Canadians whose primary consideration to investing in stocks is price have excellent choices on the TSX. A high-yield dividend stock, a dividend-paying tech stock, and a high-growth asset trades under $20 per share. The three names are cheap but are not mediocre stocks.
Unique funding structure
Alaris Royalty Partners (TSX: AD.UN) is ideal for yield-thirsty investors. At only $18.46 per share, you can partake of the ultra-high 7.15% dividend. You can generate $1,430 in extra income (annually) with a $20,000 position in this private equity firm.
The $817.39 million company is unique in many ways. It capitalizes lower middle-market companies in North America by up to 75%. However, Alaris only accommodates industry leaders with more than $3 million historical cash flows. The transaction size ranges from $10 million to $100 million.
Management’s criterion is strict in that it will not touch Canadian and American private businesses that have a high risk of obsolescence. Some business owners seek Alaris’ assistance to buy out their departing shareholders and consolidate 100% of their common equity.
The global pandemic hurt Alaris, although it has returned to profitability this year. In the nine months ended September 30, 2021, net earnings reached $98.1 million compared to the $10.6 million net loss in the prior-year period. Also, the $42.9 million revenue in the trailing 12 months was a new record for Alaris.
Leader in Endpoint Resilience
Absolute Software (TSX: ABST)(NASDAQ: ABST) is a true gem. Growth-oriented companies, especially in the tech sector, rarely pay dividends. However, this $568.95 million, cloud-based endpoint visibility and control platform offers a decent 2.85% dividend.
The competitive advantage of Absolute is its undeletable defence platform (the only one in the industry) in Endpoint Resilience. Currently, more than 500 million devices have the platform. The endpoint resilience solutions allow enterprises, IT, and security organizations to have complete visibility, control, and self-healing Endpoint security.
Absolute enjoys brisk business this year, as shown by Q1 fiscal 2022 results. In the quarter ended September 30, 2021, total revenue increased 53% to US$43.7 million versus Q1 fiscal 2021. While it incurred a US$7.6 million net loss during the quarter, annual recurring revenue climbed 68% year-over-year to US$187.4 million.
The tech stock trades at a discount (-24.33% year-to-date), yet the return potential is fantastic. Market analysts forecast the share price of $11.94 to climb 68.1% to $18.90 in 12 months.
Three-time TSX30 winner
Investors can’t underestimate Ballard Power Systems (TSX: BLDP)(NASDAQ: BLDP). This industrial stock is one of only four high-growth stocks that made it to all TSX30 List (2019 to 2021). It’s in the company of Shopify, Cargojet and Wesdome Gold Mines Limited.
Ballard rewarded investors with a 340.90% return (63.68% CAGR) in the last three years. Market analysts remain bullish despite the current outperformance (-43.89% year-to-date). They forecast a potential upside of 72.6%, from $13.16 to $22.71 in one year.
The $4.01 billion company is a leading provider of fuel cell and clean energy solutions worldwide. Expect Ballard to dominate the transportation industry (transit bus, trucks, light rail, automotive) for years to come.
Get your money’s worth.
You’ll surely get your money’s worth by investing in Alaris, Absolute Software, and Ballard. Their competitive advantages should drive business growth.
