DH Corporation (DH.TO)

Only 40% of revenue comes from cheques. A lot of other irons in the fire. A really good yield. He would buy it here. He has always liked it. 6% yield. Long term hold.

Was a cheque producing company. Still is but has shown an ability to adjust to get into other areas. Have added other sections such as lending technology, loan and credit card services, securitized lending, etc. About 40% of their revenue is coming from other areas. 6.1% dividend is relatively safe.

Attractive yield. Company diversified out of cheques and have been moving into mortgage servicing business. Couldn’t see a lot of exciting growth so she never went into this. Not really a great growth stock and not particularly exciting on the income side. Expensive at 17X earnings.

Have been turning themselves around for a number of years. Made a lot of acquisitions in the US and are more of a financial IT company now. A little bit of an unknown story creating an opportunity. Balance sheet has been improving so they can make some acquisitions. Only trading at 11X next year’s earnings. 5.9% dividend is very safe and increasing.

(A Top Pick Jan 10/12. Up 28.43%.)

Has hit the old highs from 2011 which are going to have an influence and is probably why you are seeing a little bit of resistance at this point. Might be a little bit overbought in the near-term. If you don’t own, wait for a breakout from the old high before buying.

Originally it was simply a cheque writing company but has gone into the transactions business, outsourcing the backend of banks and doing data processing. Has done extremely well. Cheque writing is still about 40% of their business. Try to get it below $21. Expect they will increase their distribution at some point.

Their business is cheques but they’ve also done some add-on acquisitions that allow them to be in the mortgage business. Moving into the US. Really great organic growth opportunities in the US. Trades at a reasonable multiple and pays a great dividend. Great balance sheet. Will continue to do well.

Cheques are only about 25% of business. He can’t make heads or tails of their other businesses. It is doing all the right things.

(A Top Pick July 17/12. Up 23.17%.) 40% of their earnings are still in cheques but they are not really resting on their laurels. Doing lots of acquisitions. Have moved into the US with good success. Doesn’t think there is a lot of growth to be had, so considers it as a Hold.

70% of their business used to be bank cheques but it is now down to 40%. Now they are essentially the back office of a lot of financial companies in the US and Canada. This is an area with high margins and they are excellent at what they do. Yield of around 7%. Expect there is a possible chance of a dividend increase.

More than just cheques. Involved in mortgage business. They are a tech company that sits on the banking businesses. Pays a nice business. Margins came down in the last couple of quarters. Great story and will grow organically over the next little while. Nice balance sheet and an opportunity to grow through acquisitions too.

They are into other business besides cheques. They have 5 operating divisions. They have done a great job of diversifying and so he thinks they have a good future ahead of them. It is selling at a bit of a premium and looks expensive. It is well run and they fixed a lot of the sensitivity they had to one area. He wants to see it cheaper before buying it.

Short (Top Pick Nov 24/11, Down 16.05%) Pairs Trade with VPY-X, which was the newer faster growing technology.

Trades at 13-14 times earnings. 6% dividend yield. The cheque writing business is what they are known for but it actually moved into the mortgage business. It is really a technology servicing company for banks. Have lots of free cash flow and continue to pay down debt. Their mortgage business in the US is very important because they can service a lot of smaller banks, which is a good growth area for them.