(Street Life is a regular feature that focuses on what's playing in the stock market.)
ACT I: The Home Run Ivanhoe Energy (TSX:IE) $3.25 Up 143.9 per cent (year to date) Oilsands - the magic word that has tar-happy energy punters dancing in the streets these days. It certainly did the trick for Ivanhoe Energy, which pounded out a tape-measure homer with a sunny press release announcing a successful test of the company's heavy oil upgrading system. But the kicker was Ivanhoe's prominent mention that the system may be utilized in the Alberta oilsands. Prior to the news, Ivanhoe's shares had been on well-greased 10-month skid in which it plunged from $4.02 to $1.16. Ivanhoe, a Vancouver-based company founded by flamboyant investor Robert Friedland, also has a portfolio of oil and gas exploration projects in the U.S. and China.
ACT II: The Bomb Quebecor World (TSX:IQW.SV) $13.93 Down 41.9 per cent (since Pierre Karl Péladeau became CEO on March 12, 2004) In assuming the reins of Quebecor World almost two years ago, Pierre Karl Péladeau drew a rave review from the printing giant's chairman, Brian Mulroney. The former prime minister, who remains chairman, said Péladeau "has proven by his recent performance that he has the drive and vision to build and manage a company that delivers strong results for its shareholders.”
Judging by the erosion of shareholder value since then, shareholders may be asking which company Mulroney was referring to. Under Péladeau, share values have nearly been halved. The latest selloff was triggered by the company's decision to slash its dividend by almost one-third. The headline in a report by analyst Andrea Horan of Genuity Capital Markets may have summed up the frustration of investors best: 'The Big Bath ... Part VII.'
ACT III: The Tech Bellwether Intel Corp. (Nasdaq:INTC) $21.76 US Down $3.76 (three-day selloff on earnings news) Few tech companies carry as much clout on Wall Street during earnings season as Intel, which rocked the street by missing its own guidance numbers for the fourth quarter of 2005. The giant chipmaker reported revenue of $10.2 billion US and earnings of 40 cents per share for the fourth quarter compared to its own guidance of $10.5 billion in revenue and 43 cents per share, and also issued a rather dreary outlook for 2006. As expected, those numbers cast a long cloud over the IT sector. Intel blamed its results on a drop in demand for desktop PCs, but also lost some ground to rival Advanced Micro Devices. "Competition is pretty fierce out there," said Intel chief financial officer Andy Bryant. Competition, eh? Isn't that against the rules?
ACT IV: The Buyout Play Retirement Residences REIT (TSX:RRR.UN) $9.90 Up 16.5 per cent (year to date) If you thought REITs were dull, check out this action. Retirement Residences has turned into a rocketship since the company announced it is considering an unsolicited bid. Speculation points to rival Chartwell Seniors Housing REIT (TSX:CSH.UN) as a potential buyer. Retirement Residences, Canada's largest provider of accommodation and care for seniors, has also been on the acquisition trail, recently bolstering its foothold in the U.S. by acquiring two skilled nursing facilities in Rhode Island. The Mississauga-based company pays a monthly cash distribution of seven cents per share. Shares in the REIT have surged 38.9 per cent since collapsing as low as $7.13 last November.
ACT V: The Comeback SunOpta Inc. (TSX:SOY) $8.11 Up 32.9 per cent (year to date) After a horrendous 2005 campaign, the much-maligned SunOpta may finally be turning the corner. The latest spike in SunOpta shares came on the heels of the company's robust revenue guidance. The producer and distributor of natural and organic food products said its revenue for 2006 could reach the $540- to $550-million US range. That would represent a whopping increase of over 30 per cent above the guidance it had provided for 2005. The company has been dogged by low profit margins and other issues such as poor soy crops and a decreasing demand for its oat fibre that resulted in a selloff to a 52-week low of $5.21 in October. The shares have since rebounded with a 55.7-per-cent return.
ACT VI: The Breakout Calvalley Petroleum (TSX:CVI.A) $7.29 Up 40.1 per cent (year to date) Calvalley has dubbed its oil and gas prospects in the Republic of Yemen as "blue sky" in terms of its upside potential. And that's not the only thing that's blue sky. Shares in the Calgary company have also been in blue-sky territory, soaring to an all-time high on the back of impressive drilling results and an oil price that is again flirting with the $70-per-barrel plateau. Calvalley's stock has already increased seven-fold in a 16-month span as the Calgary company has consistently churned out positive drilling results. Calvalley is the operator of the project in Yemen and has a 50-per-cent working interest. Its partners are Reliance Industries, one of India's largest companies, and Hoodoil Ltd., based in Yemen.
ACT VII: The Breakdown Google (Nasdaq:GOOG) $399.46 US Down 14.3 per cent (one-week selloff) For a time, it appeared that Google's stock was an unstoppable superpower that defied all stock market rules, even that one about nothing going straight up. Shares in the Internet search engine had gone mostly straight up from its $85 US price when it went public in August of 2004 to a high of $475 US, but this rude awakening for giddy shareholders was certainly a nasty one. The stock took a brutal single-day haircut, dropping 8.5 per cent amid concerns about its legal battles and a general weakening in the tech sector precipitated by a slew of disappointing earnings. That left the stock looking terribly vulnerable from a technical-analysis perspective as a key technical support level was broken with ease. But that's not the worst of it. Among those turning bearish on Google was the infamous one-time Merrill Lynch Internet analyst Henry Blodgett, who is now providing analysis on his blog at www.internetoutsider.com.
ACT VIII: The Penny Jackpot Bravo Venture Group (TSXV:BVG) $1.98 Up 227.8 per cent (year to date) As mining plays go, Bravo may be the poster child for rampant speculation. It boasts the three key characteristics of a hot speculation these days - it's a gold play, it's drilling in the trendiest area, Nevada, and it's interlisted on the Frankfurt Stock Exchange where the penny mining sector is on fire. Bravo Venture has tripled in a three-week span as investors await drill results from its South Battle Mountain/ Eureka project in an area where Placer Dome has already hit multimillion-ounce discoveries. Bravo is partnered with Placer Dome Gold on the project and has a substantial land holding in the area. The Vancouver-based company's other exploration properties are in British Columbia and Alaska.
(Stock prices are based on trading through Jan. 20 unless otherwise specified.)
(Gyle Konotopetz can be reached at gyle@businessedge.ca)
