oil and gas

YAMANA GOLD $4.38 (Toronto symbol YRI; TSINetwork Rating: Speculative) (416-815-0220; www.- yamana.com; Shares outstanding: 880.8 million; Market cap: $3.9 billion; Dividend yield: 1.6%) 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. Yamana now plans to form a subsidiary to hold some of its Brazilian assets. This will let the company focus on its main projects, including the Canadian Malartic gold mine in Quebec, in which it owns a 50% stake. The new subsidiary, to be named Brio Gold Inc., will hold Yamana’s Fazenda Brasileiro and Pilar gold mines, as well as its C1 Santa Luz development project. Yamana will retain its Chapada and Jacobina mines in Brazil....

Linn Energy LLC, $11.90, symbol LINE on Nasdaq (Units outstanding: 331.9 million; Market cap: $3.3 billion; www.linnenergy.com), acquires and develops oil and gas properties in the U.S. In December 2013, Linn bought Berry Petroleum for $4.3 billion. The move added long-lasting assets and significantly enhanced Linn’s growth prospects. Berry’s reserves were roughly 75% oil. Linn’s shares have dropped lately, along with oil and gas prices. That’s despite the fact that the company’s overall production jumped 51% from a year earlier....

TIM HORTONS INC., $99.00, symbol THI on Toronto, has completed its merger with U.S.-based BURGER KING WORLDWIDE INC., $35.50, symbol BKW on New York.

On Monday, December 15, 2014, the combined company, called Restaurant Brands International Inc., will begin trading on the Toronto and New York exchanges under the QSR symbol.

Restaurant Brands is the world’s third-largest fast-food restaurant operator, after McDonald’s and Yum Brands, with 14,000 Burger King restaurants and 4,590 Tim Hortons outlets in 100 countries. In all, these locations have annual sales of over $23 billion U.S.

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The four companies below sell gear and services to energy-exploration and mining firms. As a result, their shares have fallen with the recent drop in prices for oil, gold and other commodities. However, all four lead their niche industries and should rebound strongly when commodity prices recover. The drop also means they now trade at attractive multiples to their projected earnings. SNC-LAVALIN GROUP INC. $40 (Toronto symbol SNC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 152.5 million; Market cap: $6.1 billion; Price-to-sales ratio: 0.8; Dividend yield: 2.4%; TSINetwork Rating: Average; www.snclavalin.com) is narrowing its focus to engineering projects in the oil and gas, mining and water treatment industries....

TIM HORTONS INC., $96.97, symbol THI on Toronto, shareholders will vote on the friendly takeover offer from BURGER KING WORLDWIDE, $34.81, symbol BKW on New York, on Tuesday, December 9, 2014. If the deal is approved, Tim Hortons investors will have a number of options: They can sell their shares on the Toronto exchange and receive the current trading price of $96.97 (less brokerage commissions). If they don’t do that, they can opt for one of the three choices below by notifying their brokers no later than 5:00 p.m. on Tuesday, December 9, 2014....

TIM HORTONS INC., $96.97, Toronto symbol THI, shareholders will vote on the friendly takeover offer from BURGER KING WORLDWIDE INC., $34.81, New York symbol BKW, on Tuesday, December 9, 2014. If the deal is approved, Tim Hortons investors will have a number of options: They can sell their shares on the Toronto exchange and receive the current trading price of $96.97 (less brokerage commissions). If they don’t do that, they can opt for one of the three choices below by notifying their brokers no later than 5:00 p.m. ET on Tuesday, December 9, 2014....

Here’s an excerpt from Pat’s latest email to his Inner Circle members: “Overall, the drop in oil prices is a favourable development for the universe of stocks we follow and recommend. It will cut into oil stock earnings, but will act like a major tax cut for all other stocks we follow, and their customers.” “A steep plunge like this inevitably sparks predictions of an even bigger drop ahead. It pays to be skeptical of predictions like these. Nobody has ever consistently predicted the rise and fall of the oil market.”...

CRESCENT POINT ENERGY CORP. $29.65 (Toronto symbol CPG; Shares outstanding: 443.3 million; Market cap: $13.2 billion; TSINetwork Rating: Extra Risk; Dividend yield: 9.3%; www.crescentpointenergy.com) produces oil and natural gas in Western Canada, with a focus on its Bakken light oil development in southeastern Saskatchewan. Its output is 91% oil and 9% gas. In the three months ended September 30, 2014, Crescent Point’s cash flow rose 11.6%, to $618.4 million from $554.1 million a year earlier. The company raised its daily output by 19.7%, to 141,183 barrels of oil equivalent from 117,963. That, plus higher oil and gas prices, was the main reason for the rising cash flow. Cash flow per share rose at a slower rate of 2.1%, to $1.45 from $1.42, because Crescent Point issued shares to pay for acquisitions....

We think conservative investors could hold up to 10% of their portfolios in foreign stocks. One way to do that is to buy carefully chosen exchange traded funds (ETFs) that have an overseas focus. The best ETFs offer very low management fees and well-diversified, tax-efficient portfolios of high quality stocks. Here’s a look at six global ETFs:...

Overall, the drop in oil prices is a favourable development for the universe of stocks we follow and recommend. It will cut into the earnings of our oil stock recommendations, of course. But for all other stocks we follow, and their customers, it will act like a major tax cut. Note, too, that lower oil prices will cut into the cash flow of the top international troublemakers—Russia, Iran, and Venezuela—in three key parts of the world. A steep plunge like this inevitably sparks predictions of an even bigger drop ahead. It pays to be skeptical of predictions like these, just as it pays to be skeptical of bullish predictions that follow a big rise in the price of a stock or a commodity. Most are extrapolations on the rise or fall that has already taken place....