The Canadian financial stocks on our list are trading at industry-low Forward P/E multiples
SmallCapPower | November 16, 2017: Today we have identified five Canadian financial stocks to watch in a rising interest rate environment. The stocks on our list trade at some of the lowest Forward Price to Earnings multiples in the industry.
Equitable Group Inc. (TSX:EQB) – $62.67
Consumer Lending
Equitable Group operates as a Schedule I bank that offers a variety of residential lending, commercial lending and saving solutions. The Company utilizes a branchless approach, instead working with mortgage brokers, deposit agents and financial planners who provide professional advice to clients. Currently, the Company has $22.3 billion in assets and employs 550 individuals across Canada.
- Market Cap: $1,033 Million
- Forward P/E (NTM): 6.49x
- ROE (Last Reported): 14.4%
- Month over Month Return: 6.9%
Street Capital Group Inc. (TSX:SCB) – $1.13
Investment Management & Fund Operators
Founded in 2007, Street Capital Group operated as a mortgage lender for 10 years before receiving approval to become a Schedule I Bank. The Company is authorized to issue and sell mortgage-backed securities, and is an approved lender with the Canada Mortgage and Housing Corporation (CMHC). Currently, Street Capital has over $25 billion in mortgages under administration.
- Market Cap: $138 Million
- Forward P/E (NTM): 7.03x
- ROE (Last Reported): 11.1%
- Month over Month Return: -13.7%
Callidus Capital Corp. (TSX:CBL) – $9.98
Corporate Financial Services
Established in 2003, Callidus Capital Corporation acts as a bridge financier, providing swift and flexible financing solutions to Companies unable to utilize the services of traditional lenders. With loan offerings ranging between $5 million and $100 million, Callidus has financed companies across Canada and the U.S. with over $1 billion.
- Market Cap: $505 Million
- Forward P/E (NTM): 8.37x
- ROE (Last Reported): -18.7%
- Month over Month Return: -2.3%
Fairfax India Holdings Corp. (TSX:FIH.U) – $15.42
Investment Holding Companies
Fairfax India Holdings acts as an investment holding company focused on acquiring private and public businesses in the Indian subcontinent. Founded in 2014, Fairfax India takes a long-term value approach towards investment opportunities. Fairfax investments are collectively worth in excess of $1.2 billion and are diversified in a number of industries including freight, transportation and chemicals.
- Market Cap: $1,801 Million
- Forward P/E (NTM): 8.89x
- ROE (Last Reported): 31.6%
- Month over Month Return: -14.5%
Laurentian Bank of Canada (TSX:LB) – $58.25
Banks
Founded in 1846, The Laurentian Bank of Canada operates as chartered Canadian bank serving over 500,000 clients across Canada. Operating a network of 145 branches, the Laurentian Bank employs over 3,600 individuals and as approximately $32 billion in assets under administration.
- Market Cap: $2,263 Million
- Forward P/E (NTM): 9.20x
- ROE (Last Reported): 11.8%
- Month over Month Return: -3.9%
Disclosure: Neither the author nor any of the principals at SmallCapPower, or their family members, own units in any of the companies mentioned above.
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