Hammond Power Solutions Inc. (HPS.A.TO) Buy,…

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Hammond Power Solutions Inc. (HPS.A.TO)

220.12

-15.02 (6.39%)

as of Oct 22, 2026, 8:00:00 pm Market Closed.

115 watching

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Curated by Michael O'Reilly since 2020.
1550+ opinions with 4.81 rating (one of the best performing expert).

TOP PICK

Stockchase Research Editor: Michael O'Reilly

We reiterate this producer of electric transformers as a TOP PICK. Management announced an acceleration of capital deployment, supporting the trend for growing demand for its products. We like that cash reserves are growing, while debt is reduced. It trades at 20x earnings and supports a 28% ROE. We recommend trailing up the stop (from $75) to $95, looking to achieve $146 -- upside potential of 28%. Yield 0.6%

(Analysts’ price target is $165.00)

BUY

Is exposed to all the right verticals. They make transformers to optimize energy, driven by the AI boom (the need for data centres). There's still upside despite the huge rally. Business is booming, and the growth trajectory is good. Trades at 18x PE, but growth makes the future PE reasonable.

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Curated by Michael O'Reilly since 2020.
1550+ opinions with 4.81 rating (one of the best performing expert).

TOP PICK

Stockchase Research Editor: Michael O'Reilly

HPS-A is the manufacturer of electric transformer systems used by electric utilities, the oil & gas sector and for EV charging stations. Recently reported earnings indicated record high quarterly sales and a 6% increase in earnings. We like that cash reserves are growing, while debt is retired. It trades at 22x earnings and supports a 25% ROE. We recommend setting a stop-loss at $75, looking to achieve $130 -- upside potential of 28%. Yield 1.0%

(Analysts’ price target is $162.00)

COMMENT

Shares have taken off due to the electrification of the grid, driven by EV demand. Kudos if you own this, but he doesn't buy smallcaps. Owners own a lot of shares. Needs to research this more.

BUY

Big tech and data centres need more power, because AI consumes a lot. Hammond plays into this.

DON'T BUY

Surprisingly, this is doing well, returning 10x your investment over 2 years. HPS has benefited from the boom in energy storage and data centres. Revenues and margins have shot up, so can they sustain this? He doesn't chase stocks that have shot up.

BUY

Canadian company that produces equipment for electrical business. Demand for EV cars, and electricity in general creating strong demand for products. Outlook for business very strong. Would expect large capital gains going forward.

BUY

Are positioned well. Sadly, he missed buying this much cheaper. This still has legs. Still fairly valued now.

BUY

It has trouble breaking past $7.50, but he would look for a nice-volume move breaking above $7.50, then see if it breaks $10. Expect a little resistance above $8. The chart looks pretty good.

PAST TOP PICK

(A Top Pick Jun 18/18, Down 21%) They've been under margin pressure that he didn't expect. So,he exited in late-2018. This holding was a mistake, and mistakes can happen in investing. You must know when to cut your losses.

COMMENT

Seasonality is Dec.2-April 15 when it beats the benchmark by 21%. These tech-related stocks are starting to bottom lately, but not outperforming during the market low. That said, it is a rounded bottom since Q4 2018 and is curently holding its lows. If it can prop higher, this could be a tremendous buying opportunity. The 50-day average is $6.

PARTIAL BUY

Hold or maybe buy more. It is dominant in electrical transformers. Businesses overseas are starting to turn around. Their end markets are all doing very well right now. It should do well over the next few years. It checks a lot of the boxes for him.

TOP PICK

Make smaller-scale electric transformers, with a pretty dominant market share, and could benefit from future increased number of electric vehicle stations. Really well run, clean balance sheet, 2.5% dividend. Sell to US customers in transportation, mining, power, oil & gas, infrastructure, where their end markets are strong and should be strong for several years. Low valuation, significant insider ownership. Good cash flow, could increase dividend and increase earnings significantly. A hidden gem in a niche sector. Canadian company that benefits from strong US economy. (Analyst’s price target is unknown .)

BUY

Dry power cell transformers. Expect it will go up again.

BUY

Produce Transformers that are used in different industries. Greatest success of late has been in the wind power and mining industries. Recently did an acquisition to expand their product offering. Has been in his watch list. Very strong management with good opportunities.

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Hammond Power Solutions Inc. (HPS.A.TO)

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