It’s Hard to Replace a Winner

Article Excerpt

Falconbridge Ltd. (formerly Noranda Inc.) will be a hard stock to replace. We first recommended it in our April, 1995 issue. The Resources sector was depressed at the time, but we liked the stock for its high-quality reserves, steady cash flow and secure 5% dividend yield. We repeatedly recommended it and advised investors to stick with it for the low-risk Resources exposure it provided. The recent takeover of Falconbridge at $62.50 a share works out to a total return (including dividends) of 286.1%. Today’s ongoing Resource boom is bound to falter eventually, but your portfolio still needs Resources exposure. It may take years, but one day we expect to see Falconbridge-sized returns from a couple of our long-time favourites, Alcan and Agrium. ALCAN INC. $47 (Toronto symbol AL; Conservative Growth Portfolio, Resources sector; SI Rating: Average) is the world’s second-largest producer of aluminum, after U.S.-based Alcoa Inc. Canada accounts for about half of Alcan’s aluminum production, while the other half comes from…

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