stock pickers
Pat McKeough responds to many personal questions on specific stocks and other investment topics from the members of his Inner Circle. Every week, his comments and recommendations on a selection of the most intriguing questions of the past week go out to all Inner Circle members. And each week, we offer you one of the highlights from these Q&A sessions. This week, we heard from an Inner Circle member asking for investment advice on America’s largest drug store chain. Pat discussed the company’s prospects following a big acquisition last year, and this year’s decision to put an end to a key commercial relationship....
VITERRA INC., $15.91, symbol VT on Toronto, has agreed to a friendly takeover offer from Switzerland-based commodity trader Glencore International plc. The purchase price is $6.1 billion, or $16.25 per Viterra share. As part of the deal, Glencore will sell a number of Viterra’s assets, including about 90% of its Canadian fertilizer retail stores and all of its Australian outlets, along with Viterra’s 34% stake in a fertilizer plant in Medicine Hat, Alberta. Agrium (symbol AGU on Toronto) has agreed to buy all of these assets. Agrium is a recommendation of our Successful Investor newsletter....
PENGROWTH ENERGY CORP., $9.78, Toronto symbol PGF, is buying rival oil producer NAL Energy Corp. (Toronto symbol NAE) in an all-stock transaction. Under the terms of the deal, 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 plan needs shareholder and other approvals, but Pengrowth and NAL aim to complete the merger 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 to between 86,000 and 89,000 barrels of oil equivalent a day, from its earlier range of 74,500 to 76,500 barrels....
Primero Mining, $2.43, symbol P on Toronto (Shares outstanding: 88.3 million; Market cap: $214.6 million; www.primeromining.com), is a junior gold/silver producer that was formed in August 2010. Its main asset is its San Dimas mine in Mexico. The company changed its name from Mala Noche Resources after it bought the San Dimas mine from Goldcorp Inc. for $510 million U.S. in cash and shares. Goldcorp holds a 36% interest in Primero. Primero expects to produce 100,000 to 110,000 gold equivalent ounces (including silver) this year. Its cash flow is forecast at $0.89 a share....
Companies take different paths to growth. Over the years, this Canadian company has steadily acquired a series of small firms with specialized expertise and integrated them into a large organization that can undertake a wide range of projects. And this year, it has joined the ranks of Canadian dividend stocks. STANTEC INC. (Toronto symbol STN; www.stantec.com) sells a range of consulting, project delivery, design/build and technology services. The company’s clients operate in a wide variety of markets, including industry, environment, transportation and construction. Stantec has over 11,000 employees at 170 locations throughout North America. It also has four international offices....
Pat McKeough responds to many personal questions on specific stocks and other investment topics from the members of his Inner Circle. Every week, his comments and recommendations on a selection of the most intriguing questions of the past week go out to all Inner Circle members. And each week, we offer you one of the highlights from these Q&A sessions. Last week, one member asked about one of Canada’s more intriguing commodity investments—a high-yielding stock that supplies chemicals to the pulp and paper industry and shipping services to the oil and gas industry....
ALIMENTATION COUCHE-TARD, $31.94, symbol ATD.B on Toronto, reported sharply higher sales and earnings in the latest quarter. The company is the largest convenience store operator in Canada, with over 2,000 outlets. It also has nearly 3,700 U.S. stores. The Canadian stores operate under the Couche-Tard and Mac’s banners, while the U.S. stores mainly use the Circle K brand. In the three months ended January 29, 2012, Couche-Tard’s earnings rose 24.7% to $86.8 million from $69.6 million a year earlier (all figures except share price in U.S. dollars). Earnings per share rose 28.9%, to $0.49 from $0.38, on fewer shares outstanding....
VITERRA $14.65 (Toronto symbol VT; TSINetwork Rating: Average) (1-866-569-4411; www.viterra.ca; Shares outstanding: 371.7 million; Market cap: $5.4 billion; Dividend yield: 1.0%) is up almost 31% since the company said it has received expressions of interest from unnamed parties interested in taking it over. The stock was our Pick of the Month in the last issue (March 2012) of Stock Pickers Digest. At the time, it was trading at $10.09. That’s a 45.2% gain in one month. Our view is that the company is well positioned to benefit from an expected rise in Canadian and Australian crop yields in 2012, as well as the end of the Canadian Wheat Board’s monopoly on western Canadian wheat and barley sales. In addition, its Australian operations’ sales to Asia continue to rise....
Pat McKeough responds to many personal questions on investing in stocks and other investment topics from the members of his Inner Circle. Every week, his comments and recommendations on a selection of the most intriguing questions of the past week go out to all Inner Circle members. And each week, we offer you one of the highlights from these Q&A sessions. This past week, one member sought long-term advice on one of North America’s best-known big-box discount chains, which faces stiff competition in a race for retail revenue that has spread well beyond North America. ...
VITERRA INC., $13.58, symbol VT on Toronto, jumped almost 21% today after the company said it had received expressions of interest from unnamed parties interested in taking it over. Viterra is a Saskatchewan-based agribusiness that mainly operates in Canada and Australia. The company accumulates, stores, transports, processes and markets grains, oilseeds and specialty crops, including lentils and mustard. The stock was our Pick of the Month in the last issue (March 2012) of Stock Pickers Digest. At the time, it was trading at $10.09. That’s a 34.6% gain in less than one month. Our view is that the company is well positioned to benefit from an expected rise in Canadian and Australian crop yields in 2012, as well as the end of the Canadian Wheat Board’s monopoly on western Canadian wheat and barley sales. In addition, its Australian operations’ sales to Asia continue to rise....