price to sales ratio
FINNING INTERNATIONAL INC. $23 (Toronto symbol FTT; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 171.9 million; Market cap: $4.0 billion; Price-to-sales ratio: 0.6; Dividend yield: 2.4%; TSINetwork Rating: Above Average; www.finning.com) is the world’s largest seller of heavy equipment, such as tractors, bulldozers and trucks, made byCaterpillar Inc. (New York symbol CAT). It sells these products to customers in the mining, forest products and construction industries in western Canada (53% of total revenue), South America (33%) and the U.K. (14%). Finning also rents and fixes equipment. These services—which are more profitable than selling this gear—now supply half of the company’s sales. Rising resource prices boosted results ...
ENCANA CORP. $21 (Toronto symbol ECA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 736.3 million; Market cap: $15.5 billion; Price-to-sales ratio: 2.0; Dividend yield: 3.7%; TSINetwork Rating: Average; www.encana.com) owns the Deep Panuke offshore natural gas field south of Nova Scotia.
The project’s cost has risen to $960 million from an earlier estimate of $750 million because Encana had problems building the drilling platform (all amounts except share price and market cap in U.S. dollars). To put that in context, the company’s cash flow was $794 million, or $1.08 a share, in the quarter ended June 30, 2012.
Even with these delays, Encana still aims to begin producing gas at Deep Panuke by the end of 2012. At full capacity, this new project will increase the company’s daily gas production by 9%.
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The project’s cost has risen to $960 million from an earlier estimate of $750 million because Encana had problems building the drilling platform (all amounts except share price and market cap in U.S. dollars). To put that in context, the company’s cash flow was $794 million, or $1.08 a share, in the quarter ended June 30, 2012.
Even with these delays, Encana still aims to begin producing gas at Deep Panuke by the end of 2012. At full capacity, this new project will increase the company’s daily gas production by 9%.
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CAE INC. $10 (Toronto symbol CAE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 258.7 million; Market cap: $2.6 billion; Price-to-sales ratio: 1.4; Dividend yield: 2.0%; TSINetwork Rating: Average; www.cae.com) is the world’s leading maker of flight simulators for commercial airlines, with 70% of the market. It also makes simulators for military clients. The company began training pilots for its customers in 2001; it now has over 100 flight schools in 30 countries.
CAE gets 50% of its revenue from military clients. That cuts its exposure to cyclical commercial airlines, which supply 45% of its revenue.
CAE gets 50% of its revenue from military clients. That cuts its exposure to cyclical commercial airlines, which supply 45% of its revenue.
New markets have big potential
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TIM HORTONS INC. $50 (Toronto symbol THI; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 154.9 million; Market cap: $7.7 billion; Price-to-sales ratio: 2.5; Dividend yield: 1.7%; TSINetwork Rating: Average; www.timhortons.com) is the first fast-food company in Canada that lets customers pay for their purchases using their smartphones. After installing the necessary software, users can pay for their purchases by swiping their phone in front of a special scanner. This should speed up service and encourage repeat visits.
The company has installed these scanners in 2,300 of its 3,300 coffee-and-donut stores in Canada. Tim Hortons plans to bring this technology to an additional 700 outlets by December 2012.
Tim Hortons is a buy.
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The company has installed these scanners in 2,300 of its 3,300 coffee-and-donut stores in Canada. Tim Hortons plans to bring this technology to an additional 700 outlets by December 2012.
Tim Hortons is a buy.
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CANADIAN NATIONAL RAILWAY CO. $86 (Toronto symbol CNR; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 431.5 million; Market cap: $37.1 billion; Price-to-sales ratio: 3.7; Dividend yield: 1.7%; TSINetwork Rating: Above Average; www.cn.ca) will repurchase up to 5.8 million of its shares from a private seller at a discount to the market price....
SHAWCOR LTD. $44 (Toronto symbol SCL.A; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 70.2 million; Market cap: $3.1 billion; Price-to-sales ratio: 2.5; Dividend yield: 0.9%; TSINetwork Rating: Average; www.shawcor.com) has acquired the 60% of Fineglade Ltd. that it did not already own. Fineglade owns 96% of Socotherm S.p.A., an Italian company that provides pipeline-coating services in Europe and Asia.
ShawCor paid $135 million, which is equal to 2.4 times its 2011 earnings of $56.1 million, or $0.78 a share.
The company is now conducting a strategic review of its operations. That could mean that ShawCor will eventually be sold. It hasn’t said how long this process will take.
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ShawCor paid $135 million, which is equal to 2.4 times its 2011 earnings of $56.1 million, or $0.78 a share.
The company is now conducting a strategic review of its operations. That could mean that ShawCor will eventually be sold. It hasn’t said how long this process will take.
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MAPLE LEAF FOODS INC. $11 (Toronto symbol MFI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 140.0 million; Market cap: $1.5 billion; Price-to-sales ratio: 0.3; Dividend yield: 1.5%; TSINetwork Rating: Average; www.mapleleaf.ca) is acquiring Puratone Corporation, a private company that raises over 500,000 hogs a year at 50 barns in Manitoba.
The takeover will give Maple Leaf control of 30% of the hogs used by its processing facility in Brandon,
Manitoba.The company will pay $42 million for Puratone when the deal closes in the next few weeks. To put that in context, Maple Leaf earned $30.2 million, or $0.21 a share, in the three months ended September 30, 2012. That’s down 24.5% from $39.9 million, or $0.28 a share, a year earlier.
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The takeover will give Maple Leaf control of 30% of the hogs used by its processing facility in Brandon,
Manitoba.The company will pay $42 million for Puratone when the deal closes in the next few weeks. To put that in context, Maple Leaf earned $30.2 million, or $0.21 a share, in the three months ended September 30, 2012. That’s down 24.5% from $39.9 million, or $0.28 a share, a year earlier.
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SUNCOR ENERGY INC. $34 (Toronto symbol SU; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.5 billion; Market cap: $51.0 billion; Price-to-sales ratio: 1.3; Dividend yield: 1.5%; TSINetwork Rating: Average; www.suncor.com) will spend $6.65 billion to upgrade its operations in 2012, down 11.3% from its earlier forecast of $7.5 billion. That’s mainly due to lowerthan- expected costs to expand its Firebag oil sands project in Alberta. The new addition should begin operating by the end of 2012—three months ahead of schedule.
The recent drop in oil prices has also prompted Suncor to slow the development of three other big oil sands projects. However, lower oil prices are boosting profits at Suncor’s refineries. As a result, cash flow per share rose 2.9% in the three months ended September 30, 2012, to $1.78 from $1.73 a year earlier.
Suncor is a buy.
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The recent drop in oil prices has also prompted Suncor to slow the development of three other big oil sands projects. However, lower oil prices are boosting profits at Suncor’s refineries. As a result, cash flow per share rose 2.9% in the three months ended September 30, 2012, to $1.78 from $1.73 a year earlier.
Suncor is a buy.
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AGRIUM INC. $95 (Toronto symbol AGU; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 149.0 million; Market cap: $14.2 billion; Price-to-sales ratio: 0.9; Dividend yield: 2.1%; TSINetwork Rating: Average; www.agrium.com) gets 60% of its sales from stores that sell fertilizers to farmers. It also makes fertilizers from natural gas, and other fertilizers such as potash and phosphate.
In the three months ended September 30, 2012, earnings fell 26.6%, to $215 million, or $1.34 a share, from $293 million, or $1.85 a share a year earlier (all amounts except share price and market cap in U.S. dollars). Sales fell 5.7%, to $3.0 billion from $3.1 billion. Weak demand for potash offset strong sales of other fertilizers.
Partly due to pressure from activist investor Jana Partners, which owns about 4% of Agrium’s shares, the company recently doubled its dividend to $2.00 a share from $1.00. The stock now yields 2.1%. It also spent $900 million (Cdn.) on share buybacks.
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In the three months ended September 30, 2012, earnings fell 26.6%, to $215 million, or $1.34 a share, from $293 million, or $1.85 a share a year earlier (all amounts except share price and market cap in U.S. dollars). Sales fell 5.7%, to $3.0 billion from $3.1 billion. Weak demand for potash offset strong sales of other fertilizers.
Partly due to pressure from activist investor Jana Partners, which owns about 4% of Agrium’s shares, the company recently doubled its dividend to $2.00 a share from $1.00. The stock now yields 2.1%. It also spent $900 million (Cdn.) on share buybacks.
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POTASH CORP. OF SASKATCHEWAN $40 (Toronto symbol POT; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 861.6 million; Market cap: $34.5 billion; Price-to-sales ratio: 4.1; Dividend yield: 2.1%; TSINetwork Rating: Average; www.potashcorp.com) is the world’s largest fertilizer producer. It has six potash mines in Saskatchewan and one in New Brunswick.
The company has faced delays in securing new supply contracts with buyers in China. That has lowered its potash shipments. As well, the Indian government has cut fertilizer subsidies.
As a result, Potash Corp.’s earnings fell 21.9% in the three months ended September 30, 2012, to $645 million or $0.74 a share (all amounts except share price and market cap in U.S. dollars). A year earlier, it earned $826 million, or $0.94 a share. Sales fell 7.7%, to $2.1 billion from $2.3 billion.
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The company has faced delays in securing new supply contracts with buyers in China. That has lowered its potash shipments. As well, the Indian government has cut fertilizer subsidies.
As a result, Potash Corp.’s earnings fell 21.9% in the three months ended September 30, 2012, to $645 million or $0.74 a share (all amounts except share price and market cap in U.S. dollars). A year earlier, it earned $826 million, or $0.94 a share. Sales fell 7.7%, to $2.1 billion from $2.3 billion.
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