The Canadian stocks on our list with operations in South Korea and Japan could thrive from economic cooperation with North Korea
SmallCapPower | May 1, 2018: South Korea and North Korea have signed a declaration committing to denuclearize the Koreas and agreed to formally end the Korean War after 65 years. While it remains to be seen what the final agreement will look like, the move represents a significant shift in North Korean foreign policy and could result in significant alterations of sanctions against the country. With less risk of regional conflict, investors may be eager to take advantage of new opportunities in the region. The three Canadian stocks on our list today could leverage that Asia-Pacific growth potential.
Westshore Terminals Investment Corp. (TSX:WTE) – $22.27
Marine Port Services
Westshore Terminals ships coal from its BC location to destinations throughout the world. The Company shipped 29Mt of coal in 2017, 37% of which was shipped to Korea, 22% to Japan, and 19% to China and Taiwan. WTE’s coal is used primarily for steel production and electricity generation.
- Market Cap: $1,574.2 Million
- Enterprise Value to EBITDA FY2018: 8.2x
- YTD Total Return: -14.7%
- Peer Average Enterprise Value To EBITDA: 9.5x
Aberdeen Asia-Pacific Income Investment Company Ltd. (TSX:FAP) – $4.44
Closed End Funds
Aberdeen is a closed-end fund focused on long-term debt securities in the Asia-Pacific region. The Company’s portfolio consists of 59% Asia-Pacific assets, 17% Australian assets, and the remainder across various North American and European assets. Aberdeen’s assets have a 5.9% annualized rate of return over the past three years, and the Company has an 8.8% dividend yield.
- Market Cap: $228.7 Million
- Forward Enterprise Value to EBITDA FY2018: N/A
- YTD Total Return: -0.3%
- Forward Peer Average Enterprise Value To EBITDA: N/A
Etrion SA (TSX:ETX) – $0.23
Independent Power Producers
Etrion is a Switzerland-based solar company operating in Japan and Chile. The Company operates 130 MW of solar farms with a 190 MW project backlog, and an additional 200 MW in the development pipeline.
- Market Cap: $74.9 Million
- Forward Enterprise Value to EBITDA FY2018: 36.6x
- YTD Total Return: -10.0%
- Forward Peer Average Enterprise Value To EBITDA: 10.4x
Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.
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