Skip to main content

The Globe and Mail

Profit generators, through thick and thin

What we're looking for

It's Friday, and the Number Cruncher team feels good on Fridays. So, let's end the week with an upbeat look at consistently profitable Canadian companies over the past few years.

We ran a Capital IQ screen for Toronto Stock Exchange-listed companies that had produced a return on equity of more than 15 per cent for each of the past four fiscal years, with the most recent being the year ended 2010. Return on equity shows how well a company uses investors' funds to generate earnings growth. In other words, it measures a firm's efficiency at creating profits from every dollar of shareholders' equity.

Story continues below advertisement

The period we used encompasses the worst of the financial crisis, as well as some of the recovery. So, these are companies that are good at taking care of business, even when times get tough.

What we found

The list is a mix of stocks from a broad range of sectors – energy, retail, technology, transportation and food.

Retailers such as convenience store operator Alimentation Couche-Tard Inc., North West Co. Inc. which owns the Giant Tiger and NorthMart brands, and Le Chateau Inc. figure on the list. North West's dividend yield is 6.4 per cent, while Le Château's is 6.2 per cent.

Not all of these money-spinning companies provide income to investors, though. Case in point: Research In Motion Ltd., the famously debt-free maker of the BlackBerry smart phone, has yet to pay a dividend. It returned 42 per cent on shareholders' equity in the last fiscal year.

Also on the list is a play on China's rapid growth and push to build infrastructure. Boyuan Construction Group Inc., with a market capitalization of $61-million, builds homes and commercial buildings in China.

(By the way, if you were simply looking for the highest return on equity over the past 12 months, the winner is Athabasca Oil Sands Corp., with 124 per cent.)

Story continues below advertisement

Report an error Licensing Options
About the Author
Deputy head of Audience

Sonali Verma is deputy head of audience at the Globe and Mail. She is a business journalist with more than 20 years of experience, mainly in digital media.She was previously the Globe and Mail’s senior editor in charge of audience engagement, overseeing its homepages as well as social media operations. More

Comments are closed

We have closed comments on this story for legal reasons. For more information on our commenting policies and how our community-based moderation works, please read our Community Guidelines and our Terms and Conditions.