3 Top Stocks in Alberta

Oil, pipelines, and telecommunications all offer strong opportunities to investors.

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Everyone likes to support a hometown hero, and Canada’s provinces boast many success stories. Today, we take a look at a few of the many exciting opportunities in Alberta, because there are so many investing options in wild rose country.

Oil and Gas

Our first company, Husky Energy (TSX: HSE), represents the burgeoning oil and gas sector in Alberta and is the nation’s third-largest integrated oil company. The company has operations here in Canada and has been expanding in China recently, with its natural gas project in southern China coming online back in March. Back home, Husky has entrenched itself in the Alberta oil sands, recovering both heavy oil and natural gas. In Atlantic Canada, Husky has a 72% controlling stake in the White Rose oil and gas fields, along with several other minority stakes off the coast of Newfoundland.

Net earnings in the previous quarter came in at $662 million, a 24% increase over the same period in 2013. Cash flow from operations also increased by 20% to $1.5 billion. Husky is offering an annual dividend of $1.20, with a yield of 3.38%. The stock has a 52-week range of $26.91 to $37.31, and closed Friday at $36.57.

Pipelines

Where would companies like Husky be if they couldn’t transport their wares? That’s where pipeline companies such as TransCanada (TSX: TRP)(NYSE: TRP) come in. Since American approval for the Keystone XL pipeline continues at a pace slow enough to make a turtle impatient, TransCanada is preparing to open up its contingency plan. Until the pipeline is approved, the company is rumoured to be considering moving Alberta crude by rail. TransCanada originally projected that the pipeline would move 800,000 barrels a day of oil; by train it would take 10 trains a day carrying 100 tanker cars each. While this may not be the ideal solution, it does move oil across the border.

Even without the Keystone XL project, TransCanada still has 68,500 km of pipeline, through which it moves 20% of all the natural gas consumed in North America. Then there’s the current Keystone oil pipeline that delivers crude into the U.S. through Manitoba and the fact that it produces 11,800 megawatts of electricity each year. Investors are treated to an annual dividend of $1.92 with a yield of 3.8%. The stock has a 52-week range of $43.94-$51.89, with a Friday closing price of $50.48 and an average price target of $54.20.

Telecommunications

Alberta is also home to one of Canada’s top telecommunication companies, Shaw Communications (TSX: SJR.B)(NYSE: SJR). Just because Shaw doesn’t offer wireless products doesn’t mean it has a disadvantage against the big three wireless telecoms. Instead, Shaw has been expanding its network of Shaw Go wireless hotspots. These Shaw Go hotspots are an effective way for the company to cut into the data-usage plans of the big three. Shaw has even set up agreements to supply free local Wi-Fi at city-owned locations in Calgary and Edmonton.

For investors who have a penchant for telecommunications but are not as interested in wireless, Shaw currently offers an annual dividend of $1.10, which carries a yield of 4.07%. The stock has a 52-week range of $22.23-$27.38, and had a closing price of $26.99 on Friday. The stock is trading around its average price target of $26.10. What it lacks in short-term growth it makes up for with its dividend yield.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

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

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