We’ve passed the midway point of the year, which means that it’s probably a good time to revisit your portfolio in preparation for 2020.
Investors have been treated to a turbulent energy sector in 2019. This has produced some attractive discounts, but today I want to focus on equities with a better chance to outpace those in the oil and gas sector.
Global Water Resources
Global Water Resources (TSX:GWR)(NASDAQ:GWRS) is a water resource management company that operates principally in Phoenix, Arizona. Demand for water around the globe is set to skyrocket in the coming years.
This is especially true in arid climates like Arizona. The company is set to release its second quarter 2019 results on August 8.
Shares of GWR have climbed 16.3% in 2019 as of early afternoon trading on July 23, and the stock is up 30% year over year. Abnormally high precipitation levels in Q1 2019 were not enough to dampen a very strong quarter for the company.
Revenue rose 4% year-over-year to $7.7 million and net income more than doubled to $0.6 million or $0.03 per share.
GWR last announced a monthly cash dividend of $0.023861 per share, which represents a 2.3% yield at the time of this writing. Shares had an RSI of 81 as of mid-afternoon trading on July 23, putting GWR deep in technically overbought territory.
Value investors may want to wait for a better entry point, but this is still a stock to cling on to for the long haul.
Innergex Renewable
Innergex Renewable (TSX:INE) stock has climbed 21% in 2019 at the time of this writing. Roughly this time last year I’d explained why Innergex was well worth stashing in a TFSA for the long term.
Over the past five years Innergex has boasted average annual returns of nearly 11%. This is a great pace given that it also offers an attractive dividend.
The company continued its strong performance in Q1 2019. Revenues rose 24% year over year to $126.4 million and adjusted EBITDA for continuing operations increased 27% to $93.2 million.
The increase was primarily due to acquisitions made in 2018. Innergex is on track for another solid year in 2019 with the Phoebe Solar Project in Texas set for commercial operation sometime in the third quarter.
Innergex last declared a quarterly dividend of $0.175 per share, representing a solid 4.7% yield at the time of this writing. Innergex stock has a high price-to-earnings ratio, so investors should keep in mind that we’re betting on a solid growth trajectory into the next decade.
The stock last had an RSI of 62, putting it just outside of technically overbought territory.
Investors can expect to see the company’s second quarter 2019 results on August 13, 2019. Those seeking value may want to wait for a more favourable entry point to avoid paying a premium. A 5% dividend yield serves well as a target to buy for the rest of 2019.
