Loyal investors of Air Canada remain hopeful that the stock could finally take off following a long-awaited lifeline from the federal government in April 2021. I don’t want to ruin these high expectations, although it’s obvious the runway isn’t free of roadblocks, at least not for a couple of years.
Instead of Canada’s most dominant air carrier, two stocks offer better growth, if not more money-making opportunities. The share prices of Jamieson Wellness (TSX: JWEL) and Corus Entertainment (TSX: CJR.B) could skyrocket post-COVID. Both companies pay dividends too, so it’s an incentive worth considering.
Health is wealth
Jamieson Wellness will stay in the consciousness of Canadians for years. The $1.55 billion company curates its products to help customers maintain their overall health. It develops, manufactures, and sells natural health products, including daily multivitamins for all age groups. Jamieson offers digestive, heart health, and immune support formulas too.
Last year, this consumer defensive stock rewarded investors with a 42% total return on top of the modest 1.3% dividend. The current share price is $39.07 (+9% year-to-date), and market analysts recommend a “buy” rating. They forecast a potential upside of 28% to $50 in the next 12 months.
The company’s heritage Jamieson brand is available in more than 45 countries and regions worldwide. Its revenue in 2020 increased 19% versus 2019. Moreover, overall revenue spiked 17% to $403 million from the previous year. Management is due to report its Q1 2021 earnings, but you can already picture what’s in the cards for Jamieson Wellness. People will prioritize health and wellness in the post-COVID world.
Visible recovery
Corus Entertainment should be a better investment prospect than Air Canada. While the airline company struggles to recoup its losses, the $1.24 billion media and content company reports improving financials. In the first six months of fiscal 2021 (quarter ended February 28, 2021), revenue and net income grew 8% and 16% versus the same period in fiscal 2020.
The expansion onto new platforms is showing encouraging results too. Corus Entertainment’s paying subscribers to its STACKTV, Nick+ and other streaming platforms increased by more than 400,000 in April from January 2021. Its Global TV app now has 14 free news streams following the addition of four new regional news streams. Furthermore, the company’s free cash flow at month-end February 2021 was $152.1 million, or 29% higher than the prior year.
According to Corus President and CEO Doug Murphy, the most recent quarterly earnings results demonstrate strong operational momentum. Another silver lining is the recovery of its TV advertising revenue. He also credits robust paid streaming subscriber gains and double-digit growth in the content licensing business as the growth drivers.
Corus Entertainment is a no-brainer buy compared to Air Canada. At $5.99 per share, the company pays a 4.08% dividend. It should be a double whammy for would-be investors if market analysts’ forecast is accurate. They see the price hitting $10 (+67%) in the next 12 months.
Clear as day
Air Canada will take long before it flies high again on the stock market. Meanwhile, the businesses of Jamieson Wellness and Corus Entertainment should continue to thrive in the months ahead. Clearly, either one is a better choice than the struggling airline stock.
