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3 Top Stocks in Quebec

Everyone likes to support a hometown hero and Canada’s provinces boast many success stories. Today, we check out three exciting opportunities based in Quebec.

Jean Coutu Group

Pharmacy chain Jean Coutu Group (TSX: PJC.A) is one of Quebec’s top companies, and the second largest pharmacy chain in the country behind Shoppers Drug Mart. While this company can be seen as a regional player compared to Shoppers, it has an entrenched position in Quebec, and expanded operations in Ontario and New Brunswick. This may change as the company is beginning to express an interest in expanding beyond its home market.

In its previous quarter revenues rose to $685 million from $625 million last year. Net profits also increased to $57.7 million ($0.30 per share) from $53 million ($0.25 per share). Following this rise in profits, Jean Coutu raised its quarterly dividend to $0.10. The rise in net profits were attributed to better margins on generic drugs.

Quebecor Inc

Next on the list is Quebecor Inc. (TSX: QBR.B), comprised of several divisions including Videotron, the nation’s third largest telecom, sitting just behind its provincial rival BCE (TSX: BCE)(NYSE: BCE). Second is its broadcasting network TVA, the most watched in the province. Comprised of eight channels including Sun News and TVA Sports, which now hold the rights to all French language NHL games in Canada. Its third main division is centered on newspaper and magazine publication, such as Sun Media, QMI Agency, and produced over 5.5 billion advertisement flyers last year.

Quebecor is looking to finally expand its wireless division outside of its home province, as it purchased several blocks of spectrum in Ontario, Alberta and BC in the past auction. Net income in the previous quarter took a massive year-over-year jump, from $6.2 million last year to $62.5 million. The stock is trading just shy of its 52-week high, closing Friday at $26.10. Quebecor also offers an annual dividend of $0.10, and has a price target of $30.60

Bombardier

Our final company is one of the nation’s largest manufacturers, Bombardier (TSX: BBD.A). The company has run into some difficulties as of late with two of its newest aircrafts running over budget and behind schedule. However gains in its train division and the beta-testing of its new wirelessly charged busses could make up for the aviation losses.

The stock has been trading near its yearly lows since February and this could be seen as a higher risk investment. Potential gains have been overshadowed by the aviation division’s R&D, yet several years of back orders are on the books. Also if Bombardier’s PRIMOVE wireless induction powered buses prove marketable, it could drastically change the company’s future. The stock closed Friday at $3.90, just behind its average price target of $4.16. Bombardier also offers an annual dividend of $0.10.

 

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Fool contributor Cameron Conway does not own shares in any of the companies mentioned.

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