Canadians with healthy investment appetites but limited capital can still make money through stock investing. Three price-friendly options are available on the TSX. Two are dividend payers and the third should benefit from emergent blockchain technology.
Diversified Royalty (TSX:DIV), Quarterhill (TSX:QTRH), and HIVE Blockchain Technologies (TSXV:HIVE)(NASDAQ:HIVE) won’t dent your budget much, but the near-term returns should be awesome. Scoop one, two, or all right now while they are surprisingly cheap.
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Strong 2022
Diversified Royalty is a pure-dividend play. The share price is only $3.08, but the dividend yield is a hefty 7.05%. This $386.14 million royalty corporation owns the trademarks to six ongoing business concerns and collects revenues from them. The companies in the royalty pool are Mr. Lube, Nurse Next Door, AIR MILES, Sutton, Mr. Mikes, and Oxford Learning Center.
Despite the fallout from the pandemic, the royalty company increased its dividends twice last year. The businesses are improving, as evidenced by the royalty income growth of Diversified in Q4 and full-year 2021. It rose 19.4% versus Q4 2020 and increased 22.4% year over year.
Sean Morrison, president and CEO of Diversified, said, “2021 was a year of continued challenges from the various COVID-19 surges.” He cites the record results of Mr. Lube, its largest royalty partner as of year-end 2021. Also, because of the recovery of the other five partners, the total royalties collected were 14% higher than in 2020.
Management said the multi-royalty firm is well-positioned for a strong 2022 with continued improvement from its Royalty Partners. There are also increased royalty acquisition opportunities available.
Niche player
Quarterhill might be obscure to many investors, but it’s a niche player in the technology sector. The $244.67 million company from Toronto operates in the intelligent transportation system (ITS) industry for which it provides tolling and enforcement solutions. Wi-LAN Inc., a subsidiary, offers intellectual property licensing.
Management aims to be the leader in ITS globally. It plans to achieve its goal through the organic growth of its platforms, namely Electronic Transaction Consultants, LLC (ETC), and International Road Dynamics, Inc. (IRD). Quarterhill’s acquisition-oriented investment strategy is also a way to capitalize on attractive growth opportunities within ITS and adjacent markets.
The tech stock trades at $2.13 per share and carries a buy rating from analysts. Their 12-month average price target is $3.73%, an upside potential of 75.1%. Your overall return would be higher to include the 2.34% dividend.
Very good entry point
HIVE underperformed in 2022 because of the overall negative sentiment in the cryptocurrency market. However, the $967.23 million crypto mining company has rewarded investors with an incredible 362.75% return (66.49% CAGR) in 3.01 years. At $2.36 share, the blockchain stock is down 28.7%.
The current share price is a very good entry point. Based on market analysts’ buy recommendation, the return potential in one year is 109.2% ($4.98). HIVE conducts its mining operations in green energy-powered data centre facilities. The locations are in Canada, Iceland, and Sweden.
HIVE looks forward to a 95% increase in its aggregate Bitcoin mining hash rate by following the deal to purchase Bonanza Mine. The latter is Intel’s newest ASIC (application-specific integrated circuit) chip.
Fair deal
If you’re ready to part ways with your limited seed capital, you’ll get a fair deal with any of these three price-friendly stocks.
