We asked our Foolish writers for their top ideas for September. Here are their picks:
Chris MacDonald: Manulife
My top stock for September is Manulife (TSX:MFC)(NYSE:MFC). This top insurance player is among the biggest players in Canada, with a growing market share in key growth markets abroad, particularly China.
Given a resurgence in higher bond yields, the longer-term earnings prospects of Manulife have improved. This insurance player currently trades at a significant discount to peers in the financials space, providing great value for long-term investors.
As far as top value stocks with excellent leverage to the pandemic recovery, Manulife remains a top pick of mine. This is a stock I think has tremendous value in September and beyond.
Fool contributor Chris MacDonald has no position in any of the stocks mentioned.
The economic recovery may be slow, but it’s there. NorthWest Healthcare Properties REIT (TSX:NWH.UN) continues to run strong. The company saw revenue skyrocket during the pandemic, as one of the very few real estate investment trusts (REITs) that provided essential services. NorthWest then used the low interest rate environment to renew lease agreements and bring in new properties — even an Australian healthcare REIT!
Yet despite this and its dividend yield of 6.16%, shares are only up 7% year to date, and it continues trade at a P/E ratio of 9.28. Given that healthcare REITS are immune to global inflation, that makes them in high demand moving forward. And NorthWest currently boasts a global 97% occupancy rate with a 14.3 year average lease agreement! So, while investors may have to be patient for share growth, it won’t be for long. Meanwhile, you can bring in this solid dividend yield for guaranteed passive income.
My top stock for September is Suncor Energy(TSX:SU)(NYSE:SU). Shares of this Canadian energy heavyweight had dropped 7.6% month over month as of close on August 26. However, it has delivered much-improved earnings in 2021. The rise of the Delta variant remains a concern when it comes to demand, but I’m bullish on the energy sector going forward.
Suncor posted a profit of $868 million in Q2 2021. Meanwhile, its production enjoyed a significant uptick, even in the face of planned maintenance. This stock last had a price-to-earnings ratio of 23, putting it in solid value territory relative to its industry peers. It offers a quarterly dividend of $0.21 per share, representing a 3.5% yield. I’m looking to snatch up this super energy stock on the dip before the summer ends.
Fool contributor Ambrose O’Callaghan has no position in any of the stocks mentioned.
Nicholas Dobroruka: goeasy
My top stock for the month of September is goeasy(TSX:GSY).
This $3 billion company might be one of the best-kept secrets on the TSX. Shares are up close to 100% year to date and more than 800% over the past five years.
Some investors may be hesitant to buy during such a strong bull run, but I’m as bullish as ever on goeasy. The reopening of the country could send the growth stock surging even higher over the next couple of months.
goeasy is a consumer-facing financial services company. It provides Canadians with all types of home, auto, and personal loans. So, if consumer spending begins to rise as the country slowly reopens, I think it’s a safe bet to say that goeasy revenue will be rising too.
The best part is, goeasy stock is trading at a discount compared to many other Canadian growth stocks right now. Shares are trading at a bargain price of a forward price-to-earnings ratio of just 15.
Fool contributor Nicholas Dobroruka has no position in any of the stocks mentioned.
Jed Lloren: Nuvei
My top stock for September is Nuvei(TSX:NVEI). This is a stock that has intrigued me since its IPO. Of all the industries to invest in, I am most fascinated by the potential growth of the e-commerce industry. While Nuvei doesn’t operate in that industry per se, it is highly exposed to it due to its business as a payment processor. As more retail spending continues to flow into these online streams, Nuvei is poised to benefit.
In its latest earnings presentation, the company reported that its total volume processed in Q2 2021 was 146% greater than its processed volume in Q2 2020. This translated into a 114% year-over-year increase in Nuvei’s quarterly revenue. Already present in 200 global markets, Nuvei is well positioned for continued growth in the future.
Fool contributor Jed Lloren has no position in any of the stocks mentioned.
Robin Brown: Sangoma Technologies
Sangoma Technologies(TSXV:STC) is a one-stop shop for unified communications-as-a-service solutions across the world. This stock has pulled back 38% from highs set earlier this year.
Yet this company is in excellent shape. It just acquired a similar-sized peer in the United States. This should significantly broaden its cloud services platform. Likewise, Sangoma expects to see higher gross margins and expanded recurring revenues (over 70%).
The company expects to grow revenues and EBITDA in fiscal 2021 by 26% and 40%, respectively. Despite strong growth and profitability, this stock trades at fraction of larger, unprofitable peers. Hence, this stock could enjoy the double-edged combination of rising earnings and higher valuation multiples in years to come.
Fool contributor Robin Brown owns shares of Sangoma Technologies.
Kay Ng: Canadian Net REIT
Nothing beats having the reassurance of earning safe passive income every month. Canadian Net REIT (TSXV:NET.UN) is a Canadian Dividend Aristocrat with a track record of cash distribution increases.
Recently, it had shown signs of accelerated dividend growth. Its five-year dividend-growth rate is 13%, including this year’s cash distribution hike of 17%.
Canadian Net REIT maintains a high occupancy rate of 99%. It has benefited from a low interest rate environment. Last quarter, its weighted average interest rate on fixed loans and mortgages was 3.4% versus 3.7% a year ago.
It’s still a small REIT with $232 million of assets and lots of room to grow. With a safe yield of about 3.9%, the undervalued monthly dividend stock is a great buy for passive income in a TFSA.
Fool contributor Kay Ng owns shares of Canadian Net REIT.
Stephanie Bedard-Chateauneuf: Spin Master
Spin Master (TSX:TOY) is my top TSX stock for September.
The toymaker posted higher earnings for its most recent quarter, as revenue climbed 39% on better-selling products from Paw Patrol, Gabby’s Dollhouse, and Present Pets as well as strong revenues for its digital games.
The Toronto-based company reported a net profit of US$33.5 million (US$0.32 per share) for the quarter ended June 30 compared with a net loss of US$14.9 million (US$0.15 per share) in the prior-year quarter.
According to Spin Master’s president and CEO Max Rangel, the company is well positioned for the second half of 2021, with a strong toy lineup, growth in its digital game franchises, and the release of the movie Paw Patrol: The Movie. Spin Master’s first foray into the film business is expected to boost toy sales as well as licensing and merchandising revenue.
Fool contributor Stephanie Bedard-Chateauneuf has no position in any of the stocks mentioned.
Puja Tayal: Suncor Energy
My top TSX stock pick for September is Suncor Energy (TSX:SU)(NYSE:SU). This stock has dipped 22% since July 5, as rising Delta variant cases created hiccups in the global recovery. Moreover, a decline in oil price and production issues at Suncor’s Fort Hills oil sands mine put downward pressure on the stock.
But these are temporary issues. There is pent-up demand for travel, and it is reflected in Suncor’s second-quarter earnings. As the fourth wave eases, the recovery could return. Suncor stock could recoup the two-month loss and surge more than 20% back to the July level of over $30.
Fool contributor Puja Tayal has no position in any of the stocks mentioned.
Vineet Kulkarni: Canadian Natural Resources
Shares of Canadian Natural Resources(TSX:CNQ)(NYSE:CNQ), Canada’s biggest energy company by market cap, have been on a downtrend for the last few months. Fears of reopening delays weighed on energy commodities and on CNQ stock as well. However, this could be a valuable opportunity for discerning investors.
Canadian Natural will likely see stellar earnings growth in the second half of 2021, driven by higher production and higher oil prices as against last year. Moreover, its lower breakeven costs allows huge free cash flow growth even at current oil prices. So, once the Delta variant fears subside, CNQ stock should resume its upward climb.
Apart from its superior capital gain prospects, CNQ offers a juicy yield of nearly 5%. Investors can expect consistent dividend growth from the energy giant driven by its robust balance sheet and strong financial growth.
Fool contributor Vineet Kulkarni has no position in any of the stocks mentioned.
Demetris Afxentiou: Fortis
The growing need to diversify your portfolio to counter volatility has never been greater. That’s just one reason why my pick for this month is Fortis(TSX:FTS)(NYSE:FTS).
Fortis is one of the most defensive picks on the market. In terms of size, the utility behemoth is one of the largest on the continent, with operations across 10 different operating regions. Fortis also boasts over 3.4 million utility customers across both electric and gas segments. If that weren’t enough, keep in mind that utilities generate a stable revenue stream backed by long-term regulated contracts.
Fortis’s immense size coupled with a very reliable and stable business model make it a great defensive pick in an increasingly volatile market.
Adding to that appeal is Fortis’s dividend. The current yield works out to a juicy 3.52%. Even better, Fortis has provided investors with annual bumps to that dividend for over 47 consecutive years. The company is also extending that guidance through 2025, making Fortis a perfect defensive option (and a future Dividend King) for your portfolio.
Fool contributor Demetris Afxentiou owns shares of Fortis.
TORONTO – Roots Corp. may have built its brand on all things comfy and cosy, but its CEO says activewear is now “really becoming a core part” of the brand.
The category, which at Roots spans leggings, tracksuits, sports bras and bike shorts, has seen such sustained double-digit growth that Meghan Roach plans to make it a key part of the business’ future.
“It’s an area … you will see us continue to expand upon,” she told analysts on a Friday call.
The Toronto-based retailer’s push into activewear has taken shape over many years and included several turns as the official designer and supplier of Team Canada’s Olympic uniform.
But consumers have had plenty of choice when it comes to workout gear and other apparel suited to their sporting needs. On top of the slew of athletic brands like Nike and Adidas, shoppers have also gravitated toward Lululemon Athletica Inc., Alo and Vuori, ramping up competition in the activewear category.
Roach feels Roots’ toehold in the category stems from the fit, feel and following its merchandise has cultivated.
“Our product really resonates with (shoppers) because you can wear it through multiple different use cases and occasions,” she said.
“We’ve been seeing customers come back again and again for some of these core products in our activewear collection.”
Her remarks came the same day as Roots revealed it lost $5.2 million in its latest quarter compared with a loss of $5.3 million in the same quarter last year.
The company said the second-quarter loss amounted to 13 cents per diluted share for the quarter ended Aug. 3, the same as a year earlier.
In presenting the results, Roach reminded analysts that the first half of the year is usually “seasonally small,” representing just 30 per cent of the company’s annual sales.
Sales for the second quarter totalled $47.7 million, down from $49.4 million in the same quarter last year.
The move lower came as direct-to-consumer sales amounted to $36.4 million, down from $37.1 million a year earlier, as comparable sales edged down 0.2 per cent.
The numbers reflect the fact that Roots continued to grapple with inventory challenges in the company’s Cooper fleece line that first cropped up in its previous quarter.
Roots recently began to use artificial intelligence to assist with daily inventory replenishments and said more tools helping with allocation will go live in the next quarter.
Beyond that time period, the company intends to keep exploring AI and renovate more of its stores.
It will also re-evaluate its design ranks.
Roots announced Friday that chief product officer Karuna Scheinfeld has stepped down.
Rather than fill the role, the company plans to hire senior level design talent with international experience in the outdoor and activewear sectors who will take on tasks previously done by the chief product officer.
This report by The Canadian Press was first published Sept. 13, 2024.
VANCOUVER – Mediated talks between the union representing HandyDART workers in Metro Vancouver and its employer, Transdev, are set to resume today as a strike that has stopped most services drags into a second week.
No timeline has been set for the length of the negotiations, but Joe McCann, president of the Amalgamated Transit Union Local 1724, says they are willing to stay there as long as it takes, even if talks drag on all night.
About 600 employees of the door-to-door transit service for people unable to navigate the conventional transit system have been on strike since last Tuesday, pausing service for all but essential medical trips.
Hundreds of drivers rallied outside TransLink’s head office earlier this week, calling for the transportation provider to intervene in the dispute with Transdev, which was contracted to oversee HandyDART service.
Transdev said earlier this week that it will provide a reply to the union’s latest proposal on Thursday.
A statement from the company said it “strongly believes” that their employees deserve fair wages, and that a fair contract “must balance the needs of their employees, clients and taxpayers.”
This report by The Canadian Press was first published Sept. 12, 2024.
MONTREAL – Travel company Transat AT Inc. reported a loss in its latest quarter compared with a profit a year earlier as its revenue edged lower.
The parent company of Air Transat says it lost $39.9 million or $1.03 per diluted share in its quarter ended July 31.
The result compared with a profit of $57.3 million or $1.49 per diluted share a year earlier.
Revenue in what was the company’s third quarter totalled $736.2 million, down from $746.3 million in the same quarter last year.
On an adjusted basis, Transat says it lost $1.10 per share in its latest quarter compared with an adjusted profit of $1.10 per share a year earlier.
Transat chief executive Annick Guérard says demand for leisure travel remains healthy, as evidenced by higher traffic, but consumers are increasingly price conscious given the current economic uncertainty.
This report by The Canadian Press was first published Sept. 12, 2024.
