Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

1 Canadian Growth Stock That Could Make You Rich

Published 2021-08-01, 10:54 a/m
Updated 2021-08-01, 11:16 a/m
1 Canadian Growth Stock That Could Make You Rich

1 Canadian Growth Stock That Could Make You Rich

Magna International (TSX:MG)(NYSE:MGA) appears committed to developing products and processes that address the issues of sustainability and promote the goal of a healthy and safe environment for future generations. The company focuses on producing innovative and sustainable next-generation products with manufacturing efficiency, precision, and scale.

A talented team that develops product solutions In addition, Magna has a talented team that collaborates and develops product solutions for automakers and new entrants alike. The trends transforming the automotive industry are moving toward Magna’s portfolio and the company’s unique ability to deliver complete vehicle system solutions.

For Magna, the road ahead appears bright and the future of the automotive industry, which is increasingly high tech and complex, looks to be more exciting than it has ever been.

Strong balance sheet providing it with flexibility The past year has shown, from a technological, financial, and cultural standpoint, Magna is on the winning side of change in the dramatic transformation in the automotive industry. Magna’s strong balance sheet continues to give it the flexibility to invest for the future and insulates the company from the ebbs and flows of the economy.

Reducing discretionary spending During the COVID-19 shutdown, Magna took actions including reducing discretionary spending and capital to minimize the considerable financial headwinds. In addition, Magna identified annual structural cost savings of $200 million, which it expects to fully realize over the next couple of years. While COVID-19 posed significant challenges in the first half of 2020, Magna’s recovery in the second half was rapid and spectacular.

Consecutive years of dividend increases The company’s earnings in the second half of 2020 far outperformed the second half of 2019, exceeding expectations. Magna’s board of directors increased the company’s quarterly cash dividend by 8%. This is the eleventh consecutive year of fourth-quarter dividend increases, reflecting the confidence that management and Magna’s board have in the company’s future.

Capitalizing on growth opportunities Further, Magna’s performance and ability to pivot in the face of challenges is a testament to the teamwork and entrepreneurial spirit of the entire family of Magna employees, from the shop floor to management. Over the past few years, Magna has been making the investments required to capitalize on growth opportunities in megatrend areas such as electrification, autonomy, and evolving mobility.

Strong operating performance and cash flow generation That includes collaborating more with innovators across the entire mobility landscape, from Magna’s ongoing partnerships with traditional customers to relationships with new entrants and startups. Recent customer program awards indicate that Magna is already starting to benefit from these investments.

As Magna looks to the future, the company’s focus appears to be on continuing to grow sales in excess of vehicle production, maintaining the company’s strong operating performance and cash flow generation, further investing for the company’s future, and returning capital to shareholders.

Creating value for shareholders Furthermore, Magna’s portfolio is in a position of strength and aligns with the car of the future. Simply put, Magna is strong and growing, and the future looks bright as it expects to continue creating value for the company’s shareholders.

The post 1 Canadian Growth Stock That Could Make You Rich appeared first on The Motley Fool Canada.

The Motley Fool recommends Magna Int’l. Fool contributor Nikhil Kumar has no position in any of the stocks mentioned.

This Article Was First Published on The Motley Fool

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.