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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GLOBAL X COPPER MINERS ETF $6.99 (New York symbol COPX; buy or sell through brokers; www.globalxfunds.com) tracks the Solactive Global Copper Miners Index, which includes 20 to 40 international companies that mine, refine or explore for copper. Germany-based Structured Solutions AG created this index. Canadian firms make up 41.0% of the ETF’s holdings. It also includes companies based in Australia (15.5%), China (5.4%), Peru (5.0%) and Mexico (4.6%). The fund’s MER is 0.65%. Its top holdings are Hudbay Minerals at 6.4%; Imperial Metals, 6.4%; Antofagasta plc, 5.8%; Teck Resources, 5.6%; Southern Copper, 5.6%; Jiangxi Copper, 5.5%; Lundin Mining, 5.2%; Kazakhmys, 5.2%; Turquoise Hill, 5.1%; Grupo Mexico, 5.0%; and Glencore International, 4.8%....
ENCANA CORP. $15.20 (Toronto symbol ECA; Shares outstanding: 741.1 million; Market cap: $11.6 billion; TSINetwork Rating: Average; Dividend yield: 2.3%; www.encana.com) produced 416,700 barrels a day (74% gas, 26% oil) in the three months ended December 31, 2014. That’s down 20.4% from 523,400 barrels a year earlier. As well, Encana’s realized gas prices, which include the benefit of hedging contracts, fell 4.1%, while oil prices declined 0.9%. As a result, the company’s cash flow per share fell 44.0%, to $0.51 from $0.91. Encana plans to spend $2.0 billion to $2.2 billion on new projects and upgrades in 2015, down from its earlier forecast of $2.7 billion. Even so, that’s more than its projected cash flow of $1.4 billion to $1.6 billion....
TD BANK $54.16 (Toronto symbol TD; Shares outstanding: 1.8 billion; Market cap: $100.2 billion; TSINetwork Rating: Above Average; Dividend yield: 3.8%; www.td.com) continues to benefit from gains in retail banking in both Canada and the U.S. The bank is also profiting from last year’s deal with Aimia (Toronto symbol AIM) to become the main credit card issuer for the popular Aeroplan travel-reward program. As a result, TD’s earnings, excluding one-time items, rose 4.9% in the three months ended January 31, 2015, to $2.12 billion from $2.02 billion a year earlier. Per-share profits gained 5.7%, to $1.12 from $1.06. Revenue rose slightly, to $7.61 billion from $7.57 billion. The bank set aside $362 million to cover potential bad loans in the latest quarter, down 29.1% from $456 million a year earlier....
This is the second in our regular series of Spinoff Stock Investigator reports. I can still say without reservation that, in investing, spinoffs are the closest thing you can find to a sure thing. When a company carries out a spinoff, it sets up one of its subsidiaries or divisions as a separate company, then hands out shares in the new company to its own shareholders. It may hand out the shares as a special dividend, or give its shareholders an opportunity to swap shares of the parent company for the shares of the newly established spinoff....
Here are some spinoff stocks that we still think have gains ahead. Symantec Corp., $25.26, symbol SYMC on Nasdaq (Shares outstanding: 690.1 million; Market cap: $17.2 billion; www.symantec.com), sells computer-security technology, including antivirus and email-filtering software, to businesses and consumers. Symantec plans to split itself up into two publicly traded firms. One will keep the Symantec name and focus on antivirus and security software and services. The other, called Veritas Technologies, will consist of Symantec’s information-management operations. This business makes products for data backup and recovery....
Let me remind you of a couple of our most valuable Successful Investor rules: First, a healthy sense of skepticism is your most valuable analytical tool. Second, the greatest risk you face as an investor to fall victim to a conflict of interest....
3D Systems Corp., $30.79, symbol DDD on New York (Shares outstanding: 111.2 million; Market cap: $3.4 billion; www.3dsystems.com), makes and services 3-D printers and provides print materials. The company’s sales rose 23.0% in the three months ended September 30, 2014, to $166.9 million from $135.7 million a year earlier, though its earnings per share fell 30.7%, to $0.18 from $0.26, on higher research and marketing spending. 3D Systems continues to grow through acquisitions, including Belgium-based LayerWise, a provider of direct-metal 3-D printing technology and a large-scale manufacturer of precision metal parts for the medical, dental and aerospace industries. The purchase price was not disclosed....
Concordia Healthcare, $64.13, symbol CXR on Toronto (Shares outstanding: 28.9 million; Market cap: $1.9 billion; www.concordiarx.com), is an Oakville, Ontario-based drug company that acquires and sells established drugs, mainly in the U.S. The company aims to acquire the rights to relatively small, mature products as opposed to the newer treatments larger pharmaceutical firms target. Concordia recently bought the North American rights to the epilepsy drug Zonegran from Eisai Inc. for $91.4 million (all figures except share price and market cap in U.S. dollars)....
DIRTT Environmental Solutions, $4.49, symbol DRT on Toronto (Shares outstanding: 75.5 million; Market cap: $343.9 million; www.dirtt.net), designs and builds customized office interiors. DIRTT stands for “doing it right this time.” The company believes its ICE 3-D software lets it deliver premade, customizable interiors faster and more efficiently than traditional construction methods. DIRTT first sold shares to the public at $3 each and began trading on Toronto in November 2013. In the three months ended September 30, 2014, the company’s revenue rose 27.1%, to $46.7 million from $36.7 million a year earlier. The higher U.S. dollar increased the contribution of its U.S. sales. The company also completed the remaining one-third of the $12.0 million of major projects it won in January 2014. DIRTT made $1.5 million, or $0.02 a share, compared to a loss of $494,000, or $0.01....
Corning Inc., $24.78, symbol GLW on New York (Shares outstanding: 1.3 billion; Market cap: $31.5 billion; www.corning.com), started making glass products in 1851. The company has a long history of innovation, including producing bulbs for Thomas Edison’s first electric lights in 1879. In 1947, it became the first company to mass-produce cathode-ray tubes for TV sets. Today, Corning makes advanced materials for a range of products at 70 plants in 15 countries. It gets about 55% of its sales from Asia. The company has five divisions:...