3 Canadian Momentum Stocks with Low Volatility

The Canadian momentum stocks we’ve identified have surged 71%, on average, over the past year

SmallCapPower | July 24, 2020: Many investors love growth but have trouble stomaching excessive volatility. Today these individuals can have their cake and eat it too, as we have discovered three Canadian momentum stocks with low volatility.

*Returns are based on closing stock prices as of July 23, 2020

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Northland Power Inc. (TSX:NPI) – $36.07
Northland Power is a global developer, owner and operator of sustainable infrastructure assets. The Company owns, or has an economic interest in, 2,429 MW (net 2,014 MW) of operating generating capacity and 382 MW of generating capacity under construction, representing the Deutsche Bucht offshore wind project in the German North Sea and the La Lucha solar project in Mexico. Northland also owns a 60% equity stake in the 1,044 MW Hai Long projects under development in Taiwan and operates a regulated utility business in Colombia. Northland Power’s most recently reported quarter (Q1 2020), saw its revenue rise 34% year over year to $668 million, net income increase 35% to $275 million, and the Company said its 2020 financial guidance remains unchanged from February 2020. NPI stock is currently yielding 3.3%.

  • One-Year Return: 48% (Excluding dividends)

Enghouse Systems Limited (TSX:ENGH) – $73.84
Enghouse Systems provides enterprise software solutions and has grown through a ‘roll-up’ strategy, typically spending between $20 million to $40 million a year on acquisitions of good-quality software assets at bargain prices, which are used in contact centres, telecommunication networks, transportation systems and for video conferencing. On June 4, 2020, Enghouse reported better-than-expected Q2 2020 revenue of $140.9 million, up 58% year over year, while net earnings per share of $0.49 also surpassed expectations, surging 64% from a year earlier. Driving second-quarter results was its video conferencing division, Vidyo Inc, which enables healthcare organizations, mostly in the United States, to hold video appointments with patients over the Internet, as well as allowing banks to meet virtually with customers. ENGH stock has a current dividend yield of 0.7% and the Company has increased its dividend for 12 straight years.

  • One-Month Return: 115% (Excluding dividends)

Richards Packaging Income Fund (TSX:RPI.UN) – $64.24
Richards Packaging is a Canadian packaging distributor, the third largest in North America, which targets small- and medium-sized North American businesses. The Company has operated since 1912. Richards Packaging Income Fund reported first-quarter 2020 revenue that rose 33% year over year, 25% of which was organic. The Company saw returns on U.S. sales boosted by the Canadian/U.S. dollar exchange rate, in addition to increased revenue from sales of healthcare-related products associated with fighting COVID-19. RPI.UN has a current dividend yield of 2.1%.

  • One-Year Return: 51% (Excluding dividends)

Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.

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