Taking stock of local winners and losers

Local stocks continued to shine through the first six months of 2013.

The Edmonton Portfolio Index — a basket of 30 area stocks created by the Journal — posted a year-to-date gain of 7.1 per cent as of Friday, the final trading day of the first half.

The 7.1 per cent uptick reflects the average unweighted gain of the EPI’s 30 component issues, excluding dividends. Although just 13 of the EPI’s 30 stocks rose on a year-todate basis, total returns were boosted by a handful of standout performers.

Toronto’s lead equity benchmark — which unlike the EPI is a properly weighted index that reflects trading volumes and market cap levels, as well as share prices — didn’t fare so well.

The resource-laden S&P/ TSX Composite Index suffered a decline of 2.4 per cent through Friday, excluding dividend payouts, as gold stocks got creamed.

The first-half picture continues a trend that began last year, when local stocks rose 17.4 per cent versus an uptick of just four per cent for Toronto’s main index, excluding dividends.

Meanwhile, major equity indexes south of the border continue to leave Canadian stocks in the dust. Through Friday, the S&P 500 Index was up 12.6 per cent thus far this year, its best first-half performance since 1998.

The Dow Jones Industrial Average has gained 13.7 per cent and the tech-laden Nasdaq Composite Index is up 12.7 per cent. None of these gains include dividends.

Among local stocks, AutoCanada Inc., the country’s only publicly traded auto dealership network, was among the biggest winners.

Its shares posted an eye-popping gain of 89 per cent during the first half. AutoCanada, which continues to grow rapidly by acquisition, has been riding an impressive rebound in auto industry sales and profits for the past two years.

Although oil price discounts, pipeline bottlenecks and low natural gas prices continue to hurt most Alberta energy producers, local firms that supply equipment and services to the oilpatch continue to do fairly well.

That’s reflected in their share prices.

North American Energy Partners, a big oilsands construction services firm, saw its shares gain 34 per cent through the first half, as investors warmed up to its ongoing restructuring and improving balance sheet.

TerraVest Capital and McCoy Corp. — both of which manufacture oil and gas drilling equipment — saw their shares climb 43.1 per cent and 18.5 per cent, respectively.

Two small but fast-growing local players in the energy services sector — Titan Logix and Enterprise Group — also had a banner first half. Shares of Titan Logix jumped 45.1 per cent while Enterprise shares were up nearly 187 per cent.

Both stocks trade for less than $1 apiece, however, so fairly modest swings in their share prices can produce outsized gains — or losses — when measured in percentage terms.

Other notable winners during the first half included shares of K-Bro Linen (up nearly 18 per cent); engineering consulting giant Stantec Inc. (up 11.6 per cent); and real estate developer Melcor (up 19.3 per cent).

Melcor’s new real estate investment trust or REIT, which was spun off by the parent company in April, has held its value in recent weeks. Despite a big selloff in the sector over the past few weeks, Melcor REIT’s units closed Friday at $10.10 apiece, a dime above their initial public offering price.

Imperial Equities, a smaller player in the local commercial and industrial real estate market, saw its thinly traded shares jump more than 46 per cent through Friday.

On the down side, the list of big decliners during the first half includes Commercial Solutions, a distributor of industrial products (down 48.9 per cent); Cash Store Financial Services (off 27 per cent); Athabasca Minerals (down nearly 50 per cent); Wavefront Technology (off 35.8 per cent); and Hyduke Energy (down 29.1 per cent).

Liquor Stores N.A., which recently announced the appointment of a new CEO, saw its shares slip by 4.1 per cent through Friday, while Canadian Western Bank, the city’s largest publicly traded company in terms of market capitalization, slid just 2.3 per cent.

Capital Power, which was spun off as a public company by city-owned Epcor Utilities in 2009, and Red Deer-based Parkland Fuel, an independent fuel wholesaler, saw their shares drop by about 9.4 per cent apiece during the first half.