price to sales ratio
INTEL CORP. $28 (Nasdaq symbol INTC; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 5.0 billion; Market cap: $140.0 billion; Price-to-sales ratio: 2.5; Dividend yield: 3.0%; TSINetwork Rating: Above Average; www.intel.com) is the world’s largest computer chip maker. About 80% of all computers use the company’s chips.
In the first quarter of 2012, Intel’s revenue rose 0.5%, to $12.9 billion from $12.8 billion a year earlier. Recent flooding in Thailand caused a hard drive shortage that hurt computer sales. That cut demand for Intel’s chips and caused a 2.0% sales decline at the company’s PC Client Group (which supplies two-thirds of its total revenue). However, software sales jumped 137.9% following last year’s purchase of antivirus software specialist McAfee.
Without unusual items, such as costs to integrate McAfee, Intel would have earned $2.9 billion in the latest quarter. That’s down 11.0% from $3.2 billion. Earnings per share fell just 3.4%, to $0.56 from $0.58, on fewer shares outstanding.
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In the first quarter of 2012, Intel’s revenue rose 0.5%, to $12.9 billion from $12.8 billion a year earlier. Recent flooding in Thailand caused a hard drive shortage that hurt computer sales. That cut demand for Intel’s chips and caused a 2.0% sales decline at the company’s PC Client Group (which supplies two-thirds of its total revenue). However, software sales jumped 137.9% following last year’s purchase of antivirus software specialist McAfee.
Without unusual items, such as costs to integrate McAfee, Intel would have earned $2.9 billion in the latest quarter. That’s down 11.0% from $3.2 billion. Earnings per share fell just 3.4%, to $0.56 from $0.58, on fewer shares outstanding.
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MICROSOFT CORP. $32 (Nasdaq symbol MSFT; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 8.4 billion; Market cap: $268.8 billion; Price-to-sales ratio: 3.7; Dividend yield: 2.5%; TSINetwork Rating: Above Average; www.microsoft.com) is paying $1.1 billion for 925 patents held by AOL Inc. (New York symbol AOL). It will also license another 300 patents from AOL. Microsoft held cash of $59.5 billion, or $7.09 a share, on March 31, 2012, so it can easily afford this purchase.
After the sale closes in the next few weeks, Microsoft will then sell 650 of AOL’s patents to social network operator Facebook Inc. for $550 million. As part of the deal, Microsoft will retain a licence on these patents.
AOL’s patents cover Internet communications technologies such as email and instant messaging. Controlling them will help Microsoft defend itself in future patent disputes. The patents will also let the company charge higher licensing fees to smartphone makers.
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After the sale closes in the next few weeks, Microsoft will then sell 650 of AOL’s patents to social network operator Facebook Inc. for $550 million. As part of the deal, Microsoft will retain a licence on these patents.
AOL’s patents cover Internet communications technologies such as email and instant messaging. Controlling them will help Microsoft defend itself in future patent disputes. The patents will also let the company charge higher licensing fees to smartphone makers.
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INTERNATIONAL BUSINESS MACHINES CORP. $204 (New York symbol IBM, Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.2 billion; Market cap: $244.8 billion; Price-to-sales ratio: 2.2; Dividend yield: 1.7%; TSINetwork Rating: Above Average; www.ibm.com) continues to expand its analytics operations, which make software that helps businesses and governments quickly gather and analyze a wide range of data.
The company recently paid an undisclosed sum for Toronto-based Varicent Software Inc. Over 180 banks, insurance companies and retailers use Varicent’s products to manage employee salaries and bonuses paid to salespeople.
IBM is our #1 buy for 2012.
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The company recently paid an undisclosed sum for Toronto-based Varicent Software Inc. Over 180 banks, insurance companies and retailers use Varicent’s products to manage employee salaries and bonuses paid to salespeople.
IBM is our #1 buy for 2012.
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INVACARE CORP. $16 (New York symbol IVC; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 32.9 million; Market cap: $526.4 million; Price-to-sales ratio: 0.3; Dividend yield: 0.3%; TSINetwork Rating: Average; www.invacare.com) makes mobility and home-care products, including wheelchairs and motorized scooters.
The stock is down 54% from its July 2011 peak of $35. That’s mainly due to production problems at its wheelchair plant in Elyria, Ohio.
On previous inspections, the Food and Drug Administration (FDA) found that this plant violated some of its regulations. However, these violations are not related to the safety or performance of Invacare’s products.
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The stock is down 54% from its July 2011 peak of $35. That’s mainly due to production problems at its wheelchair plant in Elyria, Ohio.
On previous inspections, the Food and Drug Administration (FDA) found that this plant violated some of its regulations. However, these violations are not related to the safety or performance of Invacare’s products.
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C.R. BARD INC. $97 (New York symbol BCR; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 84.8 million; Market cap: $8.2 billion; Price-to-sales ratio: 2.8; Dividend yield: 0.8%; TSINetwork Rating: Above Average; www.crbard.com) makes medical devices in four main areas: vascular products, such as stents and catheters (29% of 2011 sales); oncology products that detect and treat various types of cancer (27%); urology products, such as drainage and incontinence devices (25%); surgical tools (16%); and other medical products (3%).
Bard continues to expand its market share and diversify its product line with acquisitions. In 2011, it spent a total of $622.6 million buying three medical device makers. The company tends to focus on smaller companies with unique products. That cuts the risk of using acquisitions to expand.
Bard also aims to spur its long-term growth by developing new products. It launched over 50 new products in 2011.
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Bard continues to expand its market share and diversify its product line with acquisitions. In 2011, it spent a total of $622.6 million buying three medical device makers. The company tends to focus on smaller companies with unique products. That cuts the risk of using acquisitions to expand.
Bard also aims to spur its long-term growth by developing new products. It launched over 50 new products in 2011.
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BAXTER INTERNATIONAL INC. $55 (New York symbol BAX; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 556.3 million; Market cap: $30.6 billion; Price-to-sales ratio: 2.2; Dividend yield: 2.4%; TSINetwork Rating: Average; www.baxter.com) makes medical products, such as intravenous pumps and kidney dialysis equipment. It also makes vaccines and drugs. Half of the company’s sales come from single-use products that continually need to be reordered.
Baxter earned $569 million in the first quarter of 2012. That’s down 0.2% from $570 million a year earlier. The company spent $575 million on share buybacks during the quarter. Because of fewer shares outstanding, earnings per share rose 3.1%, to $1.01 from $0.98.
These figures exclude several unusual items, such as costs to integrate Synovis Life Technologies Inc., which Baxter recently bought for $325 million. Synovis makes surgical tools and bandages.
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Baxter earned $569 million in the first quarter of 2012. That’s down 0.2% from $570 million a year earlier. The company spent $575 million on share buybacks during the quarter. Because of fewer shares outstanding, earnings per share rose 3.1%, to $1.01 from $0.98.
These figures exclude several unusual items, such as costs to integrate Synovis Life Technologies Inc., which Baxter recently bought for $325 million. Synovis makes surgical tools and bandages.
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WAL-MART STORES INC. $57 (New York symbol WMT; Conservative Growth Portfolio: Consumer sector; Shares outstanding: 3.4 billion; Market cap: $193.8 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.8%; TSINetwork Rating: Above Average; www.walmart.com) fell 8% recently after it admitted that it is investigating allegations that executives of its 69%-owned Mexican subsidiary paid bribes to local officials in 2005 to speed up the construction of new stores.
U.S. companies are prohibited from bribing foreign officials under the 1977 Foreign Corrupt Practices Act.
Wal-Mart is fully cooperating with American and Mexican authorities. This should limit any possible fines it may have to pay. The company has also strengthened its internal accounting controls to make sure all of its overseas businesses comply with the anti-bribery law.
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U.S. companies are prohibited from bribing foreign officials under the 1977 Foreign Corrupt Practices Act.
Wal-Mart is fully cooperating with American and Mexican authorities. This should limit any possible fines it may have to pay. The company has also strengthened its internal accounting controls to make sure all of its overseas businesses comply with the anti-bribery law.
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PFIZER INC. $23 (New York symbol PFE; Income Portfolio, Manufacturing & Industry sector; Shares outstanding: 7.5 billion; Market cap: $172.5 billion; Price-to-sales ratio: 2.5; Dividend yield: 3.8%; TSINetwork Rating: Above Average; www.pfizer.com) is the world’s largest pharmaceutical drug maker. Its top-selling brands include Lipitor (for high cholesterol), Lyrica (epilepsy), Celebrex (arthritis pain), Viagra (erectile dysfunction), Xalatan (glaucoma), Norvasc (hypertension) and Zyvox (bacterial infections). The company is also the world’s fifth-largest maker of over-the-counter drugs. Its major brands include Advil (pain relief), Centrum (vitamins) and Robitussin (cough syrup).
Pfizer gets about a third of its revenue by selling its products to drug wholesalers. The other two-thirds come from direct sales to retailers, hospitals, clinics and government agencies. Overseas markets supply 60% of its revenue.
Pfizer gets about a third of its revenue by selling its products to drug wholesalers. The other two-thirds come from direct sales to retailers, hospitals, clinics and government agencies. Overseas markets supply 60% of its revenue.
Acquisitions added top-selling drugs
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Low interest rates continue to fuel loan demand at Canada’s big five banks. However, rising competition for new borrowers has forced all five to launch aggressive new promotions—including special mortgage rates as low as 2.99%—that are weighing on their profits. Even so, we continue to see all five banks as buys. In fact, every Canadian investor should own two or three of them. For new buying, Bank of Nova Scotia remains our favourite. It’s the most international of Canada’s banks, and it’s in a particularly strong position to profit from rising prosperity in Asia and Latin America. That cuts its reliance on slower growing regions like North America and Europe....
PENGROWTH ENERGY CORP. $8.96 (Toronto symbol PGF; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 360.3 million; Market cap: $3.2 billion; Price-to-sales ratio: 2.1; Dividend yield: 9.4%; TSINetwork Rating: Average; www.pengrowth.com) has a long history of using acquisitions to expand, which adds risk. However, these purchases have increased its reserves and cash flow. Its latest acquisition is NAL Energy Corp. (Toronto symbol NAE). NAL investors will receive 0.86 of a Pengrowth common share for each share they hold. That will give them 26% of the combined company. The deal should close by May 31, 2012. Adding NAL’s properties in Alberta and B.C. (54% natural gas and 46% oil) will increase Pengrowth’s projected 2012 production by about 16%, to between 86,000 and 89,000 barrels of oil equivalent a day....