oil and gas
MCCOY GLOBAL $1.90 (Toronto symbol MCB; TSINetwork Rating: Speculative) (780-453-8451; www.mccoyglobal.com; Shares outstanding: 27.7 million; Market cap: $54.6 million; No dividends paid) sold its heavy-duty truck-trailer unit in 2014 and is now focused on its Energy Products and Services segment. It sells hydraulic gear, including power tongs, for drilling rigs. (Power tongs are large wrench-like tools that tighten and loosen the pipe in the drill hole.) McCoy has international sales and service centres in Singapore, Dubai and Aberdeen, Scotland. In the three months ended December 31, 2015, McCoy’s revenue fell 57.2%, to $11.6 million from $27.2 million a year earlier. Low oil and gas prices prompted clients to cut back on equipment purchases....
Aecon Group Inc. continued to increase its revenue, earnings and dividend with a steady flow of public infrastructure and private road-building contracts.
WAJAX CORP. $16.85 (Toronto symbol WJX; TSINetwork Rating: Extra Risk) (905-212-3300; www.wajax.ca; Shares outstanding:20.0 million; Market cap: $335.9 million; Dividend yield: 5.9%) sells and services cranes, forklifts and other heavy equipment. It also provides related parts (such as ball bearings, motors, hoses and fittings) and power systems (including diesel engines and transmissions). The company’s customers are in the natural resource, construction, manufacturing and transportation industries. In the three months ended December 31, 2015, Wajax’s clients in mining and oil and gas made fewer purchases. As a result, revenue fell 16.0%, to $324.4 million from $386.1 million a year earlier. Earnings, excluding one-time items, declined sharply, to $4.0 million, or $0.20 a share, from $11.0 million, or $0.66....
Imperial Oil will focus on oil sands, refineries after selling 497 Esso stations–for double its 2015 earnings.
Chicago Bridge & Iron Company NV, $34.97, symbol CBI on New York (Shares outstanding: 104.6 million; Market cap: $3.8 billion; www.cbi.com), is one of the world’s leading engineering and construction companies. It specializes in projects for the energy, petrochemical and natural resource industries. Netherlands-based Chicago Bridge was founded in 1889. The company’s projects include oil and gas processing plants, liquefied natural gas (LNG) terminals, offshore structures, bulk liquid terminals, and water storage and treatment facilities. Chicago Bridge also provides a range of maintenance and repair services. Customers include Shell, ExxonMobil, Chevron, Occidental Petroleum, ConocoPhillips, Saudi Aramco, Alcoa and BHP Billiton. Warren Buffett’s Berkshire Hathaway is Chicago Bridge’s biggest shareholder, with a 9.9% interest....
Dividend for Russel Metals seems sustainable and it’s managing long-term debt despite slower sales to energy producers.
ALIMENTATION COUCHE-TARD, $60.63, symbol ATD.B on Toronto, has agreed to buy 279 Esso gas stations in Ontario and Quebec from Imperial Oil for $1.7 billion. (Imperial Oil is a recommendation of The Successful Investor, our newsletter that focuses on conservative investments.) Imperial Oil is selling all of its 497 company-owned Esso gas stations to independent operators for $2.8 billion. Following the sale, franchisees will operate all of its 1,700 Esso stations across Canada. Besides Couche-Tard, the buyers include 7-Eleven Canada, which is getting 148 stations in Alberta and British Columbia. Parkland Fuel (Toronto symbol PKI) will buy 17 stations in Saskatchewan and Manitoba....
SHAWCOR LTD. $28 (Toronto symbol SCL; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 64.5 million; Market cap: $1.8 billion; Price-to-sales ratio: 1.0; Dividend yield: 2.1%; TSINetwork Rating: Average; www.shawcor.com) makes sealants and coatings that keep oil and gas pipelines from rusting. It also makes electrical wire and protective sheaths. In 2015, its revenue fell 4.2%, to $1.8 billion from the $1.9 billion in 2014. That’s because weaker demand for its pipeline coating services offset the benefit of the low Canadian dollar. Favourable exchange rates added $106.5 million to ShawCor’s revenue in 2015. Earnings rose 3.6%, to $98.2 million from $94.9 million, thanks to fewer losses from its joint ventures. Due to more shares outstanding, per-share profits fell 0.7%, to $1.52 from $1.53. ShawCor’s backlog was $452 million at the end of 2015. Currently, it has $900 million worth of bids outstanding on new jobs. It also expects to bid on an additional $500 million worth of contracts. ShawCor’s strong reputation should continue to help it win bids....
SHAWCOR LTD. $28 (Toronto symbol SCL; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 64.5 million; Market cap: $1.8 billion; Price-to-sales ratio: 1.0; Dividend yield: 2.1%; TSINetwork Rating: Average; www.shawcor.com) makes sealants and coatings that keep oil and gas pipelines from rusting. It also makes electrical wire and protective sheaths. In 2015, its revenue fell 4.2%, to $1.8 billion from the $1.9 billion in 2014. That’s because weaker demand for its pipeline coating services offset the benefit of the low Canadian dollar. Favourable exchange rates added $106.5 million to ShawCor’s revenue in 2015. Earnings rose 3.6%, to $98.2 million from $94.9 million, thanks to fewer losses from its joint ventures. Due to more shares outstanding, per-share profits fell 0.7%, to $1.52 from $1.53. ShawCor’s backlog was $452 million at the end of 2015. Currently, it has $900 million worth of bids outstanding on new jobs. It also expects to bid on an additional $500 million worth of contracts. ShawCor’s strong reputation should continue to help it win bids....
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