Seven Income Trusts We Don’t Like

Article Excerpt

SUPERIOR PLUS INCOME FUND $11.07 (Toronto symbol SPF.UN) faces gradual shrinkage in its core propane distribution market. Its diversification into new areas such as pulp and paper chemicals and construction materials does not inspire our confidence. We don’t recommend Superior Plus. WESTSHORE TERMINAL INCOME FUND $11.49 (Toronto symbol WTE.UN) receives 90% of the revenue at its coal storage and loading terminal at Roberts Bank, B.C. from mines owned by the Elk Valley Coal Partnership. That concentration in a single facility, moving just one commodity and serving one customer almost exclusively, are major risk factors. Westshore is a sell. YELLOW PAGES INCOME FUND $12.81 (Toronto symbol YLO.UN) is Canada’s largest telephone directories publisher. The company already has around a 93% share in its markets in Ontario and Quebec, so there’s not a lot of room for growth. Yellow Pages’ assets consist mainly of intangibles and goodwill. These assets only have full value if the fund can maintain its market share and public recognition…

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