Visa Inc.

TELUS CORP., $31.97, Toronto symbol T, gained 3% this week in response to media reports that U.S.-based Verizon Communications (New York symbol VZ) may postpone its plan to enter Canada’s wireless market. Verizon is a recommendation of Wall Street Stock Forecaster, our newsletter that focuses on U.S. stocks. Verizon is reportedly interested in buying two smaller Canadian wireless carriers, Mobilicity and Wind Mobile, and bidding on new wireless frequencies, or spectrum. For technical reasons, Verizon may prefer to buy the new spectrum at an auction to be held in January 2014 before acquiring the two companies. Telus gets 53% of its revenue and 67% of its earnings from wireless services. That makes it particularly vulnerable to new competition from Verizon. Telus’s stock will likely remain volatile until Verizon’s intentions become clearer....

SYMANTEC CORP., $26.52, Nasdaq symbol SYMC, sells computer-security technology, including anti-virus and email-filtering software, to businesses and consumers. The stock jumped 8% this week after the company reported record quarterly revenue and earnings. In its fiscal 2014 first quarter, which ended June 28, 2013, Symantec’s revenue rose 2.5%, to $1.71 billion from $1.67 billion a year earlier. That beat the consensus estimate of $1.64 billion. The company is doing a good job of selling its products as ongoing subscriptions instead of one-time purchases. Subscriptions now account for 45% of Symantec’s revenue, up from 44% a year ago....

AIMIA INC., $15.35, symbol AIM on Toronto, rose as high as $16.63 this week after the Canadian Competition Tribunal dismissed a complaint that Visa Canada and MasterCard impose anti-competitive rules on merchants. Merchants want to place surcharges on consumers’ credit card purchases to offset fees they pay to Visa and MasterCard. Credit card companies and the banks that issue the cards currently split these fees, which range from 1.5% to 3%. The merchants also wanted to be able to choose not to accept premium credit cards, which charge higher fees. The current rules, set by credit card issuers, prohibit merchants from doing either of these things. Visa and MasterCard currently process over 90% of credit card transactions in Canada....

VISA INC. (New York symbol V; www.visa.com) operates the world’s largest electronic payments network. The company processes credit, debit, prepaid and commercial payments under the Visa, Visa Electron, Interlink and PLUS brands. Visa gets most of its revenue from fees it charges card issuers and merchants for using its network. These fees are based on payment volume, transactions processed and other factors. The responsibility for evaluating customer creditworthiness and collecting payments lies with the banks that issue the cards, not with Visa....

VISA INC. $183 (New York symbol V; Conservative Growth Portfolio, Finance sector; Shares outstanding: 792.0 million; Market cap: $144.9 billion; Price-to-sales ratio: 10.9; Dividend yield: 0.7%; TSINetwork Rating: Above Average; www.visa.com) operates the world’s largest electronic payments network....

VISA INC. $183 (New York symbol V; Conservative Growth Portfolio, Finance sector; Shares outstanding: 792.0 million; Market cap: $144.9 billion; Price-to-sales ratio: 10.9; Dividend yield: 0.7%; TSINetwork Rating: Above Average; www.visa.com) operates the world’s largest electronic payments network. The company processes credit, debit, prepaid and commercial payments under the Visa, Visa Electron, Interlink and PLUS brands.

Visa gets most of its revenue from fees it charges card issuers and merchants for using its network. These fees are based on payment volume, transactions processed and other factors. The responsibility for evaluating customer creditworthiness and collecting payments lies with the banks that issue the cards, not with Visa.


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TRANSCANADA CORP., $46.80, Toronto symbol TRP, hopes the U.S. State Department will approve its proposed Keystone XL pipeline in the next few months. Nebraska’s governor recently approved the company’s plan to reroute the line around environmentally sensitive areas of the state. When completed, Keystone XL would pump oil from Alberta to the U.S. Gulf Coast. The entire project would cost $5.3 billion U.S. It could begin operating in late 2014 or early 2015. So far, TransCanada has invested $1.8 billion U.S. in Keystone XL. Meanwhile, TransCanada’s earnings fell 14.7% in 2012, to $1.3 billion, or $1.89 a share. These figures exclude unusual items, such as gains and losses on contracts the company uses to lock in prices for natural gas and electricity. On that basis, the latest earnings missed the consensus estimate of $1.98 a share. In 2011, it earned $1.6 billion, or $2.22 a share....

WESTJET AIRLINES $22.29 (Toronto symbol WJA; TSINetwork Rating: Extra Risk) (1-877-493-7853; www.westjet.com; Shares outstanding: 132.3 million; Market cap: $2.9 billion; Divd. yield: 1.8%) serves 81 destinations in North America, Central America and the Caribbean....

AIMIA INC. $15.93 (Toronto symbol AIM; TSINetwork Rating: Extra Risk) (514-205-7315; www.aimia.com; Shares outstanding: 172.3 million; Market cap: $2.7 billion; Dividend yield: 4.0%) owns and operates Aeroplan, Canada’s largest loyalty program, and Nectar, the U.K.’s biggest loyalty program. In addition, Aimia has interests in Air Miles Middle East and Nectar Italia, as well as Club Premier, the leading loyalty program in Mexico.

In the nine months ended September 30, 2012, Aimia’s revenue rose 1.0%, to $1.63 billion from $1.61 billion a year earlier. Excluding one-time items, earnings per share rose 33.8%, to $1.03 from $0.77. The company’s cost per mile awarded dropped significantly, partly because it is making better use of its computer systems. Redemptions also fell.

… but it faces three risks in 2013

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Online shopping continues to grow quickly, mainly because the Internet makes it easier for consumers to find the merchandise they’re looking for and compare prices. Online shopping is also becoming more popular in developing countries, where there are few shopping malls and stores.

The best way to profit from this trend is through companies that process online payments....