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ENERFLEX LTD., $18.86, symbol EFX on Toronto, rents and sells equipment and services for natural gas production, including compression and processing plants, refrigeration equipment and power generators. The stock jumped over 12% this week after Enerflex announced that it will acquire two businesses owned by privately held Axip Energy Services LP: an international contract compression and processing subsidiary and a division that provides aftermarket services. Enerflex will pay $430 million U.S. in cash. The agreement includes operations in Mexico, South America, Southeast Asia and the Middle East, but not Axip’s U.S. business. The major assets that Enerflex will receive include a 448-unit compression fleet totalling about 285,000 horsepower, all of which are operating under long-term rental contracts. This equipment is currently 90% utilized and has an average age of 5.5 years. Enerflex also gets gas-treating facilities in Mexico, Argentina and Peru....
CHIPOTLE MEXICAN GRILL (New York symbol CMG; www.chipotle.com) is a Denver-based Mexican restaurant chain. It charges slightly higher prices than fast food companies, but it offers better quality food, including naturally raised meat, and superior decor and service. In the three months ended March 31, 2014, Chipotle’s sales rose 24.4%, to $904.2 million from $726.8 million a year earlier. The company’s restaurants attracted more customers during the quarter, which pushed up same-restaurant sales by 13.4%. Chipotle also opened 44 new outlets and now has a total of more than 1,600. In all of 2014, it aims to open 180 to 195 locations....
GOODYEAR TIRE & RUBBER, $26.37, symbol GT on New York, is the world’s largest tire maker, with 51 plants in 22 countries. This week, the company announced that it will build a new tire plant in either North or South America. The facility will produce six million tires a year and help Goodyear meet rising demand for high-performance tires in both regions. Goodyear expects to spend $500 million on this facility, which could start up in 2017. To put that in context, Goodyear’s 2013 cash flow was $407.0 million....
TOROMONT INDUSTRIES LTD (Toronto symbol TIH; www.toromont.com) distributes a broad range of industrial equipment, including machinery made by Caterpillar Inc. It also makes refrigeration systems through its CIMCO division. The company completed the spinoff of Enerflex Ltd. (see below) in July 2011. Shareholders received shares of both the new Toromont Industries and Enerflex....
METRO INC. $68 (Toronto symbol MRU; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 87.6 million; Market cap: $6.0 billion; Price-to-sales ratio: 0.5; Dividend yield: 1.8%; TSINetwork Rating: Average; www.metro.ca) operates about 600 supermarkets in Quebec and Ontario. It also has over 250 drugstores that operate under the Brunet, The Pharmacy and Drug Basics banners.
Metro continues to cut costs in response to competition from larger Canadian chains, like Loblaw and Sobeys, and big box stores like Wal-Mart and Costco. It is also converting some of its underperforming Metro outlets in Ontario to the faster-growing Food Basics discount banner.
In its fiscal 2014 second quarter, which ended March 15, 2014, Metro’s earnings rose 0.5%, to $96.9 million from $96.4 million a year earlier. In the last six months, the company has spent $301.8 million on share buybacks. Due to fewer shares outstanding, per-share earnings rose 9.2%, to $1.07 from $0.98.
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Metro continues to cut costs in response to competition from larger Canadian chains, like Loblaw and Sobeys, and big box stores like Wal-Mart and Costco. It is also converting some of its underperforming Metro outlets in Ontario to the faster-growing Food Basics discount banner.
In its fiscal 2014 second quarter, which ended March 15, 2014, Metro’s earnings rose 0.5%, to $96.9 million from $96.4 million a year earlier. In the last six months, the company has spent $301.8 million on share buybacks. Due to fewer shares outstanding, per-share earnings rose 9.2%, to $1.07 from $0.98.
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COMPUTER MODELLING GROUP LTD., $29.94, symbol CMG on Toronto, makes software and provides services that help its clients get as much oil as possible from their existing wells. The company makes mostly recurring revenue from software licences and consulting contracts, which gives it long-term stability. In the quarter ended March 31, 2014, Computer Modelling’s revenue rose 3.6%, to $20.0 million from $19.3 million a year earlier. Software licence sales (89% of total revenue) increased slightly. However, consulting and professional services revenue (11%) rose 39.1%, due to new projects and a large consulting deal. Earnings gained 6.7%, to $7.7 million from $7.25 million. Per-share earnings jumped 18.8%, to $0.19 from $0.16, on fewer shares outstanding. That matched the consensus estimate....
METRO INC. (Toronto symbol MRU; www.metro.ca) operates about 600 supermarkets in Quebec and Ontario. It also has over 250 drugstores that operate under the Brunet, The Pharmacy and Drug Basics banners. Metro continues to cut costs in response to competition from larger Canadian chains, like Loblaw and Sobeys, and big box stores like Wal-Mart and Costco. It is also converting some of its underperforming Metro outlets in Ontario to the faster-growing Food Basics discount banner....
PASON SYSTEMS (Toronto symbol PSI; www.pason.com) is trading near all-time highs as it continues to gain from the boom in U.S. shale oil and gas drilling. Pason rents equipment for monitoring and managing oil and gas rigs. It also sells communication technology, such as its satellite system, which companies use to remotely collect data from their drilling operations. Pason serves oil and gas producers and drilling contractors throughout Canada, the U.S., Mexico, Argentina and Australia....
AIMIA INC, $19.15, symbol AIM on Toronto, owns and operates Aeroplan, Canada’s largest loyalty program, with over 4.8 million members who collect Aeroplan miles from participating companies. Members can exchange miles for flights, car rentals, hotel rooms and merchandise. The company also owns Nectar, the U.K.’s biggest loyalty program. In addition, it has interests in Air Miles Middle East and Nectar Italia, as well as Club Premier, the leading loyalty program in Mexico. On January 1, 2014, TD Bank replaced CIBC as the main credit card issuer for Aeroplan. Under a new 10-year deal, TD is now launching new cards under the Aeroplan banner, including cards for frequent flyers and small businesses. The deal also let CIBC hang on to Aeroplan accounts held by customers who also bank at CIBC. That was about half the Aeroplan portfolio....