Posted by Andrew Bell on January 29, 2010

The tittering about "cougars" – older women reputed to stalk younger men – is getting a bit tiresome.

But, we got a laugh out of this Air New Zealand spot that just showed up on the viral video chart at Advertising Age. (Watch out, though, for a gratuitously offensive gay reference).

Note the soft sell: The video refers to the airline’s booking site just briefly, at the end.

The Kiwis have also raised eyebrows with a hilarious in-flight safety check ad featuring painted-on uniforms.

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Posted by Andrew Bell on January 28, 2010

The surprise departure of boy wonder retailer Dalton Philips at Loblaw has sent a minor chill down the backs of a few analysts who follow the stock.

"The departure of Mr. Philips leaves a serious void in the ranks at L [Loblaw] and is a loss, in our opinion," Scotia’s Patricia Baker writes. She calls the stock a sector perform, with a one year target of $35. 

Loblaw stock, controlled by the family of Galen Weston, trades at $35.30, so it sounds like Scotia fears it could be dead money for now.

Philips, just 41, is leaving as chief operating office and chief merchandising officer to run Wm Morrison Supermarkets, Britain’s 4th-biggest chain. He used to head Brown Thomas, the Weston family-owned Irish department. Before that, he was with Wal-Mart in Europe.

"The loss of such a key individual could lead to near-term disruptions in our opinion," says Robert Cavallo at Research Capital, noting that Philips departure comes on the heels of another change to the senior ranks, with Robert Vaux being replaced by Sarah Davis as chief financial officer.

"We did not view that change with any concern given that Ms. Davis has been a senior member of the finance team at Loblaw for some time and that Mr. Vaux was remaining as CFO at parent company, George Weston Ltd. (WN-TSX)," Cavallo says. "The departure of Mr. Philips is a little more troubling as no replacement was named immediately and given his dual role as COO and CMO."

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Posted by Frances Horodelski on January 27, 2010

People like to be organized. Putting things into categories can be part of that trait. If you can lump things together, things seem simpler and neater. We do this in our closets with sweaters and pants and sometimes, as investors, we do it with the companies we invest in.

*** Watch this edition of Stock $ense

For example, we tend to sort our stocks into financials, energy, materials, technology, etc. Further, we lump our banks together and our semiconductor stocks together. But just like the difference between the lovely black cashmere you keep for that special evening and the everyday cotton sweater that works for doing the grocery shopping, stocks within sectors can be very different beasts.

Let’s take a look at Texas Instruments and Intel – two global technology companies that are lumped into the semiconductor sector. Both companies recently reported results that beat analyst expectations and both are well recommended by the analysts that cover them. But many investors would say: “Hey, I only need one semiconductor stock so I’ll pick the biggest and best known – Intel - and leave it there.” But that might be a mistake.

Did you know that about 75 percent of Intel’s revenues and profit come from chips related to computing such as PCs, servers, etc., and it is highly leveraged to the replacement cycle for those products? Intel is a concentrated company from a product profile perspective.

On the other hand, Texas Instruments has four broad revenue categories. While it does have exposure to the more traditional semiconductor businesses, it is more diversified with almost 50 percent of its revenues coming from communication related products (wireless, broadband, mobile connectivity) and only about 20 percent from computing.

To understand how to value these two companies and to make projections about future growth, an investor needs to understand that demand is very different for products from both companies. It isn't that one is better than the other – just very different.

Kimberly-Clark and Procter & Gamble are two other companies that investors tend to lump together because one makes Huggies and the other Pampers. But that is really where their similarities end.

About 43 percent of Kimberly-Clark's revenues come from personal care (Huggies, Kleenex, etc.) while less than 20 percent at P&G is related to family and baby care. About 35 percent of P&G's revenues are beauty and grooming (Gillette) and another 17 percent from healthcare. Kimberly-Clark's healthcare division is less than 8 percent. P&G's profitability, on average, is greater than Kimberly-Clark, but P&G is more expensive.

A focus on diaper market share gains for one or the other misses the many unique differences between the two companies – and the opportunity to capitalize on the differences.

Putting things into neat categories may make sense in your closet – but these categories are only a starting point for investing. Time to do your homework.

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Posted by Andrew Bell on January 22, 2010

AGF Management Ltd. chairman and CEO Blake Goldring, who has watched investors yank more than $2.5 billion out of his funds over the past two years, has been bidding farewell to some high-profile employees too.  

The Globe’s Shirley Won says today that the abrupt departure of fund manager Christine Hughes "comes at an inopportune time during the key registered retirement savings plan (RRSP) selling season."

She quotes Dom Rando, vice-president of mutual fund research at TD Wealth Management, as warning that "we are unenthusiastic on this change and believe Ms. Hughes' departure to be a material and negative event, given the experience and skill-set she brought to the management of AGF Canadian Balanced Fund."

Scotia Capital isn’t thrilled either. Analyst Kevin Choquette cut the stock to sector perform from sector outperform this morning “due to increased concern about no improvement in net outflows, lagging assets-under-management growth, loss of lead manager on Canadian Balanced Fund, and the expectation that global equities will remain in net redemptions in the near term, especially given the recent strength in the C$.” He reduced his one-year target price to $18 from $20.

 AGF dropped 4 percent today to trade at $15.77. As of this morning, the stock had rallied 93 percent in a year. But was down a dispiriting 6 percent over five years – rivals CI Financial Corp. and IGM Financial Inc. have climbed more than 20 percent in the same time frame.

 AGF chief financial officer Greg Henderson is also quitting at the end of March, for a job outside fund management. His replacement is Fidelity Investments’ Bob Bogart, who is moving from Boston. Bogart worked at Fidelity for over 17 years and during that time as CFO of its Canadian ops from 1997 to 2002.

 Financial disclosure at AGF "improved considerably” during Mr. Henderson’s tenure, BMO Capital analyst John Reucassel said in a note on Tuesday. “We hope that financial disclosure remains at a high level."

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