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Summary
- US President Donald Trump has threatened to challenge the election results in the Supreme Court in case of a loss, which would delay the process of having a clear winner.
- In the past, a dragged-out vote-recounting in US presidential elections process has impacted stock markets.
- The demand of safe stocks has risen in light of the election results.
There is a lot of anticipation regarding the final outcome of the 2020 US presidential elections, as vote counts show a close margin. Along with that, there is also current President Donald Trump’s threat of challenging the results in the Supreme Court in case of a loss. The previous US presidential elections have had quite an impact on the stock markets around the world. With that in mind, many investors are seeking refuge with safe assets such as gold, consumer and supply chain stocks, such as Barrick Gold Corporation (TSX:ABX), Metro Inc (TSX:MRU) and Shopify Inc (TSX:SHOP).
Let’s take a closer look at the three large cap Toronto Stock Exchange (TSX) stocks to understand their recent performances better.
Barrick Gold Corporation (TSX:ABX)
Current Stock Price: C$ 38.48
Shares of Canadian gold producer Barrick Gold Corporation are currently trending on the TSX among stocks with heavy trading activities. In the last 10 days, Barrick stocks garnered an average share trading volume of 4.38 million.
Barrick Gold is one of the top gold manufacturers around the world, with mining sites spanning across Africa, Australia, North and South America. Barrick’s joint venture Twiga Minerals Corporation recently paid a cash dividend of US$ 250 million and about US$ 205 million in taxes, royalties and dividends to the Tanzanian government.
ABX STOCK PERFORMANCE
While most companies suffered amid the coronavirus pandemic, stocks of Barrick Gold Corporation climbed almost 60 per cent this year. Its scrips recorded a drop of about eight per cent in the last six months and over 10 per cent in three months.
However, since its pandemic-triggered March lows, Barrick stocks rose by 30 per cent in the last eight months.
ABX Q3 2020 RESULTS
Riding on higher gold prices, Barrick Gold Corporation saw its operating cash flow shoot up 80 per cent quarter-on-quarter (QoQ) to US$ 1.9 billion in third quarter of 2020. Its free cash flow registered a record level climb of 151 per cent QoQ to US$ 1.3 billion in Q3 2020.
The Toronto-based company’s debt net of cash reduced by 71 per cent QoQ to US$ 417 million in the third quarter ending 30 September 2020. Its quarterly dividend was also increased again in the latest quarter by 12.5 per cent.
Metro Inc (TSX:MRU)
Current Stock Price: C$ 64.03
Being a consumer staples stock, Metro Inc did not suffer massive setback amid the pandemic as the demand for its products did not drop extensively. If anything, panic-buying and bulk-storing in the beginning of the pandemic saw demand for such products shoot up.
Ahead of the 2020 US presidential elections results, Metro Inc stock spike nearly three per cent in November.
MRU STOCK PERFORMANCE
Shares of Metro Inc are up over 19 per cent this year. In the last six months, its scrips climbed over 10 per cents.
Since its brief slump during the COVID-inflicted market crash in March, the stocks rose about 15 per cent in the following eight months.
MRU FINANCIAL RESULTS
Metro Inc recorded a 11.6 per cent year-over-year (YoY) growth in its total sales in the third quarter of fiscal 2020. Its operating income before depreciation and amortization and associate's earnings rose 9.3 per cent in Q3 FY20 ending 4 July 2020.
The company’s gross margin on sales stood at 20 per cent, while its operating expenses as a percentage of the sales were about 10.7 per cent in the third quarter of fiscal 2020.
One of the top retailers in Canada, Metro Inc is set to release its fourth quarter fiscal 2020 results on November 18.
Shopify Inc (TSX:SHOP)
Current Stock Price: C$ 1352.84
Canadian online one-stop shoppers’ corner Shopify Inc continues to garner much attention on the TSX. Its shares jumped about six per cent in October ahead of the US election results.
SHOP STOCK PERFORMANCE
Stocks of Shopify Inc recorded an increase of over 160 per cent year-to-date (YTD) and of over 40 per cent in the last six months. In the last three months, however, the scrips fell about nine per cent.
Shopify shares have rebounded almost 90 per cent in the eight months since the coronavirus-inflicted March lows.
SHOP Q3 2020 FINANCIAL RESULTS
Shopify Inc reported a record performance in the third quarter of 2020, with its revenue skyrocketing by 96 per cent year-over-year (YoY) to US$ 767.4 million. Its subscription solutions revenue was up 48 per cent YoY at US$ 245.3 million, while its merchant solutions revenue grew 132 YoY to US$ 522.1 million in Q3 2020.
The company’s operating income stood at US$ 50.6 million, while its net income US$ 191.1 million for the third quarter ending 3 September 2020.
Shopify Inc reported that it had about US$ 6.12 billion in cash, cash equivalents and marketable securities as of September 2020, up from US$ 2.46 billion on 31 December 2019.
