Two of the most important books I’ve read during my investing career are Benjamin Graham’s The Intelligent Investor and Graham’s and David Dodd’s Security Analysis.

The Intelligent Investor is a straightforward, conversational book that I devoured while I was getting set to enter the financial services business in 1999. Security Analysis is a dense, technical volume from which I cherry-picked. Warren Buffett wrote the introduction to the former and the foreword to the latter.

The theme that courses through both is value, and the bright line that defines value is a price-to-earnings (P/E) ratio of 15.

Two Graham-Friendly Canadian Picks

Graham was very much on my mind when I was picking this month’s Best Buys—new Aggressive holding WestJet Airlines Ltd. (TSX: WJA, OTC: WJAFF) and long-time Conservative holding DH Corp. (TSX: DH, OTC: DHIFF).

WestJet and DH boast P/E ratios of 13.65 and 15.46, respectively. By comparison, the S&P 500 Index is currently priced at 18.25 times earnings, while the S&P/Toronto Stock Exchange Composite Index is valued at 19.01 times.

So there’s some value here. Now let’s talk about growth.

For WestJet, the oil price plunge will be a key story in 2015.

To be sure, there’s a risk that if oil stays low for a prolonged period, it could slow Canadian economic growth—and travel spending along with it. But for now, lower fuel costs will let WestJet cut ticket prices, boosting demand for its flights.

Global Dreams

WestJet is a low-cost air travel leader and one of Canada’s most admired companies. It flies to 86 destinations in North America and the Caribbean.

The company reported a 6.3% year-over-year traffic increase in 2014, as it achieved its third-highest fourth-quarter and full-year load factors. (Load factor is the percentage of available seats occupied by paying customers.)

The airline has grown steadily since its founding in 1996, mainly by expanding in the domestic market. Now it’s building on that with new initiatives, like code-share agreements with foreign carriers, premium-economy seating, fare bundles and new in-flight entertainment systems.

The company will also add four 262-seat aircraft to its fleet in May 2016. That will bolster its Alberta-to-Hawaii routes during winter months and add European—and perhaps Asian—destinations in the second half of 2016.

Meanwhile, WestJet’s regional carrier, WestJet Encore, will add five new Bombardier Q400 planes in 2015, and it’s highly likely that management will exercise its option to add another four such jets to the service.

Earnings, Dividend Take Flight

In the third quarter, WestJet’s load factor was 83.1%, up from 82.8% a year earlier. Earnings fell 19.8%, but that was because of a pre-tax, non-cash charge of CAD45.5 million related to the sale of 10 old Boeing 737s.

On an adjusted basis, WestJet earned CAD0.66 a share, up from CAD0.50, as revenue gained 9.2%. Cost per available seat mile (or the cost to fly a single seat one mile) rose to CAD13.60 from CAD13.52.

The company declared its first-ever dividend in November 2010, paying CAD0.05 a share in January 2011. It hiked the quarterly rate to CAD0.06 in February 2012, CAD0.08 in July 2012, CAD0.10 in February 2013 and CAD0.12 in February 2014.

If that pattern holds, management will boost the rate to CAD0.14 when it next declares a dividend on or about February 5, 2015.

New Aggressive holding WestJet Airlines, poised for long-term dividend growth, is a buy under $32.

DH Corp., known as Davis + Henderson Income Fund when we added it to the Canadian Edge portfolio in November 2009, used to specialize in printing checks for the banking industry.

But over the past 10 years, the Conservative holding has evolved into a North American financial technology leader, providing software and IT solutions to more than 7,000 banks and credit unions in the U.S. and Canada.

Big Deal Transformed DH

In 2013, DH bought U.S.-based Harland Financial Solutions for USD1.2 billion.

Harland is one of four companies that provide core-banking systems (or the necessary applications for processing day-to-day transactions) in the US. It also offers technology for online banking, account opening, mobile banking and commercial lending.

The deal boosted DH’s financial results and transformed the company in a number of ways.

For one, it took DH from being an outsider in the core-banking market to a significant player. Before the purchase, DH offered lending and payment services but had no real core-banking presence. Harland brought more than 5,000 core-banking clients, not only boosting DH’s customer base but providing key cross-selling opportunities.

Already, DH is grabbing share in the lending market by combining Harland’s LaserPro automated loan-compliance system with its Mortgagebot point-of-sale and loan-origination systems.

What’s more, Harland gave DH a stronger foothold in the US: only 8% of the company’s revenue came from south of the border in 2012, but that jumped to 43% in the four quarters ended September 30, 2014.

A Growing Market

Research firm Celent recently predicted slow but steady growth in the global core-banking market, from $8.6 billion in 2013 to $10.1 billion by 2017.

Smaller banks are shaping up to be a particularly attractive area: in a 2012 survey, the Independent Community Bankers of America found that more than half of community banks were using core systems that were more than 10 years old.

In the third quarter, DH’s revenue from continuing operations rose 38%. Adjusted earnings before interest, taxation, depreciation and amortization (EBITDA) grew 43%, while adjusted earnings per share were up 19%.

The business generated cash from operating activities of CAD72.2 million, for a year-over-year increase of 24%. DH’s trailing 12-month payout ratio was 56.4%.

Great Time to Buy

Management hasn’t raised the dividend since November 2012, as it focuses on building scale and paying down debt. In the latest quarter, DH repaid CAD5 million, resulting in a debt-to-EBITDA ratio of 2.79 as of September 30, 2014.

The company continues to take advantage of opportunities to expand in the 13,000-strong market of banks and credit unions. But meanwhile, DH’s business model has proved to be recession-resistant, thanks to long-term contracts that provide recurring revenue (with solid margins) and drive strong cash flows.

Those cash flows will continue to support the company’s dividend—and will soon reward investors with higher payouts.

DH Corp., which is yielding 3.5%, is a buy under $32.