5i Stock Screener: Canadian Companies With Strong Share Buybacks Programs

Michael Huynh Jan 31, 2023
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2022 was an interesting year to watch from the long-term investors’ point of view, as it is only in tough times that we can test the managerial talents of a company. This is an opportunity for investors to evaluate whether the management of their portfolio companies play offence by actively acquiring competitors at a good valuation, buying back their own shares or play defence by holding more cash and paying down debts. Over time, these decisions could have a tremendous impact on the long-term shareholders’ returns.

Below we have screened for companies with the following criteria:

  • Repurchased shares of more than 5% of the market cap in the last twelve months
  • Market cap larger than $100 million
  • Net debt to EBITDA ratio below 3.0x

The criteria above reflect companies that have repurchased their shares for cancellation of more than 5% of the shares outstanding within the trailing twelve-month period. We like share buybacks for a few reasons: 1) Management believes shares are currently undervalued 2) Management is disciplined in allocating capital and shareholder-friendly by unlocking that discount to intrinsic value through a safe and tax-efficient manner 3) It is psychologically comfortable for investors to continue owning the stock when it goes down, as the lower the share price drops, the more shares the company can repurchase given the same amount of dollars spent.

Here is the screener:

Identifier Company Name Country of Exchange T12M % Change in Shares Outstanding Company Market Capitalization
(Hundred Million, CAD)
Net Debt To EBITDA (Daily Time Series Ratio)
ATD.TO Alimentation Couche-Tard Inc Canada -5.8% 618.62 1.21
AGFb.TO AGF Management Ltd Canada -8.4% 5.22 0.09
TCW.TO Trican Well Service Ltd Canada -7.3% 8.27 0.06
ELF.TO E-L Financial Corp Ltd Canada -6.7% 32.02 0.18
LNR.TO Linamar Corp Canada -6.1% 38.93 0.48
IFP.TO Interfor Corp Canada -15.4% 11.60 0.21
LNF.TO Leon's Furniture Ltd Canada -11.6% 12.29 1.02
TFII.TO TFI International Inc Canada -6.1% 125.27 1.13
FTT.TO Finning International Inc Canada -5.0% 55.28 2.02
ALC.TO Algoma Central Corp Canada -6.9% 6.35 1.77
SJ.TO Stella-Jones Inc Canada -7.9% 28.14 2.26
ARX.TO ARC Resources Ltd Canada -11.0% 103.23 0.36
WTE.TO Westshore Terminals Investment Corp Canada -5.1% 15.35 0.73
AAV.TO Advantage Energy Ltd Canada -10.0% 15.11 0.12
ERF.TO Enerplus Corp Canada -9.2% 51.93 0.25
MX.TO Methanex Corp Canada -7.9% 41.12 1.94
CNQ.TO Canadian Natural Resources Ltd Canada -7.2% 888.28 0.59
IMO.TO Imperial Oil Ltd Canada -13.0% 418.13 0.06
GIL.TO Gildan Activewear Inc Canada -7.4% 72.45 1.11
CIGI.TO Colliers International Group Inc Canada -5.5% 58.55 2.21
EXE.TO Extendicare Inc Canada -5.4% 5.56 2.59
SU.TO Suncor Energy Inc Canada -7.4% 600.64 0.61
DR.TO Medical Facilities Corp Canada -16.7% 2.11 1.63
CGG.TO China Gold International Resources Corp Ltd Canada -5.8% 19.27 1.09
FEC.TO Frontera Energy Corp Canada -11.7% 10.85 0.43
MEG.TO MEG Energy Corp Canada -5.0% 57.69 0.91
TOU.TO Tourmaline Oil Corp Canada -7.9% 216.76 0.05
ZZZ.TO Sleep Country Canada Holdings Inc Canada -5.6% 8.87 1.44
NTR.TO Nutrien Ltd Canada -8.8% 544.24 1.06


In addition, having an appropriate debt level, and a healthy financial position not only lowers the company’s cost of capital but also helps its investors sleep better at night. This is even more critical as interest rates have gone up recently, making it more expensive for companies to borrow. We prefer companies that are over $100 million in market cap, as these companies have proven themselves to be more mature, self-sustainable entities.

Members will recognize some of the names that we cover in our Model Portfolios and coverage list such as: TFI International Inc. (TFII), Gildan Activewear Inc. (GIL).

It is critical to note that although we do like accretive acquisitions as an offensive strategy. However, it takes years to evaluate whether those M&A deals make sense strategically or if management overpaid just for the sake of expansion. Therefore, we think share buybacks are one of the safest ways to return capital to shareholders in a tax-efficient way, given that these buyback programs are done when shares are traded at a discount to intrinsic value.

Lastly, these companies on the list are not recommendations, but rather a starting point that helps investors generate potential investment ideas. You can view our previous screener blog here.

Take Care,

Michael Signature

Disclosure: The analyst(s) responsible for this report do not have a financial or other interest in the securities mentioned.

1 comment


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Feb 1, 2023
I would have thought Stelco would be the top of this list. Bought back 29% of their shares in 2022, have net cash on the balance sheet, and a market cap of almost $3 billion.