Savaria Corporation (TSX:SIS) might not have the largest yield or even a high market cap, but it does have a lot of potential. With a yield of barely 2% a year, it doesn’t offer the allure of a dividend like Corus Entertainment Inc. (TSX:CJR.B) which pays investors nearly 10%. It also doesn’t have the strong dividend-growth history of a reputable stock like Enbridge Inc (TSX:ENB)(NYSE:ENB).
Instead, what Savaria offers is a lot of opportunity for growth. In the past three months, Savaria’s stock price has risen more than 27% and in one year it has produced its investors returns of more than 60%.
The company produces lifts, elevators, and helps improve personal mobility for many people. As the economy continues to age and as we see more baby boomers retire, there could be significant demand for Savaria’s products. This is where we could see significant potential for the company to grow over the long term.
In three years, the company’s sales have risen more than 58% and profits have more than doubled. In its most recent quarter, Savaria’s sales increased 73% as the company is on its way to another strong year which will continue to show strong growth.
This dividend stock is a long-term play and as the company continues to grow and expand its bottom line, it’s likely that payouts will increase as well. However, given that Savaria is still in its early growth stages, investors will need to be patient, but in the long term the rewards could be significant.