How To Invest
In addition, Pat thinks then beginner investors should cultivate two important qualities: a healthy sense of skepticism and patience.
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Investors should approach all investments with a healthy sense of skepticism. This can help keep you out of fraudulent stocks that masquerade as high-quality stocks. It will also keep you out of legally operated, but poorly managed, companies that promise more than they can possibly deliver.
If you are a new investor, you should also realize that losing patience can cause you to sell your best choices right before a big rise. All too often, investors buy a promising stock just as it enters a period of price stagnation. Even the best-performing stocks run into these unpredictable phases from time to time. They move mainly sideways in a wide range for months or years before their next big rise begins. (Stock brokers often refer to these stocks as “dead money.”)
If you lack patience, you run a big risk of selling your best choices in the midst of one of these phases, prior to the next big move upward. If you lose patience and sell, you are particularly likely to do so in the low end of the trading range, when stock prices have weakened and confidence in the stock has waned.
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SunEdison, $31.13, symbol SUNE on New York (Shares outstanding: 274.5 million; Market cap: $8.4 billion; www.sunedison.com), develops, finances, installs and operates solar-power plants, delivering electricity to residential, commercial, government and utility customers. The company also supplies other solar products, including polysilicon and solar cells. Photovoltaic cells, also called solar cells, are typically made from polysilicon and absorb the energy in sunlight. This energy excites the electrons in the solar cells, which then break loose and become electricity. Solar manufacturers gather cells into solar panels, which they then connect in large arrays....
Electronic Arts Inc., $73.54, symbol EA on Nasdaq (Shares outstanding: 312.1 million; Market cap: $22.5 billion; www.ea.com), makes video games for a variety of devices, including computers, consoles (such as the Sony PlayStation, Microsoft Xbox and Nintendo Wii) and mobile devices (including the iPhone and iPad). The company sells a number of sports-based titles it reissues annually. It has licensing deals with most major professional sports organizations, including the National Football League, National Basketball Association, National Hockey League, FIFA (soccer) and PGA Tour golf. Electronic Arts also develops its own game franchises and constantly releases sequels and new versions that give it ongoing revenue. Top-selling examples include The Sims (a life-simulation game), Need for Speed (car racing), Battlefield (war), Plants vs. Zombies (strategy) and Dragon Age (a fantasy role-playing game). In addition, Electronic Arts makes games based on popular movies, such as Star Wars....
Trevali Mining, $0.96, symbol TV on Toronto (Shares outstanding: 316.9 million; Market cap: $282.1 million; www.trevali.com), is a zinc-focused base-metal miner with one producing operation in Peru and another being commissioned in Canada. The company’s Santander mine in Peru produces zinc and lead-silver concentrates; ihttps://www.tsinetwork.ca/?p=77646&preview=truen the three months ended March 31, 2015, Santander produced and sold 11.8 million pounds of zinc, 7.3 million pounds of lead and 244,000 ounces of silver. That generated $25.9 million of revenue and cash flow of $3.2 million, or $0.011 a share. Meanwhile, Trevali is now starting production at its Caribou zinc-lead-silver mine and 3,000-tonne-per-day mill, located in northern New Brunswick’s Bathurst Mining Camp. It hopes to eventually bring its nearby Halfmile-Stratmat deposit into production and process that ore at the Caribou mill, as well....
Colabor Group, $1.18, symbol GCL on Toronto (Shares outstanding: 27.5 million; Market cap: $31.6 million; www.colabor.com), is Canada’s third-largest foodservice distributor. The company sells to restaurants as well as institutions including hospitals, schools and government institutions, Its customers are mostly in Quebec, Ontario and the Maritimes: it’s the dominant operator in Quebec and the second biggest in Ontario. Colabor serves its clients through a network of 65 wholesalers and its own distribution facilities. In the three months ended March 21, 2015, Colabor’s revenue rose 9.1%, to $304.7 million from $279.3 million a year earlier. Excluding acquisitions, sales gained 2.9%. The company lost $0.23 a share, compared to $0.21....
In recent years, Great-West has bought companies in Ireland and the U.S. that have added new business lines and boosted its profits. Growth by acquisition can be risky, but Great-West’s large size lets it take advantage of opportunities with strong chances of success. GREAT-WEST LIFECO $36.57 (Toronto symbol GWO; Shares outstanding: 997.4 million; Market cap: $36.7 billion; TSINetwork Rating: Above Average; Yield: 3.6%; www.greatwestlifeco.com) is one of Canada’s largest insurance firms. It also offers mutual funds and wealth management. Power Financial owns 67.1% of Great-West. In the three months ended March 31, 2015, Great-West’s earnings per share rose 18.6%, to $0.70 from $0.59 a year earlier....
CENOVUS ENERGY $18.66 (Toronto symbol CVE; Shares outstanding: 828.5 million; Market cap: $15.9 billion; TSINetwork Rating: Average; Dividend yield: 5.7%; www.cenovus.com) gets 35% of its revenue from its oil sands projects and conventional oil and gas wells in Western Canada. Refining supplies the remaining 65% of Cenovus’s revenue. The company ships oil to its 50%-owned refineries in Illinois and Texas. Phillips 66 (New York symbol PSX) owns the other 50% of these operations. Cenovus has now agreed to sell its royalty lands to the Ontario Teachers’ Pension Plan for $3.3 billion. The company collects royalties from firms that drill for oil and gas on these properties, which total 4.8 million acres in Alberta, Saskatchewan and Manitoba....
RIOCAN REAL ESTATE INVESTMENT TRUST $27.20 (Toronto symbol REI.UN; Units outstanding: 317.8 million; Market cap: $8.7 billion; TSINetwork Rating: Average; Dividend yield: 5.2%; www.riocan.com) is Canada’s largest real estate investment trust (REIT), with interests in 338 shopping malls containing over 92 million square feet of leasable area. That total includes 48 U.S. malls with over 13 million square feet. In the three months ended March 31, 2015, RioCan’s revenue rose 7.7%, to $331.0 million from $307.4 million a year earlier. Cash flow per unit gained 4.8%, to $0.44 from $0.42. The trust’s latest acquisitions increased its rental space by 1.7%. It’s also doing a good job of renewing current tenants at higher rates: rents on renewals rose 9.8% in Canada and 8.3% in the U.S....
BCE INC. $52.91 (Toronto symbol BCE; Shares outstanding: 847.9 million; Market cap: $45.4 billion; TSINetwork Rating: Above Average; Dividend yield: 4.9%; www.bce.ca) continues to expand its Fibe TV and high-speed Internet networks. BCE aims to increase Fibe speeds in Toronto to 1,000 megabits a second, or 5.7 times faster than its current top speed of 175 megabits. Faster networks will help BCE hang on to its current customers and compete with cable companies. The company will spend $1.14 billion on these improvements, which will eventually reach 1.1 million Toronto homes and businesses. It will also speed up its Fibe networks in other cities in Ontario, Quebec and Atlantic Canada....
ARC RESOURCES $21.14 (Toronto symbol ARX; Shares outstanding: 340.0 million; Market cap: $7.4 billion; TSINetwork Rating: Speculative; Dividend yield: 5.7%; www.arcresources.com) produces oil and natural gas in Western Canada. Its average daily output of 120,354 barrels of oil equivalent is 64% gas and 36% oil. In the quarter ended March 31, 2015, ARC’s cash flow per share fell 38.7%, to $0.57 from $0.93 a year earlier. Production gained 13.9%, but its realized oil price fell 49.0% and its gas price declined 45.5%. Like many oil and gas producers, ARC is cutting back on exploration and development spending. This year, it will devote $550.0 million to this purpose, down sharply from $945.5 million in 2014....
IBM $163.16 (New York symbol IBM; Shares outstanding: 984.7 million; Market cap: $162.5 billion; TSINetwork Rating: Above Average; Dividend yield: 3.2%; www.ibm.com) has formed an alliance with Box Inc. (New York symbol BOX), which sells cloud-storage services to businesses. Under the deal, IBM will develop programs that combine its analytics software with Box’s cloud-based data. It will also integrate some of Box’s programs with its business email and online collaboration services, while Box’s clients will gain access to IBM’s consultants and online security technologies. Teaming up with Box should help IBM compete with cloud-computing providers like Amazon.com and Oracle....