price to sales ratio
BOMBARDIER INC. (Toronto symbols BBD.A $4.15 and BBD.B $4.14; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.7 billion; Market cap: $7.1 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.4%; TSINetwork Rating: Average; www.bombardier.com) has won several orders for new regional jets, business jets and turboprop planes. Assuming these customers exercise all of their options, these deals are worth a total of $1.7 billion (all amounts except share prices and market cap in U.S. dollars). That’s equal to 9% of the company’s annual revenue of $19.5 billion. In addition, Bombardier has received an order for 42 passenger railcars from the operator of a public transit system near Paris, France. This deal is worth $484 million, and the company will begin delivering the trains in 2017. Bombardier B stock is a buy.
SUNCOR ENERGY INC. $35 (Toronto symbol SU; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.5 billion; Market cap: $52.5 billion; Price-to-sales ratio: 1.2; Dividend yield: 3.2%; TSINetwork Rating: Average; www. suncor.com) gets 40% of its revenue and 65% of its earnings by producing oil and natural gas, mainly at its large Alberta oil sands projects. The remaining 60% of revenue and 35% of earnings come from its four oil refineries and 1,500 Petro-Canada gas stations. Big merger boosted results Suncor merged with rival Petro-Canada in 2009, increasing its revenue by 52.2%, from $25.5 billion in 2009 to $38.8 billion in 2011. Lower oil prices cut the company’s revenue to $38.5 billion in 2012. In 2013, Suncor sold most of its Western Canadian natural gas operations for $1 billion. However, higher oil prices offset the lower production, and its revenue rose to $40.3 billion....
CINTAS CORP. $78 (Nasdaq symbol CTAS; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 117.3 million; Market cap: $9.1 billion; Price-to-sales ratio: 2.1; Dividend yield: 1.1%; TSINetwork Rating: Average; www.cintas.com) provides a range of products and services to over one million businesses, mainly in North America.
The company gets 71% of its revenue by renting uniforms that it makes and cleans. This business also rents a variety of related products, such as mats, towels, mops and cleaning supplies. Cintas gets a further 10% of its revenue by selling uniforms.
In addition, the company sells first aid kits, fire extinguishers, sprinklers and emergency-exit lights (11%). It also shreds corporate documents (8%). In April 2014, it merged its shredding operations with Shred-it International. In exchange, Cintas received 42% of the combined company, which uses the Shred-it brand, plus $180 million in cash.
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The company gets 71% of its revenue by renting uniforms that it makes and cleans. This business also rents a variety of related products, such as mats, towels, mops and cleaning supplies. Cintas gets a further 10% of its revenue by selling uniforms.
In addition, the company sells first aid kits, fire extinguishers, sprinklers and emergency-exit lights (11%). It also shreds corporate documents (8%). In April 2014, it merged its shredding operations with Shred-it International. In exchange, Cintas received 42% of the combined company, which uses the Shred-it brand, plus $180 million in cash.
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AMERICAN EXPRESS $82 (New York symbol AXP, Conservative Growth Portfolio, Finance sector; Shares outstanding: 1.0 billion; Market cap: $82.0 billion; Price-to-sales ratio: 2.6; Dividend yield: 1.3%; TSINetwork Rating: Average; www.americanexpress.com) earned $1.4 billion in the three months ended December 31, 2014, up 10.6% from $1.3 billion a year earlier. Per-share earnings rose 14.9%, to $1.39 from $1.21, on fewer shares outstanding. Revenue gained 6.6%, to $9.1 billion from $8.5 billion, as cardholder spending rose 6% and credit card balances grew by 7%.
The company is now cutting 6% of its workforce as part of a plan to improve its overall efficiency. Severance costs cut its earnings by $206 million in the latest quarter. However, the savings will help Amex invest in new growth initiatives, including adapting its networks to process purchases made from smartphones.
American Express is a buy.
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The company is now cutting 6% of its workforce as part of a plan to improve its overall efficiency. Severance costs cut its earnings by $206 million in the latest quarter. However, the savings will help Amex invest in new growth initiatives, including adapting its networks to process purchases made from smartphones.
American Express is a buy.
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FAIR ISAAC CORP. $79 (New York symbol FICO; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 31.7 million; Market cap: $2.5 billion; Price-to-sales ratio: 3.5; Dividend yield: 0.1%; TSINetwork Rating: Average; www.fico.com) has paid an undisclosed amount for Tonbeller, a German firm whose software helps banks and insurance companies detect and prevent money laundering and fraud.
The company plans to integrate Tonbeller’s antifraud products with its own software, which can quickly analyze a large number of transactions. That should give Fair Isaac an advantage, as users usually have to buy these programs separately.
Fair Isaac is a hold.
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The company plans to integrate Tonbeller’s antifraud products with its own software, which can quickly analyze a large number of transactions. That should give Fair Isaac an advantage, as users usually have to buy these programs separately.
Fair Isaac is a hold.
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CHEVRON CORP. $104 (New York symbol CVX; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.9 billion; Market cap: $197.6 billion; Price-to-sales ratio: 0.9; Dividend yield: 4.1%; TSINetwork Rating: Above Average; www.chevron .com) has signed a five-year deal to supply liquefied natural gas (LNG) from its 47.3%-owned Gorgon project in Australia to South Korea’s SK Group. Gorgon should start up later this year.
With this deal, Chevron now has contracts covering 75% of Gorgon’s LNG production from 2017 to 2022. That helps cut this project’s risk .
Chevron is a buy.
With this deal, Chevron now has contracts covering 75% of Gorgon’s LNG production from 2017 to 2022. That helps cut this project’s risk .
Chevron is a buy.
L BRANDS INC. $85 (New York symbol LB; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 292.7 million; Market cap: $24.9 billion; Price-to-sales ratio: 2.8; Dividend yield: 1.6%; TSINetwork Rating: Average; www.lb.com) has opened its first Victoria’s Secret store in China. The company plans to open five more outlets in that country in the next few weeks.
China restricts clothing imports, so unlike Victoria’s Secret stores in other countries, which mainly sell lingerie, these locations will focus on handbags, cosmetics and fragrances.
L Brands is a hold.
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China restricts clothing imports, so unlike Victoria’s Secret stores in other countries, which mainly sell lingerie, these locations will focus on handbags, cosmetics and fragrances.
L Brands is a hold.
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FORD MOTOR CO. $14 (New York symbol F; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 3.8 billion; Market cap: $53.2 billion; Price-to-sales ratio: 0.4; Dividend yield: 4.3%; TSINetwork Rating: Extra Risk; www.ford.com) sold 2.5 million vehicles in the U.S. in 2014, down 0.5% from 2013.
Truck sales (38% of the 2014 total) fell 0.7% as Ford slowed production of its popular F-150 as it prepared to launch a new version that uses lightweight aluminum body panels. Car sales (32%) declined 3.8%, but SUV sales (30%) gained 3.5%.
The company also raised its dividend by 20.0%. The new annual rate of $0.60 a share yields 4.3%.
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Truck sales (38% of the 2014 total) fell 0.7% as Ford slowed production of its popular F-150 as it prepared to launch a new version that uses lightweight aluminum body panels. Car sales (32%) declined 3.8%, but SUV sales (30%) gained 3.5%.
The company also raised its dividend by 20.0%. The new annual rate of $0.60 a share yields 4.3%.
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NEWMONT MINING CORP. $24 (New York symbol NEM; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 498.8 million; Market cap: $11.9 billion; Price-to-sales ratio: 1.7; Dividend yield: 0.4%; TSINetwork Rating: Average; www.newmont.com) has started work on its 75%-owned Merian gold project in Suriname; the Suriname government owns the remaining 25%.
The company will spend $600 million to $700 million on Merian. The new mine will supply 7% to 10% of Newmont’s total gold production when it starts up in 2017.
The stock has jumped 36% from its December 2014 low of $17.60. That’s mainly because gold prices have strengthened in response to fears of deflation in Europe. However, the higher U.S. dollar will continue to weigh on gold.
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The company will spend $600 million to $700 million on Merian. The new mine will supply 7% to 10% of Newmont’s total gold production when it starts up in 2017.
The stock has jumped 36% from its December 2014 low of $17.60. That’s mainly because gold prices have strengthened in response to fears of deflation in Europe. However, the higher U.S. dollar will continue to weigh on gold.
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ALLIANT ENERGY CORP. $69 (New York symbol LNT; Income Portfolio, Utilities sector; Shares outstanding: 110.9 million; Market cap: $7.7 billion; Price-to-sales ratio: 2.3; Dividend yield: 3.2%; TSINetwork Rating: Average; www.alliantenergy.com) sells electricity and natural gas to 1.4 million customers in Wisconsin, Iowa and Minnesota.
The company has earmarked $5.2 billion for plant upgrades and replacing older transmission lines and pipelines between 2014 and 2018. These funds include $750 million for a gas-fired plant that should replace some of its older coal facilities (coal accounts for about half of Alliant’s electricity production).
Partly due to these extra costs, Alliant’s earnings fell 2.3%, to $155.2 million, or $1.40 a share, in the third quarter of 2014. A year earlier, it earned $158.9 million, or $1.43. Cooler-than-normal weather also cut its earnings by $0.06 a share in the latest quarter. Revenue fell 2.7%, to $843.1 million from $866.6 million.
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The company has earmarked $5.2 billion for plant upgrades and replacing older transmission lines and pipelines between 2014 and 2018. These funds include $750 million for a gas-fired plant that should replace some of its older coal facilities (coal accounts for about half of Alliant’s electricity production).
Partly due to these extra costs, Alliant’s earnings fell 2.3%, to $155.2 million, or $1.40 a share, in the third quarter of 2014. A year earlier, it earned $158.9 million, or $1.43. Cooler-than-normal weather also cut its earnings by $0.06 a share in the latest quarter. Revenue fell 2.7%, to $843.1 million from $866.6 million.
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