Break Out Stocks 2006 Q3 Review

Once again we are conducting our quarterly review and re-evaluating the stocks on our Watched List to see if we want to keep following them.

We sometimes err in our recommendations and sometimes circumstances change and a stock that had been behaving well starts to  head south.

We're also looking for ways to improve our selection and culling criteria and you'll find a review of our previous paring jobs elsewhere. For this effort we are following much the same plan, dropping stocks that meet both of the following three criteria:

And we are dropping any stocks we've had for over a year that have failed to grow by 25% or have had for two years and have failed to grow by 50%. We are making exceptions for stocks that are in a current up trend or are growing earnings.

This quarter we are taking a larger slice out of our Watched List by also dropping stocks that have faltered since the beginning of 2005. An example would be Home Capital Group which has been one of our best performers, up 923.33% since we featured it in November 2000, but which is lower today than it was at the beginning of 2005. Same with Peyto Energy Trust, another superb performer which peaked in mid-2005 at around $35 but has since dropped steadily back to $21. We're also dropping RONA Inc. for this reason. And we're dropping four others - easyhome, Calfrac Well Services, Centurion Energy and Cryptologic for this reason. These may be added to our list again in the future if they once again catch our eye by hitting new 52 week highs. But for now we are dropping them.

The table below gives the complete picture. Also dropped per our criteria are Reitman's, Sherritt International, Xceed Mortgage Corporation,  Savannah Energy Services, and Royal Gold. We are opting to keep Pareto Inc. because it is our pick in the Globe & Mail's stock picking contest so we will wait until the end of the year and see where it's at then. And dropped because they have been taken over or are about to be taken over are Intrawest, Falconbridge and Western Lakota Energy Services.

It should be noted, of course, that because we are dropping them from our Watched List doesn't necessarily mean they are poor stocks.  We've dropped stocks before only to see them catch fire and soar subsequently. It just means that I no longer consider the upside odds very good. I may add one or more back in at a later date.

Note: T = turnaround from loss to profit, L means the company had a loss in the most recent quarter, * means quarterly earnings per share not available.

Name

Symbol

Date Featured

Price Then

Change Q3

Change YTD

Change Since Profiled

Recent Trend QEPS Change Status

Home Capital Group

HCG

Nov. 20/00

$3.00

-5.83%

-11.65%

923.33%

g +11.63% Drop

Melcor Developments

MRD

Mar. 2/01

$2.03

12.94%

62.03%

845.81%

h +47.06% Keep

Alimentation Couche-Tard

ATD.SV.B

Dec. 4/00

$2.88

-0.54%

1.97%

729.91%

h -19.23% Keep

Peyto Energy Trust

PEY.UN

Feb. 22/02

$2.58

-15.84%

-21.50%

673.98%

i +100.00% Drop

Reitmans (Canada)

RET.A

July 6/01

$2.53

-4.20%

11.85%

656.94%

i -51.22% Drop

Zargon Oil & Gas

ZAR.UN

Jan. 29/01

$4.70

5.30%

1.42%

585.11%

g +92.68% Keep

TransForce Income Fund

TIF.UN

Jan. 18/02

$3.02

-1.95%

-2.58%

450.33%

h +7.89% Keep

SNC-Lavalin Group

SNC

Mar. 23/01

$5.42

-2.11%

13.09%

430.63%

i +8.70% Keep

Stantec Inc.

STN

Apr. 20/01

$4.13

-3.08%

2.89%

395.76%

h +5.88% Keep

Canada Bread Co.

CBY

May 18/01

$13.00

-4.96%

0.59%

356.54%

i +8.43% Keep

Contrans Income Fund

CSS.UN

Oct. 12/01

$3.63

11.81%

1.00%

291.18%

h +2.22% Keep

CCS Income Fund

CCR.UN

May 18/03

$10.15

-1.49%

-1.49%

259.29%

i +160.00% Keep

Goldcorp Inc.

G

May 25/01

$7.83

-21.66%

1.78%

236.65%

i +75.00% Keep

Falconbridge Ltd.

FAL.LV

Mar. 14/04

$19.63

5.99%

80.64%

217.47%

h +213.11% Drop - TO

Trican Well Service

TCW

Apr. 18/04

$6.08

-15.56%

-32.75%

209.70%

i +114.29% Keep

Richelieu Hardware

RCH

Dec. 4/00

$7.00

-2.51%

-11.35%

200.14%

g +22.58% Keep

Niko Resources

NKO

Nov. 17/02

$22.20

5.49%

20.43%

199.55%

h L Keep

ZCL Composites

ZCL

June 20/04

$2.05

16.60%

53.83%

184.39%

g +300.00% Keep

CML Healthcare Income Fund

CLC.UN

Apr. 12/02

$5.85

10.45%

11.60%

174.70%

h 21.43% Keep

BMTC Group

GBT.SV.A

Aug. 20/02

$6.98

-0.55%

13.13%

159.50%

g -19.05% Keep

Fortis Inc.

FTS

Mar. 16/01

$9.50

9.65%

0.70%

157.26%

g +2.94% Keep

AlarmForce

AF

Sept. 21/03

$1.92

5.68%

17.72%

142.19%

g +100.00% Keep

Finning International

FTT

May 11/01

$16.40

0.56%

0.73%

128.11%

i +23.53% Keep

Cameco Corp.

CCO

Nov. 19/04

$18.44

-8.41%

10.39%

120.94%

i +344.44% Keep

TSX Group

X

Jan. 18/04

$22.50

9.42%

4.68%

117.87%

g +17.14% Keep

La Senza

LSZ

April 17/05

$14.65

33.91%

67.74%

117.54%

h +218.75% Keep

Pason Systems

PSI

May 16/04

$7.50

-3.49%

9.20%

110.40%

i +133.33% Keep

Aur Resources

AUR

Oct. 16/05

$8.57

1.12%

52.80%

110.04%

g +155.26% Keep

Steepleback Industrial Group

SID

Jan. 18/04

$2.95

-16.67%

-15.49%

103.39%

h +2800.00% Keep

Garda World Security

GW

Aug. 21/05

$12.15

2.64%

49.14%

85.60%

g +41.67% Keep

RONA Inc.

RON

Nov. 16/03

$12.78

5.59%

-1.31%

65.71%

h +13.11% Drop

Western Lakota Energy Services

WLE

July 17/05

$9.45

3.95%

-11.98%

61.69%

n/a n/a Drop - TO

McCoy Brothers

MCB

May 15/05

$4.65

-13.58%

11.11%

50.54%

g -22.22% Keep

WFI Inc.

WFI

May 19/06

$16.80

32.11%

49.40%

49.40%

h +114.29% Keep

Stella-Jones Inc.

SJ

Feb. 19/06

$15.75

13.39%

33.33%

33.33%

g +35.90% Keep

Gildan Activewear

GIL

Sept. 18/05

$42.01

2.94%

8.68%

29.35%

g +24.56% Keep

easyhome

EH

Dec. 17/04

$12.93

-1.54%

1.27%

23.71%

i T Drop

Teck Cominco

TCK.B

Dec. 18/05

$57.75

4.51%

12.81%

21.21%

i +165.77% Keep

Research In Motion

RIM

Sept. 19/04

$94.82

47.29%

49.30%

20.85%

h +32.14% Keep

Big Rock Brewery Income Trust

BR.UN

Oct. 15/04

$16.05

9.08%

0.31%

20.56%

g +64.29% Keep

Foremost Income Fund

FMO.UN

June 16/06

$17.15

0.26%

13.12%

13.12%

i +81.82% Keep

Vicwest Income Fund

VIC.UN

June 16/06

$15.98

12.85%

12.64%

12.64%

g +56.31% Keep

Sherritt International

S

Nov. 19/04

$8.66

-12.71%

-3.47%

12.59%

i +24.14% Drop

Le Chateau

CTU.A

June 19/05

$39.06

-2.77%

-10.90%

9.45%

h -43.42% Keep

Xceed Mortgage Corporation

XMC

Jan. 16/05

$5.05

-10.71%

-12.70%

8.91%

i -20.69% Drop

Com Dev International

CDV

Sept. 18/06

$5.73

8.03%

8.03%

8.03%

h +233.33% Keep

Carfinco Income Fund

CFN.UN

Aug. 21/06

$3.88

6.96%

6.96%

6.96%

g +33.33% Keep

Intrawest Corporation

ITW

Mar. 19/06

$37.58

9.27%

2.58%

2.58%

g L Drop - TO

Silver Wheaton

SLW

July 17/06

$10.40

0.87%

0.87%

0.87%

i +175.00% Keep

Ritchie Brothers

RBA

Mar. 19/06

$59.30

0.64%

0.86%

0.86%

h +14.75% Keep

Pareto Corp.

PTO

Aug. 21/05

$1.13

-8.33%

-19.71%

-2.65%

g 0.00% Keep

Sino-Forest Corporation

TRE

Dec. 18/05

$4.40

-25.74%

-13.56%

-2.95%

h 0.00% Keep

Potash Corporation

POT

June 19/05

$119.85

21.36%

24.62%

-3.20%

h +13.01% Keep

Commercial Solutions

CSA

May 21/06

$7.09

-17.58%

-4.09%

-4.09%

i 0.00% Keep

Savannah Energy Services

SVY

Feb. 20/05

$19.35

-19.98%

-36.01%

-5.43%

i -99.82% Drop

GMP Capital Trust

GMP.UN

June 16/06

$22.50

-9.69%

-5.56%

-5.56%

i +53.33% Keep

Parkland Income Fund

PKI.UN

Sept. 18/06

$31.94

-5.98%

-5.98%

-5.98%

g +212.50% Keep

Royal Gold

RGL

Sept. 18/05

$33.50

-0.42%

-23.63%

-7.76%

i -11.76% Drop

Ensign Energy Services

ESI

Nov. 20/05

$20.12

-19.14%

-20.93%

-7.80%

i +275.00% Keep

Pacific & Western Credit

PWC

Aug. 21/06

$12.95

-9.27%

-9.27%

-9.27%

i +608.33% Keep

FirstService Corporation

FSV

Feb. 19/06

$29.50

-11.19%

-9.83%

-9.83%

i +11.43% Keep

Wajax Income Fund

WJX.UN

May 19/06

$41.79

-12.68%

-15.77%

-15.77%

i +484.21% Keep

March Networks

MN

Nov. 20/05

$22.50

-20.39%

-41.79%

-16.36%

i +47.37% Keep

Aber Diamonds

ABZ

Jan. 15/06

$46.77

3.92%

-23.99%

-23.99%

i +78.79% Keep

MacDonald Dettwiler

MDA

April 16/06

$50.40

-17.94%

-25.20%

-25.20%

g +17.07% Keep

Calfrac Well Services

CFW

Mar. 20/05

$36.75

-8.96%

-45.78%

-40.54%

i T Drop

Cryptologic

CRY

May 15/05

$42.05

-8.64%

7.98%

-41.43%

i +78.79% Drop

Centurion Energy

CUX

Jan. 16/05

$14.45

-2.70%

-39.33%

-52.60%

g +133.33% Drop

-34.23%

255.61%

9546.23%

     

-0.50%

3.76%

140.39%

     

Dropped in Q3 (with YTD and Total Gain in brackets) are Home Capital Group  (-11.65%, +923.33%), Peyto Energy Trust (-21.50%, +673.98%), Reitman’s (+11.85%, +656.94%), Falconbridge (+80.64%, 217.47%), RONA Inc. (-1.31%, +65.71%), Western Lakota Energy Services (-11.98%, +61.69%), easyhome (+1.27%, +23.71%), Sherritt International (-3.47%, +12.59%), Xceed Mortgage Corporation (-12.70%, +8.91%), Intrawest (+2.58%, +2.58%), Savannah Energy Services (-36.01%, -5.43%), Royal Gold (-23.63%, -7.76%), Calfrac Well Service (-45.78%, -40.54%), Cryptologic (+7.98%, -41.43%), and Centurion Energy (-39.33%, -52.60%)

The information in this table was derived using the Portfolio Tracking feature at globeinvestor.com