Latest news with #ScottLysakowski
Globe and Mail
2 days ago
- Business
- Globe and Mail
This $4.6-billion money manager used the April downturn to buy Canadian dividend stocks on sale
While the U.S.-led trade war hasn't been as catastrophic for Canada as originally feared, at least so far, money manager Scott Lysakowski is still cautious about the impact the ongoing uncertainty is having on the economy. 'It hasn't really materialized in the numbers yet,' says Mr. Lysakowski, managing director and a senior portfolio manager at RBC Global Asset Management in Vancouver. He's also head of the Phillips, Hager & North (PH&N) Canadian equity team. While he's 'not overly defensive' right now, Mr. Lysakowski says he's 'mindful' of the pullback in business spending and impact on jobs that could weigh on economic growth in the coming months. 'And of course, when you've had the markets recover like they have, the risk-reward today is a lot less compelling than it was during the depths of the market volatility in April,' he says. Mr. Lysakowski, who manages the $4.6-billion PH&N Dividend Income Fund, used the April downturn to buy companies he felt were on sale, including Canadian dividend-paying stocks. The fund returned 16.7 per cent over the past 12 months, as of April 30, and has a three- and five-year annualized return of 8.5 per cent and 15.1 per cent, respectively. The performance is based on total returns, net of fees. The Globe spoke with Mr. Lysakowski recently about what he's been buying and selling. Name three stocks you own today and why. Arc Resources Ltd. ARX-T, the mid-sized natural gas producer, is a long-time core holding and a stock we've been adding to recently. It has assets in some of the best acreage in the Montney region of northeast B.C. and northwest Alberta. Arc is a low-cost producer that's disciplined with its production growth and capital allocation. And despite natural gas being a volatile commodity, it has done a good job of maintaining and growing its cash flow. Its strong balance sheet has allowed it to acquire more assets to help it build inventory for long-term growth. The company has also sustained and grown its dividend over time, which is an important feature for us. Canadian National Railway Co. CNR-T and Canadian Pacific Kansas City Ltd. CP-T are both core holdings and stocks we added to in April. Before the tariff threats, railroad stocks faced freight recessions, which are characterized by declining volumes, pricing pressure and operational challenges such as labour unrest and wildfires. We're about three years into this freight recession, a follow-on from the pandemic, which meant lagging performance. We believe railway stocks are high-quality growth cyclicals that will be impacted by economic activity but will survive. CP has been the clear outperformer in recent years and continues to drive synergies thanks to its merger with Kansas City Southern, and we expect those results to continue. There's a particular opportunity for CN to make up some lost ground. CN has lagged its peers in North America with declining volumes and operational outages. The company is focused on returning to its historical growth trend in terms of volumes, getting some of these operational issues behind it and focusing on productivity. We have been adding more CN than CP recently because we see more growth potential ahead. Telus Corp. T-T is a stock we've owned for several years and bought more of recently. All telecoms have faced several headwinds, including increased wireless competition, decreasing population growth and rising interest rates. All of the telecom stocks have underperformed the market significantly, but Telus has done slightly better than its peers. It has delivered slightly better than average revenue and EBITDA [earnings before interest, taxes, depreciation and amortization] growth. Its capital spending has peaked and is now being reduced, which enabled it to recently increase its dividend, which is quite different than some of its peers. Telus has also signalled to the market that it aims to deliver some dividend growth over the next few years. Name a stock you sold recently. Northland Power Inc. NPI-T, the offshore wind generation company, is a stock we recently exited after owning it since the fall of 2023. Investor sentiment toward renewable stocks has soured lately with the new U.S. administration removing some of the tax incentives in the industry. That led us to reduce our exposure to that group as a whole, but specifically to Northland Power. The company is developing two large-scale offshore wind projects. It has a reasonable track record of delivering projects like this and does its best to de-risk them, but as it moves through the construction phase, it will experience an elevated payout ratio – the dividends it pays out as a percentage of cash flow will be high. The market is concerned about the payout ratio and the potential risk of a dividend cut. So, as a dividend manager focused on dividend growth, I don't want to be invested in companies that are cutting their dividends. We decided to step aside during this period of uncertainty. This interview has been edited and condensed.
Yahoo
08-03-2025
- Business
- Yahoo
Is B2Gold Corp. (BTG) the Cheap Canadian Stock to Buy According to Analysts?
We recently published a list of . In this article, we are going to take a look at where B2Gold Corp. (NYSEAMERICAN:BTG) stands against other cheap Canadian stocks to buy according to analysts. In January, RBC Global Asset Management released its Market Outlook for Canada. Scott Lysakowski, the Managing Director & Senior Portfolio Manager, Head of Canadian Equities reflected on the Canadian market's performance in 2024. He noted that the Canadian equity market, particularly the S&P/TSX Composite Index, experienced a notable year. The TSX achieved a total return of approximately 21%, which Lysakowski thinks is commendable, especially considering the broader economic context. However, this performance was somewhat overshadowed by the US market, where mega-cap stocks led the charge. The TSX's gains, while substantial, were not as robust as those in the US, which Lysakowski attributed to the dominance of large-cap stocks in the latter part of the year. Lysakowski noted that one interesting observation from 2024 was the brief increase in market breadth following significant events, such as elections. During these periods, mid-cap and small-cap stocks temporarily outperformed, suggesting a potential shift towards broader market participation. However, this trend was short-lived, and the year concluded with mega-cap stocks once again driving the majority of returns. The top ten stocks in the market contributed significantly to the overall performance, highlighting the persistent dominance of these large players. Moreover, in analyzing the composition of returns for the TSX, Lysakowski suggests that it's clear that the 21% total return consisted of a 3% dividend yield, with the remaining 18% split between earnings growth and valuation changes. Specifically, earnings growth accounted for about 9%, and multiple expansions contributed around 7%. In contrast, the US market, particularly mega-cap stocks, saw more pronounced earnings growth and multiple expansions, which explains their superior performance. Looking ahead to 2025, Lysakowski noted that the outlook remains uncertain, partly due to macroeconomic factors such as the weakness in the Canadian dollar. This currency volatility is a significant concern for Canadian equities, as it impacts both investor sentiment and the macroeconomic outlook. Furthermore, the divergence in earnings growth between mega-cap and small-cap stocks suggests that until smaller companies demonstrate stronger earnings growth, the dominance of large-cap stocks will likely continue. This dynamic will be crucial to monitor in the coming year, as broader market participation could have a positive impact on Canadian equities. For this article, we used the Finviz stock screener, Yahoo Finance, Seeking Alpha, and CNN as our sources. Using the screener we aggregated a list of Canadian stocks that are trading below a Forward P/E of 15, with earnings growth expectations this year, and an upside potential of more than 10%. Next, we cross-checked the FWD P/E for each stock from Seeking Alpha and earnings growth from Yahoo Finance. Lastly, we ranked the stocks in ascending order of the average upside potential. Please note that the data was recorded on March 3rd, 2025. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (). Aerial view of a gold mine in Mali, showing the scale of the mining operations.B2Gold Corp. (NYSEAMERICAN:BTG) is a Canadian company that specializes in gold mining. It has operations in several countries including the Fekola Mine in Mali, the Otjikoto Mine in Namibia, and the Masbate Mine in the Philippines. The company is also involved in developing new projects and exploring for gold in countries like Colombia, Finland, and Canada. In Canada, it is working on the Goose Project in Nunavut and has interests in the Back River Gold District. On February 20, analyst Brian Quast from BMO Capital maintained a Buy rating on the stock while keeping the price target at C$7.00. The analyst noted that the company's gold production levels were in line with expectations, reaching the lower end of their revised annual guidance for 2024. This stability suggests a reliable production base moving forward. In addition, the cash operating costs and all-in-sustaining costs were within the company's guidance ranges as well, indicating that the company is managing its expenses effectively. During the fiscal fourth quarter of 2024, B2Gold Corp. (NYSEAMERICAN:BTG) produced 186,001 ounces of gold. Management noted that strong performance from the Masbate and Otjikoto mines aided in offsetting the lower output from Fekola. It is one of the cheap Canadian stocks to buy according to analysts. Overall, BTG ranks 3rd on our list of cheap Canadian stocks to buy according to analysts. While we acknowledge the potential of BTG as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than BTG but that trades at less than 5 times its earnings, check out our report about the . READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
