stock pickers

The U.S. restaurant industry has faced tough challenges over the past 18 months. That’s because the economic downturn has prompted more consumers to eat at home, or to spend less when they dine out. The best U.S. restaurants have done a good job of cutting costs during the slowdown. Some have improved their menus by introducing new items and focusing on value-priced meals. And a few have taken advantage of the slowdown to expand into new markets with strong growth potential. That has helped these restaurants report improved results. It also puts them in a good position to profit as the global economy continues to improve. In light of the improvement in the U.S. restaurant industry, we’ve updated our buy/sell/hold advice on two U.S. restaurant growth stock picks, Ruby Tuesday (symbol RT on New York), and Chipotle Mexican Grill (symbol CMG on New York), in the current issue of Stock Pickers Digest, our newsletter for more aggressive investors....

FAIRFAX FINANCIAL HOLDINGS, $372, symbol FFH on Toronto, plans to buy the 91.7% of Zenith National Insurance Corp. (New York symbol ZNT) that it doesn’t already own for $1.4 billion U.S. To help pay for the purchase, Fairfax will raise $200 million U.S. by issuing new shares. Zenith has two wholly owned subsidiaries: Zenith Insurance Company and ZNAT Insurance Company. These firms sell workers’ compensation insurance to businesses across the U.S. Sharply higher layoffs during the economic slowdown have hurt Zenith’s business. Fairfax has taken advantage of its strong financial position to buy other insurers whose share prices have dropped with the slow economy. It recently paid $960 million U.S. for the 27.4% of Odyssey Re Holdings Corp. that it didn’t already own....

8 tips for spotting the best Canadian gold stocks

A subscriber to Stock Pickers Digest, our newsletter for aggressive investing, recently asked us how much importance we give to a company’s name when we’re selecting growth stock picks to recommend in our newsletters and investment services. He felt that a poorly thought-out company name may reflect a poorly thought-out business plan and a low chance of success. He specifically asked about Tucows Inc. (symbol TC on Toronto). We recently updated our buy/sell/hold advice on the company in a Stock Pickers Digest Email Hotline. See below for more details on this growth stock pick’s outlook.

A growth stock pick’s name should be more memorable than descriptive

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AEROPOSTALE INC., $33.73, symbol ARO on New York, plans to split its shares on a 3-for-2 basis. Shareholders of record on February 24 will get one additional Aeropostale share for every two shares they hold. The company will have 94 million outstanding shares after the split. It now has 62.7 million outstanding shares. When a stock splits, the percentage of the company that you own is unchanged. You simply hold more shares, which are each worth proportionally less. Some studies have shown that companies that split their shares are better investments than those that do not carry out splits, but that confuses cause and effect. When a company’s stock goes up a great deal, it has an incentive to split the stock and stop it from going to higher prices where it might be less liquid....

In mining exploration, an “anomaly” is a geological formation that might attract a prospector’s interest. However, one rule of thumb is that you have to look at 1,000 anomalies to find one prospect. And fewer than one prospect in a thousand turns into a mine. In other words, finding a mine is a million-to-one shot. That’s one reason why junior mining stocks are highly speculative. Another reason is that it’s much easier to launch and promote one of these stocks than it is to build a profitable business. So junior mines attract more than their share of unscrupulous operators and stock promoters. But there are little-known ways to cut your risk. Here are 9 “secrets” we use to pick junior mines to analyze in our Stock Pickers Digest newsletter. We’re sure they can help you find the gems among the rocks in this fast-changing industry:...

Demand for medical devices and supplies will undoubtedly continue to grow as the population ages. Companies in this fast-changing field make a wide range of products, from laboratory instruments to bandages and surgical tools. Some medical-equipment firms are large and well-established, like C.R. Bard (symbol BCR on New York), one of the stocks we cover in our Wall Street Stock Forecaster newsletter. Bard makes many different medical devices and tools, and has over $2.4 billion U.S. in annual sales. The company also has a long history of paying dividends. At the other end of the scale are companies like Intuitive Surgical (symbol ISRG on Nasdaq). Intuitive’s share price has been rapidly rising, but its sales of $874.9 million U.S. are only about 36% of Bard’s sales. As well, Intuitive only has one product — the da Vinci computerized surgical system (more on that below) — and does not pay a dividend....

IMPERIAL METALS, $16.33, symbol III on Toronto, jumped 13% this week. That’s after the Supreme Court of Canada ruled that the company’s Red Chris copper/gold project in B.C. can proceed. Environmental groups had challenged the project because the federal government accepted permits issued by the B.C. government without conducting its own environmental assessment. Drilling at Red Chris continues to reveal very high grades of copper and gold. A feasibility study shows that the project contains enough reserves to support a mine with a 25-year life. The mine would eventually replace declining production at Imperial’s Mount Polley and Huckleberry mines....

At left we announce our Stock Pickers Digest #1 stock for 2010. In choosing a #1, I look for a stock that seems to offer above-average if not great returns, but with below-average risk. Our #1’s have generally done well, and many were top performers. Autodesk, our #1 pick in 2004 for Stock Pickers Digest (and for Wall Street Stock Forecaster, our U.S. stocks newsletter), was the #1 performer among all 500 stocks in the S&P 500 that year! We’ll reveal our #1 pick for Wall Street Stock Forecaster in our Hotline on January 22, 2010. It’s sure to be different from our #1 Stock Pickers Digest selection, since Wall Street Stock Forecaster doesn’t analyze Canadian stocks....

We’ve chosen CGI Group is our “Stock of the Year” for 2010. It differs from past #1 picks in that it’s not a dividend payer and we rate it as Extra Risk. But we’ve followed it a long time and feel it may have set off on a rise that lasts years beyond 2010. The company took its present form in September 1981, and first sold shares to the public for $0.81 each (adjusted for splits) in December 1986. In June 2002, we added CGI to the stocks we analyze in Stock Pickers Digest, our newsletter for aggressive investors. It was then trading at $8.75. In December 2007, we thought the company had matured enough to suit more conservative investors, so we moved it to The Successful Investor. The stock has gained 50% since then....