investment

ENBRIDGE INC., $39.86, Toronto symbol ENB, has finished repairing a leaking pipeline in Wisconsin. This line pumps crude oil from Western Canada to refineries in the U.S. Midwest. However, U.S. regulators have stopped Enbridge from restarting the pipeline until the company submits a new plan outlining its environmental and maintenance procedures. This delay is not likely to have a meaningful impact on Enbridge’s growth. Meanwhile, the company earned $277 million in the three months ended June 30, 2012. That’s up 7.4% from $258 million a year earlier. Earnings per share rose 5.9%, to $0.36 from $0.34, on more shares outstanding....

Almost three months ago, on May 18, Facebook issued one of the most highly-publicized Initial Public Offerings (IPO) in the history of Wall Street. A week before, Pat McKeough had already issued his own investment advice on the stock. He advised investors to take a pass. Just as Pat predicted, Facebook shot up briefly, only to reverse course and head into a decline that hasn’t ended yet. This week it disappointed investors again with bad earnings (as did another Internet issue that has taken a beating, games specialist Zynga Inc.). There’s a cautionary message for investors in this and it relates directly to one of Pat’s core principles: Avoid stocks that bask in the broker/media limelight. Stocks like these can cause investor expectations to rise so high that downturns can be brutal—which is exactly what happened in this instance. Here is Pat’s original warning about Facebook from May 11....

Chinese stocks are down roughly 14% since March 2012. That’s largely because slow growth in the U.S. and Europe is hurting China’s export-driven economy. Still, China’s growth rate could reach 8% this year, and its long-term outlook is positive. Here are two Chinese exchange traded fund (ETF) recommendations. One invests in all publicly traded Chinese stocks available to foreign investors. The other holds small cap Chinese stocks. SPDR S&P CHINA ETF $63.27 (New York Exchange symbol GXC; buy or sell through brokers; www.spdrs.com) is an exchange traded fund that aims to track the S&P China BMI Index, which is made up of all the publicly traded Chinese stocks that are available to foreign investors. Right now, SPDR S&P China ETF holds 184 stocks....

RIOCAN REAL ESTATE INVESTMENT TRUST $28.36 (Toronto symbol REI.UN; Units outstanding: 285.9 million; Market cap: $8.1 billion; TSINetwork Rating: Average; Dividend yield: 4.9%; www.riocan.com) is purchasing the Georgian Mall, a shopping centre in Barrie, Ontario, with over 150 stores. This will be RioCan’s largest, most prominent enclosed mall property. The trust will pay $318 million for the shopping centre when the deal closes in the third quarter of 2012. That’s equal to 93% of the $342 million, or $1.20 a unit, that RioCan earned in the first quarter of 2012. This mall is 97% leased and gets 91% of its rental revenue from national chains. That cuts the risk of this purchase. Moreover, Barrie’s population should rise by 20% over the next decade....

ISHARES CDN REIT SECTOR INDEX FUND $17.25 (Toronto symbol XRE; buy or sell through brokers; ca.ishares.com) holds the 13 Canadian real estate investment trusts (REITs) in the S&P/TSX Capped REIT Index. The weight of any one REIT is limited to 25% of the ETF’s value. iShares CDN REIT’s expenses are 0.55% of its assets. The fund yields 4.3%. RioCan REIT is the fund’s largest holding at 22.0%, followed by H&R REIT (12.2%), Dundee REIT (8.9%), Canadian REIT (7.7%), Calloway REIT (7.5%), Boardwalk REIT (6.8%), Cominar REIT (6.4%), Canadian Apartment Properties REIT (6.2%), Primaris Retail REIT (5.7%), Artis REIT (5.0%), Allied Properties REIT (4.5%), Chartwell Seniors Housing REIT (2.9%), and Northern Property REIT (2.8%)....

Pat McKeough responds to many personal questions on specific stocks and other investment topics 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. This week, one question from an Inner Circle member wanted Pat’s input on one of the Canadian commodity stocks that depends heavily on one metal, molybdenum. Thompson Creek has seen a drop-off in both molybdenum prices and its own shares, but it is just possible, Pat says, that this could make it an appealing acquisition for a larger firm. ...

Every Wednesday, we publish our “Investor Toolkit” investing advice series. Whether you’re a new or experienced investor, these weekly updates are designed to give you our specific advice on successful investing. Each Investor Toolkit update gives you a fundamental piece of investing advice and shows you how you can put it into practice right away. Tip of the week: “Short selling stocks may seem like a potential money-making opportunity, but there are pitfalls that don’t exist when you’re buying stocks.”...

I’ve been advising members to take a positive view of the market outlook, so I was glad to see the Dow Jones Industrials rise above 13,000 last Friday. Media reports said this rise was due to a quote from the head of the European Central Bank, who said the bank “is willing to do whatever it takes to preserve the euro.” Media interpretations of a market move always seem to have an official air, as if they were as unquestionable as, say, estimates of heat damage to the coming grain harvest. But this quote struck me as standard bureaucrat-speak. I think it only got credit for the rise because it was the main euro-related news that day. Developments in the eurozone will undoubtedly influence U.S. joblessness and economic growth. But uncertainty about policies coming out of Washington will have a much bigger impact. Friday’s Dow gain may owe something to the influence of the U.S. presidential election campaign....

Canadian Western Bank, $26.60, symbol CWB on Toronto (Shares outstanding: 78.2 million; Market cap: $2.1 billion; www.cwbank.com), offers business and personal banking services across the four western provinces. It’s the biggest Canadian bank headquartered in western Canada and the country’s eighth-largest. The bank’s wholly owned subsidiaries include National Leasing Group Inc., Canadian Western Trust Company, Valiant Trust Company, Canadian Direct Insurance Inc., Adroit Investment Management Ltd. and Canadian Western Financial Ltd. In the three months ended April 30, 2012, Canadian Western Bank’s earnings rose 7.4%, to $39.7 million from $36.9 million a year earlier. Earnings per share were unchanged at $0.52, on more shares outstanding. Net interest income rose 8.6%, to $105.1 million from $96.8 million. Other income fell 1.7%, to $20.3 million from $20.6 million....

True North Apartment REIT, $4.60, symbol TN.UN on Toronto (Units outstanding: 6.9 million; Market cap: $31.7 million; no website) was formerly Wand Capital, a company with no operating businesses. In early June, Wand reorganized into a real estate investment trust, and changed its name to True North Apartment REIT. On June 5, 2012, True North bought its first property, a 72-unit apartment building in Guelph, Ontario, for $7.6 million. The following day, June 6, 2012, the REIT bought 457 & 499 Albert Street in Waterloo, Ontario, for $5.1 million. On June 7, 2012, True North paid $1.3 million for 35 Mowat Boulevard in Kitchener, Ontario. On June 7, 2012, True North began trading on the Toronto exchange at $4 per unit....