stock pickers

For most of its 62-year history, grocery-store operator Metro focused solely on its home province of Quebec. In 2005, it successfully expanded to Ontario with its acquisition of the A&P chain. This purchase gave Metro the size it needed to compete with other supermarket chains, such as Loblaw, and with non-traditional food sellers, such as Wal-Mart. The company now aims to build on its recent success with several new initiatives. These include lowering its marketing costs by consolidating its banners and private-label brands. The company is also launching a new customer-loyalty program through a joint venture with a leading marketing firm. That should help it drive long-term sales growth. These initiatives will help Metro thrive in a fiercely competitive industry. Moreover, its stake in convenience-store operator Alimentation Couche-Tard is an overlooked asset....

Titan Medical, $0.40, symbol TMD on Toronto (Shares outstanding: 19.4 million; Market cap: $7.8 million), is developing Amadeus, a four-armed robotic surgical system. Amadeus is designed to let surgeons remotely manipulate surgical instruments. Titan’s products are still under development, so it has yet to generate any revenue. In the nine months ended September 30, 2009, the company lost $295,498, or $0.08 a share. It holds cash of $1.4 million, or $0.07 a share. Titan recently signed a contract with flight-simulator maker CAE Inc. Under the terms of the deal, CAE will be the exclusive training provider for Amadeus. In exchange, Titan will gain access to CAE’s modelling and simulation expertise. The contract has attracted a lot of investor interest in Titan....

Some investors rely on chart reading (or technical analysis), when they’re aiming to add hot stock picks to their portfolios. That’s because relying on charts seems much simpler than delving into and weighing a company’s fundamentals. We always look at charts when we select stocks to recommend in our newsletters, including Stock Pickers Digest, which focuses on more aggressive investments. And some successful investors find it helps to know a little about charts. But if you rely on charts at all, you should view them as just one of many things to consider when you make investment decisions.

Chart reading can steer you wrong at the worst possible moment

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Iraq’s instability has weighed heavily on its oil exports. That’s caused many oil companies, including some Canadian oil stocks, to hold off on investing in the country. However, the situation has presented some real bargains for foreign firms willing to take larger interests in Iraq. For example, China’s Sinopec recently paid $8 billion U.S. for Addax Petroleum, which was developing the huge Taq Taq oil field in Iraq’s northern Kurdistan region. (See below for an update on a Canadian oil stock with a new presence in Kurdistan. We’ve updated our view on this company in the latest Stock Pickers Digest.)...

AMAZON.COM $131.29 (Nasdaq symbol AMZN; SI Rating: Extra Risk) (206-266-1000; www.amazon.com; Shares outstanding: 433.0 million; Market cap: $56.8 billion) reported sharply higher results in the three months ended September 30, 2009. Revenue rose 27.8%, to $5.4 billion from $4.3 billion a year earlier. Earnings jumped 68.6%, to $199 million, or $0.46 a share, from $118 million, or $0.28 a share. That beat the $0.33 a share that analysts were expecting. Amazon’s North American media revenue rose 13% during the quarter. Overall media sales climbed 17%, to $2.9 billion. Revenue from electronics and other general merchandise jumped 44% to $2.4 billion. Revenue in the company’s “other” category, which includes Amazon’s web-services business, rose 25%, to $163 million. The company accounts for sales of its Kindle electronic-book reader in its electronics and general merchandise segment. It includes sales of Kindle books and other content in media sales....

When you join my Inner Circle service, you get to ask me your own personal investment questions, plus you get to see what other Inner Circle members have asked, along with our answers. So you can see how the service works, and get a sense of how it might help your portfolio, I’d like to share a member question about the liquidity of more aggressive stock market picks. I hope you enjoy and profit from it. Q: Would you comment on the liquidity of stocks? I fear that if I bought a stock, especially a speculative one, and wanted to sell I wouldn’t be able to. Does the average volume of a stock have any bearing on the stock’s quality, or the ease of being able to sell that stock? I guess what I am asking is if there are any ways to determine the liquidity of a stock. A: Many speculative stocks, including some of our stock market picks in Stock Pickers Digest, our newsletter focusing on more aggressive investments, are inactive or “thin” traders. They trade perhaps a few thousand shares daily, compared to tens, if not hundreds of thousands for, say, a Canadian bank....

One of the best ways to get exposure to the Louisiana shale-gas region is through Chesapeake Energy, $25.14, symbol CHK on New York (Shares outstanding: 647.7 million; Market cap: $16.3 billion). The company is active in the Haynesville shale discovery in Louisiana. Chesapeake is a recommendation of Stock Pickers Digest. We see it as a buy. EnCana Corp., $57.86, symbol ECA on Toronto (Shares outstanding: 750.2 million; Market cap: $43.4 billion), also has an active drilling program at Haynesville. It’s a buy recommendation of The Successful Investor.

GABRIEL RESOURCES, $3.35, symbol GBU on Toronto, shot up over 30% this week after it added a new investor with experience in permitting and building large industrial projects in Romania. That’s where Gabriel’s 80.23%-owned Rosia Montana project is located. Rosia Montana contains an estimated 10 million ounces of gold reserves, and could produce over 500,000 ounces a year. This gives it the potential to become Europe’s largest producing gold mine. BSG Capital Markets, a unit of Beny Steinmetz Group, a privately owned holding company, is buying 30 million units of Gabriel at $2.25 each (or a total of $67.5 million). Aside from one common share, each unit includes a two-year warrant that entitles BSG to buy additional Gabriel stock. For the first 18 months, BSG may buy Gabriel shares for $2.50 each. The price rises to $3.00 a share for the final six months....

Technology stocks have always been a more speculative segment of the stock market. But you can turn the odds in your favour by investing in those that have hidden assets, or assets that other investors overlook. Hidden assets are items that don’t show up on a company’s balance sheet, but can offer dramatic rewards for investors who are able to spot them.

This technology stock’s research spending is a key hidden asset

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Candente Resource Corp., $0.45, symbol DNT on Toronto (Shares outstanding: 80.9 million; Market cap: $36.0 million), explores for copper, gold and silver in Peru and Mexico. The company is based in Vancouver. Candente’s main interest is its 100%-owned Canariaco Norte copper/gold project in northern Peru. So far, the company estimates that the deposit contains 6.5 billion pounds of copper, 1.4 million ounces of gold and 36.5 million ounces of silver. Moreover, the company’s preliminary economic assessment, which it carried out in December 2008, showed that a mine would be profitable. The mine is projected to produce 200 million pounds of copper per year over its 19-year life. Candente has also discovered a second mineralized zone next to the Norte deposit, and believes that drilling will unveil a third deposit....