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Ahhh! The great feeling of a good rally!

But wait there are some clouds.

The Futures Markets suggest our future has green in it! Asia and Europe agree but gold seemingly will continue in a funk and oil is sticking close to even. Well let’s take it and be happy it makes for a good day to look over all the great stuff on sale.

Apparently all North American housing is continuing to get dressed up to lead the parade higher. Canadian housing seems poised for a soft landing and US housing reports continue showing both sales and prices on the rise. There remain pockets of trouble and softness but overall I think this train is well on the way.

This housing talk makes me think of Ainsworth Lumber Co. and Norbord Inc. both trade on Toronto’s TSX.

Ainsworth Lumber Co. describes itself as:

“a leading manufacturer and marketer of oriented strand board (“OSB”) with a focus on value-added specialty products for markets in North America and Asia. Ainsworth’s four OSB manufacturing facilities, located in Alberta, British Columbia and Ontario, have a combined annual capacity of 2.5 billion square feet (3/8-inch basis) OSB.”

Norbord Inc. self description runs:

“an international producer of wood-based panels with assets of $1 billion, employing approximately 1,900 people at 13 plant locations in the United States, Europe and Canada. Norbord is one of the world’s largest producers of oriented strand board (OSB). In addition to OSB, Norbord manufactures particleboard, medium density fibreboard (MDF) and related value-added products.”

OSB is the sheet material used to cover house frames to create exterior walls. It is also used to sheet roofs. Lots and lots get used when housing is growing or following major storms. OSB replaced far more expensive plywood and currently is the standard sheeting material used extensively throughout the construction industry.

MDF is used in dry or indoor situations as a relatively low cost sheet material (compared to plywood) used for panels, countertop bases, furniture and cabinet boxes and many other construction and building uses.

Ainsworth is a Canadian focused play with the larger Norbord in Canada, Europe and most importantly in the growing and immense US market with several plants in the north eastern states. Just where housing looks set for solid growth.

Best yet Norbord pays a very nice dividend of 7.95% as I key this in and the smaller Ainsworth pays nothing. So my vote goes to NBD.

If you want more upside possibility in stock price you may consider ANS the better choice. In this market I like getting paid while I wait and still expect to ride the stock price significantly higher. Of course I could be wrong! But now you know my opinion.

If gold was level like oil I would say we have enough carry over from yesterday to give us some upside strength. But the Canadian market is slightly down. The big Canadian telecoms are sharply selling off on the news the giant American telecom Verizon is dealing for two small Canadian wireless carriers. That pressures the stock prices of Rogers, Telus and BCE.

The prospect of more competition is is good news for anyone shocked by a mobile phone bill but could give pain to shareholders in the big carriers. I am staying with BCE as the very sharp share price dip puts this secure big time dividend payer on sale. That means buying rather than selling can make you more money.

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Have a prosperous day!

Bryan

White Top Investor
whitetop@WhiteTopInvestor.com
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