TC Energy (TRP.TO)

Owned for some time. There has been some punchiness based on activism south of the boarder, Does not think that is well founded and was trimming his position when it was high. His is now holding. Fundamentals of the company are quite good, however.

(Top Pick Nov 21/13, Up 26.49%) It is rumoured that there are activist investors that have taken a position in the company. It could be broken into the power and pipeline parts of the company.

Stays away from the larger pipelines. They have keystone XL which is going on 6 years trying to get approval. They may reverse a pipeline to sell oil on the East coast. She does not think it will be broken up, nor taken over. There are certain assets the government may see as crown jewels and so block a takeover. She would prefer a KEY-T, which could get taken out.

You have a proliferation of pipelines and they will do well.

This is a real core holding, not only for its pipelines, but also its power generation. There was some speculation last week that activists were looking at this as an under performer and they could break it into pieces. He thinks this is a company that the Canadian government would protect and would not let it get taken over.

Doesn’t think they have any publicly traded subsidiaries. The stock has had a beautiful run. Keystone? – who cares. People are paying for certainty of cash flows. Have great assets. Would not buy at this level, but he holds it. He has to provide income for his clients and does not want to own bonds so he has these.

Amongst the best performers in the bull market we have had in the last 6 years. It looks like Keystone won’t get approved this year. However it is doing very nicely. Decent yield. Might well be worth looking at.

(Market Call Minute) 20+ multiple when it used to be 12 and for the same growth rate.

Can’t see a stock split at $60, although it could happen. Have already increased their dividend this year. Expects the dividend increases over the next couple of years will be above the 4% average of the last 5 years. This is primarily because earnings and cash flow are going up at a better rate than in the last couple of years.

The reason behind the recent run is probably because of Kindor Morgan (KMI-N) doing a lot of consolidation and this company was rumoured as a possible takeover. He thinks this is unlikely. He has owned this for a long time for the income potential. If you own, consider taking some profits, but it is still a good holding.

A lot of people have been waiting for the KXL pipeline decision to come down. Thinks there will be a lot of rumours about Kinder Morgan (KMP-N) taking the company over. You should never buy a company on the basis that it might possibly be a takeover candidate, but on the basis of it being undervalued and a good business. This company has gone quite a ways up, and is now selling at around 25X earnings, 2.5X BV. Has a yield over 3%, but is not at a level where he would be comfortable buying it today. Somewhere around $50 would be a more comfortable point.

This is her least favourite pipeline. Doesn't feel there is any more money to be made in the stock over the next year.

(Market Call Minute.) There is some value that could be created with this company and Canadian Utilities to spin off and try to compete with Pentium (?) pipelines of the world.

He doesn’t get the pipeline stocks and their valuations right now. They always traded at 10 to 12 times earnings multiples, and now they are trading at around 20 times. Doesn’t feel the growth is that much faster. Multiples are way too high.

(A Top Pick July 29/13. Up 21.4%.) Had hoped we would get the Keystone, which has now been put back earliest to Q1 of 2015. Wouldn’t be buying this today.