I read a recent Seeking Alpha article about Cenovus (NYSE:CVE), easily one of Canada’s best energy producers. The author’s focus on CVE’s buyback propensity had me thinking about other Canadian stocks making big share repurchases in 2023.
I’m a Canadian who generally writes about American companies. However, Cenovus is listed on the NYSE, so it ought to be of interest to American investors. There are plenty of other NYSE-listed stocks based in Canada.
In Canada, we have what is called a “Normal Course Issuer Bid” (NCIB) that gets approved by the Toronto Stock Exchange. This details how much stock a firm can buy back over the course of a 12-month period.
In the case of Cenovus, it announced on Nov. 7 that the TSX — it also trades on the TSX — approved its NCIB to repurchase up to 133.2 million shares of its stock over the next 12 months between Nov. 9, 2023, and Nov. 8, 2024. This NCIB represents 10% of its current public float, which is a very high percentage for Canadian companies.
In the past year, under its old NCIB, Cenovus repurchased 44.3 million shares at an average price of 24.74 Canadian dollars ($17.90). That’s about where it currently trades, so it’s just to get a return on its investment.
Here are three other NYSE-listed Canadian stocks doing big share repurchases.
Colliers International (CIGI)
Colliers International (NASDAQ:CIGI) is a Toronto-based commercial real estate advisory and investment management firm. It has $4.5 billion in annual revenue and $98 billion in assets under management, with operations in 66 countries.
In July, it announced the approval of its NCIB to purchase up to four million of its subordinate voting shares, representing 10% of its public float. The buyback remains in place until July 19, 2024.
Like all buybacks, share repurchases are optional based on the business’s financial situation, the price of its shares, the desire to make acquisitions in lieu of share repurchases, and the many other reasons to allocate capital elsewhere.
It has not repurchased any of its shares through the first nine months of 2023. However, in 2022, it bought back $165.7 million of its stock during the calendar year, repurchasing 1.43 million subordinate voting shares. Of those, 76% were through its 2021/2022 NCIB and 24% from its 2022/2023 NCIB through July 31.
Given its shares are down 15% since early September, I’d be surprised if it didn’t buy back some of its stock in the fourth quarter ended Dec. 31.
Over the past five years, its shares are up 53.4%, trailing the S&P 500 slightly but well ahead of the S&P/TSX Composite Index.
TFI International (TFII)
TFI International (NYSE:TFII) and Cenovus were in my September 2022 article about the 7 Best Canadian Stocks to Buy Now. The company is one of North America’s leading Logistics and transportation companies. It got to this position with a combination of organic growth and acquisitions.
In October, the company announced that its freight business went through a weak stretch due to lower demand. It’s expected to pick up in the next few quarters. However, it remains very profitable.
At the same time it announced its Q3 2023 results, TFI said that the TSX had approved its NCIB. Under the NCIB, it can purchase up to a maximum of 7.2 million of its common shares, which represents 10% of its public float. The NCIB remains open from November 2, 2023, to November 1, 2024.
Through Oct. 19, the company had repurchased 1.55 million shares at a volume-weighted average purchase price of 139.41 Canadian dollars ($100.89). That’s approximately 24% of its 2022/2023 NCIB of 6.4 million shares.
Over the past five years, its shares are up 234.8%, considerably higher than the S&P 500 and S&P/TSX Composite Index.
Gildan Activewear (GIL)
Gildan Activewear (NYSE:GIL) shareholders have not had an easy go of it the past five years. As a result, its shares are up just 13%, considerably less than the S&P 500 and S&P/TSX Composite Index. However, if you bought during the March 2020 correction when its shares traded below $15, you’re sitting on a 212% return, so it’s all relative.
An article appeared in the Akron Beacon Journal in October 2012 that discussed how the Montreal-based manufacturer of blank t-shirts and other imprintables was taking market share from both Fruit of the Loom — owned by Berkshire Hathaway (NYSE:BRK.B) — and HanesBrands (NYSE:HBI).
At the time, it had approximately 70% of the North American wholesale imprintables market. In the decade since, its shares have doubled in value, while HanesBrands has seen its share price fall by half over the same period.
In August, Gildan announced the renewal of its NCIB to repurchase up to 5% of its outstanding shares between Aug. 9, 2023, and Aug. 8, 2024. The repurchase amounts to up to 8.78 million of its stock.
During Q3 2023, it repurchased 2.7 million shares of its stock during the quarter for $80 million, or an average of $29.63 a share. Its shares are currently trading 10% above that, so it’s already generating a return on investment.
On the date of publication, Will Ashworth did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
