Despite the recent rally, some Canadian bigwigs are still trading at a notable discount against their fair values. These attractively valued TSX stocks offer greater stability and decent growth potential for the future.
Let’s take a look at three such Canadian titans.
Top TSX stocks: TC Energy
Though in the energy business, TC Energy is not much exposed to volatile oil and gas prices. Thus, its earnings are relatively stable, which ultimately makes its dividends stable. TRP stock currently yields 5.4%, notably higher than that of broader markets.
It has also managed to increase its dividends by 9% compounded annually in the last five years. It will likely continue to follow a similar dividend growth, mainly due to its stable business model and visible earnings growth.
One of the major energy pipeline operator TC Energy will report its second-quarter earnings on July 30. Based on analyst estimates, it is expected to do relatively better on both revenues as well as on earnings front compared to peers.
TC Energy stock has been trading largely flattish for the last three months. Notably, it is currently trading at a forward price-to-earnings valuation of 14 times. This is a considerable discount compared to peers as well as its own average historical valuation.
Investors generally see utility stocks as boring because of their slow stock movements and unexciting business model. However, they stand tall when it comes to stability and dividend reliability. One undervalued utility stock Canadian investors can consider is Canadian Utilities (TSX:CU).
It is trading at a valuation of 14 times its 2020 earnings, which is much lower against its peer utility stock Fortis. Besides, Canadian Utilities stock yields beyond 5.1%, against Fortis’ 3.6%. CU has increased its dividends for the last 48 consecutive years, the longest streak of any Canadian company.
Canadian Utilities is a diversified utility that operates in electricity generation, transmission, and distribution. It also operates in energy storage and as a natural gas and water utility. Notably, it generates 95% of its earnings from regulated operations, which facilitates long-term stability.
Kirkland Lake Gold
Kirkland Lake Gold (TSX:KL)(NYSE:KL) is one of the country’s biggest gold miners. Gold miner stocks have already been on an uptrend on the back of higher gold prices. Interestingly, the trend might continue, and gold miners will likely maintain their upward momentum.
Kirkland Lake Gold is expected to report its Q2 earnings on Wednesday. Analysts expect significant growth in its revenues and earnings in Q2 compared to the same quarter last year.
Higher realized gold prices will likely boost its profits for the quarter. Its discounted valuation indicates room for growth rather than a potential downside.
Kirkland Lake Gold has been a massive wealth creator for its shareholders in the last few years. The stock has returned more than 500% in the last three years, beating many TSX mining giants.
Rosy outlook for the yellow metal and Kirkland Lake Gold’s discounted valuation at the moment make it an attractive investment bet for long-term investors.
Locked-up computer systems only part of 'terrifying' ransomware scourge – National Post
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Morneau Shapell, one of dozens of potential third-party victims, said it accepted Xpertdoc’s assurances no sensitive information had been compromised.
Accreon, which has until the first weekend in October to pay up, would not discuss its situation.
NetWalker did recently publish gigabytes of internal data from a Canadian Tire store in Kelowna, B.C. In response to a query, Canadian Tire Corporation said store computers were hit and authorities were investigating.
“This incident has not affected the Canadian Tire Corporation computer networks that process customer information or purchases,” the company said, adding store employees were told their personal information had been compromised.
The nurses’ college, which angered members by taking more than a week to publicly admit the attack discovered Sept. 8, did say it was getting back on its feet, although some services remained down.
“We share our members’ distress and frustration that this has happened,” college CEO Anne Coghlan said in a statement. “Members can rest assured that we will notify them directly if we identify any risk to individuals.”
The consequences of ransomware can go beyond the financial and reputational. This month, for example, a hospital in Duesseldorf, Germany, was unable to admit a patient for urgent treatment after an apparent cyber-attack crippled its IT system, authorities said. The woman died.
Such attacks have become increasingly frequent. Earlier victims in Canada include municipalities — among them Stratford and Wasaga Beach in Ontario and the Regional District of Okanagan-Similkameen in B.C. — health-care organizations and charities. Cloud storage companies, with troves of third-party data, have also become attractive targets.
Members fighting sale of MEC say planned COO hire clashes with Canadian company's values – CBC.ca
Members of Mountain Equipment Co-op (MEC) fighting its takeover by an American investment firm say the hiring of an executive from a U.S. company that makes footwear for the military and police clashes with the company’s values.
Jay Taylor, who is currently listed as the CEO of LALO Tactical on its web page, is in line to be MEC’s president and chief operating officer if the sale goes through to Kingswood Capital Management, the Los Angeles-based firm confirmed to CBC News in an email.
So far, 2,400 MEC supporters have raised more than $100,000 for a legal fund to fight the takeover, but the deal could be approved as soon as Monday at a court hearing in Vancouver.
Word of the potential hire was buzzing on social media over the weekend, infuriating members of Save MEC, a group trying to stop the sale of the Vancouver-based retailer and organize a counter-offer.
“It’s shocking to me,” said Jackie Pierre, an MEC customer from Vancouver for 10 years and a Save MEC member. “This is so far from what [MEC] is known for originally.”
MEC’s values include democratic collaboration, social and environmental accountability, stewardship and more recently, diversity and inclusion. Those who want to stop the sale of MEC — the largest co-operative in Canada — are concerned that bringing in a leader with military roots is a bad match for the brand and could endanger the company’s culture.
LALO Tactical, based in San Diego, was set up in 2009 “to serve the needs of Special Operations Forces.” It makes specialized boots with names like “Intruder,” sold in colours like Black Ops and Ranger Green.
Though it also makes athletic shoes, LALO’s Instagram marketing leans heavily toward the military and police.
In an open letter last week, Kingswood assured MEC customers that the brand’s values would be protected.
But Pierre and other Save MEC members, including Kevin Harding, say the potential hiring of Taylor sends a different message.
“If this is how Kingswood plans to honour MEC’s values, I’m deeply disappointed,” Harding, of Vancouver, said.
An old social media post by Taylor is also being cited as proof of the mismatch.
Save MEC members aren’t the only ones concerned that the company’s values are in jeopardy. An advertising expert is warning Kingswood that it could be doing damage to the iconic company it wants to buy.
A culture clash seen through the lens of social media
Kingswood confirmed to CBC on Saturday that Taylor attended meetings in Vancouver last week as part of “introductory discussions” with “key suppliers and incoming MEC leadership.”
Taylor’s history with LALO is alarming to some MEC members.
The company, which counts a former U.S. soldier among its founders, says LALO is an acronym for “Light Assault Lo-Vis Operator, a nimble, quick, tactical Special Forces Operator.”
Many company Instagram posts show its boots being worn by heavily armed men in combat-like settings, or by men in police uniforms with guns drawn.
Captions in some posts include: “I have a very strict gun control policy; if there’s a gun around, I want to be in control of it,” and “Locked, cocked, and ready to rock.”
Another featuring police officers says “Blessed are the peacemakers for they shall be called the children of God.”
Reactions on Save MEC’s Facebook page were strong.
One member described LALO’s instagram feed as “particularly jarring for those familiar with MEC’s ethos.”
Another, who claimed to be part of the hunting and gun community, called Taylor a name and said the executive and LALO were “totally the wrong fit.”
There’s also a strong reaction to a post coming from Taylor’s own little-used Instagram account in 2016.
In it, Taylor responds to the killing of a group of police officers known as the “Dallas 5.” The shooter was an army veteran who said he wanted to kill white officers to demonstrate his anger over police shootings of Black men.
Taylor’s message suggests people should buy a T-shirt to support the families of the officers who died.
The post includes the hashtags #livesmatter, #policelivesmatter and #bluelivesmatter.
While it mentions a more inclusive hashtag, #oneteamonefight, it does not mention #blacklivesmatter.
At the time, the Black Lives Matter movement was already three years old, and police shootings of Black people were a growing part of public discourse.
For Jackie Pierre, it’s an upsetting picture.
“You know, this guy to me resonates guns, All Lives Matter, Blue Lives Matter,” she said. “Whoever’s making these decisions is obviously not in solidarity with people of colour.”
MEC supporters pressuring creditors
Pierre said if the Kingswood offer goes through and Taylor is hired, not only will she stop shopping at MEC, but she’ll quit banking with RBC, which is one of MEC’s leading creditors.
MEC lost $11 million in its last fiscal year of operation. COVID-19 has further weakened the company this year, and its management agreed to the sale.
The Save MEC movement is pressuring the company’s creditors, especially RBC, to extend loans to MEC long enough for the group to present a counter-offer.
WATCH | Why MEC might perish, regardless of sale to U.S. investment firm:
The group’s hope is that drawing attention to the legacy values of the brand and the direction the company would be taken under new owners will encourage RBC to include public perception as part of its evaluation.
Almost 50 years old, MEC has 5.4 million members and 22 stores in Canada. More than 135,000 people have signed an online petition to stop its privatization.
An accomplished executive
In response to the concerns of Pierre and other Save MEC members, Kingswood said in an email to CBC that it has a “deep appreciation for what MEC stands for” and will operate within MEC values.
It also said that Taylor is a “longtime Vancouver resident and MEC member” and an “accomplished executive in the outdoor industry.”
In addition to expertise in “product innovation, development and manufacturing, as well as sales and marketing,” the statement noted his past experience as an owner of ski shops in British Columbia.
Taylor’s LinkedIn profile also describes his leadership role at the running shoe company Hoka One One over nearly three years.
It says he was responsible for launching Hoka in North America and the Asia Pacific region before negotiating the sale of the brand to another company.
Taylor did not respond to a request from CBC for comment or an interview.
Risking the brand
Toronto-based advertising executive Denise Cole has worked with iconic Canadian companies like Roots and Lululemon, as well as the international mega brand Coca-Cola.
Co-founder of the ad agency Juliet Creative, she said she believes Kingswood should be worried about the reaction to its bid for MEC.
“A brand is certainly only as valuable as people’s belief in it, in what it stands for,” Cole said.
MEC is built on a “foundation of community,” she said, and upsetting that community could do major damage to sales and what the company is worth in the future.
Cole said she thinks MEC’s most loyal customers would accept an American owner so long as they felt the owner was listening to them.
“And I think that the outcry that we’re seeing from the most active consumers and the most active members of their base, it does put them in jeopardy.”
Brampton banquet halls and weddings bigger COVID-19 concern than restaurants, mayor says – Brampton Guardian
While applauding recently announced stricter COVID-19 restrictions on restaurants and bars by the Ontario Government, Brampton Mayor Patrick Brown says banquet halls and weddings in Brampton are a bigger concern.
“There continues to be a number of large events at banquet halls, and I think we need some tougher rules when it comes to banquet halls,” Brown told reporters during a Sept. 23 news conference.
“Interesting is that we’re hearing from public health that there’s not significant transmission among restaurants. They’ve handled the Stage 3 quite well, but where there’s an area of concern, we all have to keep an eye out is with banquet halls and weddings,” the mayor added during a committee of city council meeting later the same day.
Brown voiced his concerns about banquet halls two days before Premier Doug Ford announced new restrictions on bars, restaurants and strip clubs, including closing in-person dining and moving last call up to 11 p.m. Only delivery and takeout will be permitted after 11 p.m.
The province’s decision comes in the wake of a surge in COVID-19 cases in Ontario, with Peel Region — especially Brampton — contributing a significant portion of daily lab-confirmed infections in recent weeks. There were 130 new cases confirmed in Peel on Friday (Sept. 26) — the highest single-day total since May 25 — with Brampton accounting for 89 of them.
The recent spike in cases also prompted the provincial government to reduce the permitted size of residential social gatherings in homes, backyards and parks from 50 indoors and 100 outdoors to 10 indoors and 25 outdoors. However, those changes to social gatherings did not include weddings and banquet halls.
Peel’s medical officer of health, Dr. Lawrence Loh, confirmed that a significant number of recent cases have been traced back to weddings and similar events at banquet halls, adding regional health authorities are monitoring the situation and may eventually recommend scaling back the current 50-person limit.
“Social gatherings are a start,” he said during the City of Brampton’s latest COVID-19 update. “We’ve had a number of wedding exposures and that’s been seen throughout the Greater Toronto Area. So, certainly, revisiting wedding and celebrations of that nature are things that we would look at.
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