Wed, April 24, 2024 at 9:35 AM EDT
Business
Got $3000? Consider These 3 Top TSX Stocks That Rose 30% in October – The Motley Fool Canada
TSX stocks at large tumbled almost 5% amid a notable surge in volatility last month. Interestingly, some of the top Canadian stocks stood strong and surged more than 30% in October. Could they remain firm for the rest of the year?
Chorus Aviation
While almost the entire global aviation space is struggling amid the pandemic, Chorus Aviation (TSX:CHR) stock surged almost 35% last week. The charter flight operator and the fleet lessor confirmed last week that it has received an acquisition offer. The transaction completion is not guaranteed yet. The stock has remained strong recently and is trading close to its four-month high.
Canadian passenger airlines reported around 90-95% revenue drop in the last few quarters amid the lower air travel demand. However, Chorus has stayed comparatively strong and reported a 45% fall in its revenues. Notably, Chorus Aviation’s unique, low-risk business model and fixed cash flows make it an attractive purchase target in these distressing times.
Interestingly, this could just be the start of industry consolidation in the aviation space. The prolonged pandemic will make smaller, vulnerable players even weaker, making them attractive targets for mightier peers. Air Canada, the country’s biggest airline, has recently revised its offer to buy Transat. The new offer is 72% lower than its previous price agreed last year.
First Quantum Minerals
First Quantum Minerals (TSX:FM), one of the world’s biggest copper producers, has been on a roll this year. The stock has soared almost 30% in October and is currently trading at its 52-week high.
Apart from tech, mining stocks have notably defied pandemic pressures this year. Rising prices of precious as well as industrial metals have substantially boosted their earnings so far this year.
For the nine months ended September 30, First Quantum Minerals reported US$3.5 billion in revenues — an increase of 30% compared to the same period last year. Its better-than-expected quarterly performance pushed the stock higher last month.
The coronavirus outbreak significantly hampered investor sentiment, particularly in the mining space in the first half of 2020. However, the global economy is steadily reviving, as suggested by the industrial growth led by China.
Copper and nickel prices have soared almost 50% since March. Notably, a sustained rally in these industrial metals could continue to push mining stocks higher for the next few quarters.
Canopy Growth
Top pot stock Canopy Growth (TSX:WEED)(NYSE:CGC) surged 32% in October. The company plans to report its fiscal second quarter of 2021 earnings next week.
Canopy Growth, the biggest marijuana company by market cap, is working on a number of growth initiatives. It is rolling out more stores and also increasing its footprint in digital sales. Additionally, it has a strong presence south of the border. If Joe Biden wins, a greater number of U.S. states will legalize weed, which should benefit Canopy Growth.
The marijuana industry remains a relatively risky bet for investors due to its immense volatility and underlying uncertainties. However, Canopy Growth is comparatively a better bet due to its strong balance sheet — a rare feature in the cannabis industry.
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Fool contributor Vineet Kulkarni has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends CHORUS AVIATION INC.
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Business
Oil Firms Doubtful Trans Mountain Pipeline Will Start Full Service by May 1st
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Oil companies planning to ship crude on the expanded Trans Mountain pipeline in Canada are concerned that the project may not begin full service on May 1 but they would be nevertheless obligated to pay tolls from that date.
In a letter to the Canada Energy Regulator (CER), Suncor Energy and other shippers including BP and Marathon Petroleum have expressed doubts that Trans Mountain will start full service on May 1, as previously communicated, Reuters reports.
Trans Mountain Corporation, the government-owned entity that completed the pipeline construction, told Reuters in an email that line fill on the expanded pipeline would be completed in early May.
After a series of delays, cost overruns, and legal challenges, the expanded Trans Mountain oil pipeline will open for business on May 1, the company said early this month.
“The Commencement Date for commercial operation of the expanded system will be May 1, 2024. Trans Mountain anticipates providing service for all contracted volumes in the month of May,” Trans Mountain Corporation said in early April.
The expanded pipeline will triple the capacity of the original pipeline to 890,000 barrels per day (bpd) from 300,000 bpd to carry crude from Alberta’s oil sands to British Columbia on the Pacific Coast.
The Federal Government of Canada bought the Trans Mountain Pipeline Expansion (TMX) from Kinder Morgan back in 2018, together with related pipeline and terminal assets. That cost the federal government $3.3 billion (C$4.5 billion) at the time. Since then, the costs for the expansion of the pipeline have quadrupled to nearly $23 billion (C$30.9 billion).
The expansion project has faced continuous delays over the years. In one of the latest roadblocks in December, the Canadian regulator denied a variance request from the project developer to move a small section of the pipeline due to challenging drilling conditions.
The company asked the regulator to reconsider its decision, and received on January 12 a conditional approval, avoiding what could have been another two-year delay to start-up.
Business
Tesla profits cut in half as demand falls
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Tesla profits slump by more than a half
Tesla has announced its profits fell sharply in the first three months of the year to $1.13bn (£910m), compared with $2.51bn in 2023.
It caps a difficult period for the electric vehicle (EV) maker, which – faced with falling sales – has announced thousands of job cuts.
Boss Elon Musk remains bullish about its prospects, telling investors the launch of new models would be brought forward.
Its share price has risen but analysts say it continues to face significant challenges, including from lower-cost rivals.
The company has suffered from falling demand and competition from cheaper Chinese imports which has led its stock price to collapse by 43% over 2024.
Figures for the first quarter of 2024 revealed revenues of $21.3bn, down on analysts’ predictions of just over $22bn.
But the decision by Tesla to bring forward the launch of new models from the second half of 2025 boosted its shares by nearly 12.5% in after-hours trading.
It did not reveal pricing details for the new vehicles.
However Mr Musk made clear he also grander ambitions, touting Tesla’s AI credentials and plans for self-driving vehicles – even going as far as to say considering it to be just a car company was the “wrong framework.”
“If somebody doesn’t believe Tesla is going to solve autonomy I think they should not be an investor,” he said.
Such sentiments have been questioned by analysts though, with Deutsche Bank saying driverless cars face “technological, regulatory and operational challenges.”
Some investors have called for the company to instead focus on releasing a lower price, mass-market EV.
However, Tesla has already been on a charm offensive, trying to win over new customers by dropping its prices in a series of markets in the face of falling sales.
It also said its situation was not unique.
“Global EV sales continue to be under pressure as many carmakers prioritize hybrids over EVs,” it said.
Despite plans to bring forward new models originally planned for next year the firm is cutting its workforce.
Tesla said it would lose 3,332 jobs in California and 2,688 positions in Texas, starting mid-June.
The cuts in Texas represent 12% of Tesla’s total workforce of almost 23,000 in the area where its gigafactory and headquarters are located.
However, Mr Musk sought to downplay the move.
“Tesla has now created over 30,000 manufacturing jobs in California!” he said in a post on his social media platform X, formerly Twitter, on Tuesday.
Another 285 jobs will be lost in New York.
Tesla’s total workforce stood at more than 140,000 late last year, up from around 100,000 at the end of 2021, according to the company’s filings with US regulators.
Musk’s salary
The car firm is also facing other issues, with a struggle over Mr Musk’s compensation still raging on.
On Wednesday, Tesla asked shareholders to vote for a proposal to accept Mr Musk’s compensation package – once valued at $56bn – which had been rejected by a Delaware judge.
The judge found Tesla’s directors had breached their fiduciary duty to the firm by awarding Mr Musk the pay-out.
Due to the fall in Tesla’s stock value, the compensation package is now estimated to be around $10bn less – but still greater than the GDP of many countries.
In addition, Tesla wants its shareholders to agree to the firm being moved from Delaware to Texas – which Mr Musk called for after the judge rejected his payday.
Business
Stock market today: Nasdaq futures pop, Tesla surges after earnings with more heavyweights on deck
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Tech stocks rose on Wednesday, outstripping the broader market as investors welcomed Tesla’s (TSLA) cheaper car pledge and waited for the next rush of corporate earnings.
The Nasdaq Composite (^IXIC) rose roughly 0.6%, coming off a sharp closing gain. The S&P 500 (^GSPC) was up 0.2%, continuing a rebound from its longest losing streak of 2024, while the Dow Jones Industrial Average (^DJI) fell 0.1%.
Tesla shares jumped nearly 12% after the EV maker’s vow to speed up the launch of more affordable models eclipsed its quarterly earnings and revenue miss. That cheered up investors worried about growth amid a strategy shift to robotaxis and the planned cancellation of a cheaper model.
The results from the first “Magnificent Seven” to report have intensified the already high hopes for Big Tech earnings, that the megacaps can revive the rally in stocks they powered. The spotlight is now on Meta’s (META) report due after the market close, as the Facebook owner’s shares rose after the Senate voted for a potential ban on rival TikTok. Microsoft (MSFT) and Alphabet (GOOG) next up on Thursday.
Meanwhile, Boeing (BA) reported better than expected first quarter results before the opening bell with a loss per share of $1.13, narrower than the $1.72 estimated by Wall Street. Shares rose about 2% in morning trade.
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