4 Canadian Stocks Gurus Bought in Q4

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Mar 06, 2015
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International equities can be a good way to diversity a portfolio by giving investors access to other economies and opportunities. Data from Fidelity Investments’ clients show that millions have no exposure to international or emerging markets, which can mean many missed opportunities.

One way to search for investing ideas is by looking at what gurus are buying or selling. GuruFocus has a page dedicated to international picks, where investors can narrow down stocks that gurus are trading by individual countries.

During the fourth quarter, gurus bought or added to existing positions in the following four Canadian stocks:

Birchcliff Energy (TSX:BIR, Financial)

The Wintergreen Fund increased its stake in Birchcliff Energy by 5.5% during the fourth quarter, for a total of 6,229,931 shares.

Birchcliff explores for and develops petroleum and natural gas reserves in Western Canada. Its operations are focused on the Peace River Arch of Alberta.

The stock price declined 32% over the past year and currently trades at C$6.97, with a P/E ratio of 7.9 and P/S ratio of 2.3.

The EBIT per share over the trailing 12 months is C$1.17, up from $0.57 in FY 2013.

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Looking at the balance sheet, Birchcliff’s current ratio is 0.4, which indicates the company cannot cover its short-term obligations.

Canadian Natural Resources (TSX:CNQ, Financial)

The Wintergreen Fund also added to its stake in Canadian Natural Resources by 3.28% for a total of 2,439,392 shares.

The stock has declined 7% over the past year and currently trades at C$38.64. The current P/E ratio is 13.5 and the P/S ratio is 2.04.

The company is an independent energy firm engaged in the acquisition, exploration, and production of crude oil and natural gas. Ă‚

Over the past five years, the EBIT per share growth rate has declined 7.4%. In FY 2013, EBIT per share was C$3.06. The following graph shows the earnings trend over time.

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The company’s operating margin has been in steady decline and recorded at 18.58% in 2013. The margin has declined 4.34% over the past five years.

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Uranium Participation Corp (TSX:U, Financial)

During the fourth quarter, the IVA International Fund added 1,816,104 shares to its stake in Uranium Participation, for a total of 2,037,035 shares. The average price of shares bought during the quarter was $5.20.

The company invests in uranium oxide concentrates or uranium hexafluoride, with the objective of achieving appreciation in the value of its holdings.

The stock currently trades at $5.62 with a P/E ratio of 6.4 and P/S ratio of 6.04.

Uranium Participation has been operating at a loss since 2008, with its only profitable year in 2011. In FY 2014, EBIT per share was $-0.64.

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Domtar Corp (TSX:UFS, Financial)

The Wintergreen Fund initiated a new position in Domtar during the fourth quarter with 38,767 shares at an average price of $44.82.

Domtar manufactures and markets fiber-based products such as communication papers, specialty and packaging, and absorbent hygiene products.

The stock price has declined 12% over the past year and currently trades at $54.61. The Peter Lynch chart indicates the stock is undervalued.

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Over the past five years, the company’s EBIT per share has declined more than 11%, and recorded at $6.47 in FY 2014.

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Domtar’s current dividend yield is 2.87%, while the payout ratio is 21%.

Visit the International Picks page to see what international stocks gurus are buying or selling. Sign up for the Canadian region membership and receive $100 off the list price for a limited time.Ă‚