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

FEATURED PRO: Jean-Francois Tardif is a portfolio manager with Sprott Asset Management, an independent broker specializing in small- and mid-cap stocks with high growth potential. Sprott also manages a hedge fund, the Bull Bear RSP (www.sprott.ca).

Fund Form: The Sprott Canadian Equity Fund has a one-year return of 8.5 per cent compared to the group average of 8.4 per cent, the Sprott Precious Metals Fund has a one-year return of 46.9 per cent (group average 31.1 per cent) and the Bull Bear RSP (long/short) is down 11 per cent since its inception in November 2002.

Management Expense Ratio (MER): Canadian Equity & Precious Metals, 2.5 per cent; Bull Bear RSP 2.0 per cent.

Tardif’s Perspective: “We’re even more bearish today because of the substantial gains in the market in the past year. It’s almost like bubble investors of ’99 again, with investors quickly buying anything that looks good, any story, any press release. Technology companies with no profit and no revenue growth have been going up like crazy. To us, it’s a sign that the market is probably very close to topping and it’s only a matter of time before the market resumes its downtrend.”



FIRST STAR
* TASER International (TASR-Nasdaq)
* Recent Price: $31.70 US.
* 52-Week Range: $3.30-$32.43 US.
* Snapshot: TASER develops, assembles and markets conducted energy weapons used in law enforcement and corrections institutes. U.S. Congress recently allocated $1 million to the Department of Defence for the purchase of TASER weapons.
* CEO: Patrick Smith.
* Head Office: Scottsdale, Ariz. (73 employees).
* Vital Stats: Current Price/Earnings Ratio, 151.8; Revenue (last 12 mos), $12.3 million US; Earnings (last 12 mos), $600,000 US; Market Cap, $89.87 million US; Shares Outstanding, 2.84 million.
* Tardif’s View: “This company has a patent on their technology so they own 100 per cent of the technology and they’ve been ramping up sales extremely quickly. We expect sales to double next year and double the year after that. The Price/Earnings Ratio is pretty high (151.8), so they do have to deliver on our high expectations. We strongly believe that they can reach those goals and perhaps do even better.”
* Tardif’s Risk Rating: High.
* Web watch: www.taser.com



SECOND STAR
* Newalta Income Trust (NAL.UN-TSX)
* Recent Price: $12.58.
* 52-Week Range: $8.60-$13.17.
* Snapshot: Newalta doesn’t mind leftovers. The company maximizes the inherent value in oil, gas and industrial wastes through recovery of salable products and recycling, rather than disposal.
* CEO: Alan Cadotte.
* Head Office: Calgary (373 employees).
* Vital Stats: Current Price/Earnings Ratio, 23.4; Revenue (last 12 mos), $137.6 million; 5-Yr Revenue Growth, 17.6%; Earnings (last 12 mos), $15.9
million; 5-Yr Revenue Growth, 44%; Market Cap, $286.55 million; Shares Outstanding, 22.78 million.
* Tardif’s View: “We like this one because it gives us a very nice yield. They just raised their distribution by 17 per cent to $1.26 per unit per year. They’re growing earnings and cash flow. Their business of treating waste oil is a pretty steady business and they’re also looking at acquisitions.”
* Tardif’s Risk Rating: Low.
* Web watch: www.newalta.com



THIRD STAR
* Central Gold Trust Fund (GTU.UN-TSX)
* Recent Price: $23.
* 52-Week Range: $19.85-$23.54.
* Snapshot: Central Gold is gold. It’s a self-governed, limited purpose trust that invests substantially all of its assets in unencumbered gold bullion – 400-troy-ounce international bars.
* President: J.C. Stefan Spicer.
* Head Office: Ancaster, Ont.
* Vital Stats: Market Cap, $52.9 million; Shares Outstanding, 2.3 million.
* Tardif’s View: “We feel strongly that people should have a portion of their personal wealth in gold bullion
and this is a practical way to own it. We think gold stocks long term will do extremely well, but we think
they’ve had a very good run and there’s also less risk in holding gold bullion. To us, gold bullion is like
cash.”
* Tardif’s Risk Rating: Low.
* Web watch: www.gold-trust.com
Tardif’s Edge Record: +38.4%. Best Pick: Eldorado Gold +38.7%. Worst Pick: Central Fund (CEF.A-TSX) -9%.
* Disclosure: Tardif says he owns the funds in which the featured stocks are held. Sprott Asset Management president John Embry is co-chairman of the Central Gold Trust and Sprott CEO Eric Sprott is a trustee of Central Gold Trust.