pension plan
Surge Energy, $6.03, symbol SGY on Toronto (Shares outstanding: 121.4 million; Market cap: $722.4 million; www.surgeenergy.ca), produces oil and gas in western and eastern Alberta and southwestern Saskatchewan. Its output is 74% oil and 26% gas. In the three months ended June 30, 2013, Surge produced 9,373 barrels of oil equivalent per day, up 1.1% from 9,275 barrels a year earlier. The rise came despite the fact that the company sold some of its less important properties, which produced 680 barrels a day, for $42.8 million U.S. on May 9, 2013. Despite the small increase in production, Surge’s cash flow per share rose 11.8% in the latest quarter, to $0.38 from $0.34 a year earlier, on higher oil and gas prices....
MANITOBA TELECOM SERVICES INC. $35.75 (Toronto symbol MBT; Shares outstanding: 67.5 million; Market cap: $2.4 billion; TSINetwork Rating: Average; Dividend yield: 4.8%; www.mts.ca) has agreed to sell its Allstream subsidiary to Accelero Capital Holdings, a private firm controlled by Egyptian billionaire Naguib Sawiris.
In 2004, the company paid $1.6 billion for Allstream, which provides integrated telephone, Internet and other communication services to over 50,000 businesses across Canada.
The sale price is $520 million, which is equal to 22% of Manitoba Telecom’s $2.4-billion market cap. If you disregard closing costs, Manitoba Telecom will receive $405 million. Assuming regulators approve, the company expects to complete the sale in the second half of 2013.
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In 2004, the company paid $1.6 billion for Allstream, which provides integrated telephone, Internet and other communication services to over 50,000 businesses across Canada.
The sale price is $520 million, which is equal to 22% of Manitoba Telecom’s $2.4-billion market cap. If you disregard closing costs, Manitoba Telecom will receive $405 million. Assuming regulators approve, the company expects to complete the sale in the second half of 2013.
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BANK OF NOVA SCOTIA $56 (Toronto symbol BNS; Conservative Growth Portfolio, Finance sector; Shares outstanding: 1.2 billion; Market cap: $67.2 billion; Price-to-sales ratio: 2.4; Dividend yield: 4.3%; TSINetwork Rating: Above Average; www.scotiabank.com) is Canada’s third-largest bank, with assets of $754.2 billion.
The bank has recovered strongly from the 2008 financial crisis. Revenue rose 65.9%, from $11.9 billion in 2008 to $19.7 billion in 2012 (fiscal years end October 31). Earnings gained 98.6%, from $3.0 billion in 2008 to $6.0 billion in 2012. Due to more shares outstanding, earnings per share rose at a slower pace of 71.1%, from $3.05 to $5.22. Without a one-time gain on the sale of real estate, it would have earned $4.61 a share in 2012.
Much of this growth is due to acquisitions. In the past six years, Bank of Nova Scotia has spent over $14 billion buying smaller financial services firms. It purchased most of these assets from banks that wanted to exit certain markets, so it probably got many of them at bargain prices.
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The bank has recovered strongly from the 2008 financial crisis. Revenue rose 65.9%, from $11.9 billion in 2008 to $19.7 billion in 2012 (fiscal years end October 31). Earnings gained 98.6%, from $3.0 billion in 2008 to $6.0 billion in 2012. Due to more shares outstanding, earnings per share rose at a slower pace of 71.1%, from $3.05 to $5.22. Without a one-time gain on the sale of real estate, it would have earned $4.61 a share in 2012.
Much of this growth is due to acquisitions. In the past six years, Bank of Nova Scotia has spent over $14 billion buying smaller financial services firms. It purchased most of these assets from banks that wanted to exit certain markets, so it probably got many of them at bargain prices.
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MANITOBA TELECOM SERVICES INC. (Toronto symbol MBT; www.mts.ca) gets around 55% of its revenue from its 1.3 million telephone and wireless customers in Manitoba. The remaining 45% has come from its Allstream division, which sells integrated telephone, Internet and other communication services to over 50,000 businesses across Canada. Following a strategic review, Manitoba Telecom has agreed to sell its Allstream subsidiary to Accelero Capital Holdings, a private firm controlled by Egyptian billionaire Naguib Sawiris....
Royal Bank (see page 63) recently raised the interest rate on its mortgage loans, which will probably spur other lenders to do the same. That could dampen demand for new loans. Even so, we still like the outlook for all five of Canada’s big banks. That’s because interest rates are still close to historic lows....
MANITOBA TELECOM SERVICES INC. $35.75 (Toronto symbol MBT; Shares outstanding: 67.5 million; Market cap: $2.4 billion; TSINetwork Rating: Average; Dividend yield: 4.8%; www.mts.ca) has agreed to sell its Allstream subsidiary to Accelero Capital Holdings, a private firm controlled by Egyptian billionaire Naguib Sawiris.
In 2004, the company paid $1.6 billion for Allstream, which provides integrated telephone, Internet and other communication services to over 50,000 businesses across Canada.
The sale price is $520 million, which is equal to 22% of Manitoba Telecom’s $2.4-billion market cap....
In 2004, the company paid $1.6 billion for Allstream, which provides integrated telephone, Internet and other communication services to over 50,000 businesses across Canada.
The sale price is $520 million, which is equal to 22% of Manitoba Telecom’s $2.4-billion market cap....
BANK OF NOVA SCOTIA $57.83 (Toronto symbol BNS: Shares outstanding: 1.2 billion; Market cap: $69.2 billion; TSINetwork Rating: Above Average; Dividend yield: 4.2%, www.scotiabank.com) has acquired 50% of AFP Horizonte, which manages pension funds in Peru, for $260 million. This business has 1.4 million clients and $9 billion U.S. of assets under management. SURA Asset Management owns the other 50%.
Demand for pension fund services is growing quickly in Latin America. As well, Bank of Nova Scotia has a long history in this region, which cuts the risk of this investment.
The bank and SURA plan to divide AFP Horizonte in the next few weeks. Following the split, Bank of Nova Scotia will merge this business with its existing pension plan operations in Peru. The combined business will have 1.9 million clients and $10.3 billion U.S. in assets under management.
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Demand for pension fund services is growing quickly in Latin America. As well, Bank of Nova Scotia has a long history in this region, which cuts the risk of this investment.
The bank and SURA plan to divide AFP Horizonte in the next few weeks. Following the split, Bank of Nova Scotia will merge this business with its existing pension plan operations in Peru. The combined business will have 1.9 million clients and $10.3 billion U.S. in assets under management.
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Every Wednesday, we publish our “Investor Toolkit” series on TSI Network. Whether you’re a beginning or experienced investor, these weekly updates are designed to give you specific investment advice. Each Investor Toolkit update gives you a fundamental piece of investing strategy, and shows you how you can put it into practice right away. Today’s tip: “You take a double loss if you lose money in your RRSP, which means that it is an expensive place to find out if you have a talent for stock trading.”...
BANK OF NOVA SCOTIA $57.83 (Toronto symbol BNS: Shares outstanding: 1.2 billion; Market cap: $69.2 billion; TSINetwork Rating: Above Average; Dividend yield: 4.2%, www.scotiabank.com) has acquired 50% of AFP Horizonte, which manages pension funds in Peru, for $260 million....
TECK RESOURCES LTD., $26.27, Toronto symbol TCK.B, reported lower quarterly revenue and earnings this week. That’s mainly because slowing industrial activity in China and elsewhere has hurt prices for its metallurgical coal, which is a key ingredient in steelmaking. Prices of Teck’s other commodities, such as copper and zinc, also declined. In the three months ended March 31, 2013, Teck earned $328 million, or $0.56 a share. These figures exclude unusual items, such as gains and losses on asset sales. On that basis, the latest earnings beat the consensus estimate of $0.41 a share. However, they are down 39.7% from $544 million, or $0.93 a share, a year earlier. Revenue fell 8.5%, to $2.3 billion from $2.5 billion. Even with the decline, the latest figure also beat the consensus estimate of $2.2 billion....