stock pickers

ALIMENTATION COUCHE-TARD, $36.65, symbol ATD.B on Toronto, jumped over 18% this week to new all-time highs after reporting higher sales and record earnings in the latest quarter, as well as a dividend increase. In the three months ended July 20, 2014, Couche-Tard’s sales rose 3.2%, to $9.2 billion from $8.9 billion a year earlier. Excluding one-time items, per-share earnings gained 23.1%, to $0.48 from $0.39 (all figures adjusted for Couche-Tard’s 3-for-1 stock split on April 14, 2014). The company is raising its quarterly dividend by 12.5% with the September 2014 payment, to $0.045 a share from $0.04. The shares now yield 0.5%....

Every Tuesday we bring you “Best Canadian Stocks.” You get our specific recommendation on the stocks we profile, with a full explanation of how we arrived at our opinion. You’ll read about stocks making moves you should know about, from coverage in one of our three newsletters featuring Canadian stocks—The Successful Investor, Stock Pickers Digest and Canadian Wealth Advisor. We continue to advise against investing in bonds, because low interest rates hurt their appeal, while rising rates would push down their future value. For stable income and growth, we prefer high-yielding utilities. Their dividends also qualify for the dividend tax credit. ATCO LTD. (Toronto symbols ACO.X [class I non-voting] and ACO.Y [class II voting; www.atco.com) holds 53.2% of Canadian Utilities. It also owns 75.5% of ATCO Structures & Logistics, which builds temporary buildings for construction and energy exploration firms; Canadian Utilities owns the remaining 24.5%....

STANTEC INC. $72.86 (Toronto symbol STN; TSINetwork Rating: Extra Risk) (780-917-7288; www.stantec.com; Shares outstanding: 46.8 million; Market cap: $3.4 billion; Dividend yield: 1.0%) plans to split its shares on a 2-for-1 basis, effective November 14, 2014.

When a company’s share price goes up, it has an incentive to split the stock to make it seem cheaper to investors, who may then buy more. This can make the stock more liquid than if the firm refrained from splits and let its share price go to uncommonly high levels.

Shares of Stantec are up 1,982% since we first recommended the company (then called Stanley Technology Group) at $3.50 in one of our first issues of Stock Pickers Digest in 1998.

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Every Monday we feature “A Stock to Sell” as our daily post. With every stock we recommend as a sell, we give you a full explanation of why we advise against investing in the stock at this time. NEPTUNE TECHNOLOGIES & BIORESSOURCES INC. (symbol NTB on Toronto; www.neptunebiotech.com), makes omega-3 dietary supplements using a patented process for extracting oil from krill. (Krill are shrimp-like deepwater invertebrates that range in length from half an inch to two-and-a-half inches.) Omega-3 fatty acids reportedly help lower cholesterol and blood pressure when used as a dietary supplement....

TIM HORTONS INC., $87.40, symbol THI on Toronto, jumped 27% this week after agreeing to a friendly takeover offer from Miami-based Burger King Worldwide (New York symbol BKW). The combined firm would be the world’s third-largest fast-food operator, after McDonald’s and Yum Brands, with annual sales of $23 billion U.S. and 18,000 restaurants in over 100 countries. Canada will supply 67% of the merged company’s revenue, followed by the U.S. (20%) and other countries (13%). The Tim Hortons and Burger King chains will operate independently but will probably share some back office and distribution networks. Tim Hortons can also use Burger King’s expertise to expand in the U.S. and other countries....

Pat McKeough responds to many requests from members of his Inner Circle for advice on investing in stocks, as well as questions on investment strategy and the economy. Every week, his comments and recommendations on the most intriguing questions of the past week go out to all Inner Circle members. And each week we offer you a report on one of the stocks profiled in these Q&A sessions. Beginning this week, we give you Pat’s buy-hold-sell recommendation as well as his analysis of the stock. This is part of our new approach offering you regular and specific buy, hold and sell advice in our daily posts. Every week you’ll get “A Stock to Sell” on Monday, “Best Canadian Stocks” on Tuesday, and “Our Top U.S. Stocks” on Thursday. This week we got a question from an Inner Circle member who is interested in a stock but concerned that it doesn’t pay a dividend. Gilead Sciences is a drug company that specializes in combatting viruses. Hepatitis C is the primary target of treatments developed by Gilead Sciences, but it also plays an important role in treatments for HIV/AIDS. Pat assesses the status of the company’s leading drugs and examines the challenges the company faces maintaining a position of leadership in a highly competitive field. Q: Please give your opinion on Gilead Sciences. It sounds very good to me as a physician, but it pays no dividend and I’ve bought into dividend investing. Thanks....

Symantec rises with successful restructuring plan

Dundee Corp., $18.94, symbol DC.A on Toronto, has sold 4.5 million units of Dream Office REIT, $29.10, symbol D.UN on Toronto, and 8.6 million units of Dream Global REIT, $9.52, symbol DRG.UN on Toronto. The sales came after the company named David Goodman as its new CEO, replacing his father, Ned Goodman. Dundee likely made the sales to raise funds for David Goodman’s plans as CEO. These initiatives could include expanding its wealth management business and shifting into risky alternative investments, such as land for development and other privately held assets....

Every Tuesday we bring you “Best Canadian Stocks.” You get our specific recommendation on the stocks we profile, with a full explanation of how we arrived at our opinion. You’ll read about stocks making moves you should know about, from coverage in one of our three newsletters featuring Canadian stocks—The Successful Investor, Stock Pickers Digest and Canadian Wealth Advisor. IGM Financial is in a strong position to profit as baby boomers sign up for retirement planning services. The company also trades at a low multiple to its earnings and will probably raise its dividend in 2015. IGM FINANCIAL INC. (Toronto symbol IGM; www.igmfinancial.com) is Canada’s largest independent mutual fund firm. Power Financial owns 58.7% of IGM, along with 67.0% of Great-West....

BELLATRIX EXPLORATION LTD., $8.53, symbol BXE on Toronto, produces natural gas (65% of output) and oil (35%) in Alberta, B.C. and Saskatchewan. Bellatrix jumped 14% this week after U.S. activist investor Orange Capital LLC revealed that it has been investing in the company since July 2. It now holds about 10.2 million shares Bellatrix shares, or a 5.3% interest. Orange Capital wants the company to discuss changing the size and composition of its 10-person board of directors. It also wants Bellatrix to hire a financial advisor to explore strategic alternatives, including selling its midstream assets (natural gas processing plants and pipeline gathering systems) or an outright sale of the entire company....