June 30, 2026
Commentary
Monthly Update
CANADIAN LARGE CAP LEADER SPLIT CORP. - COMPOUNDED RETURNS¹ AS OF JUNE 30, 2026 | INCEPTION DATE: FEBRUARY 22, 2024
1M |
YTD |
3M |
6M |
1YR |
Inception |
|
|---|---|---|---|---|---|---|
Canadian Large Cap Leaders Split Corp - Class A Shares |
6.54% |
29.59% |
17.53% |
29.59% |
60.98% |
37.95% |
Canadian Large Cap Leaders Split Corp - Pref Shares |
0.64% |
3.78% |
1.87% |
3.78% |
7.71% |
7.72% |
The second quarter of 2026 unfolded in three distinct phases, each shaped by the evolving geopolitical and macro backdrop that defined the first half of the year. In April, markets rallied nearly 15% from their March lows as investor confidence grew that the Middle East conflict was unlikely to deteriorate further. The Q1 earnings season reinforced that underlying corporate fundamentals remained more resilient than the market had anticipated, and leadership rotated away from defensives and back toward growth. Energy prices remained elevated, keeping inflation expectations above central bank targets, but the worst-case stagflation scenario appeared to be off the table.
The recovery extended into May, although with narrowing leadership. Investor attention shifted back to AI-driven capital spending and durable earnings growth among a small group of companies. Oil prices pulled back modestly from their highs, moving below US$100 per barrel, but remained well above pre-conflict levels. Fixed income markets continued to price a higher-for-longer rate environment, while gold traded in a relatively rangebound fashion as markets weighed slowing growth against persistent inflation risk.
June, however, brought another nuanced phase for investors to cope with. A stronger-than-expected May jobs report in the United States effectively closed the door on near-term rate cuts and prompted a swift repricing toward a more hawkish Federal Reserve under new leadership (note that US monetary policy has a decently strong influence over interest rates and stocks in Canada as well). Simultaneously, progress in U.S.-Iran negotiations and a gradual reopening of the Strait of Hormuz allowed oil prices to retreat sharply. Notably, growth stocks, value stocks, energy equities and utilities moved independently based on both macroeconomic and stock-specific factors, which created opportunities for investors.
In keeping with our mandate, we remain invested in a diversified portfolio of high quality, dividend-paying Canadian companies. With significant exposure to the Financials and Energy sectors, along with diversifying positions in the Industrials, Consumer Staples and Utilities sectors, we believe that we have a well-constructed portfolio that should perform well under various scenarios going forward.
Information below is specific to individual securities held in the Portfolio. It is only intended to describe key characteristics of individual holdings at a point in time and makes no inference about the return nor yield of either the Preferred Shares or the Class A Shares of the Canadian Large Cap Leaders Split Corp.
From the chart above, we can see that our positions, on average, trade at an LTM price to earnings multiple of 20.6x (excluding Brookfield Infrastructure Partners, which is typically valued on cash flow), slightly above the 5-year average price to earnings multiple of 18.8x. But, with the Class A Shares trading approximately 5% below the reported NAV at the close on June 30, 2026, we can adjust this table to visualize the implied valuation today:
The implied discount was currently 1.0x worth of multiple points (from the unadjusted P/E of 20.6x) at the close on June 30, 2026, which highlights the opportunity to buy our portfolio of Canadian high-quality, dividend payers essentially in-line with the long-term historic valuations through the purchase of shares of NPS on the open market. We continue to believe that the purchase of shares of NPS represents an attractive investment opportunity for those looking for exposure to the Canadian market.
In addition to the stock split of the Class A Shares earlier in the year, the Company’s strong track record of performance allowed the Company to announce an overnight offering of Preferred and Class A Shares. The well-received securities offering should further improve the trading liquidity of both classes of securities and should help the Class A Shares trade more consistently closer to the underlying net asset value.
Finally, we would like to highlight that the Canadian Large Cap Leaders Split Corp has announced its next series of distributions, payable on July 14, 2026, to both Class A and Preferred shareholders of record at the close of business on June 30, 2026. As planned, holders of Class A Shares will receive the $0.1800 per share regular monthly dividend and holders of the Preferred Shares will receive the $0.1875 regular quarterly dividend.
As always, we appreciate the support of all those who have invested in the Canadian Large Cap Leaders Split Corp.
Until next month,
John, Jeff & Colin
Ninepoint Partners
1All returns are based on Net Asset Value per Class A share, or the redemption price plus accrued interest per Preferred share and assumes that distributions made by the Fund on the Class A shares, or Preferred shares in the period shown were reinvested in additional Class A shares and Preferred shares of the Fund as at 06/30/2026.