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Highlights
- The world is facing an energy crisis, clean energy sources are the hope for the future.
- This clean energy stock expanded by more than 53 per cent in the past year.
- The company recorded a 110 per cent year-over-year growth to US$ 9 billion in sales in Q2 2021.
Global energy markets are hit hard by increased post-pandemic demand while the supply remains strained, resulting in soaring prices of gas, electricity and fuels. That’s why major economies are looking at cleaner, renewable energy sources to meet the mounting demand for power.
There are many Canadian companies listed on the Toronto Stock Exchange (TSX) that are engaged in renewable technology solutions. Such companies could gain momentum in the future as we move towards a clean-energy transition era.
Also read: Tricon (TSX:TCN) eyes US IPO. How to buy the real estate stock?
Let us discuss one such clean energy company.
Magna International Inc. (TSX:MG)
The Ontario-headquartered Magna International Inc. is mainly known for its innovative mobility technologies and systems for electric vehicles, a booming industry in the automobile sector. The company supplies mobility technology to key automakers in the market.
The vehicle equipment manufacturer saw its scrip surge by more than 53 per cent in the past year and jump roughly 11 per cent on a year-to-date (YTD) basis.
Its scrip tumbled by about 12 per cent in the last six to three months, however, it seems to be on the path of recovery with an approximately three per cent increase in the last week.
On Tuesday, October 5, Magna’s stock wrapped up trading at C$ 99.70 apiece, almost 21 per cent below its 52-week high of C$ 126 (June 7). However, it is priced at nearly 56 per cent above its 52-week low of C$ 64.03 (October 5, 2020).
Magna International posted a 110 per cent year-over-year growth to US$ 9 billion in sales, in the second quarter of 2021. This phenomenal increase in sales was due to a hike in global light vehicle production by 58 per cent, particularly driven from North America and Europe.
In addition, the company recorded an adjusted EBIT of US$ 557 million in Q2 2021, reflecting a raise of US$ 1.2 billion from the previous year. It also noted income from operations before income taxes of US$ 540 million in Q2 2021, up against a loss of US$ 789 million incurred in the same quarter a year ago.
The company reported a net income of US$ 424 million in its latest quarter, up from the net loss of US$ 647 million incurred in Q2 2020.
The nearly C$30 billion market cap firm held price-to-earnings ratio of 10.50, return on equity of 19.59 per cent, and return on assets of 7.91 per cent on October 5. The company posted a dividend yield of 2.157 per cent with a five-year average dividend growth rate of 11.55 per cent on this day.
Also read: Which TSX energy stocks to buy as oil hits highest price since 2014?
Bottom line
As we are heading to clean-energy transformation, investors are drawn towards green technology companies such as Magna International Inc. to explore environment-oriented market opportunities.
