There are some great companies to buy up on the TSX today. Many offer significant value, and you are likely to see your shares climb in the years and decades to come. But it can be hard to sit there and watch them fall day after day, which is why utility stocks have been interesting of late.
Utility stocks have been some of the best performers on the TSX today, as investors look for stability. These companies offer it, and then some, given that no matter what, we need to keep the lights on, go to work, and do laundry — all the necessities that utility stocks offer. Today, I’m going to look at three that you may want to consider investing in right now.
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Hydro One
Hydro One (TSX:H) shares are up 8% year to date compared to the TSX today, which is down 10.63% as of writing. The company serves over 1.5 million customers across the country, powering through hydro-electric power. And business has been good.
During the first quarter of 2022, Hydro One was one of the utility stocks reporting major growth. The company reported that earnings per share were 15.6% higher than the same time last year. Analysts remain confident that these utility stocks are great long-term buys, given the shift into renewable energy as well. And Hydro One has a step ahead of the rest, given it’s already in hydro-electric power.
With its second quarter due on Aug. 8, investors can pick up this company while still getting a deal. Shares trade among utility stocks at 11.55 times earnings, and it offers a dividend of 3.21%. Shares are up 88% in the last five years as well for a compound annual growth rate (CAGR) of 13.43%.
Canadian Utilities
If you’re interested in dividends, Canadian Utilities (TSX:CU) should be your first stop. Shares of the company are up 10.58% year to date as of writing, and it’s the only Dividend King — a company that has increased its dividend for 50 consecutive years — on the TSX today.
Yet among utility stocks, it’s also been a powerful performer. That’s because it has a diverse range of power options across North America, Latin America, and Australia. Earnings are due for the second quarter this week, and the last quarter was strong. The company reported its adjusted earnings were up to $0.81 per share — an increase of 15.7% year over year. And it’s one of the utility stocks offering both renewable and gas-powered utilities. It’s a great transition stock for those interested.
Yet again, it’s still a deal even after all this growth. Shares trade at a fair 25.84 times earnings and cheap 2.05 times book value. It has a dividend of 4.48% that’s grown at a CAGR of 8.13% over the last decade. Finally, shares are up 67% in the last decade for a CAGR of 5.24%.
Fortis
Finally, if you’re looking at utility stocks, you’re going to come across Fortis (TSX:FTS)(NYSE:FTS), and for good reason. Shares are about where they were at the beginning of 2022, but don’t let that trick you. This is a strong, stable company that’s been growing through acquisitions for years.
This company, like Canadian Utilities, also offers both gas powered and electric energy to its customers. So, again we have a great stock to consider for the transition to renewable energy. It also has customers across North and Latin America and continues to see stable growth. That includes its dividend, where the company is just short of being another of the utility stocks to reach Dividend King status.
Shares of Fortis stock trade at a reasonable 23.29 times earnings and 1.62 times book value on the TSX today. It offers a dividend of 3.51%, which has grown at a CAGR of 5.86% in the last decade, and shares are up 167% for a CAGR of 10.32% during that time.
