Greg Newman is director and senior wealth advisor with Newman Group, ScotiaMcLeod. His focus is on Canadian dividend stocks and protection strategies.
Market outlook
Absent bold action from the governments of Europe, the U.S. and China to their respective challenges, the stock market may remain challenged this summer. Investors should look for companies that can grow their dividends and businesses even in these difficult economic conditions.
Past picks: September 22, 2011
Shoppers Drug Mart
Then: $40.57
Now: $42.59
TR: +7.08 per cent
ParklandFuel
Then: $9.22
Now: $14.92
TR: +72.71 per cent
Intact Financial
Then: $54.50
Now: $62.80
TR: +17.50 per cent
Total Return Average: +32.43 per cent
Top picks:
Brookfield Renewable Energy Partners
BEP.UN pays a dividend of almost 5 per cent that management targets to grow at 3-5 per cent annually. Growth should come from $ 1.2 B in existing projects, prolific future Brazilian demand, North America's aging infrastructure and trends toward cleaner power. BEP.un has also indicated that they may be opportunistic in Europe.
Gibson Energy
GEI's small size and exposure to rising oil flows position it for superior growth relative to their peers, yet it trades a valuation discount. Gibson is also less exposed to falling commodity prices than its peers and has a less levered balance sheet. The dividend is close to 5 per cent and appears sustainable.
Northland Power
NPI has little exposure to failing commodity prices and pays a dividend of nearly 6 per cent with significant growth potential. They currently produce 1005 MW of Power and have 2,800 MW of projects in the pipeline. They have a strong history of completing projects on time and under budget.