RE:EMA - Top Pick on BNN Market Call - Teltscher Emera (EMA TSX)
Emera is a utility that suffered in 2023 while interest rates rose, but has failed to get back to normalized levels once the Fed pivoted at the end of the year. Emera is a stable utility that continues to grow earnings, increase its dividend and reinvest capital back into the business. Emera operates in favourable jurisdictions, including Florida, which is the fastest growing state by population. In addition to population growth, Emera continues to grow by electrification and modernization of the grid (converting coal generation to less carbon intensive power sources). While the fundamentals of the business remain strong with rate base growth of seven per cent and dividend growth of 4-5 per cent through 2026, the stock is down more than 10 per cent on a one-year basis. We like Emera as a long-term investment and would be adding to any underweight positions.