Top retailers set to gain as economy re-opens: Loblaw, Metro, Canadian Tire and Leon’s

Article Excerpt

Continuing COVID-19 lockdowns, particularly in Ontario and Quebec, will undoubtedly limit sales and earnings for these leading retailers. However, all of them have expanded their online businesses in the past few years. That should help them handle any longer-term shift away from in-store shopping. We feel all four are poised to move higher in 2021 as the economy re-opens. That will also let them keep raising your dividends. LOBLAW COMPANIES LTD. $62 is a buy. The company (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 352.9 million; Market cap: $21.9 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.2%; TSINetwork Rating: Above Average; www.loblaw.ca) is Canada’s largest food retailer with 1,091 supermarkets. Those stores operate under the Loblaws, Zehrs, Provigo, Real Canadian Superstore and No Frills banners. Franchisees operate 540 of those outlets. The company’s investors continue to benefit from its March 2014 acquisition of Shoppers Drug Mart for $12.3 billion in cash and shares. That chain now includes 1,347 drugstores across Canada. The stock is down…

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