October brings beautiful fall colours, but in 2018 it also brought some unwanted volatility to the TSX Index.
Just as trees shedding their leaves is a necessary part of nature, giving way to new life next spring, sell-offs like we’ve seen over the past month create new opportunities for Foolish investors.
Maxar Technologies (TSX:MAXR)(NYSE:MAXR) is a technology company undergoing a pretty significant transformation right now.
Maxar, which used to go by the name of MacDonald, Dettwiler and Associates, is currently making a pivot away from its legacy satellite communications business and now making a big push into the U.S. defence market.
Several components of the company’s transition have already taken place, including the dual listing of its shares on the NYSE.
If the move is executed according to plan, and the company is successful in winning some large U.S. government contracts, shares could soar to new heights.
Meanwhile, MAXR stock pays you a respectable 4.10% while you wait.
Okay, so Teck Resources’s (TSX:TECK.B)(NYSE:TECK) dividend isn’t exactly going to blow your socks off, yielding just 0.81% per year as of Friday’s trading. The metals and mining company was forced to cut its dividend in the wake of the super-cyclical collapse in commodity prices that took place earlier in the decade.
But it appears as though Teck is starting to learn from some of its past mistakes.
Instead of aggressively ramping up its dividend as commodity prices have begun to recover, it’s taken the more prudent route of paying down some of its near-term debt maturities in order to improve its long-term financial flexibility.
However, the company did come out with a disappointing earnings report late last week, so investors would probably be best advised to continue to monitor TECK stock and wait for the situation to stabilize somewhat before making their move.
Canadian Western Bank (TSX:CWB) has made some pretty major acquisitions in recent years, as the bank looks to make a push to compete on the same stage of some of its larger rivals.
However, the bad news is that may cost shareholders if the economy were to take a downturn.
The very same aggressiveness that won the favour of CWB’s shareholders, leading to the value of the company more than doubling between 2016 and 2018, may come back to haunt it should interest rates continue to rise, as some are speculating they may.
Not only would CWB’s interest costs be expected to increase but there would be a heightened degree of risk on the company’s loan book.
Yielding shareholders 3.40% annually as of this writing, this is another one that offers solid long-term promise, but it might warrant that investors exercise a little patience to see if they can obtain a better purchase price for the shares.
When investors start to stress about the stock market, more often than not, it’s quality that ends up being rewarded.
These three stocks each have bright futures ahead of them, which should pave the way for sustainable dividend increases for the company’s shareholders.
When you buy heavily cyclical stocks at low prices… and then hold the shares until the cycle reaches its peak… you can make a very healthy profit.
Every investor knows that. But many struggle to identify the best opportunities.
Except The Motley Fool may have a plan to solve that problem! Our in-house analyst team has poured thousands of hours into their proprietary research – and this is the result.
Our top advisor Iain Butler has just identified his #1 stock to buy in 2018 (and beyond).
The last time this stock went from the low point of its cycle to the peak… shares shot from $12 to $40 inside of 4 years. That’s an 300%-plus return. And if you missed out on that ride, today might just be your second chance.
Fool contributor Jason Phillips has no position in any of the stocks mentioned. Maxar is a recommendation of Stock Advisor Canada.