Hitting their 52-week highs, here are four of the top Canadian stocks that have had high upwards momentum of late. With a consensus “buy” signal across the board, we’ll take a look at a couple of super-charged TSX index power stocks, a tech ticker that’s been doing roaring trade, and one lucrative healthcare stock that’s a popular choice right now.
Northland Power (TSX:NPI)
With five-year returns of 56.4% and a one-year past earnings growth of 77.8% that beat its own five-year average past earnings growth of 46.2%, Northland Power is one of Canada’s best-performing energy stocks.
Aside from the upside, this stock should appeal beyond the capital gains fanbase, with a tasty dividend yield of 4.58% backed up by a moderate 16.2% expected annual growth in earnings. While valuation is so-so (see a P/B ratio of 5.8 times book), Northland Power is a quality stock, with a 26% ROE over the past year.
Pembina Pipeline (TSX:PPI)(NYSE:PBA)
On the rise since December, Pembina Pipeline can boast a one-year past earnings growth of 44.7% that beat its own five-year average of 29.1%. As with the previous stock, the passive income crowd may be interested in a dividend yield of 4.62%, although it’s just hitting its buy limit (which may also explain why it’s reaching a 52-week high).
Again, valuation is what you might expect from a high-powered stock on the up, with a P/E of 21.6 times earnings and P/B of 2.1 times book. Still, there are far worse valuations on the TSX index, and dividend investors should be interested to see that there is some growth in earnings ahead, at 10.8% annually over the next one to three years.
On a tear since December, Shopify’s three-year returns of 639.2% would have made an investor considerably better off had they bought in back then. Up 7.49% in the last five days, this TSX index tech star still has the power to reward with upside.
Pretty consistent inside selling over the last 12 months seems somewhat at odds with the image of a breakout stock, though given its overvaluation there does seem to be some logic behind it. The buy signal for this stock should perhaps be taken tentatively, though with a 24.3% expected annual growth in earnings ahead, the growth investor may be tempted to buy.
Sienna Senior Living (TSX:SIA)
With five-year returns of 51.2% and an average earnings growth rate of 66.8% for the same period, this is a stock to keep an eye on. However, with high debt at 179.4% of net worth and Sienna Senior Living insiders having only sold shares over the last three months, caution should be exercised. Dividend investors interested in a yield of 4.95% and 23.4% expected annual growth in earnings will have to weigh up a high P/E of 119.7 times earnings.
The bottom line
Value for money is probably the deciding factor in whether the buy signal for these stocks should be acted upon. Northland Power’s P/E of 17.5 times earnings isn’t too bad, while Sienna Senior Living P/B of 2.2 times book likewise could be worse for a growth stock – see Shopify’s P/B of 10.9 times book for what runaway overvaluation looks like, for example.
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 Victoria Hetherington has no position in any of the stocks mentioned. Tom Gardner owns shares of Shopify. The Motley Fool owns shares of Shopify and Shopify. Shopify is a recommendation of Stock Advisor Canda. Pembina is a recommendation of Dividend Investor Canada.