Recent Canadian Stock Purchases

As my Canadian timer is still long, I decided to buy shares of Open Text (OTC), Rogers Communications (RCI.B) and Agrium (AGU).








The P&F chart for Agrium indicates that a double bottom breakdown occurred yesterday. I am hoping that Agrium will resume moving upward in price and that I bought it at the bottom of a dip. Time will tell!

American Pacific Corp

APFC is a stock that I purchased on April 14 as it passed one of my more promising US stock screens and currently has a Risk Grade of 164. As far as the P&F chart is concerned, APFC entered an ascending triple top breakout on April 10.

Canadian Weekly Dividend Report. 04/28/08

Atco Ltd...................(ACO.X) Annual dividend increased by 6.8% from $0.88 to $0.94
Husky Energy Inc.............(HSE) Annual dividend increased by 21.2% from $1.32 to $1.60

Shanda Interactive Entertainment

SNDA, an interactive online gaming company operating in China, picqued my interest this weekend when it passed one of my more successful short term screens and also recently experienced a double top breakout as seen in the P&F chart below. Interesting articles can be found at Seeking Alpha and Yahoo. It has a forward P/E of 13.92 according to Yahoo which is not bad given that its 2007 revenues were up 49.1% over 2006 and its annual net inome increased by 21.8%.



Looking at the chart below, it appears that SNDA may retreat before heading higher.

American Capital Strategies

One more short for the day - ACAS.

Shorting Starbucks

Late to the game I know but I decided to short a very small amount of SBUX.

Baytex Energy Trust.......(BTE.UN) Annual distribution increased by 11.1% from $2.16 to $2.40
Canadian Resources Income Trust (RTU.UN) Annual distribution increased by 24.6% from $1.308 to $1.63
Matrikon Inc.................(MTK) Declared first quarterly dividend of $0.03

RiskGrade Update

I have posted before about how the practice of buying only stocks that have a RiskGrade below a certain maximum may improve portfolio performance. When I began the practice of narrowing the list of stocks for potential purchase on the basis of the RiskGrades, the annualized standard deviation of my US stocks as noted on the Covestor site was a little over 37. Today the standard deviation is down to 34.5 but that is still much higher than the current standard deviation of 21.7 for the S&P 500.

The maximum RiskGrade value that should be used in stock selection may depend on the stock screen. I am currently buying US stocks almost exclusively based on a Nasdaq filter that I have developed. It is much too early to tell, but it appears that the maximum RiskGrade cut-off that I should use is around 400. For some other stock filters, a maximum RiskGrade of 250 seems to work well and for an ETF filter that I use the maximum RiskGrade of 150 is looking good.

It will take another two or three years before I have enough data to make sound conclusions about the value of using RiskGrades as a stock selection tool but I like what I have seen thus far.

Canadian Stock Ideas

Only Enerflex Systems Income Fund (EFX.UN) and Saxon Energy Services (SES) pass my best-performing search for Canadian stocks which is based on holding the stocks for two months. I should note that I already hold Saxon in my portfolio and may purchase Enerflex today.

For those of you who are American investors who have never considered the Canadian stock market, you may find the following 1-year and 5-year charts which compare the performance of the Canadian index (S&P/TSX) to the S&P500 to be of interest.

CCL Industries

I purchased shares of CCL Industries (CCL.B) today which closed up 3.50% even though the S&P/TSX closed down 0.13%. From CCL's website, CCL manufactures "pressure sensitive, shrink sleeve and in-mould labels, aluminum containers and plastic tubes, providing state-of-the-art specialty packaging solutions to global producers of consumer brands in the home and personal care, healthcare and specialty food and beverage sectors. With headquarters in Toronto, Canada, CCL Industries employs approximately 5,000 people and operates 48 production facilities in North America, Europe, Latin America and Asia. CCL’s joint venture, ColepCCL operates five plants in Europe and employs approximately 2,000 people.".

CCL has increased its dividend every year for the past five years, interim revenue growth is 11.1% and interim earnings per share growth is 89.7%. Its TTM price/sales is only 0.90 and its TTM price/earnings is 7.22. CCL's market cap is almost eight times that of its nearest competitor, Intertape Polymer.

For what it is worth, on 03/27/08 while appearing on BNN, Norm Levine named CCL as one of his Top Picks.

Canadian Weekly Dividend Report. 04/07/08

Bird Construction Income Fund(BNE.UN) Annual distribution increased by 8.7% from $2.76 to $3.00
Richelieu Hardware...........(RCH) Annual dividend increased by 14.3% from $0.28 to $0.32

You Bought What Today?!

I bought Proshares Ultra QQQ.  You know, the ones that provide double the exposure to the Nasdaq 100.  Holy crap!

 

There is usually some backtesting to my moves in the market and this purchase is based on my timer that went long yesterday.  Had I used my timer to move between QLD and QID (Proshares Ultra Short QQQ) starting on August 02, 2006, I'd be up by almost 77% by now - that's a compound annual growth rate of 40.7%.  Sweet.

 

Remember the almighty caveat though - past performance is no guarantee of future performance!

 

Timer	Signal	Bull	Gain / Loss	Bear	Gain / Loss
Date		(QLD)		(QID)		Value
						100,000
8/2/2006	Long	63.55	24.4%			124,359
3/1/2007	Short	79.03		55.95	-6.1%	116,735
3/21/2007	Long	84.10	18.2%	52.52		137,944
7/26/2007	Short	99.38		43.69	-2.0%	135,198
9/5/2007	Long	99.57	15.8%	42.82		156,556
11/7/2007	Short	115.30		37.93	35.9%	212,731
2/25/2008	Long	70.59	-3.1%	51.54		206,071
3/4/2008	Short	68.38		53.06	-14.3%	176,632
4/1/2008	Long	76.28		45.48
				CAGR=	40.7%

And The Number One Reason Why It's Great to be a Canadian ..

... our markets have gone up more!!


Above graph is S&P/TSX vs the S&P500



To top it all off, Jeff Rubin, a top notch economist with CIBC, forecasts that the Canadian stock markets will continue to outperform the US stock markets by 7% per year. Commodities aren't such a bad thing to have after all!

Timer Update

My US stock timer has gone long. I would be more comfortable if the S&P500 closed above 1400 since my timer went long on 02/25/08 only to be followed by a market decline.



In order to provide independent verification of my signals, I have signed up with TimerTrac. Once the timer has sufficient history, I will provide a link to my TimerTrac record.

Two stocks that I'll consider buying today are SID and SIM.