AT&T INC. $24 (New York symbol T; Income Portfolio, Utilities sector; Shares outstanding: 6 billion; Market cap: $144 billion; Price-to-sales ratio: 1.1; WSSF Rating: Average) plans to upgrade its Internet capacity, which will let it store and distribute more content. AT&T hopes these enhancements will help it attract more business customers, whose online payroll and accounting services require reliable data connections and lots of bandwidth. Increasing revenue from businesses also cuts AT&T’s reliance on consumers, who tend to buy fewer phones and services during recessions. This project will cost AT&T $1 billion in 2009, which is equal to 6% of its 2008 earnings of $16.7 billion, or $2.81 a share. AT&T is a buy.

WEYERHAEUSER CO. $26 (New York symbol WY; Conservative Growth Portfolio; Resources sector; Shares outstanding: 211.3 million; Market cap: $5.5 billion; Price-to-sales ratio: 0.7; WSSF Rating: Average) is looking to lower its annual expenses by $375 million including cutting its workforce by 3%, as weak housing markets have hurt demand for its lumber. In 2008, it lost $5.57 a share (or a total of $1.2 billion) compared with a profit of $3.60 a share ($790 million) in 2007. These figures include several unusual items, such as non-cash writedowns of goodwill and its real-estate holdings. Revenue fell 25.9%, to $8 billion from $10.8 billion. To conserve cash, Weyerhaeuser has cut its quarterly dividend by 58.3%, to $0.25 a share from $0.60. The new annual rate of $1.00 yields 3.8%. The savings will help it pay down its long-term debt of $5.2 billion, which is a high 95% of its market cap. Weyerhaeuser needs a rebound in the housing market to show significant growth, but the company’s vast timberlands are an under-appreciated asset....

This year, global oil consumption will probably fall for the first time since the early 1980s. We feel now is a good time to buy well-established oil companies that can take advantage of low oil prices. The three listed below are good examples; all have low debt and plenty of cash, which puts them in a good position to buy new properties or smaller producers, possibly at bargain prices. CHEVRON CORP. $64 (New York symbol CVX; Conservative Growth Portfolio, Resources sector; Shares outstanding: 2 billion; Market cap: $128 billion; Price-to-sales ratio: 0.7; WSSF Rating: Above Average) is the second-largest integrated oil company in the United States, after ExxonMobil. Oil production supplied 86% of its earnings in 2008; the remaining 14% came from its refineries and retail gas stations. In response to weaker energy prices, Chevron aims to conserve cash by temporarily suspending its share buyback program. (In 2008, it repurchased $8 billion of its stock.) It now holds $9.6 billion, or $4.70 a share, in cash, and its total debt of $8.9 billion is a low 7% of its market cap....

partly because so many commentators are talking about the risk of a 1930s-style depression. That kind of talk is common in any deep stock market setback. But this time it’s closer to home, due to plunging house prices and the troubles of the auto industry. To top it off, President Obama has taken to warning that we risk a new depression if Congress failed to pass his stimulus package and other pet projects. But statistics to date are closer to the 1980s recession (and its savings-and-loan crisis) than the 1930s....

The market downturn has been particularly hard on cyclical technology companies like Symantec and Autodesk. However, both are world leaders in their niches, which gives them an advantage over competitors; many users prefer to avoid having to learn new software. As well, both companies continue to heavily invest in research. This hurts their earnings, but the resulting new products will help them thrive once the economy starts growing again. Symantec trades at a slightly lower p/e ratio than Autodesk, mainly because of its heavier debt burden. However, both are well positioned for earnings growth when the economy improves. SYMANTEC CORP. $14 (Nasdaq symbol SYMC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 821 million; Market cap: $11.5 billion; Price-to-sales ratio: 1.9; WSSF Rating: Average) makes software that protects computers from viruses and intruders....

RUSSEL METALS, $11.48, symbol RUS on Toronto, fell over 28% this week, even though it reported improved results in the fourth quarter of 2008. Investors mainly sold the stock because the slowing global economy drove demand for steel down by approximately 40% during the first two months of 2009. Russel is now working to cut costs and save cash. In the three months ended December 31, 2008, Russel’s earnings per share (excluding one-time items) more than doubled, to $0.87 from $0.37 a year earlier. Its revenues rose 40.8%, to $842.7 million from $598.4 million. In response to falling steel demand, Russel plans to cut 500 jobs (or 16.7% of its workforce), lower executive pay by 10% and reduce its remaining employees’ working hours. The company expects these moves to lower its annual costs by as much as $70 million....

J.P. MORGAN CHASE & CO., $22.85, New York symbol JPM, has cut its quarterly dividend by 86.8%, to $0.05 a share from $0.38. The new annual rate of $0.20 yields 0.9%. The lower dividend should save Morgan $5 billion a year, and help it cope with higher loan losses brought on by the recession. The company earned $3.7 billion, or $0.84 a share, in 2008. It also received $25 billion from the U.S. government through the Troubled Asset Relief Program. Meanwhile, Morgan expects to report a profit for the first quarter of 2009. That’s despite $1 billion to $1.4 billion in projected losses from home-equity loans. Morgan made these loans to high-quality borrowers, but because home prices have fallen so much, they now owe more that the current market value of their homes. Morgan also expects more losses from its credit-card loans. However, by cutting jobs at Washington Mutual, which Morgan bought in September 2008, it should save $2 billion this year. In light of its weaker loan portfolio, we’ve cut Morgan’s WSSF Quality Rating from Above Average to Average. However, the company is still in a strong position to survive the economic slowdown, and thrive when the economy starts growing again....

TOROMONT INDUSTRIES LTD. $20.51 (Toronto symbol TIH; SI Rating: Extra Risk) (416-667-5511; www.toromont.com; Shares outstanding: 64.6 million; Market cap: $1.3 billion) operates in two business segments: the equipment group and the compression group. The equipment group’s Caterpillar dealership, which covers Ontario, Manitoba, Newfoundland, and most of Labrador and Nunavut, is one of the world’s largest. It also includes rental operations. Also part of this group is Toromont Energy, which supplies, builds and operates high-efficiency power plants. Toromont’s compression group designs, engineers, builds and installs compression systems for natural gas, fuel gas and carbon dioxide, as well as industrial and recreational refrigeration systems....

TRIMBLE NAVIGATION $14.22 (Nasdaq symbol TRMB; SI Rating: Speculative) (408- 481-6914; www.trimble.com; Shares outstanding: 119.5 million; Market cap: $1.7 billion) reports that its revenues fell 14.3% in the three months ended December 31, 2008, to $268.1 million from $312.8 million a year earlier. Excluding one-time items, earnings fell 18.4%, to $29 million from $35.5 million. Earnings per share fell 14.3% on 1.7% fewer shares outstanding. Trimble specializes in “advanced positioning solutions,” such as GPS and other tracking technologies. In the latest quarter, sharply falling demand at its engineering and construction division hurt results. Revenues were down 16% in the mobile solutions division, which focuses on vehicle and vessel tracking, and GPS components revenues fell 5%. However, field solutions (agriculture) revenues rose 17.4%. Trimble forecasts a difficult market in the early part of 2009, especially in its engineering and construction division, which generates 53% of Trimble’s revenues. To improve its profitability, Trimble is undertaking a number of cost-cutting measures, including cutting its workforce by 10%, or 360 jobs....

KINGSWAY FINANCIAL SERVICES $2.90 (Toronto symbol KFS; SI Rating: Speculative) (905-629 -7888; www.kingsway-financial.com; Shares outstanding: 55.1 million; Market cap: $159.7 million) dropped recently after it announced that it expects to post a 2008 fourth-quarter loss of between $5.88 and $6.24 a share. (All figures except share price in U.S. dollars.) The expected loss is mainly the result of underwriting losses at its U.S. trucking insurance subsidiary, Lincoln General Insurance, and the weak performance of its investment portfolio. In response to its losses, Kingsway will cut 750 jobs, or 26% of its workforce, as it reduces its nine operating divisions to three (two in Canada and one in the U.S.). Kingsway hopes this will save it $80 million a year. It will also eliminate about $350 million of its annual premiums (or roughly 20%) by dropping unprofitable business from its U.S. operations. To lower the volatility of its balance sheet, Kingsway will also sell its equity portfolio. Kingsway’s initiatives are, in part, a response to pressure from New York-based money manager The Stilwell Group, which owns 8.4% of Kingsway. Stilwell wants Kingsway to cut its costs, sell unprofitable businesses and focus on its core business, which is non-standard auto insurance (for higher-risk drivers)....