Top TSX Utility & Pipeline Stocks of 2020

The TSX utilities index is up 8.40 percent year-to-date (YTD), outperforming the benchmark TSX Composite index that has gained 2.56 per cent in same time frame.

However, utility companies have a bigger challenge lined up in front of them. In order to achieve the established climate goals and attain net-zero, many companies will have to overhaul their business models.

Despite all the challenges, a handful utility and pipeline stocks surged ahead this year. Let’s take a look at the top performers of 2020:

Brookfield Renewable Corporation (TSX: BEPC)

Stocks of Brookfield Renewable have been riding high this year, up over 85 per cent in less than six months. The rallying renewable stocks hold a current price-to-book (P/B) ratio of 7.5, price-to-cashflow (P/CF) ratio of 13.2 and debt-to-equity ratio of 9.29. In its third quarter (Q3) results (ending 30 September 2020), the corporation posted revenue US$ 724 million and a net loss of US$ 1,297 million. The stocks are up nearly 60 per cent in the last three months.              

Polaris Infrastructure Inc. (TSX: PIF)

Polaris stocks are a part of TMX’s top price performer and top utilities, both lists of stocks outperforming their peers on the TSX and the TSXV. The stock are up 60 per cent year-to-date (YTD) and over 40 per cent quarter-to-date.

The company posted a revenue of US$ 17 million and net income of US$ 1.98 million the Q3 2020. It also announced quarterly dividend of US$ 0.15 per stock.

TransAlta Renewables Inc. (TSX: RNW)

TransAlta stocks are up almost 25 per cent YTD and over 35 per cent in the last six months. Since a sharp nosedive during the pandemic market crash, the stocks have rebounded nice, growth by 56 per cent in the last nine months. It stock have zoomed past its pre-COVID highs in February 2020, and are currently trading at C$ 19.35 a pop.

TransAtla posted total revenue of C$ 95 million and a net income of C$ 7 million in Q3 2020. Its current market cap is over C$ 5 billion.

@Kalkine Image 2020

Algonquin Power & Utilities Corp. (TSX: AQN)

This utility stock has gained over 12 per cent this year. Its current market cap is C$ 12.3 billion. The stock holds a P/E ratio of 18.6 and P/CF ratio of 17.5.

The company posted revenue of US$ 376.1 million in Q3, up 3 per cent year-over-year (YoY). The (adjusted) net earnings stood at US$ 88.1 million, up 27 per cent YoY.

AltaGas Ltd. (TSX: ALA)

While AltaGas stocks are down 5 per cent YTD, it shows a remarkable 72+ per cent growth in the last nine months.

AltaGas is a part of top utility stocks and stands at a current market cap of C$ 5.2 billion. It increased its annual dividend payment by 4 per cent to C$ 0.0833 per share.

The company posted a normalized net income of C$ 12 million in Q3 2020, as compared to normalized net loss of C$ 62 million in Q3 2019.