Q: EMA has underperformed in my view and I'm considering replacing it. Should I hope or would you suggest a replacement. It is part of my daughter's TFSA
5i Research Answer:
EMA has struggled over the passed year declining by ~9% as the whole utilities industry has been hit hard by high rates. Growth is likely to be slow in the future and it is more of an income play with a 6% yield. As rates eventually come down, EMA will likely perform better, but we think there are names in the utility space with more potential, especially considering EMA's revenue slightly declined in 2023. As a direct replacement in the utilities sector we like FTS.