Davis + Henderson Corp., $31.00, symbol DH on Toronto (Shares outstanding: 80.7 million; Market cap: $2.5 billion; www.dhltd.com), is a leading cheque printer. It also sells software for managing chequing and credit card accounts and technology for approving loans and searching for and registering liens. Davis + Henderson’s clients are mainly financial institutions. It now has over 7,000 customers in Canada and the U.S. In April 2011, the company bought Wisconsin-based Mortgagebot LLC, which sells web-based mortgage software, for $231.8 million U.S. Mortgagebot’s software runs on more than 6,000 mortgage websites and generates mortgage applications for nearly 1,100 U.S. banks and credit unions....

Recent events in Ukraine leave me with a pleasing sense of déjà vu. This goes back to the early 1960s. I had a number of friends back then who had left Hungary as refugees after the failed revolution of 1956. I had read about conditions in the communist world, of course. But hearing about it from friends who had lived through it made it much more tangible. With those memories in mind, the Eastern European revolutions of 1989 seemed like a wonderful thing. When the Eastern European revolutions broke out, I often stayed up until the early hours of the morning, watching live CNN coverage of events then going on in the former Soviet bloc—the destruction of the Berlin Wall, the non-violent crowds standing up to the dictators, and the on-the-scene discussions of political changes that were likely to follow. I felt a strong personal connection to the changes. But I also had a professional interest. The collapse of communism was likely to be great for the world, and in particular for the stock market. The spread of political and economic liberty, and of the free enterprise system, was bound to lead to greater wealth for all....

Manulife Floating Rate Senior Loan Fund, $9.85, symbol MFR.UN on Toronto (Units outstanding: 26.5 million; Market cap: $261.0 million; www.manulifemutualfunds.ca), mainly holds senior floating rate loans and, to a lesser extent, short-duration debt securities. Senior debt is first in line to be repaid in the event of a bankruptcy. However, the fund primarily invests in junk bonds—debt that’s rated below investment grade. Corporate bonds are riskier than government bonds, and their risk levels vary widely. Some corporates are almost as safe as government bonds and offer only slightly higher yields. Others offer much higher yields, but are far riskier. The junk bonds that Manulife Floating Rate Senior Loan Fund invests in are from the second group....

E-L Financial Corp. Ltd., $701.13, symbol ELF on Toronto (Shares outstanding; 4.0 million; Market cap: $2.9 billion; www.empire.ca), is a holding company that owns 80% of the Empire Life Insurance Company. In addition to life insurance, Empire provides employee benefit plans and financial services. E-L also owns an investment portfolio that includes both direct investments in companies and publicly traded stocks and bonds. As well, it has a 51.38% interest in United Corporations, a closed-end investment fund (symbol UNC on Toronto). The company sold its 100% interest in the Dominion of Canada General Insurance Company, which underwrites property and casualty insurance, on November 1, 2013. That brought in cash of $1.1 billion and let E-L pay a $75 dollar-a-share special dividend....

FuelCell Energy, $1.69, symbol FCEL on Nasdaq (Shares outstanding: 227.4 million; Market cap: $402.2 million; www.fuelcellenergy.com), develops and produces fuel cells for power generation. A fuel cell is a device that uses hydrogen as a fuel, combined with oxygen from air, to produce electricity without combustion or harmful emissions. The hydrogen comes from a fossil fuel, such as natural gas or propane. It can also be produced by passing an electric current through water. Hydrogen can be stored or transported by pipeline, but it’s highly explosive. Fuel cells have no moving parts, make little noise, and have only heat and water as by-products when fuelled by pure hydrogen. They were first used in the U.S. space program, where they powered electronics in the Gemini and Apollo spacecraft. Later, they provided electricity and water for the space shuttles....

We haven’t been able to find any water utilities we would recommend for investment. The water business in developed countries is subject to a lot of regulatory hurdles and has limited growth prospects. There may be opportunities in developing nations, many of which desperately need clean water. But investing in these markets can expose you to political risk. We think you should stick with the utility stocks we recommend in our newsletters....

Rio Alto Mining, $2.60, symbol RIO on Toronto (Shares outstanding: 176.7 million; Market cap: $473.7 million; www.rioaltomining.com), produces gold from its La Arena project in northern Peru. The mine reached commercial production in January 2012. In 2013, its output totalled 214,742 ounces of gold. Rio Alto is moving closer to producing copper from a pit near the La Arena mine, with a recent environmental approval for an 18,000-tonne-per-day open-pit operation. Construction could begin in late 2014 or early 2015, with completion forecast in 2017....

The U.S. dollar accounts for most of the foreign currency-denominated earnings of Canada’s six big banks. Bank of Nova Scotia also has exposure to Latin American and Asian currencies, but these are down roughly the same amount against the U.S. dollar as the Canadian dollar. In general, the rising value of the U.S. dollar against the Canadian dollar (another way to look at the fall of our dollar) is a positive for the banks. That’s because it increases the contribution of their U.S. operations to their earnings.

You may have read about the “scary 1929 market chart” that has been making the rounds on Wall Street. It shows two periods of trading history of the Dow Jones Industrial Average, superimposed one over the other. (You can see the chart in a Mark Hulbert column at www.marketwatch.com) One period covers 1928 and 1929. The Dow had a sharp rise in 1928 and the first three quarters of 1929, followed by the October 1929 market plunge which led into the 1930s depression. The second period on the chart shows the Dow from mid-2012 through today. The two periods are aligned so that the peak in the 1929 market is roughly above the recent peak in today’s market. When you compare the two historical patterns, you can see some vague similarity between the two sets of squiggles. It’s clear that the creator of the chart wants to suggest that history is repeating itself and the Dow is headed for a 1929-1932 style collapse. These “1929-all-over-again” charts have been around for as long as I’ve been in the investment business. The last time I recall one of them gained this much notice was in the first half of 1988. Back then, investors were still rattled by the one-day, 22.5% market plunge that happened on October 19, 1987, sometimes referred to as “Black Monday”....

Automodular Corp., $2.43, symbol AM on Toronto (Shares outstanding: 19.4 million; Market cap: $47.5 million; www.automodular.com), assembles car and truck components, such as instrument panels, engines and rear suspensions. The company operates two plants in Oakville, Ontario, that assemble parts for its one remaining automotive customer: Ford Motor Company’s Oakville Assembly Plant. Automodular closed its Oshawa, Ontario plant in 2010 after it lost its contracts with General Motors of Canada, which switched to a U.S. supplier after Automodular refused to sharply cut its prices. These deals, under which Automodular supplied parts for the Camaro sports car, accounted for roughly 20% of its business....