(Every week, Business Edge columnist Gyle Konotopetz
profiles the top three stock picks of one of Canada’s most
accomplished investment pros.)

FEATURED PRO: Jason Donville is president and director of research for Calgary-based Lightyear Capital (www.lightyear.com).

Donville’s Perspective: “I’m seeing a lot of value in the consumer sectors right now. A lot of retailers look very attractive. What we are emphasizing going forward are some of the consumer names rather than industrial names. The financial-services sector also is looking very
interesting.”



FIRST STAR
* CPI Plastics (CPI-TSX)
* Recent Price: $8.25.
* 12-Month Range: $3-$8.25.
* Donville’s Call: Buy (top rating).
* Lightyear’s 12-Month Target: $10.40.
* Snapshot: CPI supplies plastics to industries and consumers, including the Eon decking system, its revolutionary wood replacement product. Products are also used in the appliance, automotive and office furniture industries.
* CEO: Peter Clark.
* Head Office: Mississauga, Ont. (600 employees).
* Vital Stats: Price/Earnings Ratio, 35.7; Revenue
(last 12 mos), $102.5 million; Profit (last 12 mos), $2.4 million; Market Cap, $85.2 million; Shares Outstanding,
11.4 million.
* Donville’s Comment: “One of their key products is the material you use in decking and the products they’re selling have a lifespan that is significantly longer
than wood. The company is showing excellent revenue growth, and the products are selling extremely well. This is an extremely well managed company. In our numbers, it has a 12-month forward P/E (price earnings ratio) of about 10 and a 21.5 per cent return on equity.”
* Donville’s Risk Rating: Medium.
* Web watch: www.cpiplastics.com



SECOND STAR
* Buhler Industries (BUI-TSX)
* Recent Price: $5.49.
* 12-Month Range: $3.35-$5.49.
* Donville’s Call: Buy.
* Lightyear’s 12-Month Target: $6.40.
* Snapshot: Even a depressed farm economy hasn’t silenced Buhler’s tractors. The farm-equipment manufacturer has almost doubled earnings in its latest quarter. Besides tractors, its product line includes augers, loaders, mowers and snow blowers.
* CEO: John Buhler.
* Head Office: Winnipeg (700 employees).
* Donville’s Comment: “This company has a
remarkably consistent track record of creating profits in a very difficult industry. Management is first-rate. The company is Canada’s largest manufacturer of farm tractors (through its Versatile factory).”
* Donville’s Risk Rating: Medium.
* Web watch: www.buhler.com

THIRD STAR
* North West Company Fund (NWF.UN-TSX)
* Recent Price: $19.70.
* 12-Month Range: $14.68-$20.44.
* Donville’s Call: Buy.
* Lightyear’s 12-Month Target: $24.
* Snapshot: North West is no flash in the pan. It has been in business for more than 300 years serving the North. It has a dominating market share in providing food and other everyday products and services to remote areas of northern Canada and Alaska.
* CEO: Edward Kennedy.
* Head Office: Winnipeg.
* Donville’s Comment: “They’re the largest retailer in Northern Canada. Basically, their stores are in any small community in the Northwest Territories and the Yukon. They have a marvelously consistent track record and a near monopoly market position in most of the markets they operate in. They have between 40 and 60 per cent market share for the sale of dry goods and grocery in Northern Canada and Alaska. They have a return on equity of about 15 per cent.”
“They have a marvelously consistent track record and a near monopoly market position in most of the markets they operate in. They have between 40 and 60 per cent market share for the sale of dry goods and grocery in Northern Canada and Alaska. They have a return on equity of about 15 per cent.”
* Donville’s Risk Rating: Low.
* Web watch: www.northwest.ca
* Donville’s Record (with nine picks since November): +20% (Best pick-CCS Income Trust +153%; Worst pick-Liquidation World -37%).
* Disclosure: Lightyear Capital may hold positions in the
featured stocks. Donville says he doesn’t personally own any of the featured stocks. Donville’s Risk Rating: Low.
* Web watch: www.northwest.ca