There are some great companies to buy on the TSX today. Many offer significant value, and you’ll likely see your stocks soar in the years and decades to come. But it can be hard to sit there and watch them fall day after day, which is why utility stocks have been interesting lately.
Utilities stocks were among the best performers on the TSX today as investors seek stability. These companies offer it, and then some, given that no matter what, we have to keep the lights on, get to work, and do the laundry – all the necessities that utility stocks offer. Today, I’m going to look at three that you might want to consider investing in right now.
Hydro One (TSX:H) shares are up 8% year-to-date against the TSX today, which is down 10.63% at the time of writing. The company serves more than 1.5 million customers across the country using hydroelectric power. And business has been good.
During the first quarter of 2022, Hydro One was one of the utility stocks that saw significant growth. The company said earnings per share were 15.6% higher than the same period last year. Analysts remain convinced that these utility stocks are excellent long-term buys, also given the transition to renewable energy. And Hydro One is ahead of the rest, given that it is already in hydroelectric power.
With its second quarter expected on August 8, investors can take over this company while securing a deal. The shares trade among utility stocks at 11.55 times earnings and offer a dividend of 3.21%. Shares have also risen 88% over the past five years for a compound annual growth rate (CAGR) of 13.43%.
Canadian public services
If you are interested in dividends, Canadian public services (TSX:CU) should be your first stop. Shares of the company are up 10.58% since writing began, and it’s the only Dividend King – a company that has raised its dividend for 50 consecutive years – on the TSX today.
Yet among utility stocks, he was also a powerful performer. This is because it offers a diverse range of power options in North America, Latin America, and Australia. Earnings are due for the second quarter this week, and the last quarter has been strong. The company reported that its adjusted earnings were $0.81 per share, a 15.7% year-over-year increase. And it’s one of the utility stocks that offers both renewable and gas-powered utilities. This is an excellent transitional stock for those interested.
Again, it’s still a bargain even after all this growth. The shares are trading at a fair 25.84 times earnings and a cheap 2.05 times book value. It has a dividend of 4.48% which has grown at a CAGR of 8.13% over the past decade. Finally, stocks have risen 67% over the past decade at a CAGR of 5.24%.
Finally, if you look at the actions of the utilities, you will come across Fortis (TSX:FTS)(NYSE:FTS), and for good reason. Stocks are pretty much where they were at the start of 2022, but don’t let that fool you. It is a solid and stable company that has been growing through acquisitions for years.
This company, like Canadian Utilities, also offers gas and electric power to its customers. So, again, we have a big stock to consider for the transition to renewables. It also has customers in North America and Latin America and continues to experience steady growth. This includes its dividend, where the company is just short of being another utility stock to achieve Dividend King status.
Shares of Fortis are trading at a reasonable price of 23.29 times earnings and 1.62 times book value on the TSX today. It offers a dividend of 3.51%, which has grown at a CAGR of 5.86% over the past decade, and the shares have risen 167% at a CAGR of 10.32% during that time.