Q: If the Canadian and US stock markets have a correction, do you anticipate that Hydro One's share price would be greatly affected?
And what would be a good entry price if looking to buy shares in the next couple months?
Thank you
And what would be a good entry price if looking to buy shares in the next couple months?
Thank you
5i Research Answer:
Utilities are typically quite resilient during economic/market turbulence. But it really depends on what causes a correction. Dividend stocks have high sensitivity to interest rates. A spike in rates (as in 2022) would likely see H decline, perhaps 10% or more. But a economic slowdown, with possible lower rates, might see it get impacted very little. Generally investors appreciate the stability of its business and continual cash flow. We would look to $52.1.50 or so for an entry, but we would also be comfortable buying today, as it does appears rates will be heading lower.