option
An option offers its holder the right to buy or sell a particular security at a specific price within a specific time frame. Two kind of options are put options and call options.
Canadian Banc Corp. is a split-share company with two types of stock: capital shares ($12.85, symbol BK on Toronto) and preferred shares ($10.26, symbol BK.PR.A on Toronto). The company holds shares of the six biggest Canadian banks. Split-share companies typically issue two classes of stock. Usually the capital shares get all or most of the capital gains and losses, as well as variable dividend income, and the preferred shares get a fixed amount of dividend income....
While this split-share company dabbles in call options, investors would be better off buying the bank and oil stocks it holds separately.
CALIAN TECHNOLOGIES $18.50 (Toronto symbol CTY; TSINetwork Rating: Speculative) (613-599-8600; www.calian.com; Shares outstanding: 7.4 million; Market cap: $136.6 million; Dividend yield: 6.1%) has won a $15- million contract with the Royal Canadian Air Force (RCAF) to provide airworthiness engineering and support. The contract starts immediately and will run to March 31, 2017. It includes one additional option year. Calian, through its Amtek subsidiary and in conjunction with subcontractor Valcom Consulting Group, will supply 40 engineers to help the RCAF meet its regulatory requirements for the safe and effective operation of its equipment. This latest deal will add to Calian’s revenue, which should reach $220 million this year. It also demonstrates the company’s ongoing ability to win recurring orders from Canadian federal government departments, including the Department of National Defence....
CALIAN TECHNOLOGIES $18.50 (Toronto symbol CTY; TSINetwork Rating: Speculative) (613-599-8600; www.calian.com; Shares outstanding: 7.4 million; Market cap: $136.6 million; Dividend yield: 6.1%) has won a $15- million contract with the Royal Canadian Air Force (RCAF) to provide airworthiness engineering and support. The contract starts immediately and will run to March 31, 2017. It includes one additional option year.
Calian, through its Amtek subsidiary and in conjunction with subcontractor Valcom Consulting Group, will supply 40 engineers to help the RCAF meet its regulatory requirements for the safe and effective operation of its equipment.
This latest deal will add to Calian’s revenue, which should reach $220 million this year. It also demonstrates the company’s ongoing ability to win recurring orders from Canadian federal government departments, including the Department of National Defence.
...
Calian, through its Amtek subsidiary and in conjunction with subcontractor Valcom Consulting Group, will supply 40 engineers to help the RCAF meet its regulatory requirements for the safe and effective operation of its equipment.
This latest deal will add to Calian’s revenue, which should reach $220 million this year. It also demonstrates the company’s ongoing ability to win recurring orders from Canadian federal government departments, including the Department of National Defence.
...
PLEASE NOTE: Our next Hotline will go out on Friday, April 10, 2015. HECLA MINING CO., $3.18, symbol HL on New York, explores for, mines and processes silver and gold in the U.S. and Mexico. This week, the company agreed to buy Revett Mining Company (symbol RVM on New York) for $20 million in Hecla shares....
Big Bank Big Oil Split Corp. is a split-share company with two types of stock: capital shares ($9.32, symbol BBO on Toronto) and preferred shares ($10.21, symbol BBO.PR.A on Toronto).
The company holds shares of the biggest six Canadian banks, plus 10 large Canadian oil and gas and pipeline companies.
Split-share companies typically issue two classes of shares. Usually the capital shares get all or most of the capital gains and losses, as well as variable dividend income, and the preferred shares get a fixed amount of dividend income.
In the case of Big Bank Big Oil Split, the capital shares receive a monthly dividend of $0.05 a share ($0.60 annually), which gives them a 6.4% yield. The monthly dividend has been as high at $0.09, most recently in 2010.
The dividend income the company gets from its portfolio isn’t enough to pay capital and preferred share dividends and management expenses of 1.22%, in addition to providing a return for the capital shares. To make up the difference, the company has to make a profit by trading its portfolio. It also aims to raise its returns by writing call options on the portfolio’s securities.
...
The company holds shares of the biggest six Canadian banks, plus 10 large Canadian oil and gas and pipeline companies.
Split-share companies typically issue two classes of shares. Usually the capital shares get all or most of the capital gains and losses, as well as variable dividend income, and the preferred shares get a fixed amount of dividend income.
In the case of Big Bank Big Oil Split, the capital shares receive a monthly dividend of $0.05 a share ($0.60 annually), which gives them a 6.4% yield. The monthly dividend has been as high at $0.09, most recently in 2010.
The dividend income the company gets from its portfolio isn’t enough to pay capital and preferred share dividends and management expenses of 1.22%, in addition to providing a return for the capital shares. To make up the difference, the company has to make a profit by trading its portfolio. It also aims to raise its returns by writing call options on the portfolio’s securities.
...
FEDEX CORP., $172.04, New York symbol FDX, earned $580 million in the third quarter of its 2015 fiscal year, which ended February 28, 2015. That’s up 53.4% from $378 million a year earlier. Per-share earnings gained 63.4%, to $2.01 from $1.23, beating the consensus forecast of $1.87. The gains mainly resulted from the company’s recent restructuring and a 30.4% drop in fuel costs. Harsh winter weather in the year-earlier quarter also disrupted ground deliveries and depressed FedEx’s earnings. Overall revenue rose 3.7%, to $11.7 billion from $11.3 billion, missing the consensus estimate of $11.8 billion....
POTASH CORP. OF SASKATCHEWAN, $40.70, Toronto symbol POT, fell 2% this week after the Saskatchewan government said it would change the timing of certain tax breaks for new potash mines and expansion projects. The province is also reviewing how it taxes potash producers. Potash Corp. expects the new rules to cut its pre-tax earnings by $75 million to $100 million (Canadian) in 2015. To put that in context, Potash Corp. (which reports its results in U.S. dollars) earned $1.5 billion, or $1.82 a share, in 2014. The company expects to complete its current $6-billion U.S. expansion plan in 2016, so the new rules will have little impact on next year’s earnings....
Niloo
WAL-MART STORES INC. (New York symbol WMT; www.walmart.com) gets about 60% of its sales from its 4,516 stores in the U.S., including 3,407 supercentres, which sell both groceries and general merchandise. Groceries now supply 56% of Wal-Mart’s U.S. sales.
In 1991, the company opened its first store outside of the U.S. through a joint venture with a Mexican retailer. Its international division (29% of total sales) now operates 6,290 stores in 26 countries.
...
ENCANA CORP., $14.66, Toronto symbol ECA, fell 10% this week after the company issued 85.6 million common shares to a group of underwriters for $14.60 each. The company plans to use the $1.25 billion of proceeds to redeem $1.6 billion worth of notes. As of December 31, 2014, Encana’s long-term debt was $7.3 billion U.S., or a high 84% of its $10.9 billion (Canadian) market cap. If the underwriters exercise their option to buy an additional 12.8 million shares, Encana would receive $1.44 billion. Including this option, the extra shares would increase the total outstanding by roughly 13%....