Better Buy in March: WELL Health Stock vs. TC Energy Stock

WELL stock (TSX:WELL) has been falling lower as TRP stock (TSX:TRP) has been climbing higher. So consider this before buying.

Amy Legate-Wolfe

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Before joining Motley Fool Canada, she wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote: “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published March 12, 2024 4:40 pm EDT

When it comes to investing in Canadian companies, there are multiple strategies to take. One is to buy low and sell high. Another is to invest while the stock has some momentum. These are exactly the two options when considering WELL Health Technologies (TSX:WELL) or TC Energy (TSX:TRP).

WELL stock has been falling further from recent news, with TRP stock climbing higher. So, which is the better buy for investors to consider?

telehealth stocks — Image source: Getty Images

WELL stock

There have been a few headlines for WELL stock lately, including earnings and company changes. During earnings, the company reported record revenue for the fourth quarter and positive earnings per share (EPS). Patient visits reached 1.2 million, which was an 18% increase from the last quarter, and 30% year over year.

The company later announced it would be streamlining its business operations to improve profitability. Now, it’s looking at two new business groups of National Clinics Group and Platform Solutions Group. The former will include Canadian clinic operations, generating $300 million in revenue for 2024. Meanwhile, the latter will include platform technologies, generating about $75 million in revenue.

Yet shares dropped after both sets of news, with earnings missing estimates.

WELL stock hasn’t delved into profit margins, and increased revenue doesn’t mean increased profits. The company has also focused on acquisitions, which can be risky. That being said, WELL stock has seen massive growth and analysts believe it will outperform based on these moves. In fact, some believe investors may be missing out.

TRP stock

Then there’s TRP stock, which has also been hitting headlines over and over. Most recently this came from the sale of its Portland Natural Gas Transmission System for US$1.1 billion, including assumed debt. This will help the company achieve its debt reduction goals and should happen mid-2024.

This shows that TRP stock is listening to concerns about debt levels, especially as its Coastal GasLink project costs overrun what was originally outlined. So this is a strong strategy.

That being said, it hasn’t been a perfect ride. The company recently shut down the Keystone oil pipeline from operational problems. This 622,000 barrel-per-day pipeline is now having more issues after a 2022 spill. Yet there has yet to be any comments by the company.

This recent shut down could provide a long-term opportunity, however, with investors seeing this as a temporary issue. Selling assets as well could eventually include Keystone as the stock continues to focus on natural gas, a strong long-term play.

Even so, there is a mixed picture right now for TRP stock. Operational issues, debt concerns, and a shift towards natural gas could all be reasons to avoid. Even with shares up right now.

Bottom line

As for me, I’m leaning towards WELL stock instead of TRP stock. Those operational issues seem concerning in the short term, and could send the stock lower after climbing. Meanwhile, WELL stock looks like a basement bargain that shouldn’t be ignored. And the recent splitting of the business could allow for more opportunities for growth. So I’d stick it out for a real deal on the TSX today.