oil and gas

VANGUARD GROWTH ETF $110.65 (New York symbol VUG; buy or sell through brokers) aims to track the Center for Research in Security Prices (CRSP) U.S. Large Cap Growth Index, a broadly diversified index that mainly consists of big U.S. companies. The fund’s MER is just 0.09%.

The $48.1-billion Vanguard Growth ETF’s top holdings are Apple, Alphabet, Coca-Cola, Facebook, Visa, Home Depot, Comcast, Amazon.com, Gilead Sciences and Walt Disney Co. The fund’s breakdown by industry is as follows: Technology, 23.9%; Consumer Services, 22.2%; Health Care, 13.7%; Financials, 12.5%; Industrials, 11.9%; Consumer Goods, 10.1%; Oil and Gas, 4.0%; Materials, 1.3%; and Telecom Services, 0.3%.

Vanguard Growth ETF is a buy.

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Cenovus Energy’s oil sands projects and integrated operations make it one energy stock we feel will bounce back stronger when oil recovers

CALIAN TECHNOLOGIES LTD., $17.05, symbol CTY on Toronto, has won two more contracts for emergency response preparedness training, a new area for the company. These deals build on the first one it signed, with Bruce Power, earlier this year. No terms were disclosed. Under one of these new contracts, Calian will help Emergency Management British Columbia design, develop, conduct and evaluate an exercise in support of the province’s new Earthquake Immediate Response Plan. The other deal, with the City of Kingston, involves setting up a plan for simulating complex emergency situations and enhancing the city’s response procedures....

MITEL NETWORKS $11.40 (Toronto symbol MNW; TSINetwork Rating: Extra Risk) (613-592-2122; www.mitel.ca; Shares outstanding: 120.3 million; Market cap: $1.4 billion; No dividends paid) develops and markets products centred on business telephone systems, including technology that integrates land lines and mobile phones. The company also offers call centre and videoconferencing products. In the three months ended September 30, 2015, Mitel’s revenue rose 7.2%, to $293.7 million from $274.0 million a year earlier (all figures except share price and market cap in U.S. dollars). However, earnings per share fell 33.3%, to $0.12 from $0.18, as the stronger dollar lowered the value of the company’s international sales. Even so, that beat the consensus estimate of $0.07 a share....

RUSSEL METALS $19.08 (Toronto symbol RUS; TSINetwork Rating: Speculative) (905-819-7777; www.russelmetals.com; Shares outstanding: 61.7 million; Market cap: $1.2 billion; Dividend yield: 8.0%) is one of North America’s largest metal distributors, serving 39,000 clients at 53 locations in Canada and 12 in the U.S. In the three months ended September 30, 2015, Russel’s revenue fell 25.5%, to $773.4 million from $1.04 billion a year earlier. Sales mainly declined because revenue fell 40% at the company’s energy products division, which sells pipes to oil and gas drillers. Earnings dropped sharply, to $12.8 million, or $0.21 a share, from $33.0 million, or $0.54. The latest figure included a $2-million charge related to a more than 7% cut to the company’s workforce. Russel’s earnings fell faster than revenue because steel prices moved down in the latest quarter. That hurts its profit margins and causes it to suffer losses on its inventory....

SHERRITT INTERNATIONAL $0.79 (Toronto symbol S; TSINetwork Rating: Speculative) (1-800-704- 6698; www.sherritt.com; Shares outstanding: 293.9 million; Market cap: $226.3 million; No dividends paid) is now focused on nickel production, with operations in Cuba and Canada. As well, it has a 40% interest in the Ambatovy nickel mine on the island nation of Madagascar, off Africa’s east coast. Sherritt also produces oil and gas in Cuba, Spain and Pakistan and manages 506 megawatts of power generation capacity in Cuba. In the three months ended September 30, 2015, the company’s revenue fell 25.3%, to $76.9 million from $102.9 million a year earlier, mostly due to lower oil and gas prices. Cash flow per share fell sharply, to $0.05 from $0.16....

DELPHI ENERGY $0.72 (Toronto symbol DEE; TSINetwork Rating: Speculative) (403- 265-6171; www.delphienergy.ca; Shares outstanding: 155.5 million; Market cap: $110.4 million; No dividends paid) develops, produces and explores for oil and natural gas. About 70% of its output is gas; the remaining 30% is oil. In the three months ended September 30, 2015, Delphi’s production fell 16.6%, to 7,888 barrels of oil equivalent a day from 9,461 a year earlier, after the company sold some fields. The lower output and a 31.4% average decline in oil and gas prices cut cash flow per share to $0.06 from $0.09. The company will need improved oil and gas prices to move significantly higher, but its long-term outlook is positive....

WAJAX CORP. $16.96 (Toronto symbol WJX; TSINetwork Rating: Extra Risk) (905-212-3300; www.wajax.ca; Shares outstanding:20.0 million; Market cap: $349.7 million; Dividend yield: 5.9%) sells and services cranes, forklifts and other heavy equipment. It also provides related parts (such as 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 September 30, 2015, Wajax’s revenue fell 19.1%, to $290.9 million from $359.5 million a year earlier, as mining, oil and gas and oil sands firms made fewer purchases. Earnings declined 32.0%, to $7.5 million, or $0.38 a share, from $11.1 million, or $0.66....

We recommend that investors diversify up to 30% of their portfolios into U.S. stocks and as much as 10% into international securities. One attractive way for safety-conscious investors to do this is with exchange-traded funds (ETFs). Today we look at several ETFs from a U.S. firm that offer a low-fee way to achieve this diversification. We profile two Vanguard ETFs that track a U.S. large-cap index and an emerging market index.

Pennsylvania-based Vanguard Group is one of the world’s largest investment management companies. In all, it administers almost $3 trillion U.S. in 170 mutual funds.

Vanguard, which went into business in 1975, offers low-fee index mutual funds. Generally speaking, Canadians can’t buy units of mutual funds that are registered in the U.S., because they aren’t registered with provincial securities commissions. For that matter, some Canadian funds aren’t available in all provinces.

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Today, we look at a Canadian bank stock that has consistently paid dividends for 186 years. Bank of Montreal has benefited both from expansion outside of Canada and low interest rates in recent years. The bank continues to make acquisitions in the U.S. and the U.K. Recently it agreed to buy General Electric’s transportation-financing business, adding $11.5 billion in assets. Low interest rates have also helped the bank by increasing demand for loans. Between 2010 and 2014, the bank’s earnings rose by more than 50% and over the past three years, BMO has raised its dividend six times. We recommend BMO as a blue chip stock to buy for conservative investors.

BANK OF MONTREAL (Toronto symbol BMO; www.bmo.com) is Canada’s fourth-largestbank, with $672.4 billion of assets.

The bank has steadily expanded beyond Canadain recent years. For example, in 2011, it acquiredWisconsin-based banking firm Marshall & Ilsley for$4.0 billion in stock. That more than doubled thenumber of branches Bank of Montreal operates inthe U.S. and added two million customers.

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