Transcontinental Inc. (A) (TCL.A.TO)

His model price is $32 giving it an 81% upside. Pays a nice yield of 4.2%. $14 would be a pretty good Buy. It is probably at its current price because of its yield. He would consider this as a weak Hold.

This is arguably the last man standing in the printing business. Printing is in secular decline. The age of digital is upon us, and people are using less paper. This company prints magazines, newspapers and flyers. Flyers for grocery stores and pharmacy chains are publications that millennials prefer to read in print. The company is moving to the flexible packaging business and in the last 2 years have upped the revenues to 10%. Dividend yield of 4.15%.

(A Top Pick May 14/15. Up 11.85%.) The print business still has a long tail, and this is the best company that has remained in the business. Have done a lot of things to prepare for the eventual phase-out by diversifying, especially in flexible packaging. Trading very, very cheaply.

You want to own the best and lowest cost producer, so when the Toronto Star wants to close their big huge facility in Vaughn, this company is going to do that business. They are also big into flyers. Although there is a lot of digital media, flyers are still used. As discount grocers are getting more traction, flyers are very important. Also, diversifying into packaging, which is smart, and is about 10% of their revenue. Trading at about 5X cash flow, with 1X debt to cash flow. Generates a lot of cash flow, which they give back to shareholders in the form of dividend increases and buying back shares. Dividend yield of 4.05%.

(A Top Pick May 14/15. Up 8.99%.) Basically prints newspapers and magazines, a dying business in many people’s minds. A declining business, but this is one of the best players that remains in the business because they have scale of operations and have better pricing. Have put some of their cash into a higher growth business of flexible packaging. Made a couple of acquisitions and thinks they will do more of that. Pays a very good dividend of 3.5%. Not an expensive stock.

Wants stocks that will benefit from a cyclical recovery, which he is expecting, but without breaking the bank while you wait. You can still make a lot of money in a poor industry, and this is an example of that. 4^th largest printer in North America. They score absolutely Tops on valuation. Very strong ROE. Good price to free cash flow. Trades at about 5X EBITDA. Their strong balance sheet and cash flow generation has let them diversify into packaging. Dividend yield of 3.16%.

They are a declining business (print media). It has been trading at very low multiples. Management has done a really good job of controlling costs. They have taken their free cash flow and got into a bigger growth business – label printing, like CCL.B-T. The company is changing from something dying into a high growth business. He thinks they will continue to tuck in acquisitions.

Reported very good earnings yesterday. This has been a volatile stock. There are 2 camps that have formed in the stock. One is a Yellow Pages business that is very challenged going forward, and the other is more of a Davidson Henderson style, a business that has more growth in it. This is in the Print business, which has been declining, but has been a very, very high margin business. It will have the printing business that supports them going forward, but as they transition into a packaging business, about 10% of their business, that is what they will grow in. It is one to own, but wait for a bit of a pullback.

A printing company in what you would call a classic value stock. Valuation is very cheap, and the dividend is attractive. They generate a huge amount of cash flow, but no one really cares because it is a printing company in a digital world. However, they have done a pretty good job of adapting to the new world. Cash flow is continuing to come in and the dividend is pretty safe. Even though the stock has done quite well in the past several years, you may get into a value trap where you just get the dividend and no one really cares. As a value stock, it is solid. He would rather pay more for a growing company.

In the traditional printing space, which is shrinking. Advertising is soft and they have been in the cost-cutting mode, which has been offsetting that to some extent. They have reinvested into label printing, which is a growth area for them. Dividend yield of 4.77%.

Trading at low, low single digit multiples. This is because they are in publishing as well as printing, which has been a declining business because the Internet has started taking away a lot of that distribution. Have done a good job of consolidating the sector and cutting costs, and are getting more and more efficient. Doing some acquisitions. Still too small to impact the whole company, but they have more than enough firepower to do more acquisitions and continue to grow. Yield of 3.7% is sustainable.

Essentially in the printing space, and about 30% of their revenue comes in the media side. Print has been under pressure with the digital age. What they have done to save their stock price is to move towards the food packaging space. The bad news is that the acquisition is only 3% of revenues in the packaging space. The good news is that it is a 10 year contract. 3.75% dividend yield.

(A Top Pick Dec 21/12. Up 45.65%.) He is probably going to get out of this one very soon.

Yield about 5%. Some good cost cutting measures. Their balance sheet is not too leveraged. They can handle it. He is not in love with the sector because of the headwinds, but the distribution is sustainable. Thinks it will go a little higher.

Fundamentals are great and you see a nice bottom formation. It’s a reversal. Predictable growth type of stock. No surprises either way. 5% yield.