Kalkine Media lists TSX stocks to watch amid 'COVID-19 recession'

With the onset of the COVID-19 pandemic, Canadian economy was impacted negatively as businesses were affected due to pandemic restrictions. However, it recouped in 2021, with the implementation of several policies, adequate public health protocol, and increased vaccination.

Reportedly, Canada is again moving towards a challenging time as a recession is likely to rear its head in early 2023. Chrystia Freeland, the Deputy Prime Minister and Minister of Finance, asserted that despite economic hardships, she believes Canadians will survive what she called the "last act of the COVID recession" that the country is currently experiencing.

With rising inflation and thereafter higher interest rates, diversification becomes even more paramount for investors.

Prepare your portfolio as a defense against the volatile market and focus on its sustainability. Amid all these market uncertainties, let’s explore a few stocks and look at their financials in recent quarters:  

BCE Inc. (TSX: BCE)

BCE Inc. is a telecommunications service provider that offers landline, television, wireless services in Canada. The company is a wireless carrier with approximately 10 million customers.

In Q2 2022, BCE Inc.’s operating revenue was C$ 5,861 million compared to C$ 5,698 million in Q2 2021. While on the other hand, its net earning decreased by 10.9 per cent to C$ 654 million from C$ 734 million in the same comparative period.

The company’s adjusted EBITDA increased to C$ 2,590 million witnessing an increase of 4.6 per cent from C$ 2,476 million in the year-ago quarter.

The cash flow from operating activities and free cash flow soared to C$ 2,597 million and C$ 1,333 million respectively.

The quarterly dividend to the shareholders was announced at C$ 0.92 with a dividend yield of 6.248 per cent.

On February 24, 2022, BCE Inc. announced its acquisition of EBOX (telephone and internet provider).

Dollarama Inc. (TSX: DOL)

Dollarama Inc. is a retailer and operates discount stores. The Montreal, Canada-based company deals in different categories of products including consumer, general and seasonal products at low fixed price points.

In Q2 2023, the company’s sales grew by 18.2 per cent and was posted at C$ 1,217 million. The comparable sales also shot up by 13.2 per cent in the reported quarter.

The EBITDA soared by 25.8 per cent to C$ 369.4 million, while the operating income increased by 30.3 per cent to C$ 287.4 million.

Algonquin Power & Utilities Corp. (TSX: AQN)

Algonquin Power & Utilities Corp. owns a subsidiary company by the name of Liberty. The company is a distribution, generation, and transmission utility with over total assets of US$ 16 billion.

In Q2 2022, Algonquin Power's revenue increased to US$ 624.3 million, which is an increase of 18 per cent compared to Q2 2021.

The adjusted EBITDA and adjusted net earnings also witnessed an increase and were posted at US$ 289.3 million (18 per cent) and US$ 109.7 million (19.6 per cent) respectively.

The EPS (earnings per share) of Algonquin Power & Utilities Corp. is US$ 0.39. The P/E (price to earnings) ratio of Algonquin Power & Utilities is 36.70.

On August 5, 2022, Algonquin Power & Utilities Corp. completed the acquisition of Sandhill Advanced Biofuels, LLC.

Loblaw Companies Limited (TSX: L)

Loblaw Companies Limited is a retailer with different segments including pharmacy and grocery. The company has presence in Ontario, Quebec, and British Columbia. Additionally, Loblaw Companies Limited oversees a segment that offers credit card services and guaranteed investment certificates.

In Q2 2022, revenue for Loblaw Companies Limited was posted at C$ 12,847 million up C$ 356 million (2.9 per cent) compared to the year-ago quarter.

The Retail segment sales were noted at C$ 12623 million witnessing an increase of C$ 341 million (2.8 per cent) from the corresponding period a year ago. As against this, E-commerce sales decreased by 17.5 per cent.

The operating income decreased by C$ 10 million and was posted at C$ 742 million. The adjusted EBITDA increased by 9.3 per cent and was noted at C$ 1,499 million.

NorthWest Healthcare Properties Real Estate Investment Trust (TSX: NWH.UN)

NorthWest Healthcare Properties Real Estate Investment Trust facilitates its investors by providing access to healthcare real estate portfolio. Further, the company helps investors by keeping them updated on diversified portfolio of healthcare real estate.

In Q2 2022, the revenue for NorthWest Healthcare Properties Real Estate Investment Trust was posted at C$ 111.8 million with a year-on-year (YoY) growth of 24 per cent.

For the June 2022 quarter, the net operating income of the company increased to C$ 88,883 million from C$ 69,826 million at the same time previous year.

The FFO (funds from operations) was noted at C$ 46,090 million as compared to C$ 42,293 million.   

The company currently distributes a monthly dividend of C$ 0.067 to its shareholders with a dividend yield of 7.737 per cent.

The EPS of NorthWest Healthcare Properties Real Estate Investment Trust is C$ 1.99.

The below graph depicts the growth of NorthWest Healthcare Properties Real Estate Investment Trust’s total assets between two quarters.

Bottom Line:

The market is impacted by the fears of an anticipated recession and hence, investing needs to be done with proper planning and market research. As a long-term investor, analyze the stocks that have sailed through the volatile times.

Understand and analyze their performance and consider a variety of sectors. If selected in the right manner, your stocks can give you the perfect combination of growth and income. To get away with a bearish market, hold on to your stocks tactfully and the pave way for a stable future.

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.