Mart, Hodson's Top Pick
I am a subscriber of 5i research and was pleasantly surprised to read Peter Hodson has made Mart Resources a Top Pick for Q3. He must have spoken with his ex co-worker Peter Imhof. Nice to see we have added another follower, believer. Welcome aboard Pete & Pete.
5i Research Inc. news
New Reports: Since our last update, 5i Research has posted on its website new reports on Davis & Henderson (DF) and HealthLease Properties REIT (HLP.UN). Davis provides technology services to the financial industry, and we can pretty much guarantee they printed the cheques you use daily. However, it has diversified its business substantially, and offers a very nice history of good growth and a 7%+ yield. HealthLease is a recently-public REIT in the seniors' care industry. It offers an 8% yield, but is new, relatively small, and has some risks associated with that higher yield.
Market Review: Recent big up moves in the market should remind you of the importance of staying patient. Despite the doom and gloom, the DOW rose 3.6% in June, its best month since October. Despite all the problems in the world, the S&P 500 is up almost 10% on the year so far. Gold rallied recently, and oil rose an amazing $10 per barrel in a matter of days. More takeovers occurred also this week, so corporations obviously see value, even if investors do not. Stick with your good companies, and ask yourself again why you own the ones that are not working out. Governments remain committed to stimulate, and we note both China and the ECB lowered interest rates today.
Updates: Great Canadian (GC, Rated B-) announced a $100 million substantial issuer buyback, at $10 per share, this week. This move, helped by a debt refinancing, saw the stock hit a new high today. GC's recent results have been much stronger, and its stable cash flow allows it to improve shareholder value by financial mechanisms such as this. We would not, however, be in a big rush to tender your stock to the buyback. Amaya Gaming (AYA, Rated B) closed its $100 million financing, at $4.05 per share. We can't tell you why AYA needs this money, but a large financing done at a premium in this market is a pretty impressive feat. At the very least, the risk here has been reduced with $125 million+ now in the bank at Amaya. Stantec (STN, Rated A) announced a deal to buy Cimarron Engineering. This is a typical type of deal for Stantec. First Capital Realty (FCR, Rated B+) announced it was taking over Gazit America in a complicated transaction to clean up its corporate structure. The company has been very active also buying and selling properties this year. Wi-Lan (WIN, Rated A) this week signed license agreeements on its DSL technologies, but details were not disclosed. MTY Food Group (MTY, rated B-) reportd a strong quarter, with earnings up 47%.
National Post Stock Market Challenge: We are pleased to report, that, after half a year, 5i Research has taken the lead in the 2012 National Post Stock Market Challenge, with a gain of 23%. Second-place is up 15%. The first-half update should be published in the paper sometime in the next week or so. Our picks for the third quarter are Mart Resources (MMT), Eldorado Gold (ELD) and Badger Daylighting (BAD). Under contest rules, all selections must pay dividends.
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The July/August 2012 issue of Canadian Money Saver has been posted online at www.canadianmoneysaver.ca There are some interesting articles coming up on Exit Strategies, How To Beat The TSX, and How to Use Wealth Wisely. A reminder that new 5i Research Members qualify for a 20% discount on Canadian MoneySaver. If interested, send us an email and we will send you a discount code to use when you register.
Best wishes for your investing!
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