Verizon Communications Inc.

Value stock Verizon Communications dials up growth with its AOL acquisition, more wireless revenue, and a new mobile video app.

These telecom firms’ recent acquisitions cut their reliance on traditional telephones and let them profit from growing markets, like Latin America, and highdemand services, such as mobile video. AT&T INC. $34 (New York symbol T; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 6.2 billion; Market cap: $210.8 billion; Price-to-sales ratio: 1.5; Dividend yield: 5.5%; TSINetwork Rating: Average; www.att.com) is the largest wireless provider in the U.S., with 126.4 million subscribers. It also sells phone, TV and high-speed Internet access to 64.1 million users. The company recently completed its $48.5-billion purchase (70% stock and 30% cash) of DirecTV, which has 19.6 million satellite TV customers in the U.S. and 12.5 million in Latin America....

VERIZON COMMUNICATIONS INC. $47 (New York symbol VZ, Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 4.1 billion; Market cap: $192.7 billion; Price-to-sales ratio: 1.4; Dividend yield: 4.8%; TSINetwork Rating: Average; www.verizon.com) has 110.8 million wireless users, 18.7 million traditional phone clients and 19.7 million high-speed Internet and TV subscribers. The company recently paid $4.4 billion for AOL, which operates several popular websites, including The Huffington Post, TechCrunch and Engadget. Verizon has since launched go90, a free app that lets users watch videos on mobile devices. This service incorporates AOL’s unique technology, which uses analytics software to place ads on websites. That should help it attract advertisers and offset its costs....

Scotia Global Dividend Fund is a mutual fund that invests in dividend-paying stocks worldwide.

Its top holdings are Citigroup, UBS Group AG, Wells Fargo & Company, Nestlé SA, Procter & Gamble, Roche Holdings AG, Novartis AG, Mondelez International, Apple and Bayer AG.

Scotia Global Dividend Fund’s geographic breakdown includes the U.S., 48.7%; Switzerland, 11.2%; Canada, 9.7%; the U.K., 9.0%; and Germany, 3.3%.

The fund’s MER is 2.64%. It yields 2.2%.

The Scotia Global Dividend Fund holds mostly large-capitalization multinational companies. We don’t see any particular advantage in investing solely in the world’s biggest stocks, and we have no reason to believe the fund’s managers can create any such advantage. With that in mind, we see little appeal in exposing yourself to a 2.64% MER, so we don’t recommend the Scotia Global Dividend Fund.

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FEDEX CORP., $145.29, New York symbol FDX, reported lower-than-expected earnings this week, as weaker demand for its shipping services and higher insurance costs offset cost savings. In the first quarter of its 2016 fiscal year, which ended August 31, 2015, the company earned $692 million, up 13.1% from $612 million a year earlier. Per-share earnings gained 14.2%, to $2.42 from $2.12, on fewer shares outstanding, but that still missed the consensus estimate of $2.46. Overall revenue rose 5.1%, to $12.3 billion from $11.7 billion, matching the consensus forecast....

Today, we look at a hedged ETF, a BMO dividend fund that Pat McKeough was asked to evaluate by a Member of his Inner Circle....

BMO US Dividend Hedged to CAD ETF, $17.36, symbol ZUD on Toronto (Units outstanding: 5.3 million; Market cap: $92.0 million; www.etfs.bmo.com), holds U.S. stocks that have maintained or increased their dividend rates over the last three years and meet other criteria, including yield and dividend payout ratio. The fund’s managers rebalance the underlying portfolio in June and December. Top holdings are Philip Morris International, ONEOK Inc., Garmin, Noble Corp., Verizon Communications, Mattel, Williams Cos., Gamestop, McDonald’s and Darden Restaurants. The ETF is hedged against movements of foreign currencies against the Canadian dollar. Its value rises and falls solely with the stocks in its portfolio, so it wouldn’t give you any diversification through foreign currency exposure....

Two questions—on Greek recovery and a tech ETF—bring our response on the risks and rewards of profiting from market trends through ETFs.

Technology Select Sector SPDR Fund ETF, $41.91, symbol XLK on New York (Units outstanding: 316.2 million; Market cap: $13.3 billion; www.spdrs.com), aims to track the S&P Technology Select Sector Index, which consists of tech stocks in the S&P 500 Index. The fund’s MER is just 0.15%. The fund’s top 10 holdings are Apple, Google, Microsoft, Verizon, IBM, Cisco Systems, Facebook, AT&T, Visa and Oracle. The fund is broken down by segment as follows: technology, hardware, storage and peripherals, 21.6%; software, 17.2%; information technology services, 16.5%; Internet software and services, 16.4%; semiconductors and semiconductor equipment, 9.9%; diversified telecommunication services, 9.8%; communications equipment, 6.9%; and electronic equipment, instruments and components, 1.7%....

Pumping $27 billion into network upgrades helps keep Telus competitive in the telecom race we see it as a clear buy among blue chip stocks.