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Enbridge Inc. (ENB)
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Fortis Inc. (FTS)
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Polaris Renewable Energy Inc. (PIF)
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Hammond Power Solutions Inc. Class A Subordinate Voting Shares (HPS.A)
Q: I am at loss with PIF. Thinking selling it and buying either ENB, FTS or HPS.A to add to my existing positions. Do you think it is a right move as PIF share price is not moving? a Which one of the above names has highest potential under current share price to buy as replacement of PIF.
5i Research Answer:
PIF's very small size and higher valution make it less interesting for us. We are quite comfortable with the other three stocks in the question. ENB and FTS are utility-like, with stable cash flow. They are of course much larger and we would see them as solid income stocks. But for replacing a small cap with growth potential, we would prefer HPS.A if one remains comfortable with small/midcap risk. HPS.A is growing much faster yet remains valued (on P/E) at about the same level as PIF.