5 TSX stocks to watch as Canada eases COVID-19 restrictions

September 28, 2022 08:38 AM EDT | By Team Kalkine Media
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  • Testing for coronavirus followed by quarantine and isolation requirements have been removed, w.e.f October 1, 2022.
  • In Q2 2022, Air Canada reported operating revenue of C$ 3.98 billion.
  • As of Q3 2022, the revenue for Transat A.T. Inc. was reported at C$ 508.3 million.

Lately, there has been the removal of all travel restrictions by the Government of Canada that were related to COVID-19. Moreover, testing for coronavirus followed by quarantine and isolation requirements have been removed, w.e.f October 1, 2022.

The removal of restrictions might make travelling easy. Also, it can help reduce the impact of COVID-19 on the travel industry overall.

As an investor, track the stock movements to be in a good space. Now, let us look at some of the stocks from the travel sector with Kalkine Media®.

  1. Air Canada (TSX: AC)

Air Canada serves nearly 50 million passengers annually and flies US nationals on trips with a layover in Canada.

In Q2 2022, Air Canada reported operating revenue of C$ 3.98 billion, an approximately five times increase from the previous quarter.

For the quarter that ended June 30, 2022, the airline posted unrestricted liquidity of over C$ 10.5 billion.

With pandemic restrictions being eased earlier, the airline's operating capacity had witnessed about five times increase from the same quarter of the previous year.

Subsequently, there was an increase in the passenger revenue, which was reported at C$ 3.44 billion, with about an eight times growth from the corresponding quarter of the previous year. 

  1. Transat A.T. Inc. (TSX: TRZ)

Transat A.T. Inc. is a specialist in the travel industry specializing in holiday travel along with its organization, marketing, and distribution. Its products include hotel stays, vacation packages, and air travel.

Reportedly, Transat A.T. Inc. witnessed a recovery at the end of the last quarter. As of Q3 2022, the revenue for Transat A.T. Inc. was reported at C$ 508.3 million. Meanwhile, the cash and cash equivalents were C$ 411.3 million.

Reportedly, in Q3 2022, the airlines had customer deposits of C$ 585.6 million, representing 96 per cent of pre-pandemic levels. Moreover, there was an increase of 19 per cent over last quarter, reflecting the uptick in demand. 

  1. Gamehost Inc. (TSX: GH)

Gamehost Inc. operates in gaming properties and hospitality and involves different gaming segments such as VLT, lottery, and table games. The gaming segment contributes to most of the revenue generation for Gamehost Inc.   

The C$ 175.8 million market capitalization company, Gamehost, announced a monthly dividend of C$ 0.03. Also, it had a dividend yield of 4.6 per cent.

Further, the earnings per share (EPS) were declared at C$ 0.54, along with a price-to-earnings (P/E) ratio of 14.5.

For the second quarter of fiscal 2022, Gamehost's operating revenue was C$ 17.9 million. The total assets and debt reported a decline and were calculated at C$ 186.9 million and C$ 58.2 million, respectively.

  1. TWC Enterprises Limited (TSX: TWC)

TWC Enterprises Limited is a leisure services provider with the brand name ClubLink One Membership More Golf. Under this, TWC Enterprises Limited carries out the core business of Golf club operations.

TWC Enterprises Limited paid a quarterly dividend of C$ 0.05 with a dividend yield of 1.19 per cent.

In Q2 2022, TWC Enterprises' operating revenue witnessed a growth and was reported at C$ 52.73 million. On the contrary, the net earnings saw a downfall and were reported at C$ 3,594 million.

  1. Alimentation Couche-Tard Inc. (TSX: ATD)

Alimentation Couche-Tard Inc. steers convenience stores network. The major source of the company's income is through tobacco product sales, quick service restaurants, groceries, fresh food, beverages, and many more.

The company has a market capitalization of C$ 56.2 billion with an employee size of 124,000.

For Q1 2023, the net earnings of Alimentation Couche-Tard were C$ 872.4 million compared to C$ 764.4 million in Q1 2022. The revenue was calculated at C$ 18.7 billion, with an increase of C$ 5.1 billion (37.4 per cent) relative to Q1 2022.

Further, the gross profit too witnessed an increase of 10.9 per cent (C$ 282.8 million) and was reported at C$ 2.9 billion.

Bottom Line

With COVID-19 travel restrictions being lifted by the government, the travel sector will likely recover further. However, given the current economic situation, investors must closely watch the different stock movements.

Investors need to remain vigilant of any minute changes in stock prices. For stock selection and market movement, keep a check on the official announcements as well, as they may influence the market at a great level.

Please note, the above content constitutes a very preliminary observation based on the industry and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.


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