Q: Hi, I have CPX and have considered switching in the past to FTS or H , because of your ranking. However in the last 5 years it has doubled in price and has a great dividend. Hydro One seems to be keeping pace but has a much lower dividend. Just wondering what I’m missing and would you be more comfortable with a switch to H or FTS. Thanks
5i Research Answer:
CPX has outperformed FTS and H over the long-term, but this has come with more volatility. We like FTS and H for their consistency, relatively low volatility, and decent yields, particularly within the income model portfolio. We like CPX for its upside potential, but within the income model portfolio, which tends to favour low volatility names, we opted for FTS and H.
While we cannot personalize responses, we feel that an investor that is comfortable with volatility, is seeking yield, and is positioned for growth, we would give CPX the slight edge, but for a mix of conservatism, yield, and relatively low volatility, we like FTS and H.