- Canada’s main equity index started the week off with a triple-digit loss
- Barrick Gold’s net earnings amounted to US$ 488 million in Q2 2022
- Dollarama stock shot up by almost 40 per cent in nine months
Canadians can explore bluechip stocks like Barrick Gold (TSX: ABX), Algonquin (TSX: AQN), Dollarama (TSX: DOL) etc., amid the ongoing market fluctuations to ensure financial stability in the long horizon.
Canada’s main equity index started the week with a triple-digit loss of 136.46 points on Monday, August 22. Investors with a low-risk appetite could find such fluctuations hard to digest. Hence, to maintain financial and mental well-being, such investors could pursue bluechip investing, wherein healthy stocks backed by robust historical business operations are the focus. Bluechip companies are also popular among income investors for their dividend payment history and are even called dividend aristocrats.
Here are five Canadian bluechip stocks, selected by Kalkine Media®, that one can explore amid the current market volatility. So, let us find out about these stocks in detail.
1. Barrick Gold Corporation (TSX: ABX)
Barrick Gold is one of the top producers, with a market capitalization of C$ 36.94 billion. Barrick posted a five-year dividend growth rate of 36.91 per cent when discussing dividend payouts.
Barrick reported gold production of 1.04 million ounces in Q2 2022, relatively high from the first quarter of the same year. The yellow metal company stated that this production growth was primarily led by Carlin and Turquoise Ridge (Nevada), Bulyanhulu and North Mara (Tanzania), and Veladero (Argentina). Barrick also claimed that production is projected to rise further in this year's last two quarters.
Barrick Gold’s net earnings amounted to US$ 488 million in the second quarter this year, comparatively high from US$ 438 million in Q1 2022 and US$ 411 million in the second quarter a year ago.
Barrick stock jumped by almost five per cent in one month. According to Refinitiv, the ABX stock recorded a Relative Strength Index (RSI) value of 45.79, which generally depicts a moderate trend.
2. Algonquin Power & Utilities Corp (TSX: AQN)
One of the largest utility service companies, Algonquin Power, said its top line amounted to US$ 624.3 million in Q2 2022, up by 18 per cent year-over-year (YoY). However, the integrated utility infrastructure company saw a net loss of US$ 33.4 million in the latest quarter, low from a profit of US$ 103.2 million in the previous year’s second quarter.
In the cash flow statement, Algonquin posted US$ 268.6 million as cash flow provided by operating activities in Q2 2022, reflecting a YoY rise of 160 per cent. Algonquin Power will distribute a quarterly dividend of US$ 0.181 on October 14.
Algonquin stock swelled by over seven per cent quarter-to-date (QTD). As per Refinitiv, the AQN stock had an RSI value of 65.78 (marginally down from the overbought level of 70) on August 19, which signals a medium-to-high trend.
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3. Dollarama Inc (TSX: DOL)
Dollarama, while reporting its Q1 FY2023 results, said it saw a double-digit rise in customer traffic aided by ‘strong’ demand for daily consumables and seasonal goods, with eased COVID restrictions. The discounted retail store company posted a growing sale of C$ 1.07 billion in the latest quarter, up by 12.4 per cent from Q1 FY2022. This increase came as the total store count jumped to 1,431 stores on May 1, 2022, from 1,368 stores a year ago. Dollarama reported a net income of C$ 145.5 million in the first quarter this year, relatively up from C$ 113.57 million in the same quarter last year.
Dollarama stock shot up by almost 40 per cent in nine months. According to Refinitiv information, the DOL stock had an RSI value of 60.48 (reflecting medium-to-high momentum) on August 19.
4. Constellation Software Inc (TSX: CSU)
Constellation Software reported a top-line increase of 30 per cent to US$ 1.61 billion in the second quarter of 2022 from US$1.24 billion in the same period last year. Constellation saw revenue growth across its operations in Q2 2022 compared to Q2 2021, with license revenue reaching US$ 72 million (up from US$ 71 million), professional services revenue at US$ 340 million (up from US$ 254 million), hardware and other revenue at US$ 50 million (up from US$ 43 million) and maintenance and other recurring revenue at US$ 1.15 billion (up from US$ 880 million).
The technology company stated that its net profit amounted to US$ 134 million in the latest quarter, higher than US$ 78 million in the prior quarter. Constellation stock grew by almost 12 per cent QTD. According to Refinitiv, the CSU stock held an RSI value of 55.89 on August 19.
5. Toronto-Dominion Bank (TSX: TD)
Toronto-Dominion posted C$ 27 million in provision for (recovery of) credit losses in Q2 2022 compared to a negative balance of 377 million in the same quarter of the previous year. Though TD Bank improved its total revenue to C$ 11.26 billion in the latest quarter from C$ 10.22 billion in Q2 2021, it was down from C$ 11.28 billion posted in Q1 2022. However, the Canadian lender saw its net profit reach C$ 3.81 billion in Q2 2022, up from C$ 3.69 billion and C$ 3.73 billion reported in Q2 2022 and Q1 2022, respectively.
Toronto-Dominion also announced a definitive agreement in August to acquire Cowen to extend its US-based investment banking business and capabilities. Toronto-Dominion stock zoomed by over six per cent in one month. According to Refinitiv data, the TD stock saw an RSI value of 62 and a trading volume of 3.96 million on August 19.
Income investors searching low volatile stocks that could weather the near-term volatility can explore quality bluechip stocks. For long-term investors, these bluechip companies can be a reliable source of dividend income and can even provide significant gains. However, investors should assess their risk capacity before putting their money in the market.
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.