Seen and heard in a coffee shop recently . . .
Child with head buried in stock pages: “Mommy, isn’t Nortel a screaming buy yet?”
Mommy with calculator calculating portfolios: “Maybe a buy, but I don’t think it’s screaming, honey, but be careful, you know about the CEO leaving.”
“Oh yeah, mommy, John Rot(h) is retiring. I think that’s good, but I’m going to insulate my portfolio and buy Liquidation World. That place sure is busy.” “You know best, darling.”
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I had to ask. The kid was 10 years old.
Wow!
So there is hope for us geezers.
Our kids may still be able to rescue us from financial ruin.
Parents are finally talking to their kids about the F word — finance.
Kids are buying low and selling high, beating the pants and skirts off their parents with real money or on simulated Internet stock market games and reading the facial expressions of their Uncle Al — U.S. Federal Reserve chairman Alan Greenspan — for hints on interest-rate moves.
Securities commissions are focusing on educating youth in the stock market. The Alberta Securities Commission recently toured Alberta rural areas, teaching the basics to Grade 11 students during Investor Education Week.
For a Saskatchewan farmboy who religiously tracked the Willie Mays Industrial Average (hits divided by at-bats=batting average), these are earth-shaking developments.
Since education systems have done such a spectacular job of teaching grade-school students everything they don’t need to know or can apply to life on this planet, too many ill-prepared folks have taken their lessons on investing and trading in the oldest school of hard knocks — the stock market.
Kids who gain a solid foundation in the intricacies of investing will have a chance to become students of the great game, putting their minds to work before their money.
There are numerous Web sites that provide the basic tools.
One we’d recommend is fool.com.
Another site geared specifically for students is smgww.org — it is sponsored by the Securities Industry foundation for Economic Education and includes a simulated stock-market game.
Go get ’em, kids!
PRO'S THREE STARS
Elvis Picardo, analyst with Global Securities, recommends TSE stocks Canadian Natural Resources (CNQ), Circuit World Corp. (CCW) and Power Financial (PWF) as buys.
“As these are trading picks, we also have recommended stop-loss levels on them,” says Picardo.
He has a target price of $65 on Canadian Natural, which recently traded at $51.20 (year range, $37.25-$56.20). His recommended stop-loss price is below $43.
“We recommend it on the basis of its reasonable valuation and the possibility that it could be a takeover target,” says the Vancouver-based analyst of the senior oil-and-gas producer.
Circuit World (recent price $2.98, year range $1.65-$4.70) is one of the largest manufacturers of printed circuit boards (PCBs) in Canada, supplying larger manufacturers such as Honeywell and Celestica.
The company recently reported first-quarter revenue of $9.74 million and net income of $830,000, almost doubling net income from a year earlier.
Picardo’s target is $4 and his recommended stop-loss is below $2.25. He cautions that “with just over seven million shares outstanding, it may not be suitable for conservative investors for whom liquidity is of primary importance.”
Picardo dubs Power Financial a “financial powerhouse,” citing increased profits at the company’s two main units — Great-West Lifeco and Investors Group.
The stock recently traded at $32.95 (year range, $26.30-$36). The analyst’s target is $39 with a stop-loss recommended below $26.
Picardo’s winner in his December picks was Encal Energy, which was up 32 per cent when he issued an official sell recommendation in April after the company was swallowed up by Calpine Corp. in the takeover wars.
Picardo’s record: -3 per cent (Encal Energy +32 per cent when taken over, TD Bank +2 per cent, Intrinsyc Software -43 per cent).
* CHEERS: To 86-year-old wrestling legend Stu Hart of Calgary, a giant of charitable work in his lifetime who has been awarded the prestigious Order of Canada.
* JEERS: To Canadian Tire for acting like a schoolyard bully in its silly legal fight with a tire kicker named Mick McFadden.
Canadian Tire recently lost its bid to gain control of crappytire.com, McFadden’s Web site, with a ruling rejecting the chain’s claim that its trademark embraced the derogatory nickname.
McFadden said he’s “laughing his butt off.”
HOT ALBERTA STOCK
GULF CANADA RESOURCES
GOU-TSE $12.40
Up $3.22 (+35.1%) on 393,498,486 shares (for week ending June 1)
Didja get the hint? For several months, with Gulf Canada's stock languishing in the $6 to $9 range, financial gurus have been screaming from rooftops in the heart of the Calgary oilpatch — TAKEOVER TARGET!!!!!!!! You bet! Nuthin's sacred in these parts. When the blockbuster news hit that Houston-based Conoco had made a $6.7-billion US all-cash deal to take over Gulf and the stock began to trade, 167 million shares moved — in one day!
COLD ALBERTA STOCK
NEW BLUE RIBBON RESOURCES
NBL-CDNX 13 cents
Down 20 cents (-60.6%) on 3,588,180 shares (for week ending June 1)
The Edmonton-based diamond exploration company has diamonds on its Web site. We checked. Unfortunately, the latest drill results from the company's Moose project in northeastern Manitoba didn't show any diamonds and a stock that has seen a year high of 53 cents plummeted to an unlucky 13 cents. The company said in its release that more exploration is scheduled at the site.
