stock pickers

PLEASE NOTE: This is our last Hotline for 2013. Our next Hotline will go out on Friday, January 3, 2014. STANTEC INC., $66.94, symbol STN on Toronto, sells a range of consulting, project delivery, design and technology services. Its clients operate in a variety of industries, including transportation, construction and oil and gas. The company continues to grow through acquisitions. It has just agreed to pay an undisclosed sum for Virginia-based Williamsburg Environmental Group, which has over 115 employees in three offices....

In 1994, I launched The Successful Investor with two goals:

First, I wanted to publish profitable advice, free of conflicts of interest. (In 1998, we launched Stock Pickers Digest to cover aggressive stocks.)

Judging by our standing in the Hulbert ratings, we produce some of the best advisory results you can find in North America.

Second, I wanted to offer portfolio management, using the same advice as our advisory service....

Many successful investors find that technical analysis or chart reading can be a help in making investment decisions. However, these investors understand that technical analysis only works as an aid to investing—not a standalone guide. Unsuccessful investors often make the mistake of relying on technical analysis alone. This, though, can pay off for short periods. It can lead you to make a series of successful trades (although these trades may only generate modest gains). When technical analysis fails you, however, the cost can be catastrophic. It can lead you to sell or go short in stocks that are about to reverse a falling pattern and shoot up. It can lead you to buy stocks with a rising pattern that are about to reverse course and collapse....

AMAZON.COM INC., $384.24, symbol AMZN on Nasdaq, has expanded its AmazonFresh same-day grocery delivery service to San Francisco. The move follows the launch of the service in Los Angeles in June 2013. AmazonFresh has also been available in the company’s hometown of Seattle for some time. AmazonFresh promises same-day or early morning delivery of over 500,000 items, including groceries and food from specialty shops. Delivery is free on orders over $35 if the customer pays a yearly $299 subscription fee. The fee also includes the benefits of Amazon’s Prime service, such as free two-day shipping on most other products sold on Amazon.com. AmazonFresh may help the company achieve its goal of same-day delivery of all its products. In addition to groceries, AmazonFresh trucks will deliver a range of toys, electronics and household goods. Eventually, they could let the company ship to customers directly and do away with the services of UPS or FedEx in many markets. The trucks could also let Amazon pick up returns from customers, again cutting out the courier companies and speeding up service....

CHEMTRADE LOGISTICS INCOME FUND, $18.45, symbol CHE.UN on Toronto, jumped almost 9% this week after it agreed to buy specialty chemicals maker General Chemical Corp. for $860 million. General makes a wide range of chemicals, including aluminum sulphate, aluminum chlorohydrate and ferric sulphate (all of which are used in water treatment), as well as ingredients for prescription drugs, nutritional supplements and veterinary products. The company also sells and regenerates sulphuric acid. In addition to water treatment and pharmaceuticals, its markets include oil refining, pulp and paper, agriculture and food and beverage. This is a huge acquisition for Chemtrade: it would more than double its $756.4-million market cap. A major purchase like this can always backfire, but it will likely be a good fit, offering Chemtrade both growth prospects and diversification....

PRECISION DRILLING CORP., $9.75, Toronto symbol PD, sells contract drilling services to oil and natural gas producers. The stock fell sharply after the Alberta Investment Management Company (AIMCo) sold its entire 15% stake in the company for $9.50 to $9.75 a share. AIMCo is a Crown corporation that manages Alberta’s public-sector pension plans and other special funds. Precision ran into trouble in 2009, because the credit crisis hurt its ability to refinance short-term loans it needed to buy U.S.-based contract driller Grey Wolf Inc. That’s when AIMCo purchased notes and shares in Precision....

Gold has dropped over 30% from its high near $1,800 U.S. an ounce in September 2012 to $1,228 today. That’s partly because the U.S. Federal Reserve has indicated that it is likely to scale back its bond-purchasing program, known as quantitative easing. Slowing down the growth in the money supply will reduce the likelihood of a sharp increase of future inflation. Since many investors buy gold as a hedge against inflation, its price has weakened. The best way for aggressive investors to invest in gold is to buy shares of companies with rising production that will give them steady cash flow even if gold prices fall further. Here is our assessment of one of the gold stocks we cover for Stock Pickers Digest....

ALIMENTATION COUCHE-TARD, $77.60, symbol ATD.B on Toronto, rose over 6% this week after reporting its latest quarterly earnings. In the three months ended October 13, 2013, the company’s sales fell 3.0%, to $9.0 billion from $9.3 billion a year earlier (all figures except share price in U.S. dollars). The year-ago quarter included 92 days of results from Norway’s Statoil Fuel & Retail ASA, which Couche-Tard bought for $2.7 billion in June 2012, while the latest quarter included just 84 days. The shorter period was due to an adjustment to align Statoil’s accounting period with Couche-Tard’s. That was the main reason for the lower revenue. Excluding that, the company benefited from higher fuel volumes and merchandise sales. Couche-Tard gets about 30% of its revenue by selling merchandise....

WAJAX CORP. (Toronto symbol WJX; www.wajax.ca) sells and services cranes, forklifts and other heavy equipment. It also provides related parts (such as bearings, motors, hoses and fittings) and power systems (including diesel engines and transmissions). Wajax operates through 128 dealerships across Canada. Its customers are in the natural resource, construction, manufacturing, industrial processing and transportation industries....

DEVON ENERGY CORP., $62.57, symbol DVN on New York, is paying GeoSouthern Energy $6 billion for oil-producing assets and other properties in Texas’s Eagle Ford shale formation. This purchase consists of 53,000 barrels of oil equivalent a day of production (including natural gas) and 82,000 acres of land with at least 1,200 undrilled locations. Peak production is expected to reach as much as 140,000 barrels a day within five years. To put these figures in perspective, Devon’s output averaged 691,000 barrels a day in the three months ended September 30, 2013....