billion in cash and $5.7 billion in Loblaw common shares. Shoppers shareholders now own 29% of the combined company.
Loblaw’s parent company, George Weston Ltd. (Toronto symbol WN), agreed to help it pay for this acquisition by purchasing $500 million worth of new shares. Due to the extra shares outstanding, Weston now owns 46% of Loblaw, down from 63% prior to the purchase.
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GREAT-WEST LIFECO $34.92 (Toronto symbol GWO; Shares outstanding: 996.7 million; Market cap: $35.2 billion; TSINetwork Rating: Above Average; Yield: 3.7%; www.greatwestlifeco.com) has reported strong results in its latest quarter and raised its dividend.
Great-West is Canada’s largest insurance company. It also offers mutual funds and wealth management. Power Financial owns 67.0% of Great-West.
The company’s earnings per share jumped 34.7% in the three months ended December 31, 2014, to $0.66 from $0.49 a year earlier. Revenue rose 33.1%, to $10.7 billion from $8.1 billion.
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Great-West is Canada’s largest insurance company. It also offers mutual funds and wealth management. Power Financial owns 67.0% of Great-West.
The company’s earnings per share jumped 34.7% in the three months ended December 31, 2014, to $0.66 from $0.49 a year earlier. Revenue rose 33.1%, to $10.7 billion from $8.1 billion.
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