investment

MOTOROLA SOLUTIONS INC. (New York symbol MSI; www.motorolasolutions.com) makes specialized electronic equipment, such as bar-code scanners and radios for police and fire vehicles. It gets 69% of its revenue by selling its products to governments; the U.S. government is the company’s largest single customer, accounting for 7% of its overall revenue. Businesses supply the remaining 31% of Motorola Solutions’revenue....

AGRIUM INC. $114 (Toronto symbol AGU; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 149.4 million; Market cap: $17.0 billion; Price-to-sales ratio: 1.1; Dividend yield: 1.8%; TSINetwork Rating: Average; www.agrium.com) has soared 60% in the past year. That’s mainly because activist investment firm Jana Partners wants Agrium to spin off its retail business as a separate company. Jana owns 6% of Agrium’s shares.

The retail division has 1,250 stores in North America, South America and Australia that sell seed, fertilizer and other products to farmers. These outlets supply 60% of Agrium’s revenue. The remaining 40% mainly comes from making fertilizers from natural gas.

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LOBLAW COMPANIES LTD. $41 (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 281.5 million; Market cap: $11.5 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.1%; TSINetwork Rating: Above Average; www.loblaw.ca) is Canada’s largest food retailer, with roughly 1,000 stores. George Weston Ltd. (Toronto symbol WN) owns 63% of the company’s shares.

Loblaw has announced a plan to form a real estate investment trust (REIT) that will hold most of its real estate assets.

Right now, the company owns 47 million square feet of real estate with a market value of $9 billion to $10 billion. Loblaw will transfer 35 million square feet of these properties—including stores, warehouses and office buildings—to the REIT. Loblaw will then rent these properties from this new trust. After the company closes this transaction in mid- 2013, it will sell units of the REIT to the public. Loblaw will hang on to a majority stake.

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RIOCAN REAL ESTATE INVESTMENT TRUST $27 (Toronto symbol REI.UN; Aggressive Growth Portfolio, Manufacturing & Industry sector; Units outstanding: 299.0 million; Market cap: $8.1 billion; Price-to-sales ratio: 5.3; Dividend yield: 5.2%; TSINetwork Rating: Average; www.riocan.com) has agreed to buy a mall in Oakville, Ontario, plus 50% of another mall in Burlington, Ontario. Right now, Primaris Retail Real Estate Investment Trust (Toronto symbol PMZ.UN) owns these malls. RioCan will buy them from a consortium that has launched a friendly takeover for Primaris. The $362-million price is equal to 4% of RioCan’s market cap.

The new malls will give RioCan more flexibility to attract tenants with leases that include space in its other Toronto-area malls.

RioCan is a buy.

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INTUITIVE SURGICAL (Nasdaq symbol ISRG; www.intuitivesurgical.com) makes the da Vinci, a computerized surgical system a computerized surgical system for use in prostate surgery and other procedures. Guided by a miniature camera connected to a 3-D monitor, surgeons use the da Vinci to operate by remotely manipulating tiny robotic arms. This process is safer and much less invasive than regular surgery and helps cut a patient’s recovery time and post-operative discomfort. It also reduces scarring and infection risk....

Pat McKeough responds to many personal questions about investing in stocks and other topics on investment and the economy from the members of his Inner Circle. 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. This week, Pat received a question from an Inner Circle member about a stock that provides a different approach to excavating for the petroleum and utility industries. Pat assesses the company’s unique arrangement with its operating partners and whether or not it can continue to improve its results in a recovering economy....

METRO INC. (Toronto symbol MRU; www.metro.ca) has moved up sharply in the past few months. That’s mainly because it is taking steps to unlock some of its hidden value, including selling some of its investments....

You can draw a number of conclusions from the Heinz takeover, and some make more sense than others. For instance, some Heinz investors are upset that Warren Buffett’s Berkshire Hathaway is supplying more than half of the capital in this $23 billion takeover. They assume, based on Buffett’s involvement and his reputation as a canny investor, that if Warren is buying, the $72.50 a share takeover price must be a better deal for buyers than for sellers. Note, however, that Mr. Buffett’s involvement—what you might think of as the “Warren Buffett seal of approval”—makes it cheaper and easier to arrange financing for the deal. It also makes it possible for the bidding group to come up with a bid that wins quick acceptance. The only way to do that is to offer the sellers a good price and/or good terms....

HealthLease Properties Real Estate Investment Trust, $11.15, symbol HLP.UN on Toronto (Units outstanding: 12.1 million; Market cap: $134.9 million; www.hlpreit.com), owns 12 retirement homes and senior-care facilities in western Canada and the U.S. Midwest. In all, these properties contain 1,656 beds. It has three more properties (with a total of 275 beds) under development in Indiana and Illinois. The REIT does not operate these homes. Instead, it rents them out to operators under long-term leases that expire in 2022 and beyond. These operators are responsible for each building’s property taxes, insurance, utilities and maintenance. Alberta supplies 64% of HealthLease’s rental revenue, followed by Indiana (26%) and B.C. (10%). HealthLease took its current form on April 12, 2012. It sold 11.0 million units to the public on June 20, 2012, for $10.00 each. The REIT then used the proceeds to buy eight seniors’ homes....

Every Wednesday, we publish our “Investor Toolkit” series on TSI Network. Whether you’re a new or experienced investor, these weekly updates are designed to give you specific investing advice on a wide range of investing topics. Each Investor Toolkit update gives you a fundamental tip and shows you how you can put it into practice right away. Tip of the week: “Even for the most seasoned traders, futures represent a risky speculation on the movement of prices.”...