10 Bluechip Stocks With High Return On Equity To Buy Right Now

Canada has several bluechip companies. Many investors take interest in their stocks as they are considered stable in terms of performance and often come with a steady dividend payout.

So, as a new month starts, let’s take a look at 10 bluechip stocks which not only pay dividends, but also post a high return on equity (ROE) at the moment.

1. Royal Bank of Canada (TSX:RY)

Royal Bank of Canada, with a market cap of C$ 167.1 billion, distributes a quarterly dividend of C$ 1.08 and registers a dividend yield of 3.683 per cent on TMX. It holds a price-to-earnings (P/E) ratio of 14.5 and offers a return on equity of 14.53 per cent.

RY stocks grew by 12 per cent year-to-date (YTD), as against the three per cent decline of the S&P/TSX Diversified Banks (Sub Industry) Index.  

The Royal Bank of Canada’s net income increased by 10 per cent year-over-year (YoY) to C$ 3.8 billion in Q1 2021. Its diluted earnings per share (EPS) stood at C$ 2.66, up by 11 per cent YoY, in the latest quarter.

2. Toronto-Dominion Bank (TSX:TD)

The Toronto-Dominion Bank’s mobile banking userbase recently hit the 10 million-mark.

The bank, with a market cap of C$ 153.7 billion, posts a 13.44 per cent ROE, as per TMX. In the past six months, the stock gained 43 per cent. Its YTD growth, meanwhile, sits at 17 per cent.

The Toronto Dominion pays a quarterly dividend of C$ 0.79, which grew by 8.4 per cent in the past three years.

In the first quarter of this year, the TD Bank posted a net income of C$ 3,277 million and a diluted EPS of C$ 1.77.

3. Canadian National Railway Company (TSX:CNR)

Canadian National Railway Company offers an ROE of 18.67 per cent and holds a debt-to-equity (D/E) ratio of 0.66. It distributes a quarterly dividend of C$ 0.615 and posts a return on assets (ROA) of 7.92 per cent.

It posted an operating income of C$ 1,327 million, an increase of nine per cent YoY, in the first-quarter 2021 results.

Stock-wise, CNR grew by two per cent in the past three months and by about 15 per cent in one year.

Source: Pixabay

4.   Canadian Pacific Railway Limited (TSX:CP)

Canadian Pacific Railway Limited’s market cap is at C$ 61.2 billion, while its P/E ratio is 23.7. The railway company posts an ROE of 36.5 per cent.

CP’s quarterly dividend, at C$ 0.19, currently posts a dividend yield of 0.166 per cent on TMX.

In Q1 2021, CP posted a net income of C$ 602 million and total assets of C$ 24.1 billion. Its diluted EPS rose to C$ 4.5 in the latest quarter.

CP stocks grew by 45 per cent in a year and about four per cent YTD.

5.  TC Energy Corporation (TSX:TRP)

Energy infrastructure company TC Energy Corporation's market cap stands at C$ 59.5 billion. It offers a 16.35 per cent ROE and a 4.16 per cent ROA.

In the past month, TRP stock grew by 5.6 per cent. Its YTD growth, meanwhile, stands at 17.5 per cent. It recorded a share trading volume of over 6.7 million in the past one month.

TC Energy distributes a quarterly dividend of C$ 0.87, which grew 8.9 per cent in three years and 9.5 per cent in five years.

The company achieved a revenue of C$ 3,297 million in Q4 2020, up from C$ 3,263 million in Q4 2019. Its annual net income was C$ 4.9 billion in 2020.

6.  Manulife Financial Corporation (TSX:MFC)

Manulife Financial Corporation holds a price-to-book (P/B) ratio of 1.092 and its ROE is 12.3 per cent. Its stocks rose 10 per cent in the past three months and 65 per cent in past one year.

Manulife gives C$ 0.28 per share as a quarterly dividend, which currently registers a 4.173 per cent dividend yield.

The financial services company achieved a net income (attributable to shareholders) of C$ 5.9 billion in 2020, up from C$ 5.6 billion in 2019.

7. Bank of Montreal (TSX:BMO)

The Bank of Montreal posts a D/E ratio of 0.63 and an ROE of 10.6 per cent, as per TMX.

BMO pays C$ 1.06 per share as dividend on a quarterly basis. Its stock, on the other hand, records a 69 per cent one-year growth and a roughly 20 per cent YTD growth.

In Q1 FY21, BMO’s net revenues amounted to C$ 6.3 billion while its net income surged to C$ 2 billion.

Source: Pixabay

8. Constellation Software Inc. (TSX:CSU)

 
Currently holding an ROE of 48.6 per cent, Constellation Software is one of the top software companies in Canada. The C$ 38.2-billion market cap company distributes a dividend of US$ 1 on a quarterly basis and offers a 10.7 per cent ROA.

Constellation Software stock grew by about three per cent in last one month, Its one-year growth, meanwhile, sits at 34.8 per cent.

Constellation’s 2020 annual revenue increased by 14 per cent YoY to US$ 4 billion while its net income increased 31 per cent YoY to US$ 436 million.

9.  BCE Inc (TSX:BCE)

BCE’s market cap price sits at C$ 52.6 billion. Its price-to-cash flow (P/CF) ratio is 6.7 and it offers an ROE of 14.2 per cent, as per TMX.

Its operating revenues expanded by 1.2 per cent YoY to C$ 5.7 billion the first-quarter results of 2021. Its stock, meanwhile, grew 0.7 per cent in the last year and surge about six per cent YTD.

10. TELUS Corporation (TSX:T)

TELUS Corporation offers an ROE of 10.4 per cent, as per TMX data. On the dividend front, it distributes C$ 0.311 per share on a quarterly basis.

TELUS stocks climbed by about two per cent in the last 30 days and by 12 per cent in one year.

Its operating revenues and other incomes grew by 5.2 per cent YoY to C$ 4.1 billion in Q4 2020, while its free cash flow increased by 61.5 per cent YoY to C$ 218 million.

The above constitutes a preliminary view and any interest in stocks should be evaluated further from an investment point of view.