The Canadian financial stocks on our list are top value picks from a Scotiabank analyst
SmallCapPower | September 11, 2020: Scotiabank analyst Phil Hardie recently published his list of top value picks in the Canadian diversified financial sector. The three Canadian financial stocks we’ve identified today are his top deep value and “recovery trade” ideas.
*Returns are based on closing stock prices as of September 10, 2020
Onex Corporation (TSX:ONEX) – $63.31
Onex is a private equity and wealth management services company that was founded in 1984. Its platforms include: Onex Partners, private equity funds focused on larger opportunities in North America and Europe; ONCAP, private equity funds focused on middle market and smaller opportunities in North America; Onex Credit, which manages primarily non-investment grade debt through collateralized loan obligations, senior loan strategies and other private credit strategies; and Gluskin Sheff’s wealth management services including its actively-managed public equity and public credit funds. In total, Onex has about $35.6 billion of assets under management, of which approximately $6.6 billion is its own shareholder capital. Mr. Hardie described Onex as “too cheap to ignore.” ONEX stock has a current dividend yield of 0.6%.
Brookfield Business Partners L.P. (TSX:BBU.UN) – $40.55
Brookfield Business Partners is the business services and industrials company of Brookfield Asset Management. Brookfield Business is focused on long-term capital appreciation, targeting 15% to 20% returns on investment. The Company acquires businesses on a value basis, refocuses operations to enhance value, and then monetizes the mature business and recycles the capital. Its three primary operating segments are: business services; infrastructure services; and industrials. BBU.UN units have a current dividend yield of 0.8%.
Guardian Capital Group Limited (TSX:GCG) – $24.30
Guardian Capital is a diversified financial services company founded in 1962. Guardian operates in two main business areas: Asset Management and Financial Advisory. As of June 30, 2020, Guardian had C$31.2 billion of assets under management and C$20 billion of assets under administration. Guardian Capital offers institutional and private wealth investment management services; financial services to international investors; services to financial advisors in its national mutual fund dealer, securities dealer, and insurance distribution network. GCG stock has a current dividend yield of 2.6%.
Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.
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