Top Stock to Buy #5 – TransCanada Corporation (TRP)
TransCanada Corporation (NYSE:TRP) is an energy infrastructure company that focuses mainly on natural gas and oil pipelines. It is the primary developer and manager of the Keystone pipeline system, and it is the company that manages non-regulated facilities in Alberta, Canada.
In January, the U.S. State Department rejected TRP’s application to build Keystone XL, an extension that would carry heavy crude from the Alberta oil sands and Bakken Shale to Gulf of Mexico refiners. Earnings for 2012 and 2013 are expected to be $2.35 and $2.70, respectively, but could be higher if the overall Keystone XL project is approved. President Obama has already approved the southern half of the line from Cushing, Okla., to the Gulf, saving months of delays. If the entire line were to be approved, the company’s earnings would improve significantly.
Technically the stock is in a bull channel with prices hugging the 50-day moving average. TRP’s overall price objective is $50-plus, depending on the political swings in the fall. Buy under $42.