According to a report on Private and Public Investment in Canada, published by Statistics Canada, public and private investment in construction and machinery and equipment is estimated to grow 1.3% to $404.5 billion in 2014. Higher capital investment in the public sector is expected to continue, growing 1.9% to $89.3 billion while investments in private sector including housing will reach $315.2 billion during 2014, 1.3% higher than 2013. According to the report, transportation and warehousing, housing and public administration sectors are the principal drivers of investment spending. Spending in oil and gas extraction is expected to increase 3.1% to $71.6 billion during 2014. However, mining – the key sector in the Canada economy, which has been witnessing a decline in capital investments since mid-2011, due to weak metal ore prices is expected to decline 14.8% to $11.5 billion during 2014. Alberta is expected to lead the country this year in total capital investment growth, driven largely by oil and gas extraction and pipelines.
Ubika Research has shortlisted eight stocks across sectors which have incurred high capital expenditure during 2013 with strong operating cash flow and are estimated to increase their Capex spending during 2014, according to analysts polled by Bloomberg. Moreover, these companies have recorded significant growth in earnings during 2013 with high EBITDA margins and are estimated to register strong growth during 2014. Additionally, we note that some of the shortlisted stocks have recorded significant price gains with daily average trading volume in excess of 100,000 shares over the past three months.
|
Company Name |
Ticker |
Exchange |
Market Cap |
Last Price |
Average Volume |
Price Change |
EPS Growth |
EPS Growth |
Operating Cash Flow Growth |
EBITDA Margin |
CaPex |
CaPex Growth |
|
Toromont Industries Ltd |
TIH |
TSX |
1.9 |
25.16 |
170,124 |
-5.9% |
2.5% |
4.7% |
494.8% |
14.6% |
94.8 |
30.2% |
|
TORC Oil & Gas Ltd |
TOG |
TSX |
1.1 |
11.65 |
1,142,523 |
9.7% |
77.5% |
364.4% |
825.4% |
40.3% |
162.7 |
23.2% |
|
Progressive Waste Solutions Ltd |
BIN |
TSX |
3.1 |
27.18 |
292,716 |
3.3% |
25.9% |
2.1% |
33.8% |
25.7% |
273.9 |
20.0% |
|
Mullen Group Ltd |
MTL |
TSX |
2.5 |
27.59 |
301,466 |
-2.0% |
1.3% |
7.1% |
-23.4% |
20.9% |
133.7 |
15.7% |
|
Paramount Resources Ltd |
POU |
TSX |
4.3 |
44.48 |
207,066 |
14.9% |
12.3% |
87.9% |
-18.7% |
19.8% |
736.2 |
12.9% |
|
West Fraser Timber Co Ltd |
WFT |
TSX |
4.5 |
50.77 |
319,900 |
-2.3% |
303.0% |
18.1% |
114.9% |
15.2% |
338.0 |
8.8% |
|
Tembec Inc |
TMB |
TSX |
0.2 |
2.43 |
202,517 |
-15.3% |
58.5% |
150.0% |
NA |
4.5%% |
127.0 |
6.3% |
|
Canfor Corp |
CFP |
TSX |
3.7 |
26.39 |
517,684 |
-1.2% |
794.4% |
41.4% |
317.6% |
16.9% |
237.3 |
5.9% |
Source: Bloomberg
Company Description:
Toromont Industries Ltd (TSX: TIH)
Toromont Industries Ltd sells, rents, and services Caterpillar construction equipment and power systems in the provinces of Ontario, Manitoba, Newfoundland, Labrador and Nunavut, Canada. The company also manufactures and distribute refrigeration and process systems throughout North America.
TORC Oil & Gas Ltd (TSX: TOG)
TORC Oil & Gas Ltd is engaged in the acquisition, development, and production of oil and natural gas in the Western Canadian Sedimentary Basin. The company is focused on Cardium development in West Central Alberta and Banff and Big Valley prospects in Southern Alberta.
Progressive Waste Solutions Ltd (TSX: BIN)
Progressive Waste Solutions Ltd. provides non-hazardous solid waste collection and landfill disposal services for commercial, industrial and residential customers in British Columbia, Alberta, Manitoba, Ontario and Quebec. The company also serves customers in the southern and northeastern regions of the United States.
Mullen Group Ltd (TSX: MTL)
Mullen Group Limited owns asset based oilfield services and trucking businesses. The company’s oilfield services division provides specialized transportation equipment and trained operating personnel to the oil and gas industry in western Canada. Mullen’s trucking division provides bulk hauling, truckload, and other services to shippers in Canada and the United States.
Paramount Resources Ltd (TSX: POU)
Paramount Resources Ltd. explores for and develops oil and natural gas. The company operates primarily in western Canada.
West Fraser Timber Co Ltd (TSX: WFT)
West Fraser Timber Co. Ltd. produces dimension lumber and related wood products, fiberboard, pulp, linerboard, kraft paper, and newsprint. The company has operations in British Columbia, Alberta and in the southern United States.
Tembec Inc (TSX: TMB)
Tembec Inc. is an integrated forest products company marketing its products in countries around the world. The company markets softwood, hardwood, and pine lumber, as well as laminated veneer lumber, hardwood flooring, and oriented strand board. Tembec also markets chlorine-free pulp, bleached kraft pulp, newsprint and publishing papers, paperboard, and lignosulfonates.
Canfor Corp (TSX: CFP)
Canfor Corporation is an integrated forest products company that produces and supplies SPF lumber, oriented strand board, plywood, kraft pulp and kraft paper. The company also produces remanufactured lumber products, hardboard paneling and special baled fibre products. In addition, Canfor produces kraft pulp and newsprint through a joint venture partnership with Howe Sound Pulp and Paper.
