investment

Capital Power Corp., $20.50, symbol CPX on Toronto (Shares outstanding: 71.0 million; Market cap: $1.5 billion; www.capitalpower.com), is one of Canada’s largest independent power producers, with interests in 3,700 megawatts of generation capacity. In the three months ended June 30, 2013, Capital Power’s revenue rose 23.0%, to $321 million from $261 million a year earlier. Cash flow per share jumped to $0.86 from $0.55. The improvements came from greatly improved Alberta power prices, which averaged $123 per megawatt hour in the latest quarter, up from just $40 a year previous....

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....

MTS SYSTEMS CORP. (Nasdaq symbol MTSC; www.mts.com) makes equipment and software that manufacturers use to test the behaviour of materials, machines and structures. This helps its clients reduce errors and costs....

SNC-LAVALIN GROUP INC., $44.62, Toronto symbol SNC, rose 8% this week after it said that it plans to sell all or part of AltaLink, which provides electricity to 85% of Alberta’s population through 12,000 kilometres of power lines and 280 substations. SNC could also spin off AltaLink as a separate publicly traded firm. The company did not say when it expects to complete this process. As of June 30, 2013, AltaLink’s net book value was $856.8 million. That’s equal to 13% of SNC’s $6.8-billion market cap (or the value of all its outstanding shares). The sale is part of SNC’s plan to sell some of its less important operations. The company will invest the cash from these sales in engineering projects in areas with strong potential, such as mining, water treatment and oil and gas....

BROADRIDGE FINANCIAL SOLUTIONS $32.80 (New York symbol BR; TSINetwork Rating: Extra Risk) (201-714-3000; www.broadridge.com; Shares outstanding: 119.1 million; Market cap: $3.9 billion; Dividend yield: 2.6%) continues to hit all-time highs, but we think the stock still has room to rise.

Broadridge serves the investment industry in three main areas: investor communications, securities processing and transaction clearing. It processes 90% of all proxy votes in the U.S. and Canada.

In its fiscal 2013 fourth quarter, which ended June 30, 2013, Broadridge’s earnings jumped 61.4%, to $134.6 million from $83.4 million a year earlier. Per-share earnings rose 67.2%, to $1.12 from $0.67, on fewer shares outstanding.
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LOBLAW COS. $45.67 (Toronto symbol L; Shares outstanding: 282.1 million; Market cap: $12.8 billion; TSINetwork Rating: Above Average; Dividend yield: 2.1%; www.loblaw.ca) has transferred the bulk of its real estate holdings to a new, publicly traded real estate investment trust called Choice Properties REIT, $10.10, Toronto symbol CHP.UN.

Loblaw sold a 16.9% interest in the REIT to the public in July 2013 as a new issue at $10....

RIOCAN REAL ESTATE INVESTMENT TRUST $24.19 (Toronto symbol REI.UN; Units outstanding: 300.7 million; Market cap: $7.3 billion; TSINetwork Rating: Average; Dividend yield: 5.8%; www.riocan.com) is Canada’s largest real estate investment trust (REIT), with interests in 348 shopping malls containing over 83 million square feet of leasable area....

Pat McKeough responds to many requests from members of his Inner Circle for specific advice on stocks as well as questions on investment strategy and the economy. Every week, his comments and recommendations on the most intriguing questions of the past week go out to all Inner Circle members. And each week, we offer you one of the highlights from these Q&A sessions. While we reserve our buy-hold-sell advice for Inner Circle members, these excerpts provide a great deal of information and analysis on stocks we’ve covered for members of Pat’s Inner Circle....

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 are six international ETFs we like:

ISHARES MSCI JAPAN INDEX FUND $11.81 (New York Exchange symbol EWJ; buy or sell through brokers; us.ishares.com) is an exchange traded fund that tries to match the return of the Morgan Stanley Capital International (MSCI) Japan index.

The ETF’s top holdings include Toyota, 6.6%; Mitsubishi UFJ Financial, 3.1%; Sumitomo Mitsui Financial, 2.4%; Softbank Corp., 2.4%; Honda Motor, 2.3%; Mizuho Financial Group, 1.9%; Japan Tobacco, 1.5%; Takeda Pharmaceutical, 1.4%; Canon, 1.3%; and Hitachi, 1.2%.

The fund’s industry breakdown is as follows: Financials, 21.4%; Consumer Discretionary, 21.1%; Industrials, 19.6%; Information Technology, 9.6%; Consumer Staples, 6.3%; Materials, 6.2%; Health Care, 5.9%; Telecommunication Services, 5.1%; Utilities, 2.8%; and Energy, 1.2%.

iShares MSCI Japan Index Fund was launched on March 12, 1996....

METRO INC. (Toronto symbol MRU; www.metro.ca) operates about 600 supermarkets in Quebec and Ontario. It also has over 250 drugstores under the Brunet, The Pharmacy and Drug Basics banners....