Hi there, Fools! I’m back to quickly highlight three stocks trading at new 52-week highs. Why? Because after a given stock rallies over a short period of time, one of two things usually happens:
- the stock keeps on climbing as momentum traders pile on; or
- the stock quickly pulls back as value-oriented investors lock in profits.
The three stocks below have returned as much as 90% over the past year. So, if you’re a TFSA investor looking to carry that momentum into 2020 (while keeping the CRA at bay), this list is a good place to begin.
Telus’s strong gains continue to be supported by steady wireless growth, robust free cash flow generation, and consistent dividend increases. In the most recent quarter, Telus’s wireless net additions climbed 13% to 193,000.
More importantly, management boosted the quarterly dividend to $0.5825 per share, the 18th straight increase since Telus’s multiyear program started in 2011.
“We have established an enviable track record in respect of an attractive balance sheet and strong operational performance, which enable us to successfully execute on our consistent, transparent and industry-leading shareholder-friendly program,” said CEO Darren Entwistle.
Telus shares offer a dividend yield of 4.4%.
Element of surprise
Next up, we have fleet management specialist Element Fleet Management (TSX:EFN), which is up about 90% over the past year and currently trades near 52-week highs of $13.25 per share.
Element’s recent price gains have been underpinned by strong asset management growth, healthy cash flows, and continued balance sheet strengthening. In the most recent quarter, adjusted operating income jumped 31%, as revenue improved 11% to $246 million.
“Element is making remarkable progress on all aspects of our strategic plan,” said CEO Jay Forbes. “Our singular focus on our transformation is delivering results that remain ahead of plan, enabling us to significantly increase our targeted profit improvements to $180 million.”
Element shares are up about 90% over the past year.
Enbridge’s steady gains continue to be supported by a diversified business model (transportation, distribution, and generation of natural gas), strong cash flows, and stable dividend growth. In December, for example, Enbridge said it expects higher EBITDA and distributable cash flow than previously forecast.
Based on that bullish view, management hiked its dividend nearly 10%.
“With the significant repositioning of the company now complete following the Spectra transaction, our asset base and low risk business model position us very well for the future,” said CEO Al Monaco.
Enbridge shares currently offer a healthy dividend yield of 6%.
The bottom line
There you have it, Fools: three red-hot momentum stocks worth checking out.
As always, they aren’t formal recommendations. Instead, look at them as a starting point for further research. Momentum stocks are especially fickle, so plenty of your own due diligence is required.
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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 Brian Pacampara owns no position in any of the companies mentioned. The Motley Fool owns shares of and recommends Enbridge.