Even though the darkest of times, such as the pandemic, is over and the market has been recovering considerably, the recession is still looking along with rising interest rates. Hence, stock market investors still need to be careful while making investment choices.
Luckily, there are still some stocks that are safe and considerably more reliable. Fortis (TSX:FTS) is such a stock.
Fortis is a highly diversified leader in the regulated electricity and gas sector in North America. With robust financial performance in 2022, the company posted revenues of $11 billion and boasted total assets of $65 billion as of March 31, 2023. Fortis employs a dedicated workforce of 9,200 professionals and serves in five Canadian provinces, 10 U.S. states and three Caribbean countries.
Fortis has provided incredible long-term returns
Fortis has shown commendable stock market performance over the past five years, posting a substantial 27% gain. Its growth of over 22% is well above the market returns over the same period, excluding dividends.
Fortis has managed to achieve a steady annual growth of 4.8% over the past five years. Interestingly, this growth is closely related to the average annual share price growth, indicating that investor sentiment towards the company has remained relatively stable.
Over the past one-year period, Fortis shareholders enjoyed a total shareholder return of 6.8%, including dividends. Looking at the longer horizon of five years, an annualized total shareholder return of 9% paints an even more promising picture.
Fortis subsidiary files IPO
Agilus Diagnostics, a subsidiary of Fortis Healthcare, filed for an initial public offering (IPO) in India, sending Fortis shares up by 0.5%. The IPO includes 1.42 crore shares offered by entities such as International Finance Corp and NYLIM Jacob Ballas India Fund III LLC. Agilus, formerly SRL Ltd, is a major diagnostic services provider in India.
Fortis Healthcare has shown promising growth with increasing revenue, profitability and plans to pay dividends. The company has expanded through acquisitions such as Artistery Properties, signalling its intent to expand the industry. Fortis Healthcare shares are trading on low volatility, near their 52-week high, indicating investor confidence. Analysts expect continued profitability, making Fortis Healthcare a company worth watching.
Bottom line
Considering Fortis’s growth over recent years and its steady record of dividend payments, long-term investors might find the stock worth investing in. I’m of the view that, at least in terms of total shareholder return, there aren’t many better options on the TSX right now. Accordingly, this is a stock I’m eyeing for my next Registered Retirement Savings Plan purchase down the line.
