investment

CGI GROUP INC. (Toronto symbol GIB.A; www.cgi.com) is Canada’s largest provider of computer outsourcing services. CGI helps its clients automate routine functions, like accounting and buying supplies. That makes them more efficient and lets them focus on their main businesses. CGI is a long-term recommendation of our Successful Investor newsletter. We made it our #1 Canadian stock of the year in 2010 at $15. The stock has risen 107% for our subscribers since then. We also made it our stock of the year in 2011. The stock is up 73% since then....

ALLIED PROPERTIES REAL ESTATE INVESTMENT TRUST $31.73 (Toronto symbol AP.UN; Units outstanding: 68.0 million; Market cap: $2.2 billion; TSINetwork Rating: Extra Risk; Dividend yield: 4.3%; www.alliedpropertiesreit.com) owns 126 office buildings, mostly in major Canadian cities. These mainly Class I properties contain over 9.5 million square feet of leasable area.

Class I refers to 19th- and early-20th-century light industrial buildings that have been converted to office and retail space. They usually feature exposed beams, interior brick and hardwood floors.

The trust bought $400 million worth of properties in 2012. In the first quarter of 2013, it added a further $146 million of acquisitions. Allied has a 92.8% occupancy rate.
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RIOCAN REAL ESTATE INVESTMENT TRUST $25.37 (Toronto symbol REI.UN; Units outstanding: 300.0 million; Market cap: $7.8 billion; TSINetwork Rating: Average; Dividend yield: 5.6%; www.riocan.com) is Canada’s largest real estate investment trust (REIT). It has interests in 344 shopping malls containing over 84 million square feet of leasable area. That total includes 50 U.S. malls containing over 13.7 million square feet.

RioCan recently ended its joint venture with Retail Properties of America (New York symbol RPAI). As a result, RioCan now holds 100% of eight highquality malls in Texas, including the dominant shopping centres in Austin and San Antonio.

In the quarter ended March 31, 2013, RioCan’s revenue rose 10.6%, to $281 million from $254 million a year earlier. Cash flow per unit rose 10.8%, to $0.41 from $0.37. The units yield 5.6%.
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AIMIA INC., $15.35, symbol AIM on Toronto, rose as high as $16.63 this week after the Canadian Competition Tribunal dismissed a complaint that Visa Canada and MasterCard impose anti-competitive rules on merchants. Merchants want to place surcharges on consumers’ credit card purchases to offset fees they pay to Visa and MasterCard. Credit card companies and the banks that issue the cards currently split these fees, which range from 1.5% to 3%. The merchants also wanted to be able to choose not to accept premium credit cards, which charge higher fees. The current rules, set by credit card issuers, prohibit merchants from doing either of these things. Visa and MasterCard currently process over 90% of credit card transactions in Canada....

FEDEX CORP. $106 (New York symbol FDX; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 316.6 million; Market cap: $33.6 billion; Price-to-sales ratio: 0.8; Dividend yield: 0.6%; TSINetwork Rating: Average; www.fedex.com) delivers packages and documents in the U.S....

NCR CORP. (New York symbol NCR; www.ncr.com) is a leading maker of automated teller machines (ATMs), checkout scanners, cash registers and self-serve kiosks.

In February 2013, the company paid $791 million for Israel-based Retalix, whose software helps retailers manage their sales and track inventories. Retailers with a combined 70,000 locations in over 50 countries use Retalix’s products. NCR feels Retalix’s expertise will improve its point-of-sale terminals and self-serve kiosks.

In the three months ended March 31, 2013, Retalix contributed $50 million to NCR’s revenue. That helped push up the total by 13.3% in the latest quarter, to $1.4 billion from $1.2 billion a year earlier. The acquisition should add $255 million to the company’s full-year revenue.

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One of today’s most dated investment terms is “tech stocks”. You’ll hear the term flung about as if it referred to well-defined groups of stocks such as the oils, the mining stocks or the banks. The difference is that changes in the price of oil have a direct impact on oil company profits and oil stock prices. Changes in mineral prices have a direct impact on mining company profits and stock prices. Changes in interest rates and in bank legislation have a direct impact on bank profits and bank stock prices. But there is no over-riding factor that influences the so-called tech stocks as a group. The term made more sense in the 1990s and before, when technology companies were in a much earlier stage of their corporate development. Back then, shares of these companies did tend to move as something of a loosely connected group. That was mainly because investors had limited information on which to base their views of many of these stocks, and decide how much to pay for them. Now, however, you might say the group has matured. The stocks it covers have differentiated. Stocks that qualify as “techs” still include a lot of companies that are little past the start-up phase and are highly speculative. But it also includes stocks issues that qualify as traditional growth stocks....

Income Streams III Corp equity dividend shares, $7.28, symbol STQ.E on Toronto; (Units outstanding: 1.4 million; Market cap: $10.2 million; www.quadravest.com), is a split-share company with two types of shares: equity dividend (symbol STQ.E on Toronto) and capital yield (symbol STQ on Toronto). Split-share companies typically issue two classes of shares. Usually the capital shares get all or most of the capital gains and losses, and the preferred shares (or equity dividend shares in the case of Income Streams III Corp) get most of the dividend income. In the case of Income Streams III Corp, the equity dividend shares receive a fixed monthly dividend of $0.0875 a share ($1.05 annually). That gives them a 14.4% yield....

YAMANA GOLD (Toronto symbol YRI; www.yamana.com) owns eight operating gold mines in Mexico, Brazil, Chile and Argentina. It also holds a 12.5% stake in the Alumbrera copper/gold mine in Argentina and has a number of other properties in advanced stages of development. In the quarter ended March 31, 2013, Yamana’s revenue fell 4.4%, to $534.9 million from $559.7 million a year earlier (all figures except share price and market cap in U.S. dollars). Gold production rose, but prices for gold, as well as copper and silver, which are both significant by-products of Yamana’s gold mining, dropped. Cash flow per share fell 3.3%, to $0.29 from $0.30....

POTASH CORP. OF SASKATCHEWAN (Toronto symbol POT; www.potashcorp.com) is the world’s largest fertilizer producer. Its five potash mines in Saskatchewan and one in New Brunswick account for 20% of global potash capacity. Five of its mines have reserves of between 65 and 84 years. It also makes fertilizers from nitrogen and phosphate. Earnings for Potash were $3.51 a share (or $3.1 billion) in 2011. However, earnings fell to $2.42 a share (or $2.1 billion) in 2012....