4 Canadian Stocks That Could Get Hurt by a U.S. Fed Rate Hike

The Canadian stocks on our list today have high debt levels, making them vulnerable to an interest rate increase

SmallCapPower | January 30, 2018: On January 31, 2018, at 2 pm EST, the U.S. Federal Reserve will announce their interest-rate decision. The CME Group foresees a 96% chance the rate remains the same. The CME Group gives a 78% chance, though, that the Fed will raise rates at their next meeting in March. Canada is widely expected to raise interest rates in accordance with the U.S. Fed, for currency stability, which could have a negative impact on the Canadian stocks on our list today.

Centric Health Corp. (TSX:CHH) – $0.57
Drug Retailers

Centric Health is a Canada-based retail company. The Company’s Specialty Pharmacy division provides 425 client facilities with pharmaceutical dispensing, packaging and ancillary products. Its Medical Centres division runs a private hospital in Ontario, providing surgical and diagnostic services.

  • Market Cap: $117.4 Million
  • Total Debt: $95.9 Million
  • Last Reported Cash: N/A
  • Working Capital: ($4.8 Million)

Temple Hotels Inc. (TSX:TPH) – $3.50
Specialized REITs

Temple Hotels is a Canada-based company engaged in owning and operating hotel property investments across Canada. The hotel portfolio of the Company consists of over 30 hotel and investment properties comprising ~3,880 rooms. The hotel portfolio includes two extended-stay properties (Stanton Suites Hotel, Yellowknife and Clearwater Timberlea) and one investment property (Cortona Residence). It has equity interests in limited partnerships, which own hotels in London and Ottawa.

  • Market Cap: $88.4 Million
  • Total Debt: $529 Million
  • Last Reported Cash: $68 Million

Gold Reserve Inc. (TSXV:GRZ) – $3.05
Gold

Gold Reserve is a US-based gold company. The Company is conducting exploration on its LMS gold project in Alaska, acquired March 2016 from Corvus Gold Inc. (TSX:KOR). The World Bank awarded GRZ US$1.04 billion in damages after Venezuela revoked the Company’s authorization to work on a gold project in Bolivar.

  • Market Cap: $290.9 Million
  • Total Debt: $59 Million
  • Last Reported Cash: $2 Million

Mogo Finance Technology Inc. (TSX:MOGO) – $6.03
Consumer Lending

Mogo Finance Technology is a Canada-based IT company. The Company operates a suite of financial services technologies, including identity fraud protection, Bitcoin wallet, and loan solutions. The Company has 500k active users across its PC and mobile apps. Mogo raised $26.3M in bought deal financing concluding on December 28, 2017.

  • Market Cap: $134.2 Million
  • Total Debt: $103.6 Million
  • Last Reported Cash: $19.1 Million

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

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