As WTI crude prices close out another trading day below $50.00 per barrel, it is becoming increasingly difficult for investors to find stocks with both short and long-term upsides. The oil market in Alberta has been hit with layoffs, cuts to capital spending, and the beginnings of a mini-recession. Yet there are a handful of energy companies worth investing in that can bring about returns to your portfolio in 2015 and beyond.

One of these stand-out energy companies is Canadian Natural Resources Ltd. (TSX:CNQ)(NYSE:CNQ), which has managed to maintain its stocks value over the past couple of quarters. It also enjoys the enviable position of a well-balanced portfolio of light crude, heavy crude, and natural gas production. There have only been a handful of opportunities for investors to begin a position in Canadian Natural Resources, and this moment may very well be one of them.

Navigating the peaks and valleys

Knowing when to begin a holding in a company is key to maximizing your long-term returns, and with Canadian Natural Resources we see a pattern of excellent jumping-in points. In the past nine years we see three major stock price peaks spread between two significant lows. In June 2008 the stock soared to $55.65, which was followed by a crash price of $18.25 in February 2009. The stock managed to recover in the coming years with a second peak of $50.26 in February 2011, but it fell again to $25.58 in July 2012.

Looking at these peaks and valleys, we see a combination of seasonal factors and overarching sways of the market at play. In more recent times the stock managed to reach its third peak in nine years when it reached $49.57 in June 2014. The interesting part is that following the crash in oil prices that began in November, Canadian Natural Resources’ stock did not return to any of its previous crash positions. Instead, it only fell to the $31.00 range in December and has been defying the market by clawing back its value ever since.

Gazing into the near future

On Monday Canadian Natural Resources saw its stock price close at $37.35, continuing its recovery despite the current price of crude. Although the stock price has recovered by $6.00 in the past couple of months, the most recent set of analysts’ price targets show that there is still time for investors to make a move and see some profits in 2015.

The average price target at the moment is only $42.70, but some of the most recent price targets paint a very interesting picture. For instance, National Bank Financial currently has the most bullish price target, which it just raised from $43.00 to $46.00 with an outperform rating. Not far behind is CIBC with a price target of $45.00 and TD Securities with a price target of $43.00.

Leading the pack

Canadian Natural Resources managed to boost its net earnings to $1.2 billion from $413 million during the height of the crude oil crash. The company also remains committed to sustaining its cash flow through any means necessary, including a decision to cut the salary of its management committee by 10% at the beginning of March. This is a very different approach than the approaches taken by many its competitors, who have opted to layoff front line staff instead.

The company is rich in both energy reserves and free cash flow that will give investors a sense of security until energy prices return to a normal range.

The post Don’t Miss Out on Canadian Natural Resources Ltd.’s Bargain Prices. Act Now! appeared first on The Motley Fool Canada.

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With the new CRTC pick-and-pay regulations for television service providers now a reality, investors are left wondering how to adjust their long-term strategies in the Canadian telecom market. Some companies, such as Telus Corporation, are poised to see some short-term gains in the momentum of its stock because of how the company is designed.

Other companies like Rogers Communications Inc. (TSX:RCI.B)(NYSE:RCI) and BCE Inc. (TSX:BCE)(NYSE:BCE) will take some time to see some positive results from this apparently consumer-friendly mandate from the CRTC. Both have similar structures, with cable, Internet, and wireless services coupled with production of TV content and joint ownership of several major sports franchises. Going forward, it is expected that both of these companies will follow a similar path.

On the surface, the new pick-and-pay cable model appears to favour the average consumer, with a $25 basic package coupled with the ability to choose individual channels or small “reasonably priced bundles.” However, this new model might have very little effect on the bottom line of telecoms in the long run.

The language used by the CRTC allows telecoms to continue to create theme packs alongside pick-and-pay bundles. The deciding factor for consumers will depend on how much the telecoms opt to charge for the individual channels, which, according to insider reports, will be full market prices. This opens up the option for Rogers or BCE to continue their practice of bundling by offering discounted rates on popular channels, while adding in less popular channels that are owned by the respective telecom.

Sim-sub retaliation

When we look at the mandatory $25.00 per month basic package, we see one segment of the “dial” that is missing: American networks. The CRTC included these networks in the “may-be-included” portion of the basic bundle and not as a mandatory inclusion. Rogers and BCE could use this loophole to bring about a limited version of its dream of pushing U.S. networks out of the country.

The issue has to do with advertising. For example, Modern Family broadcasts in the U.S. on ABC, but in Canada, it is shown on City TV. The commercials from the U.S. feed are replaced by a process called sim-subbing to the same ones advertisers paid to have shown on City TV. This is the same issue being fought between consumers and BCE when it comes to Super Bowl commercials. The telecoms believe that if they have the rights to broadcast a show in Canada, it is entitled to the first run of advertising revenues.

Take me home to the ball game

Another advantage both Rogers and BCE have at their disposal is their control over the sports broadcasting market in Canada. This control will mitigate some of the upcoming losses from the pick-and-pay model. The majority of sports fans still prefer to watch games live, but will now have to shoulder a greater share of the cost to broadcast major sports. This is because sports coverage is the most expensive portion of the television landscape to produce and broadcast.

The end of Corus Entertainment

While some of the under-performing channels produced by Rogers and BCE will fall to the wayside, this could open up the opportunity to acquire additional successful channels from independent producers. One example is Corus Entertainment Inc., which generates the vast majority of its revenues from three channels: YTV, Teletoon, and W Network. Following the CRTC announcement, Corus’ shares fell by 11%, which was the largest single day loss in 14 years, making it susceptible to a takeover from one the four national telecoms.

The Internet to the rescue

Many believe that any losses Rogers and BCE incur from their cable division will simply be made up by increasing Internet prices or imposing stricter fines for exceeding data caps. This is the ultimate goal these companies were hoping for with the respective launches of the ShowMi and Encore streaming services. The hope is that it would appease cord cutters, while simultaneously reaping revenues from higher Internet traffic.

The new pick-and-pay model won’t be rolled out until January 2017, leaving investors plenty of time to decide their best strategies going forward.

The post Why Rogers Communications Inc. and BCE Inc. Are Your Best Long-Term Options in the New Pick and Pay World appeared first on The Motley Fool Canada.

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It has been less than a week since the CRTC released its landmark Pick and Pay cable service initiative to the Canadian public. This ruling will significantly alter the telecommunications landscape, while balancing the changing viewing habits of Canadians. For the most part, consumers who have been promised more choice in the future have applauded the decision. However, telecoms, content providers, and investors are concerned about their futures.

What sets Canada apart from other nations is that so much of its television programming is both produced and broadcasted by cable companies. That is with the exception of Telus Corporation (TSX:T)(NYSE:TU), which might just be the strongest bet for investors in the early stages of the Pick and Pay world.

Pick and pay and pay and pay

The new regulations from the CRTC stipulate that cable providers must now offer a basic package that costs no more than $25.00 per month. It must include all local and regional stations, CPAC (plus its provincial counterpart), APTN, provincial education channels, and community channels. For Telus, this new basic package price will not be much of a stretch, as its current “basic” package already costs $29.00 for 34 channels, with 16 theme packs and 100 pick and pay channels available.

All remaining channels will then be offered either individually or through small (five to 10 channel) bundles at a “reasonable price.” This will inevitably lead to the death of smaller niche channels, but Telus shouldn’t be affected, as many of these fringe channels only survive through conventional bundling.

Redistribution of revenues

As of this moment the vast majority of the 14 million homes in Canada still pay for conventional television services, but we are entering a generation with different tastes and viewing habits. The emergence of Netflix and similar Internet streaming services has shifted how a growing number of people consume media content. But this reliance of consumption through the Internet comes at a price, and Telus and the other telecoms secretly welcome the new found dependency on the Internet.

The belief among many is that all of the telecoms will simply take any lost television revenues and make up for it with higher Internet prices, or more aggressive data-cap penalties. Last month Telus ended its long-run offering of unlimited home Internet data and introduced capped data packages, with fines up to $75.00 for exceeding your monthly plan. Telus justifies this by stating that the 5% of customers that make up the heaviest users consume 25% of the data on the network.

With the shift to watching TV and movies online, these ratios will only grow higher, as an hour of HD video typically consumes 2.5GB of data usage. This increased dependency on streaming will push the existing national infrastructure to its limits, which will require increased monthly prices to upgrade and maintain. Telus has been one of the few companies to be very proactive in its attempts to upgrade its network in western Canada to fibre-optic to mitigate some of these issues.

Bundling your portfolio

We cannot forget that this new era of pick and pay isn’t the only thing in Telus’ favour. Its “free TV” with a three-year contract initiative has been very successful in many parts of Canada.

Not to be forgotten is Telus’s wireless division, which last year became the second largest in the country in terms of subscribers.

Generally, Telus has received the CRTC’s decision in a positive light, declaring it a “real win for Canadians.” In the short term this deal has the possibility to turn Telus’ stock into a real win for investors, as the drop in price to $42.08 opens up a good buying opportunity. Telus is generally seen as a stock that tracks upward at a slow and steady pace, making any sharp drop prime buying time. The average price target may only be set at $44.80, but this is offset by the dividend, which has an annualized payout of $1.60 with a yield of 3.8%.

The post Why Telus Corporation Is Your Best Short-Term Option in the New Pick and Pay World. appeared first on The Motley Fool Canada.

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Since Bombardier Inc. (TSX:BBD.B) cancelled its dividend and announced it would be taking on more debt, investors have been clamouring for any good news about the company. The CSeries, which has become the bane of most Bombardier investors, has fallen two years behind schedule and its price has ballooned by over US$1.5 billion.

It now seems that for the first time since September 2014, a new order for the CSeries has emerged. Is this a sign to investors that the bad days are behind, or is it time to strap on your parachute?

Bombardier finds its mojo…maybe.

Bombardier was enthused to hear that Malaysian start-up airline Fly Mojo had signed a letter of intent. The deal would be for 20 CSeries 100 aircraft at a price of US$1.47 billion, with an option for 20 more that could bring the total value of the deal to US$2.94 billion.

If this letter of intent can be converted into firm orders, this would be Bombardier’s first order in a region that represents one of the largest sources of potential sales. Bombardier projects that 13,100 aircraft in the same size class as the CSeries could be purchased in that region between now and 2033.

However, there are concerns as to whether Fly Mojo will ever take off as a company. The potential airline has the backing of the Malaysian government, which has been trying desperately to repair the country’s aerospace reputation. Yet some analysts believe that Fly Mojo may never actually materialize in the crowded and competitive Asian aviation marketplace. If Fly Mojo is able to come together, it is expected to enter service between October 2015 and the first quarter of 2016. Whether or not the CSeries 100 will be ready for commercial use by Fly Mojo by then is another issue.

Lost orders

Bombardier needed this potentially positive news to reassure investors after Qatar Airways announced “We have completely forgotten about it because you cannot wait indefinitely,” concerning the CSeries. Qatar Airways has decided to go with the A319neo aircraft from Airbus Group NV instead, delivering a significant PR blow to Bombardier in the Middle East.

This was followed up days later by an announcement from the Austrian branch of Lufthansa AG that it had cancelled its CSeries order in favour of 17 used Embrarer 195s. Fortunately for Bombardier, Lufthansa AG will continue to retain its 2009 order for 30 CSeries 100 (plus an option for 30 more) for its Swiss division.

Forecasting the future of Bombardier

As far as investors are concerned, the future of Bombardier is intrinsically linked to the success of the CSeries program. This is a theme we have seen play out several times in the past year, as we have watched Bombardier’s debt balloon to dangerous levels. The situation has become serious enough that the Quebec government has come out and said it would be willing to listen if Bombardier asks for a bailout.

As of now, Bombardier has 243 firm orders for the CSeries, with another 603 options and expressions of interest on the books. However, this is still below the 300 firm orders Bombardier had projected to receive by the time the aircraft entered commercial use. What is also concerning is that the majority of the orders are for the CSeries 300 model, which is even further behind in its certification phase than the smaller CSeries 100. Of the 243 firm orders, only 63 are for the CSeries 100, which will be the first model to enter service.

The lack of North American orders for the CSeries is also concerning, and while Air Canada has expressed an interest, it is believed that it wouldn’t need the aircraft until 2020, and would only make up a small portion of its fleet.

Bombardier’s stock has continued to take a beating, as it closed Tuesday at $2.48, right near the bottom of its 52-week range of $2.32-4.43. The stock is now trading above its average price target of $2.31, leaving investors with the risky gamble of whether or not the CSeries will succeed or if it will crash the company.

The post Has Bombardier Inc. Finally Found its Mojo? appeared first on The Motley Fool Canada.

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Crude oil prices are still suffering below the $50-per-barrel mark, but investors who understand the ebbs and flows of the market know how to take advantage of this opportunity. Inevitably, oil prices will return to a normal range and energy stock prices will recover, but for now, many well-performing companies are trading at a discount. Among these discounted energy companies is Crescent Point Energy Corp. (TSX:CPG)(NYSE:CPG) which has managed to outperform many of its competitors in recent quarters.

Crescent Point has released its fourth-quarter financial results, and despite the collapse of the oil industry, it has posted record revenues and production. But are these results sustainable or is the company actually teetering on the edge of insolvency?

Repeatable records?

Unlike its Canadian competitors who are bogged down in the oil sands, Crescent Point has managed to turn its niche assets in Saskatchewan’s Bakken region, North Dakota, and Utah into record-setting results. In the fourth quarter, funds flow from operations reached a new record of $572 million, up from $533 million last year. This was achieved thanks to record average daily production totals of 153,800 barrels of oil equivalent (BOE) per day, up from 127,641 BOE during the same period last year.

In a quarter where many energy producers suffered, net income totaled $121 million ($0.27 per share), up from a net loss of $13 million ($0.03 per share) in Q4 2013, despite average crude prices falling to $65.74 from $77.38 and net backs falling to $43.88 from $48.47.

These fourth-quarter results helped Crescent Point’s year end funds flow from operations reach a new record of $2.4 billion, up from $2.04 billion in 2013. Net income rose sharply over the year to $508 million ($1.21 per share) from $144 million ($0.37 per share). This represents a year-over-year increase of 251%, and the intriguing thing is that these results could become consistent, as long as oil recovers by the end of 2016.

Acquisitions on the horizon

Crescent Point is looking to expand its operations in the coming year in order to take advantage of cost savings that it believes could reach 15-20% in certain capital projects. Crescent Point is projecting to spend $1.45 billion in the coming year on capital expenditures in order to drill 617 new wells. These new wells will be necessary in order to take advantage of the 22% increase in proved-plus-probable reserves discovered recently.

However, Crescent Point is not content to only develop its current assets. The company may have hinted in its recent report that it is ready for another round of acquisitions. In the quarterly report it was revealed that Crescent Point had increased its line of credit by 40% to $3.6 billion.

Currently, Crescent Point has already deployed $1.27 of its line of credit, leaving $2.33 billion available for acquisitions, which is roughly the amount the company spent on acquisitions in 2014.

The belief throughout the industry is that this is a prime time to seek out smaller producers who are drowning in debt and are unable to manage low commodity prices. In a recent conference call, management at Crescent Point revealed that they are talking with “various parties” and that the Denver-Julesburg Basin of Colorado could be a likely territory for acquisitions.

The belief among analysts is that the rich dividend of $2.76 (annualized) with a yield of 9.84% should remain rather secure during this season of low prices and potential acquisitions.

The diamond in the rough

Many believe that Crescent Point Energy is one of the few companies that will emerge stronger than before the current oil-price crises began. Thanks to Crescent Point’s hedging strategy, aggressive acquisition, and development strategy, it is setting up investors for great returns when the market stabilizes.

Crescent Point Energy closed Thursday at a discounted price of $28.06, right in the bottom end of its 52-week range of $21.20-48.68. The average price target is currently set at $35.85, but if Crescent Point can keep up these earnings results with $50 crude prices, this could turn into a very lucrative long-term investment.

The post Prepare Yourself for Crude Oil’s Recovery With Crescent Point Energy Corp. appeared first on The Motley Fool Canada.

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When it comes to Canada’s telecom sector, investors are finding that many of the top companies are running out of room for growth. This has led companies to seek out alternative revenue streams, such launching streaming services available only to subscribers (now banned by the CRTC). But these endeavors have done little to boost revenues and have left investors to wonder if the good times are over in Canada’s telecom market.

The current state of the market is the reason why many are beginning to take a deeper look at Quebecor Inc. (TSX:QBR.B) and its growing telecom ambitions. Through its subsidiary Videotron, Quebecor has been a major player in the cable TV and Internet market in Quebec. The company is so entrenched in the province that for the 10th year in a row it has been recognized for having the best reputation among telecom companies in Quebec according Leger’s annual corporate reputation survey.

With continued rumours that Quebecor is quietly preparing itself to be the fourth national carrier, should investors begin to look at this company as a viable investment option?

Wireless ambitions

Since launching its wireless network in Quebec, Videotron has grown to 630,000 subscribers, which represents 12% of the province’s market share. In the past quarter alone, Videotron managed to add 42,400 new subscribers, and for all of 2014, the company added 125,500 subscribers. These numbers show that it is making significant headway against its national competitors, with its average monthly prices around $12.00 lower than the competition.

In the most recent spectrum auction, Videotron managed to acquire the LTE friendly 30 MHz spectrum across all of Quebec and Ottawa at a discounted “entry-level-player” price of $33 million. Some were hoping that the company would try and pick up an additional spectrum license outside of Quebec as a way of showing the market that it is serious about becoming a national player.

Quebecor is taking the slow and steady approach to the situation, as its largest concern about entering the national market remains. The issue has to do with how much the other national telecoms can charge in roaming rates. This has led to Quebecor lobbying the Canadian government and the CRTC to change the regulations.

The government appears to be listening to Quebecor’s concerns and all parties are currently waiting for a ruling from the CRTC. Going by its recent string of announcements, the CRTC may lean in favour of “more choice” and remove the last major hurdle that is holding Quebecor back.

Buying and selling

While the wireless and telecom segment of Quebecor is garnering all the attention, the company was once also known for its print media empire. In 2014, we saw the sale of its English-language arm Sun Media and 74 weekly papers in Quebec. Many have seen these deals as turning points for the company, as it can focus more resources towards its telecom ambitions.

Quebecor also made several acquisitions that are more in line with the new direction of the company. The acquisitions include a film production house, a data centre in Quebec City, and the naming rights to the new hockey arena in Quebec City. This furthers Quebecor’s ambitions to relocate an NHL team, such as the Carolina Hurricanes or Florida Panthers, to Quebec City. If so, Quebecor would be looking to enjoy the same control over content that BCE Inc. and Rogers Communications Inc. currently have over the Toronto Maple Leafs, Toronto Raptors, and Toronto FC.

Stock growth vs. market growth

Investing in Quebecor can seem like a gamble at times, especially if it never emerges as the fourth national carrier, either on its own or through a partnership with Wind Mobile. Analysts have mostly positive opinions on the stock, with the vast majority setting a buy recommendation. There are some signs that some investors have lost patience, as fund management firm Beutel Goodman & Co. has reduced its holdings in the stock from 22.8% to 9.97% in the past year.

Quebecor closed Friday at $33.74 near the top of its 52-week range of $25.15-34.70, while carrying an average price target of $36.80, with the most bullish target being set at $41.00.

The post Is Quebecor Inc. Your Best Bet to See Growth in the Telecom Industry? appeared first on The Motley Fool Canada.

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Under the leadership of John Chen, BlackBerry Ltd. (TSX:BB)(NASDAQ:BBRY) has begun a steady march from hardware specialist to offering its software through products of other companies. However, BlackBerry remains committed to selling 10 million devices per year to regain a portion of its once mighty market share. In the past few months, BlackBerry has already released the Passport, Classic, and Leap smartphones, and now is re-entering the tablet market with its newest device the SecuTABLET.

When investors hear the words BlackBerry and tablet together, they immediately conjure up memories of the unsuccessful Playbook and fear a similar financial failure. In this case, however, this new tablet is actually a “secure” and rebranded version of the Samsung Galaxy Tab S 10.5. The tablet, like much of BlackBerry’s recent products, will be marketed to government and business clients looking for more secure devices for work that are also compatible with popular apps for personal use.

The question being faced by investors is whether or not this new tablet will be a financial success, and if it is, will it lead to more product integration with Samsung?

The Playbook 2.0

The new SecuTABLET is the latest product to emerge from Secusmart, a specialist in encryption that BlackBerry acquired late last year. Since BlackBerry was forced out of the consumer market by Apple Inc. and Samsung, it has been forced to rely even more heavily on its marketing to government and business clients. This tablet is no exception and the proof is in the $2,380 price tag, which could be justifiable to clients if the product can live up to expectations. The device is currently awaiting certification to be approved for use by the German government, which could be one of the first to employ the device in the field.

This tablet differs as it allows sensitive data to be isolated from apps such as YouTube without worry of malware. This is accomplished with the help of technology acquired through a partnership with IBM.

Apples and oranges

When the announcement of the partnership between Samsung and BlackBerry was first released, it sparked a flurry of merger rumours and boosted the stock’s prices. It is possible that these rumours may never materialize, yet the partnership gives both companies an avenue to push Apple products out of the hands of professionals and government officials; especially at a time when Apple is facing the P.R. nightmare concerning allegations of spying being perpetrated on its devices.

BlackBerry is hoping that its recent wave of devices and its growing expansions of software partnership agreements will help the company recover a portion of its once mighty revenue stream. On the software front, BlackBerry has already launched a cloud version of its mobile security suite and is continuing its integration in Samsung products with its BlackBerry Enterprise Service 12 security software.

A secure investment?

John Chen’s long-term plan for BlackBerry is to match or exceed the revenues it currently generates from hardware with software. This strategy is alleviating some over-arching concerns from potential investors small and large. Recently, Canso Investment Counsel Ltd. converted $300 million of a debt offering into shares, bringing its holdings to 5.4%, which makes it the third-largest shareholder of BlackBerry.

While one firm is loading up on stock, another is downplaying the possibilities of the stock, namely Goldman Sachs, which painted a sour picture for BlackBerry in its most recent report. The analysts at Goldman Sachs cut their price target to $9.00 and are projecting rising losses between now and 2017. They also believe that BlackBerry’s projections of $500 million in software revenues will fall short by $74 million by 2016.

Investors are hoping that a clearer picture will emerge on March 27 when BlackBerry releases its fourth-quarter results. The fourth-quarter results also come at a time when the stock is trading well above its current price targets.

The post Should You Invest in BlackBerry Ltd. and its Growing Partnership With Samsung? appeared first on The Motley Fool Canada.

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Since its founding in 1995, Vancouver-based Westport Innovations Inc. (TSX:WPT)(NASDAQ:WPRT) has spent over US$ 700 million in research and development in order to corner the natural gas engine market. However, in the years since, the company has failed to post any net income and has built up an accumulated deficit of US$765 million. Yet investors are still intrigued by the company and its natural gas engines and related products, with the belief that in the long run, these products will become more appealing.

The big question now is what should investors do with this company? With all the hype and technological fan-fare surrounding it, Westport has managed to swoon many investors, while simultaneously drawing sever criticism that it has failed to produce any profits.

An unwanted technology?

Over at Westport, quarterly report day has become quickly become “time for the stock to crash” day. This is a trend that has not gone unnoticed as a 34 minute IROC trade halt was initiated when the report was released to the public. Westport remained consistent in this quarter as it posted a net loss of US$64.9 million. It is slightly comforting that this loss is down from the US$89.5 million net loss in Q4 2013 and US$98.8 million net loss in Q4 2012.

Revenues fell in the quarter to $27.4 million from $52.6 million last year, Westport has attributed this to the retirement of its first-generation Westport HPDI system. The discontinuation of this engine platform should be good news for Westport, as it was hindered by performance issues and failed to impress many trucking companies.

2014 Milestones

Westport had earlier predicted that the fourth quarter would be “rough” due to market conditions, but its year-end results presented a few notable surprises. The biggest positive surprise in the annual portion of the report was that Westport has finally managed to cross the US$1 billion mark in consolidated revenues. The actual amount of consolidated revenues was US$1.08 billion up from US$941 million in 2013 and US$625 million in 2012.

The bulk of the revenue growth came from two of Westport’s joint ventures, with Cummings-Westport (50% ownership) posting an increase of revenues of 9%, and Weichai Westport Inc. (35% ownership) posting a 33% increase in revenues. In 2014, Westport posted a net loss of US$149 million down from 2013’s net loss of US$185 million.

Is Westport worth investing in?

In short, it is less likely that investors will revisit the types of prices they saw in 2012, when the stock was trading at over $40.00. For many investors, Westport is the ultimate gamble on the TSX at the moment. However, the industry will flounder domestically as long as the LNG dreams in B.C. fail to materialize and the infrastructure for natural gas fueling stations remains absent. This leaves Westport increasingly dependent on its foreign joint ventures and OEM partnerships in China and India for growth.

The markets appear to be turning against Westport, as each year, the number of outstanding shares increases. At the end of 2014, there were 63.1 million outstanding shares available, up from 54 million in 2012. Then you have the stock price that closed Monday at $7.18 with a 52-week range of $3.82-20.32. The average price target for Westport’s shares on the TSX appears outdated, as the average price target is still set at $19.40. When we look at Westport’s NASDAQ shares (which are more heavily covered by analysts) we see an average price target of US$9.63.

The post Is it Time to Concede That Westport Innovations Inc. May Never Be Profitable? appeared first on The Motley Fool Canada.

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Last week, Canada’s big six banks began to release their first quarter results and Bank Of Montreal (TSX:BMO)(NYSE:BMO) was the first of the six to report. Things did not go well for the bank, as it missed analysts’ expectations and sent tremors throughout the TSX. Now that the dust has settled, investors can take a better look at the bank and decide what to do with its stock.

Result refresher

Before we go forward, we have to look back at the financial report that sent the stock price down. BMO managed to increase its revenues in the first quarter to $5.06 billion from $4.48 billion, but the bank saw its net earnings fall by $61 million to $1 billion. This is less than half of what some of its competitors posted in net income during the quarter. BMO has attributed some of the drop in net income to the recent drops in the loonie, crude prices, and the continued low interest rates. The bank also saw its return on equity fall to 11.8% from 14.2%. For a comparison, Royal Bank Of Canada posted a return-on-equity rate of 18.1% during the same period. BMO also saw income from its capital markets division fall by 20%, as some of its competitors gained ground in this business segment.

Brighter future ahead?

BMO did have some good news in its last quarter, mainly due to its wealth management division. In the quarter, assets under management rose by 18%, revenues increased by 26%, and adjusted net income rose by 28%. These increases are partly attributed to the recent $1.3 billion acquisition of London firm F&C Asset Management in May 2014.

While BMO may be the smallest of the Canadian banks in terms of its branch footprint, the bank has managed to grow its U.S. banking division to be the second largest of Canadian banks. Since 2008, this has been seen as a fiscal weakness for the bank, but as the American economy continues to strengthen, BMO should be in line to take advantage of the “good times.”

In Q1 2015 alone, BMO generated $192 million in net income, up from $167 million last year and revenues of $720 million up from $714 million in Q1 2014. These increased revenues from its U.S. operations are going a long way to justify the US$4.1 billion the bank paid for Marshall & Ilsley Corp. This acquisition made back in 2010 was done to give BMO a larger foothold in the U.S., while also taking advantage of the devalued prices of smaller American banks at the time.

The final word on BMO

With its exposure to the U.S. market, some investors could look at this as a way to invest in the U.S. banking market without investing in an American bank. However, BMO may not be the most lucrative option available. As mentioned above, BMO only generated $192 million in net income from its U.S. banking operations. While Toronto-Dominion Bank, the Canadian bank with the largest exposure to the U.S., generated US$536 million from its U.S. retail banking division.

BMO closed Friday at $76.06, near the low end of its 52-week range of $71.64 to $85.71. This quarterly report has soured analysts’ expectations, as the average price target has fallen to $81.20. Even the most bullish price target is only $85.00. BMO may not be the star of the Finance & Banking portion of your portfolio, but it could be a supporting player.

The post The Bank of Montreal Is in the TSX Dog House: Could This Be an Opportunity to Invest? appeared first on The Motley Fool Canada.

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Mitel Networks Corp. (TSX:MNW)(NASDAQ:MITL) has shown that if a company facing irrelevancy is willing to take a risk, it can still thrive and be competitive in a new market sector. Recently, Mitel was recognized by Synergy Research Group as the global market leader in cloud communications, with a world-wide market share of 20%.

It was also recognized as the fastest growing provider of cloud computing services, with over one million cloud seats. However, the question investors are now facing is whether this company is the “real deal” or a passing fad.

Cloudy with a chance of profits

Mitel has also recently released its fourth-quarter results, giving investors their first glance at the year end results since the Aastra merger. Revenues in the fourth quarter totaled $301 million, down from $319 million ($144 million not including Aastra). Net income, still feeling the effects of the merger, totaled $10.8 million up from a net loss of $800,000 in Q4 2013.

When it comes to EBITDA, however, Mitel is boasting about its record-setting quarter, which totaled $57.9 million, up from $23.2 million (Mitel & Aastra).  In Q4 2014, Mitel alone posted an EBITDA of $47.8 million.  Investors were hoping to see some cost savings with the merger, and gross margins have begun to reflect those sentiments, as gross margins in the quarter rose to 55.1% from 51.5%.

The largest selling point for the Aastra merger was the claim that Mitel would emerge with over $1 billion in annual revenues. Mitel managed to accomplish that goal, but the numbers are not as rosy as investors had hoped. Revenues in 2014 totaled $1.1 billion, which is up from the $569 million Mitel alone generated in 2013, and down from the $1.15 billion Mitel and Aastra earned combined in 2013.

Net income for the year fell to a loss of $7.3 million, while adjusted EBITDA climbed to a new record of $166 million. The next quarter will offer investors even more clarity, as there will be no more divide between Mitel and Aastra. The down side is that there will be no more large increases in the key financial segments to boost the stock price.

Kings of the cloud

As mentioned above, Mitel was recently recognized as the leader in market share in terms of cloud computing providers. In the fourth quarter alone, Mitel installed over 177,000 new cloud seats, including over 24,000 recurring cloud seats. While revenues have slipped a touch over the year, the number of cloud seats at Mitel has surged in the past year from 566,562 to 1,039,032. Recurring cloud seats in the year grew to 269,155 from 121,314 and average revenue per user also increased to $50.00 from $48.00.

Mergers over the horizon

Over the past couple years, Mitel has become increasingly aggressive in its efforts to consolidate the market with the motto “we’re always looking.” The most recent acquisition however is rather different than recent acquisitions targeting cloud computing firms. This new deal will see Mitel acquire Texas-based Mavenir for $560 million (cash & stock) in what has been described by management as “a growth play,” and “it is not a synergy play.”

Mavenir specialized in aiding mobile service providers with voice, video, messaging, and mobile core services over 4G-LTE cellular networks. In the deal, Mitel will add to its books a company which produced $130 million in revenues in 2014 and has a customer portfolio that includes most of the top 20 mobile carriers. While this type of business is outside of Mitel’s newly realized cloud services, Mitel CEO Rich McBee has gone as far as calling this deal a “perfect match.” Mitel believes the type of market serviced by Mavenir could be a $14 billion per year industry by 2018.

The average price target for Mitel is only $11.60, while the closing price Friday was $12.24. Mitel’s stock may only be able to generate moderate returns in the near future, but it offers a stable option for investors looking to invest in the tech sector.

The post How Mitel Networks Corp. Is Cornering the Tech Sector appeared first on The Motley Fool Canada.

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