Energy producers, miners, and the big banks tend dominate Canadian water cooler investing chats, but Canada has some other top stocks that should be the topic of discussion.
Here’s why I think D+H Corp. (TSX:DH) and Progressive Waste Solutions Ltd. (TSX:BIN)(NYSE:BIN) deserve to get more respect.
D+H Corp.
Most Canadians haven’t heard of this company, but anyone who has a bank account has certainly used its products.
D+H Corp. (formerly Davis and Henderson) is primarily known as being the company that prints cheques for Canada’s banks. This business is still an important and profitable part of the revenue mix, but DH has its fingers in many other parts of the financial spending pie.
Over the past decade the company has transitioned into a key player in the rapidly evolving financial technology or “fintech” market.
D+H successfully completed two major acquisitions in the past two years and is well positioned to grab a big slice of this growing market in Canada, the U.S., and overseas.
In 2013 D+H spent US$1.2 billion to buy Harland Financial Solutions, a leading fintech company that designs software systems to help banks operate more efficiently in the areas of compliance, lending, channel management, and core banking. The acquisition launched D+H as a major competitor in the U.S. market, where it previously had little business.
This year D+H pulled off another big purchase with the US$1.25 billion acquisition of FundTech, a leading provider of scale-based payment technologies.
As global banks scramble to stay competitive in the world of mobile banking, they are turning to trusted partners to help them provide better service to their customers while remaining compliant with new regulations.
D+H is in a perfect position to capitalize on this opportunity.
The stock just hit an all-time high of $44 per share and pays a dividend that yields about 3%.
Progressive Waste
If one industry can be deemed recession-proof, it has to be the waste-management sector.
Progressive Waste is a major player in the collection, disposal, and recycling of North America’s waste. The company has more than 7,500 employees and 4,500 trucks serving more than four million residential and commercial customers.
The waste-hauling business can be very competitive, but Progressive Waste is differentiating itself in a very interesting way through its investment in state-of-the art technology.
The company is converting its fleet of vehicles to run on natural gas. For the moment, the trucks have to purchase the gas at refueling stations, but there might be a day when all the trucks are fueled for free.
How is that possible?
Progressive is also a leader in converting methane gas produced at its landfill sites into natural gas. The day could arrive when all of Progressive Waste’s trucks are fueled by natural gas produced at the company’s own facilities.
In the meantime, low oil prices are driving down diesel fuel costs and that is also helping Progressive Waste’s margins.
Long-term investors can buy this stock and simply sit on it for decades.
