TSX Stocks Are Flying High: Should You Take Profits Now?

The TSX is rocking in Q2 2021 and so are Inter Pipeline stock and BlackBerry stock. Investors should be accumulating more shares rather than taking profit right now.

| More on:
question marks written reminders tickets

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn more

The TSX isn’t as hot as Canada’s housing market, but stocks are gaining a lot of ground in Q2 2020. Some investors will take profits while the index is up nearly 12% year to date. But if you want higher returns, now is the time to pick up the right stocks.

Inter Pipeline (TSX:IPL) and BlackBerry (TSX:BB)(NYSE:BB) had a forgettable 2020. However, both have promising business outlooks this year and beyond. The companies appear undervalued, too, and the stocks should seek their intrinsic values soon.

The promise to shareholders 

Maximizing value for all shareholders is the promise of the Inter Pipeline following its strong financial and operating results in Q1 2021. The most notable result was the 43% increase in net income to $127.8 million over Q1 2020. Its total revenue grew by 15%. On March 31, 2021, the available capacity on revolving credit facilities was approximately $2 billion.

Christian Bayle, Inter Pipeline’s president and CEO, said the successful execution of its business plan was the reason for the solid quarterly results. He also cited the considerable progress made in contracting and completing the Heartland Petrochemical Complex (HPC).

Bayle added, “The ongoing construction work at HPC is progressing well, and we remain on track to begin generating significant additional cash flow for shareholders in early 2022.” Inter Pipeline’s board of directors unanimously rejected the hostile takeover bid by an affiliate of Brookfield Infrastructure Partners in February 2021.

The board said the hostile bid is highly opportunistic. It doesn’t reflect Inter Pipeline’s full and fair value. If you were to invest today, the share price is $17.94 (+52.61% year to date). This $7.7 billion energy company pays a 2.68% dividend.

Heritage of innovation

Over the last three years, BlackBerry’s total return was a dismal -26.20%. Thus far, in 2021, the tech stock is on a hot streak with its 21.8% gain. Market analysts are bullish and see a potential 36.2% upside from $10.28 to $14 in the next 12 months. The beating should be over for the $5.81 billion provider of intelligent security software and services to enterprises and governments worldwide.

BlackBerry was part of the GameStop drama in late January 2021. Its price has risen to as high as $31.49, or 206.3% higher than the current price. Still, investors should instead look at what’s in the cards in the future. The collaboration with Amazon Web Services should start to bear fruits this year.

Furthermore, the latest company announcement is another compelling reason to invest in the tech stock. On May 7, 2021, Chinese electric carmaker WM Motor chose BlackBerry’s QNX Neutrino Realtime Operating System (RTOS), QNX Software Development Platform (SDP), and QNX Hypervisor to power its advanced W6 SUV model.

The all-electric vehicle is China’s first mass-produced vehicle. W6 can autonomously perform specific parking maneuvers. According to Dhiraj Handa, BlackBerry’s vice-president for the Asia Pacific region, the company is a trusted partner for the automotive industry. BlackBerry boasts a heritage of innovation in operating system technology and security.

TSX is rocking

Besides the record-high close on May 7, 2021 (19,472.70), Canada’s main stock index rose for a 10th consecutive week. A senior investment adviser at IA Private Wealth, Allan Small, said, “We’re rocking.” All 11 major sectors, led by health care and energy, climbed in a broad-based rally. Inter Pipeline and BlackBerry are screaming buys.

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.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Fool contributor Christopher Liew has no position in any of the stocks mentioned. David Gardner owns shares of Amazon and GameStop. The Motley Fool owns shares of and recommends Amazon. The Motley Fool recommends BlackBerry, BlackBerry, BROOKFIELD INFRA PARTNERS LP UNITS, and Brookfield Infrastructure Partners and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon.

More on Dividend Stocks

edit Person using calculator next to charts and graphs
Dividend Stocks

The 3 Best Dividend Stocks for Monthly Passive Income

These three dividend stocks are the best options for those seeking high passive income in the next few years in…

Read more »

clock time
Dividend Stocks

Got $10,000 to Invest? 1 Cheap TSX Stock to Buy Right Now

This top TSX dividend stock is finally on sale and has made some savvy buy-and-hold investors quite rich.

Read more »

A close up image of Canadian $20 Dollar bills
Dividend Stocks

Want Monthly Passive Income? These TSX Dividend Stocks Are for You

If you want monthly passive income from TSX stocks, you have to do a little digging. I've given you a…

Read more »

ETF chart stocks
Dividend Stocks

3 International ETFs to Buy for a Diversified Portfolio

Some international markets may prove more resilient against economic downturns, and exposure to them may strengthen your portfolio during crashes…

Read more »

Payday ringed on a calendar
Dividend Stocks

TFSA Pension: 3 Canadian Dividend Stocks to Buy for Monthly Passive Income

These high-yield Canadian stocks look good to buy right now for a TFSA focused on monthly passive income.

Read more »

TIMER SAYING TIME FOR ACTION
Dividend Stocks

Need $500 Right Away? These 3 Passive-Income Stocks Have Got You Covered

I could really use an extra $500 to feed my kids, who seem to be permanently hungry. Couldn't you?

Read more »

Young adult woman walking up the stairs with sun sport background
Dividend Stocks

3 Top TSX Stocks to Begin Your Investment Journey

Given their solid business models and stable cash flows, these three TSX stocks are ideal for income-seeking investors.

Read more »

Community homes
Dividend Stocks

Housing Market Crash: How to Make a Profit 

The housing market crash is here, but you can still earn dividends with Brookfield Infrastructure Partners (TSX:BIP.UN)(NYSE:BIP).

Read more »