price to sales ratio

Teck’s shares have rebounded strongly since falling to $3.65 in January 2016. That’s mainly because the company is doing a good job holding down its costs while it waits for metallurgical coal, copper and zinc prices to recover. The direction of commodity prices depends on many things, particularly economic growth rates around the world. Still, we feel Teck’s lower costs and high-quality reserves put it in a strong position to rapidly expand its profits as prices stabilize. TECK RESOURCES LTD. $10 (Toronto symbol TCK.B; Conservative Growth Portfolio, Resources sector; Shares outstanding: 576.3 million; Market cap: $5.8 billion; Price-to sales ratio: 0.7; Dividend yield: 1.0%; TSINetwork Rating: Extra Risk; www.teck.com) is a leading producer of metallurgical coal, a key ingredient in steel making. Its six coal mines (five in B.C. and one in Alberta) account for 11% of global demand....

SAPUTO INC. $40 (Toronto symbol SAP; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 392.9 million; Market cap: $15.7 billion; Price-to-sales ratio: 1.5; Dividend yield: 1.4%; TSINetwork Rating: Average; www.saputo.com) is Canada’s largest producer of dairy products, including milk, butter and cheese. It also operates dairies in the U.S., Australia and Argentina. The company’s sales rose 2.8% in its fiscal 2016 third quarter, which ended December 31, 2015, to $2.9 billion from $2.8 billion a year earlier. It gets 65% of its sales from outside Canada, and the lower Canadian dollar added $261 million to the latest quarter’s sales. Lower selling prices for cheese and butter cut sales by $191 million. Earnings gained 15.8%, to $0.44 a share from $0.38. That’s mainly due to better efficiency and lower ingredient costs....

IMPERIAL OIL LTD. $44 (Toronto symbol IMO; Conservative Growth and Income Portfolios, Shares outstanding: 847.6 million; Market cap: $37.3 billion; Price-to-sales ratio: 1.5; Dividend yield: 1.3%; TSINetwork Rating: Average; www.imperialoil.ca) is selling its 497 company-owned Esso gas stations to independent operators for $2.8 billion. Following the sale, franchisees will operate all of its 1,700 Esso stations across Canada. The buyers include Alimentation Couche-Tard (Toronto symbol ATD.B). It is purchasing 279 stations in Ontario and Quebec. (Alimentation Couche- Tard is a recommendation of Stock Pickers Digest, our newsletter that focuses on aggressive investments.) In addition, 7-Eleven Canada is getting 148 stations in Alberta and British Columbia. Parkland Fuel (Toronto symbol PKI), will buy 17 stations in Saskatchewan and Manitoba....

MAPLE LEAF FOODS INC. $27 (Toronto symbol MFI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 134.6 million; Market cap: $3.6 billion; Price-to-sales ratio: 1.1; Dividend yield: 1.3%; TSINetwork Rating: Average; www.mapleleaffoods.com) is Canada’s largest foodprocessing company. It mainly sells its products, including fresh and prepared meats and poultry, under the Maple Leaf and Schneider brands. The company will soon complete a multi-year restructuring that involves closing older meatprocessing plants and shifting their operations to newer, more efficient ones. Thanks to these new plants, Maple Leaf earned $0.58 a share in 2015 compared to its loss of $0.56 in 2014. Sales rose 4.3%, to $3.3 billion from $3.2 billion. That’s partly because the lower Canadian dollar boosted the contribution of its exports to customers in the U.S. and Japan. Without exchange rates, sales gained 2.6%....

We continue to recommend that Canada’s big five banks make up the bulk of the Finance portion of your portfolio. Investors should also diversify their Finance holdings with high-quality non-bank stocks, such as the three we analyze below. GREAT-WEST LIFECO INC. $35 (Toronto symbol GWO; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 993.4 million; Market cap: $34.8 billion; Price-to-sales ratio: 1.0; Dividend Yield: 3.9%; TSINetwork Rating: Above Average; www.greatwestlifeco.com) is Canada’s second-largest insurance company, after Manulife Financial (Toronto symbol MFC). It also offers mutual funds, retirement planning and wealth management. Power Financial (Toronto symbol PWF) owns 71.4% of Great-West....

TRANSCANADA CORP. $49 (Toronto symbol TRP; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 702.3 million; Market cap: $34.4 billion; Price-to-sales ratio: 3.1; Dividend yield: 4.6%; TSINetwork Rating: Above Average; www.transcanada.com) has cancelled its contracts to buy electricity from three coal-fired power plants in Alberta. That’s because higher costs to comply with the province’s new carbon taxes and emission controls have hurt the profitability of these deals. As a result, TransCanada will record a non-cash, after-tax charge of $175 million. That’s equal to 10% of its 2015 earnings of $1.8 billion, or $2.48 a share. However, cancelling these deals will improve its cash flow and earnings. TransCanada is a buy.

TORONTO-DOMINION BANK $55 (Toronto symbol TD; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 1.9 billion; Market cap: $104.5 billion; Price-to-sales ratio: 3.3; Dividend yield: 4.0%; TSINetwork Rating: Above Average; www.td.com) earned $2.4 billion, or $1.18 a share, in its fiscal 2016 first quarter, which ended January 31, 2016. That’s up 5.8% from $2.1 billion, or $1.12, a year earlier. Earnings for its Canadian banks (62% of the total) rose 4.4%, thanks to strong loan demand and gains from the wealthmanagement and insurance businesses. Earnings from U.S. banking (31%) jumped 20.2%. That’s largely because the low Canadian dollar enhanced its profits. However, earnings from wholesale banking (7%) fell 16.1%. Lower stock trading volumes offset higher advisory fees on mergers and acquisitions. Revenue rose 13.1%, to $8.6 billion from $7.6 billion. However, TD set aside $642 million to cover potential future loan losses, up 77.3% from $362 million. That’s mainly because it recently acquired the U.S. credit card portfolio of department store Nordstrom’s (New York symbol JWN). As well, low oil prices could hurt the ability of energy producers to repay their loans. These borrowers represent less than 1% of TD’s overall loan portfolio....

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: 1.8; Dividend yield: 3.3%; TSINetwork Rating: Average; www. suncor.com) has now acquired 84.2% of Canadian Oil Sands (Toronto symbol COS). That firm owns 36.74% of the Syncrude oil sands project in northern Alberta. The takeover gives Suncor 48.74% of Syncrude, and allows it to improve the project’s efficiency and profits. Under the terms of its takeover offer, Canadian Oil Sands investors each received 0.28 of a Suncor share for every share they own. If you include Canadian Oil Sands’ debt, the deal is worth $6.6 billion. Suncor expects to acquire the remaining shares in the next few weeks. Suncor is a buy.

EMERA INC. $47 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares outstanding: 145.3 million; Market cap: $6.8 billion; Price-to-sales ratio: 2.5; Dividend yield: 4.0%; TSINetwork Rating: Average; www.emera.com) has reached a deal to increase its ownership of Emera (Caribbean) Inc. From 95.6% to 100.0%. This publicly traded subsidiary holds Emera’s interests in power utilities in Barbados, Dominica and St. Lucia. Emera will cut administrative costs by taking full control. The company will pay roughly $16.5 million in cash and Emera stock for the additional stake. To put that in context, Emera earned $330.0 million, or $2.26 a share, in 2015....

TORSTAR CORP. $1.82 (Toronto symbol TS.B; Conservative Growth and Income Portfolios, Consumer sector; Shares outstanding: 80.5 million; Market cap: $146.5 million; Price-to-sales ratio: 0.2; Dividend yield: 14.3%; TSINetwork Rating: Average; www. torstar.com) launched a digital version of The Toronto Star, its flagship newspaper, for tablet computers in September 2015. In addition to newspaper content, this free app, called Star Touch, gives users quick access to related information like photos, maps and videos. So far, Star Touch has attracted over 65,000 weekly and 26,000 daily users. The company spent $14 million in 2015 to set up Star Touch, and maintaining and updating it will cost a further $10 million this year. It expects Star Touch will break even in 2017....