Looking for Canadian stocks that could add to your next Warren Buffett portfolio? Algonquin Power & Utilities Corp. (TSX: AQN)(NYSE: AQN) That may be all. I think 2021 will be a year when certain sectors such as renewable energy are on track. Therefore, now is a great opportunity to gain a share of this stable growing gem.
Here’s why I think Algonquin may be on Buffett’s radar right now:
Exposure to renewable energy
2021 could be the year Warren Buffett and other prominent money managers make a major entry into the renewable energy space. Algonquin has proven to be one of the best acquirers in this area. Indeed, the company has built a renewable energy portfolio that is the envy of its peers.
Algonquin has added exposure to renewable energy for many years, a fact that has not been well-received in the market until recently. With the rise of environmental, social and governance (ESG) investment mandates, capital inflows into renewable energy investments have skyrocketed in recent years. Therefore, I think this long-term trend will last very long. Also, I think I’ve only seen the tip of the iceberg in this regard.
This is a great way to access renewable energy in the long run, as about 30% of the company’s revenue comes from renewable energy. The company’s acquisition-based growth model enables future growth in this segment. Algonquin’s management has openly stated that it continues to look for attractive pricing options in this sector. Therefore, the company’s theory of growth in its renewable business remains strong.
Excellent growth profile
In addition to renewable energy, Algonquin’s regulated utilities are growing at a very reasonable and predictable rate. This is a bonus for investors seeking low volatility returns over long investment periods. This stable growth is complemented by the more dynamic growth of the renewable energy sector, which sets Algonquin apart from most other peers. Algonquin is unique in the portfolio of acquired assets and will continue to acquire through the acquisition.
The acquisition made by Algonquin Opportunities for synergistic growth.. Algonquin TSXImproves return on equity for most acquisitions immediately after acquisition. This experienced management team continues to earn over time, and this reputation continues to rise as the corresponding revenue grows.
One of Buffett’s favorite aspects of the business he invests in is the size of the moat of a particular company. In this regard, Algonquin’s very wide moat can seduce investment from one of the world’s greatest investors.
Due to the very favorable nature of regulated utilities, Algonquin’s earnings are almost completely guaranteed. This is also bullish for long-term growth investors like Buffett, who prefer cash flow growth and stability.
Other good investments like Warren Buffett should also be considered.
Ian Butler, a well-known Canadian investor, has nominated 10 shares for Canadians to buy today. So if you’re tired of reading about getting rich in the stock market, today may be a good day for you.
The Motley Fool Canada offers 65% off the list price of the best stock selection service, plus a full money-back guarantee on the amount you pay for the service. Click here for instructions on how to take advantage of this.
Stupid contributor Chris Macdonald There are no positions in any of the listed stocks.
Warren Buffett’s next Canadian pick could be this Canadian renewable energy gem!
https://www.fool.ca/2021/01/05/warren-buffetts-next-canadian-pick-could-be-this-canadian-renewables-gem/ Warren Buffett’s next Canadian pick could be this Canadian renewable energy gem!