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Opinions The Panic-Proof Portfolio (Stockchase Research)
Canadian Utilities Preferred 4.6% PerpetualCIU.PR.A.TOTOP PICKJun 22, 2023
N/A
Stock price when the opinion was issued
Utilities
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Premium contentTOP PICK
Stockchase Research Editor: Michael O'Reilly
As the Canadian Central Bank suggests no further interest rates are likely necessary to curtail inflation, we reiterate preferred shares as a TOP PICK. The parent, CU, is a diversified utility provider with a strong balance sheet. We continue to recommend a stop-loss at $14, looking to achieve $25 -- upside potential over 40%. Yield 6.7%
(Analysts’ price target is $25.00)Utilities
Premium contentTOP PICK
Stockchase Research Editor: Michael O’Reilly
We reiterate CIU.PR.A as a TOP PICK. The parent company, CU, is a diversified utility provider that trades at 15x earnings and under 2x book value. These perpetual preferred shares -- with a high credit rating (Pfd-2) -- have declined below their $25 par value, due to rising interest rates. As interest rates stall and eventually decline, they will see a some good capital gains. This affords upside opportunity over 30 along with a great yield. We recommend maintaining the stop at $14. Yield 6.6%
Utilities
The parent company, CU, is a diversified utility provider that trades at 15x earnings and under 2x book value. The company has been prudently using cash to aggressively retire debt. The preferred shares -- with a high credit rating (Pfd-2) -- have declined below their $25 par value, due to rising interest rates. This affords upside opportunity of 38%. We recommend placing a stop-loss at $14. Yield 6.6%
(Analysts’ price target is $25.00)