The small cap Canadian stocks we have discovered have seen a significant increase in their Return on Equity (ROE) over the past five years
SmallCapPower | June 25, 2019: Return on Equity (ROE) is a measure of how effectively management is using a company’s assets to create profits and is calculated by dividing net income by shareholders’ equity. Today we have uncovered four small cap Canadian stocks trading on the Toronto Stock Exchange (TSX) that have seen the largest growth in ROE during the past five years.
Share prices as at close Friday, June 21, 2019, data obtained from S&P Capital IQ
Premium Brands Holdings Corporation (TSX:PBH) – $86.78
Packaged Foods and Meats
Premium Brands Holdings is a food-focused holding company that invests primarily in manufacturers & wholesalers of specialty food products, along with food distribution businesses. The Company reports on two operating segments: Specialty Foods and Premium Food Distribution. On May 21, Premium Brands Holdings Corporation announced that it had completed a private placement of 2,361,000 common shares to Canada Pension Plan Investment Board (CPPIB) for aggregate gross proceeds of approximately $200M.
- Market Cap: $3.2B
- YTD Return: 14.1%
- 90 Day Average Trading Volume: 120,000
- 5-year ROE Growth: 121%
Rogers Sugar Inc. (TSX:RSI) – $5.85
Packaged Foods and Meats
Rogers Sugar engages in refining, packaging, and marketing sugar & maple products. The Company offers granulated, plantation raw, brown, organic, icing, maple, stevia, smart sweetener blend, and coconut sugar. RSI also offers syrups, jam & jelly mixes, iced tea mixes, and hot chocolate mixes. Roger Sugar markets its products to wholesalers, restaurants, and end users, under the Lantic name in Canada, the U.S., and globally.
- Market Cap: $614.3M
- YTD Return: 5.98%
- 90 Day Average Trading Volume: 80,000
- 5-year ROE Growth: 107%
Celestica Inc. (TSX:CLS) – $8.76
Electronic Manufacturing Services
Celestica provides design, manufacturing, hardware platform, and supply-chain solutions globally. The Company offers a range of services, including design and development, engineering, supply chain management, new product introduction, and component sourcing. Celestica services the aerospace, industrial, health tech, telecommunications, and storage businesses. On June 4, 2019, Celestica Inc. announced that it has been named one of Canada’s best corporate citizens in 2019 by Corporate Knights, an organization dedicated to encouraging responsible business practices.
- Market Cap: $1.2B
- YTD Return: -27.1%
- 90 Day Average Trading Volume: 190,000
- 5-year ROE Growth: 98%
Great Canadian Gaming Corporation (TSX:GC) – $44.30
Casinos and Gaming
The Great Canadian Gaming Corporation operates 28 gaming, entertainment, and hospitality facilities throughout Ontario, British Columbia, Nova Scotia, New Brunswick, and Washington State. Its facilities include over 16,000 slot machines, 300 table games, 80 dining amenities, and over 500 hotel rooms. The Company is highly committed to its social responsibility initiatives, donating a signification portion of its gross gaming revenues to provincial governments in support of healthcare, education, and social services programs.
- Market Cap: $2.6B
- YTD Return: -8.7%
- 90 Day Average Trading Volume: 250,000
- 5-year ROE Growth: 91%
Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.
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