Fortis Inc. (FTS.TO)

Sold it because PE got too high relative to yield. Moved to REITs. Would not look at it now.

Track record is amazing. Longest track record of dividend increases in Canada. His problem is that their last acquisition did not have anything to the bottom line. He doesn’t trust management that this latest acquisition will add anything either. Doesn’t see synergies in acquiring a utility in Tucson, Arizona versus the utilities that they have now in Canada. Sold his holdings just before the last acquisition.

Big potential acquisition of utility in AZ. Probably a cap on this stock. It might get weak. He heard it wasn’t going that well.

Convertible debentures. (Market Call Minute) Thinks there are a lot of bells and whistles on the shares. Nice yield but you are levered up 3 times.

Financing their Arizona acquisition by convertible debentures. He is still looking at this. His concern is that it is a big bite. He is not totally familiar with the Arizona area. Hasn’t decided how he feels about this yet.

(Market Call Minute) Nothing wrong except it is defensive and sensitive to interest rates.

Just sold his holdings because earnings are going nowhere, PE is very high and interest rates are going higher. Doesn’t see that they can raise the dividends much higher since earnings are not growing.

Has owned this for years and still likes it. A slow dividend grower but a solid company. Share price has been held back because they bought US assets and the return on them will take a couple of years longer because regulators put a cap on this.

Thinks this goes higher. Has a target of $35. They’ve gone through a number of quarters for years with earnings that have just continued to go down. Thinks they have bottomed here. Sees growth coming from utility expansion of almost $5 billion over the next 3 years. Sees the expiration of rate freezes at their subsidiary CH Energy occurring in the mid-2015. Waneta Dam revenues should start in 2015. Their unregulated businesses he thinks, are going to improve from here or they can be sold.

High-quality business. Taper talks from the fed really hammered all interest sensitive stocks. This found some support and he is looking for it to reach $34-$35 and to get the dividend. Nice boring play.

Top Short. He would not go near utilities and these guys are the biggest outliers in terms of poor growth and bad economics. They have a ton of leverage in these utility models. When the yield curve goes up and they want to refinance their leverage, it is going to be a lot higher. He would be surprised if they ever grow. Trading at 18X earnings right now, which is ridiculous.

Virtually every dividend paying stock, including utilities and telcos, got absolutely hammered when tapering was supposed to come in. This is a good company. Good yield.

Likes this as a utility play. Natural gas utility in BC and have a number of other assets, including real estate and Caribbean utilities as well. They’ll get paid because they generate the power electricity and get paid by contract. They’ll have to fund the acquisition of the New York company but the markets are healthy for equity issues these days. 4% dividend yield. Could flirt with $35 in the next year.

Enbridge (ENB-T) or Fortis (FTS-T)? There is no growth in this from an earnings basis. The last 2 acquisitions they did were not accretive at all. Feels Enbridge has more earnings growth. If he had to pick one of the 2, it would be Enbridge.

Very safe, income producing stock. A great time to buy it. Not high growth and fairly expensive compared to historical trend but that is because interest rates are so low. Longest stream of uninterrupted dividend increases.