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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Fortis Inc. (FTS $68.35)
- $68.35 P/E (TTM): 20.1X Cap: $34.42B
- View FTS Profile
- View Questions on FTS
Capital Power Corporation (CPX $57.27)
- $57.27 P/E (TTM): 17.68X Cap: $8.85B
- View CPX Profile
- View Questions on CPX
- View Reports on CPX
Brookfield Infrastructure Partners L.P. (BIP.UN $43.14)
- $43.14 P/E (TTM): 1043.97X Cap: $19.89B
- View BIP.UN Profile
- View Questions on BIP.UN
Hydro One Limited (H $50.01)
- $50.01 P/E (TTM): 23.97X Cap: $29.99B
- View H Profile
- View Questions on H

Q: My utilities holdings include BIP.UN (3.9% of total equity), H (2.1%) and FTS (1.9%). Considering the momentum of CPX and its higher dividend than either H or FTS, what would your thoughts be about the idea of selling both H and FTS to buy CPX? Seems to present more growth potential and higher dividend. My thanks.

Asked by David C. on November 25, 2024

5i Research Answer:

CPX is certainly outperforming the others. It also has a lower valuation. While it is much smaller and thus riskier, we could live with this trade, providing an investor is OK with a more concentrated sector position, is OK with a smaller company, and taxes do not apply on any sales.

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